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Cisco Reports First Quarter Earnings

SAN JOSE, CA -- (Marketwire) -- 11/13/12 -- Cisco (NASDAQ: CSCO)

  • Q1 Net Sales: $11.9 billion (increase of 6% year over year)

  • Q1 Net Income: $2.1 billion GAAP (increase of 18% year over year); $2.6 billion non-GAAP (increase of 11% year over year)

  • Q1 Earnings per Share: $0.39 GAAP (increase of 18% year over year); $0.48 non-GAAP (increase of 12% year over year)

Cisco, the worldwide leader in networking that transforms how people connect, communicate and collaborate, today reported its first quarter results for the period ended October 27, 2012. Cisco reported first quarter net sales of $11.9 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.1 billion or $0.39 per share, and non-GAAP net income of $2.6 billion or $0.48 per share.

"We delivered record results this quarter -- with revenue growth of 6 percent and strong earnings per share growth -- demonstrating our vision and strategy are working," said John Chambers, chairman and chief executive officer, Cisco. "Our innovation engine, operational discipline and on-going evolution are enabling us to differentiate in the market."

Chambers continued, "Cisco is at the center of the major market transitions -- cloud, mobility, video -- and yet we believe the largest market transition lies ahead of us, as the Internet of Everything becomes a reality. Cisco has the unique ability to turn information that will flow across networks into new capabilities and richer experiences. The Internet of Everything will create unprecedented possibilities for businesses, individuals and countries, and Cisco is poised to lead and fully maximize the opportunities of this evolution."


                                GAAP Results

                                    Q1 2013         Q1 2012     Vs. Q1 2012
                                --------------  --------------  -----------
Net Sales                       $ 11.9 billion  $ 11.3 billion          5.5%
Net Income                      $  2.1 billion  $  1.8 billion         17.7%
Earnings per Share              $         0.39  $         0.33         18.2%


                              Non-GAAP Results

                                    Q1 2013         Q1 2012     Vs. Q1 2012
                                --------------  --------------  -----------
 Net Income                     $  2.6 billion  $  2.3 billion         10.6%
 Earnings per Share             $         0.48  $         0.43         11.6%

A reconciliation between net income on a GAAP basis and non-GAAP net income is provided in the table on page 5.

Cisco will discuss first quarter results and business outlook on a conference call and webcast at 1:30 p.m. Pacific Time today. Call information and related charts are available at http://investor.cisco.com.

Cash and Cash Equivalents and Investments

  • Cash flows from operations were $2.5 billion for the first quarter of fiscal 2013, compared with $2.3 billion for the first quarter of fiscal 2012, and compared with $3.1 billion for the fourth quarter of fiscal 2012.
  • Cash and cash equivalents and investments were $45.0 billion at the end of the first quarter of fiscal 2013, compared with $48.7 billion at the end of the fourth quarter of fiscal 2012.

Dividends and Stock Repurchase Program

During the first quarter of fiscal 2013:

  • The combination of cash used for dividends and common stock repurchases under the stock repurchase program totaled approximately $1.0 billion.
  • Cisco paid a cash dividend of $0.14 per common share, or $744 million.
  • Cisco repurchased 15 million shares of common stock under the stock repurchase program at an average price of $16.44 per share for an aggregate purchase price of $253 million. As of October 27, 2012, Cisco had repurchased and retired 3.8 billion shares of Cisco common stock at an average price of $20.34 per share for an aggregate purchase price of approximately $76.4 billion since the inception of the stock repurchase program. The remaining authorized amount for stock repurchases under this program is approximately $5.6 billion with no termination date.

"Once again, we delivered strong financial performance with continued execution on our long-term strategy of growing profits faster than revenue and driving long-term value to our shareholders," stated Frank Calderoni, executive vice president and chief financial officer, Cisco. "We remain confident in our financial strategy and in our ability to consistently execute moving forward."

