The past couple of years have been difficult for Cisco (NASDAQ: CSCO), the global leader in networking equipment, as it started focusing on the server market and its Unified Computing Service platform became its priority from 2010. Since January 2010 until the end of 2011, its stock had fallen by more than 24%. As I have discussed in an earlier article, the turnaround was essential for Cisco to survive and rebuild a long term growth path, and this is now becoming more and more apparent.
In its previous quarter-- the last of its financial year -- Cisco posted better than expected results that saw revenues and profits rising by 5% and 55%, respectively, year over year. The improvement came on the back of not only its aggressive cost cutting strategy but its ability to attract new orders from Asian and U.S. firms. As a result, Cisco is also increasing its dividends from $0.08 to $0.14 per share.
On the other hand Cisco’s peers, such as IBM (NYSE: IBM), Intel (NASDAQ: INTC), and Ericsson (NASDAQ: ERIC), have posted falling quarterly income by 0.42%, 14.30%, and 43%, respectively. In such an environment, Cisco’s results lifted the gloom from Wall Street.