Cisco reports quarter earnings – Nexus sales down

Cisco announced quarter earnings late yesterday which received good press even though numbers were down. The WSJ reported:

Cisco is the greatest company in America, or at least it gets to wear the ceremonial crown for a day, after managing to not report terrible earnings last night. Cisco’s earnings, revenue and profit margins all topped forecasts, marking the company’s second straight solid earnings report — a good sight better than this past spring, when it warned of disappointment ahead and the need for massive restructuring and its stock tanked.

Network World reported more detail, saying Cisco conceded disappointing results in edge routers and the Nexus 7000.  They quote CEO John Chambers as saying:

The Nexus 7000 has a ways to go to get back to where I want it to be. We used to be good at what I call the Texas two-step: product introduction, then value engineering. Nobody did it better than our Catalyst 6000 team. We’ve got to have more consistency.

I am particularly interested in the 7000 sales. A CIO’s decision to replace an existing 6500 involves hundreds of thousands of dollars and really provides some insight into corporate IT investment. I know I was laughed out of the room when I proposed it to a client this summer – and that was as part of a data center move even.

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