Select Global Business Highlights

  • Cisco announced the completion of its acquisition of NDS Group Ltd., a leading provider of video software and content security solutions that help service providers and media companies to securely deliver and monetize new video experiences.
  • Cisco and NBC Olympics provided a personalized, interactive, multiscreen Olympics experience at the 2012 London Olympic Games to select users at event venues and accommodations using Cisco® Videoscape™.
  • Cisco and Citrix announced a significant expansion of their successful desktop virtualization partnership into three strategic areas: cloud networking, cloud orchestration, and mobile workstyles.
  • Cisco and EMC announced further collaboration to help accelerate IT transformation by providing customers with choice and flexibility via "three paths to the cloud" -- custom-design infrastructure, validated reference architectures, and pre-integrated converged infrastructure.

Cisco Innovation

  • Cisco introduced an expanded and enhanced content delivery network portfolio, branded as the Cisco Videoscape Distribution Suite.
  • Cisco introduced a new wave of security solutions designed to fortify data centers against the threats they face in moving toward more consolidated and virtualized environments, while also helping businesses to take advantage of new cloud-based models.
  • Cisco announced new elastic core networking capabilities that help service providers to cost-effectively launch and scale revenue-generating services within minutes instead of months.
  • Cisco introduced a new Unified Access solution, a highly secure network infrastructure based on one policy source and one management solution for the entire network, to help organizations quickly respond to new business opportunities while managing rapidly changing network demands.
  • Cisco introduced a full suite of solutions for the SAP HANA platform built on the Cisco Unified Computing System™ allowing customers to experience benefits -- realtime data analytics and data warehousing -- in seconds instead of hours.
  • Cisco unveiled enhancements to its collaboration portfolio, delivered via public, private or hybrid cloud models.

Select Customer Announcements

  • Miami International Securities Exchange, LLC announced plans to offer a trading platform built on Cisco's ultra-low latency intelligent network infrastructure and designed from the ground up to address the highly secure, functional and high performance demands of the derivatives market.
  • Cisco and Manila Electric Company (Meralco), the Philippines' largest distributor of electrical power, announced a collaboration to provide reliable computing and networking infrastructure as a foundation for operations on a smart grid.
  • Cisco, Barcelona's City Council, and GDF SUEZ agreed to launch, and agreed on the criteria for the creation of, the City Protocol (the first certification system for smart cities) that can be put into practice by any city in the world.
  • SBB-Telemach Group, the largest pay-TV platform in southeast Europe providing television, Internet, and telephony services, selected the Cisco Videoscape-capable Personal DVB Set-Tops (PDS) Series and Cisco Integration Services to deliver next-generation television services.
  • Cisco and the United Nations (UN) Office for the Coordination of Humanitarian Affairs (OCHA) reached an agreement that will allow any United Nations organization to access Cisco's networking technology solutions for emergency communications assistance during UN disaster relief missions.
  • Barclays Center will feature Cisco's Connected Sports and Entertainment solutions -- Connected Stadium Wi-Fi and StadiumVision™ to deliver a next-generation fan experience and make this venue one of the most technologically advanced arenas in the world.
  • Cisco announced that it has been selected by NBN Co. to provide equipment for its national data connectivity network, which is part of the Australian National Broadband Network.
  • Itaú BBA will invest $2 million in technology to expand its Latin American businesses and has selected Cisco solutions for its IT environment, including servers, networking, increased access security and IP telephony systems.

Editor's Note:

  • Q1 2013 conference call to discuss Cisco's results along with its business outlook will be held at 1:30 p.m. Pacific Time, Tuesday, November 13, 2012. Conference call number is 888-848-6507 (United States) or 212-519-0847 (international).
  • Conference call replay will be available from 4:30 p.m. Pacific Time, November 13, 2012 to 4:30 p.m. Pacific Time, November 20, 2012 at 1-800-224-1051 (United States) or 1-402-220-3762 (international). The replay also will be available via webcast from November 13, 2012 through January 18, 2013 on the Cisco Investor Relations website at http://investor.cisco.com.
  • Additional information regarding Cisco's financials, as well as a webcast of the conference call with visuals designed to guide participants through the call, will be available at 1:30 p.m. Pacific Time, November 13, 2012. Text of the conference call's prepared remarks will be available within 24 hours of completion of the call. The webcast will include both the prepared remarks and the question-and-answer session. This information, along with GAAP reconciliation information, will be available on the Cisco Investor Relations website at http://investor.cisco.com.

