Cisco – Profit For Q3 Rises And They Hire An Ex-Apple Employee
The U.S. technology sector has some problems for this fourth quarter. Analysts had expected Cisco, one of the leading technology corporations, to have a forecast profit at least as expected, but their estimates for the current quarter and up to January 2011 are at 50% of those expectations. It would be the second quarter when sales decline for this corporation. So that Wall Street sanctioned the price of this stock very harsh given that on the 12th of November the price fell by 16% to $ 20.57 per share. It was the largest daily depreciation of this stock since 1994 when it registered a decline of 17.71%.
The trading volume was of 385 million Cisco shares in one of the ten very busy days in the stock market history. Cisco’s warning pushed down stock prices and other IT corporations such as Microsoft (MSFT.O), up 1.7 percent at $ 26.48, Hewlett-Packard (HPQ.N), down by 3 percent to $ 42.83, and Juniper Networks (JNPR.N), down 0.4% at $ 34.40.
In this context, Americans indexes had the same downward trend but at lower percentages: Dow 11,283.10 -73.94 -0.65%; Nasdaq 2555.52 -23.26 -0.90%; S & P 500 1213.54 -5.17 -0.42%; 10 Yr. Bond (%) 0.0000 0.2574%; Oil 87.69 -0.10 -0.11%; Gold 1403.10 +4.00 +0.29%. Thus, Wall Street didn’t even start the say properly on Wednesday (November 10) as Cisco Systems Inc. (CSCO) forecast sales growth of 3-5% in the current quarter, much lower than the forecast of 13%., So Thursday the Dow lost 0.65% Thursday, while CSCO shares fell 16% as the biggest daily drop in 16 years with not so good future prospects. A graph of the IT sector in the S & P 500 shows the situation of this sector which increased from the beginning of this year with about 9%, as much as both the DJIA index and S & P 500 index increased.
Cisco’s quarterly profit rose by 8% to $ 1.9 billion
Cisco, the largest maker of networking equipment worldwide, posted a profit of $ 1.9 billion in the first fiscal quarter which ended on Oct. 30th , 8% higher than the same period last year, informs Market Watch.
Cisco’s revenue increased in the period from August to October with about 19% to 10.75 billion dollars. In the analyzed period, earnings per share were of 34 cents, compared with 30 cents last year, according to the source mentioned. For the current quarter the company expects higher revenues by 3-5% over the same period last year, while analysts are more optimistic and expects a 13% advance.
Cisco takes a controversial employee of Apple, in charge of the iPhone’s 4 antenna
When it comes to looking for a scapegoat for problems with iPhone’s antennas, the culprit was quickly found: the head of Apple’s design and engineering, Mark Papermaster. He still continues his career, unhindered by Apple, and we find him hired by Cisco to manage the production of chips for the company’s switches.
This segment of the wireless equipment manufacturer is very important, bringing a third of Cisco profit in Q3 of this year, according to The Wall Street Journal. Please note that under the supervision of Papermaster, Apple created and launched the iPhone 4 in April, with its famous problems with the antenna, which led its manufacturer to offer customers free cases.
These cases corrected the defect, which was eventually removed entirely, at least on models produced subsequently, by a modification in hardware. Papermaster made it into the staff of Apple accompanied with some problems, the Cupertino giant having a dispute with IBM over him.11