USA TODAY, August 13, 1996, Tuesday, FINAL EDITION Aggressive Chambers powers Cisco Even rumors following AOL crash don't slow it down SAN JOSE, Calif. -- When Cisco Systems CEO John Chambers plays tennis, his game plan is this: Hit a huge serve. Rush to the net and slam the ball away. He runs Cisco Systems, one of the Silicon Valley's brightest stars, the same way. Cisco, founded in 1984, is the undisputed titan of networking. Its products connect 80% of the world's personal computers to the Internet and make up much of its backbone. Cisco's stock has been a tremendous play, up 10,300% since Cisco went public in 1990. If it doesn't have the technology to retain its dominance, it buys it. In three years, Cisco has bought 12 companies. "Cisco is clearly in the driver's seat," says PaineWebber's Paul Weinstein. === NY Times, April 17, 2001 Cisco Issues a Warning on Its Sales and Earnings By ALEX BERENSON and CHRIS GAITHER Offering fresh evidence that economic growth is slowing notably, Cisco Systems said yesterday that its sales and profit were falling far short of expectations. Cisco, whose startling success in the 1990's mirrored the rise of the Internet, blamed a worldwide economic slowdown for its problems. The boom in communications and information technology spending, which powered the United States economy in the late 90's, has ended in painful retreat for Cisco and other technology companies that a few months ago could seemingly do no wrong. Cisco's equipment undergirds much of the Internet, and over the last decade it has grown from a tiny start-up in San Jose, Calif., to a corporate titan. At its peak a year ago, Cisco, which leads the market for routers, computers that manage data traffic on a network, was briefly the world's most valuable company. In March 2000, its market capitalization reached a peak of $560 billion, more than those of General Motors, Citigroup and Wal-Mart combined. But now Cisco, which as late as last fall was reporting quickly rising sales, is shrinking faster than it grew. The company estimated yesterday that its sales for the quarter ending April 30 would be about $4.7 billion, 30 percent lower than in the previous three months. And Cisco warned not to expect a quick rebound, predicting that sales would fall again next quarter, ending July 31. With revenue declining so rapidly, Cisco has been caught with big surpluses of its equipment. The company said that for accounting purposes it would reduce the value of inventory by $2.5 billion this quarter, including $500 million in partly completed equipment and $2 billion of raw materials like computer chips. The accounting procedure, known as a write-down, reflects Cisco's belief that it will not be able to sell the equipment for as much as it once expected. "This may be the fastest any industry our size has ever decelerated," John Chambers, the company's chief executive, said in a statement. In a conference call later, Mr. Chambers compared the slowdown to a 100-year flood, adding that the economic challenges confronting the network equipment industry are proof that "a 100-year flood can happen in your lifetime." "We never built models to anticipate something of this magnitude," he said. Full article: http://www.nytimes.com/2001/04/17/technology/17CISC.html Louis Proyect Marxism mailing list: http://www.marxmail.org