About Cisco

Cisco (NASDAQ: CSCO) is the worldwide leader in networking that transforms how people connect, communicate and collaborate. Information about Cisco can be found at http://www.cisco.com. For ongoing news, please go to http://newsroom.cisco.com.

This release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events (such as statements regarding our innovation engine and operational strategies, operational discipline and execution, the evolution of our industry, major market transitions and our position with respect to such transitions) and the future financial performance of Cisco that involve risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results due to a variety of factors, including: business and economic conditions and growth trends in the networking industry, our customer markets and various geographic regions; global economic conditions and uncertainties in the geopolitical environment; overall information technology spending; the growth and evolution of the Internet and levels of capital spending on Internet-based systems; variations in customer demand for products and services, including sales to the service provider market and other customer markets; the return on our investments in certain priorities, including our foundational priorities, and in certain geographical locations; the timing of orders and manufacturing and customer lead times; changes in customer order patterns or customer mix; insufficient, excess or obsolete inventory; variability of component costs; variations in sales channels, product costs or mix of products sold; our ability to successfully acquire businesses and technologies and to successfully integrate and operate these acquired businesses and technologies; our ability to achieve expected benefits of our partnerships; increased competition in our product and service markets, including the data center; dependence on the introduction and market acceptance of new product offerings and standards; rapid technological and market change; manufacturing and sourcing risks; product defects and returns; litigation involving patents, intellectual property, antitrust, shareholder and other matters, and governmental investigations; natural catastrophic events; a pandemic or epidemic; our ability to achieve the benefits anticipated from our investments in sales, engineering, service, marketing and manufacturing activities; our ability to recruit and retain key personnel; our ability to manage financial risk, and to manage expenses during economic downturns; risks related to the global nature of our operations, including our operations in emerging markets; currency fluctuations and other international factors; changes in provision for income taxes, including changes in tax laws and regulations or adverse outcomes resulting from examinations of our income tax returns; potential volatility in operating results; and other factors listed in Cisco's most recent report on Form 10-K filed on September 12, 2012. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes thereto included in Cisco's most recent report on Form 10-K as it may be amended from time to time. Cisco's results of operations for the three months ended October 27, 2012 are not necessarily indicative of Cisco's operating results for any future periods. Any projections in this release are based on limited information currently available to Cisco, which is subject to change. Although any such projections and the factors influencing them will likely change, Cisco will not necessarily update the information, since Cisco will only provide guidance at certain points during the year. Such information speaks only as of the date of this release.

This release includes non-GAAP net income, non-GAAP net income per share data and non-GAAP inventory turns.

These non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Cisco believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Cisco's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Cisco's results of operations in conjunction with the corresponding GAAP measures.

Cisco believes that the presentation of non-GAAP net income and non-GAAP net income per share data, when shown in conjunction with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to its financial condition and results of operations. In addition, Cisco believes that the presentation of non-GAAP inventory turns provides useful information to investors and management regarding financial and business trends relating to inventory management based on the operating activities of the period presented.

For its internal budgeting process, Cisco's management uses financial statements that do not include, when applicable, share-based compensation expense, amortization of acquisition-related intangible assets, impact to cost of sales from purchase accounting adjustments to inventory, other acquisition-related costs, significant asset impairments and restructurings, the income tax effects of the foregoing, and significant tax matters. Cisco's management also uses the foregoing non-GAAP measures, in addition to the corresponding GAAP measures, in reviewing the financial results of Cisco. In prior periods, Cisco has excluded other items that it no longer excludes for purposes of its non-GAAP financial measures. From time to time in the future, there may be other items, such as significant gains or losses from contingencies that Cisco may exclude for purposes of its internal budgeting process and in reviewing its financial results.

For additional information on the items excluded by Cisco from one or more of its non-GAAP financial measures, refer to the Form 8-K regarding this release furnished today to the Securities and Exchange Commission.

Copyright © 2012 Cisco and/or its affiliates. All rights reserved. Cisco, the Cisco logo, Cisco UCS, Cisco Unified Computing System, StadiumVision, and Videoscape are trademarks or registered trademarks of Cisco and/or its affiliates in the U.S. and other countries. To view a list of Cisco trademarks, go to this URL: www.cisco.com/go/trademarks. Third party trademarks mentioned in this document are the property of their respective owners. The use of the word partner does not imply a partnership relationship between Cisco and any other company. This document is Cisco Public Information.


