But the company expects revenues to fall or remain flat in 2Q.
Despite the downturn and weak service provider market, Cisco Systems Inc. managed to post a 9 percent revenue increase to $4.8 billion for its first fiscal quarter of 2003, compared to the same year-ago period.
Net income for the quarter rose to $618 million or 8 cents a share, compared to a net loss of $268 million or 4 cents per share for the year-earlier quarter.
Cisco beat Thomson First call pro forma earnings-per-share expectations by 1 cent.
Cisco CEO John Chambers attributed the companys positive results to both market share gains as well as Ciscos ongoing efforts to keep its own costs in line.
"Our revenue over the last six quarters went from $4.3 to $4.8 billion, while competitors dropped (significantly) over those quarters. There was a 48 percent decrease for competitors compared to Ciscos 9 percent increase," said Chambers.
During the quarter, Cisco brought out new switching products, including the Catalyst 4500 Series and new options for the Catalyst 6500 Series that deliver new price/performance points; completed the acquisition of AYR Networks, Inc. for $97 million; and announced its intent to acquire security company Psionic Software Inc.
Chambers believes that Cisco is well positioned for an uptick in the economy although Cisco has no visibility into when that will happen.
"We are ready for the upturn, and we are very close to (achieving the kind of) profitability achieved during the height of the economic activities in the late 90s," said Chambers.
For the second fiscal quarter of 2003, Cisco expects to see its revenues remain flat or decrease slightly by as much as 4 percent.