Cisco reported a strong improvement in results for its fiscal second quarter to 24 January. Revenue growth accelerated to 7 percent year-on-year to USD 11.9 billion in sales, and the operating margin rose to 28.4 percent from 27.8 a year ago. Net profit jumped 68 percent to USD 2.4 billion, and earnings per share rose 70 percent to USD 0.46.
Cisco said the results reflect the impact of its restructuring in recent years, despite a still volatile economic environment. The company also increased its quarterly dividend by 2 cents to USD 0.21 per share. Operating cash flow was stable year-on-year at USD 2.9 billion, and Cisco finished the quarter with a total USD 53.0 billion in cash. The company also spent USD 2.2 billion repurchasing shares in the quarter.
Cisco reported product orders up 5 percent year-on-year, led by a 10 percent increase in the enterprise segment, 8 percent growth in the commercial market and a 7 percent rise in the public sector. Only the service provider market remained weak, with a 1 percent drop in orders. Across geographies, orders were up 8 percent in the Americas and 7 percent in Europe, while Asia was still down 6 percent.
Overall, the product book-to-bill ratio was above 1. In terms of product revenues, growth was strongest in the data centre market, with sales up 40 percent to USD 846 million. Switching revenues increased 11 percent to USD 3.62 billion, and routing was up 2 percent to USD 1.76 billion. Service provider video was the main weak spot, down 19 percent to USD 776 million.