                   CONSOLIDATED STATEMENTS OF OPERATIONS
                  (In millions, except per-share amounts)
                                (Unaudited)

                                                      Three Months Ended
                                                   ------------------------
                                                   October 27,  October 29,
                                                       2012         2011
                                                   -----------  -----------
NET SALES:
  Product                                          $     9,297  $     8,952
  Service                                                2,579        2,304
                                                   -----------  -----------
    Total net sales                                     11,876       11,256
COST OF SALES:
  Product                                                3,748        3,563
  Service                                                  889          803
                                                   -----------  -----------
    Total cost of sales                                  4,637        4,366
                                                   -----------  -----------
GROSS MARGIN                                             7,239        6,890
OPERATING EXPENSES:
  Research and development                               1,431        1,375
  Sales and marketing                                    2,416        2,452
  General and administrative                               560          552
  Amortization of purchased intangible assets              122           99
  Restructuring and other charges                           59          202
                                                   -----------  -----------
    Total operating expenses                             4,588        4,680
                                                   -----------  -----------
OPERATING INCOME                                         2,651        2,210
  Interest income                                          161          164
  Interest expense                                        (148)        (148)
  Other income (loss), net                                 (33)          19
                                                   -----------  -----------
    Interest and other income (loss), net                  (20)          35
                                                   -----------  -----------
INCOME BEFORE PROVISION FOR INCOME TAXES                 2,631        2,245
Provision for income taxes                                 539          468
                                                   -----------  -----------
  NET INCOME                                       $     2,092  $     1,777
                                                   -----------  -----------

Net income per share:
Basic                                              $      0.39  $      0.33
                                                   -----------  -----------
Diluted                                            $      0.39  $      0.33
                                                   -----------  -----------

Shares used in per-share calculation:
Basic                                                    5,301        5,394
                                                   -----------  -----------
Diluted                                                  5,334        5,407
                                                   -----------  -----------

Cash dividends declared per common share           $      0.14  $      0.06
                                                   -----------  -----------


               RECONCILIATION OF GAAP TO NON-GAAP NET INCOME
                  (In millions, except per-share amounts)

                                                      Three Months Ended
                                                   ------------------------
                                                   October 27,  October 29,
                                                       2012         2011
                                                   -----------  -----------
GAAP net income                                    $     2,092  $     1,777

  Adjustments to cost of sales:
    Share-based compensation expense                        45           50
    Amortization of acquisition-related intangible
     assets                                                134           87
    Impact to cost of sales from purchase
     accounting adjustments to inventory                    24           --
    Significant asset impairments and
     restructurings                                         --           (5)
                                                   -----------  -----------

  Total adjustments to GAAP cost of sales                  203          132
                                                   -----------  -----------

  Adjustments to operating expenses:
    Share-based compensation expense                       264          291
    Amortization of acquisition-related intangible
     assets                                                122           99
    Other acquisition-related costs                         15            8
    Significant asset impairments and
     restructurings                                         59          202
                                                   -----------  -----------
  Total adjustments to GAAP operating expenses             460          600
                                                   -----------  -----------

  Total adjustments to GAAP income before
   provision for income taxes                              663          732
                                                   -----------  -----------

  Income tax effect                                       (186)        (187)
                                                   -----------  -----------

Non-GAAP net income                                $     2,569  $     2,322
                                                   -----------  -----------

Diluted net income per share:

GAAP                                               $      0.39  $      0.33
                                                   -----------  -----------

Non-GAAP                                           $      0.48  $      0.43
                                                   -----------  -----------


                    CONDENSED CONSOLIDATED BALANCE SHEETS
                                (In millions)
                                 (Unaudited)

