Networking giant Cisco beat Wall Street expectations by a penny in its fourth-quarter results after claiming its growth was outpacing that of its competitors.
Revenue for the period ended 31 July jumped 48 per cent to $3.55bn. Net income, including one-off acquisition charges, increased to $635m, or $0.18 per share, compared with $493m, or $0.15 per share last year.
Excluding the charges, net income was $727m or $0.21 per share, narrowly beating the $0.20 per share expected by analysts polled by First Call.
During the quarter, Cisco completed the $159m acquisition of unified messaging firm Amteva Technologies for which it took an $81m one-off charge.
It also finalised the $2bn acquisition of internet-enabled voice call centre Geotel Communications, which resulted in a $16m charge.
John Chambers, chief executive of Cisco, said: "By providing the systems that make the internet work, Cisco is playing a key role in helping customers thrive in the explosive internet economy. As a result, we are growing faster than all of our main competitors."
Meanwhile, Cisco is spending $1.05bn on a 20 per cent stake in the systems integration unit of KPMG, in a deal that could attract regulatory attention (PC Dealer, 11 August).
Analysts fear the transaction will come up against regulatory problems because the management consultancy could be seen to be in violation of the Securities and Exchange Commission's (SEC) auditor independence rules.
But a spokesman for KPMG said the company was not concerned because Cisco did not employ it to undertake audits and it would still own the majority of the unit.
The business, which is expected to be spun off by early 2000, will provide system integration services to Cisco's enterprise and service provider customers. A spokesman for Cisco said the networking giant did not expect to increase its stake even after the unit has been separated from KPMG.
KPMG will spend $800m during the next 18 months recruiting 4,000 engineers with skills to develop internet-based data, voice and video services to customers.
View pictures of all of last night's fights
Acquisitive comms provider swoops on Frontier Voice & Data and StoneHouse Logic
Cybersecurity firm rakes in £3.6m for unwanted unit
Results, reaction and pictures from last night's CRN Fight Night