                                                     October 27,   July 28,
                                                         2012        2012
                                                     ----------- -----------
ASSETS
Current assets:
  Cash and cash equivalents                          $     4,773 $     9,799
  Investments                                             40,227      38,917
  Accounts receivable, net of allowance for doubtful
   accounts of $224 at October 27, 2012 and $207 at
   July 28, 2012                                           3,942       4,369
  Inventories                                              1,709       1,663
  Financing receivables, net                               3,726       3,661
  Deferred tax assets                                      2,253       2,294
  Other current assets                                     1,277       1,230
                                                     ----------- -----------
  Total current assets                                    57,907      61,933
Property and equipment, net                                3,409       3,402
Financing receivables, net                                 3,695       3,585
Goodwill                                                  20,443      16,998
Purchased intangible assets, net                           3,449       1,959
Other assets                                               3,740       3,882
                                                     ----------- -----------
TOTAL ASSETS                                         $    92,643 $    91,759
                                                     ----------- -----------

LIABILITIES AND EQUITY
Current liabilities:
  Short-term debt                                    $        55 $        31
  Accounts payable                                           889         859
  Income taxes payable                                       200         276
  Accrued compensation                                     2,710       2,928
  Deferred revenue                                         8,721       8,852
  Other current liabilities                                4,539       4,785
                                                     ----------- -----------
  Total current liabilities                               17,114      17,731
Long-term debt                                            16,272      16,297
Income taxes payable                                       1,577       1,844
Deferred revenue                                           3,902       4,028
Other long-term liabilities                                1,077         558
                                                     ----------- -----------
Total liabilities                                         39,942      40,458
Total equity                                              52,701      51,301
                                                     ----------- -----------
TOTAL LIABILITIES AND EQUITY                         $    92,643 $    91,759
                                                     ----------- -----------


                   CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (In millions)
                                (Unaudited)

                                                      Three Months Ended
                                                   ------------------------
                                                   October 27,  October 29,
                                                       2012         2011
                                                   -----------  -----------
Cash flows from operating activities:
  Net income                                       $     2,092  $     1,777
  Adjustments to reconcile net income to net cash
   provided by operating activities:
    Depreciation, amortization, and other                  612          621
    Share-based compensation expense                       306          341
    Provision for receivables                               29          (13)
    Deferred income taxes                                  135          109
    Excess tax benefits from share-based
     compensation                                          (15)         (21)
    Net losses (gains) on investments                       15          (13)
    Change in operating assets and liabilities,
     net of effects of acquisitions and
     divestitures:
      Accounts receivable                                  615          399
      Inventories                                           42         (168)
      Financing receivables                               (132)          (9)
      Other assets                                          99         (374)
      Accounts payable                                     (19)          36
      Income taxes, net                                   (372)         (38)
      Accrued compensation                                (359)        (548)
      Deferred revenue                                    (295)         232
      Other liabilities                                   (288)           2
                                                   -----------  -----------
        Net cash provided by operating activities        2,465        2,333
                                                   -----------  -----------

Cash flows from investing activities:
  Purchases of investments                              (8,213)     (11,770)
  Proceeds from sales of investments                     2,447        7,721
  Proceeds from maturities of investments                4,388        1,179
  Acquisition of property and equipment                   (265)        (265)
  Acquisition of businesses, net of cash and cash
   equivalents acquired                                 (4,912)         (38)
  Purchases of investments in privately held
   companies                                                (9)        (153)
  Return of investments in privately held
   companies                                                12           58
  Other                                                     22           77
                                                   -----------  -----------
        Net cash used in investing activities           (6,530)      (3,191)
                                                   -----------  -----------
Cash flows from financing activities:
  Issuances of common stock                                117          203
  Repurchases of stock - repurchase program               (183)      (1,744)
  Shares repurchased for tax withholdings on
   vesting of restricted stock units                      (203)        (137)
  Short-term borrowings, maturities less than 90
   days, net                                                23           --
  Excess tax benefits from share-based
   compensation                                             15           21
  Dividends paid                                          (744)        (322)
  Other                                                     14          (78)
                                                   -----------  -----------
        Net cash used in financing activities             (961)      (2,057)
                                                   -----------  -----------

Net decrease in cash and cash equivalents               (5,026)      (2,915)
Cash and cash equivalents, beginning of period           9,799        7,662
                                                   -----------  -----------

Cash and cash equivalents, end of period           $     4,773  $     4,747
                                                   -----------  -----------

Cash paid for:
Interest                                           $       221  $       220
Income taxes                                       $       776  $       398

Certain reclassifications have been made to prior period amounts to conform to the current period's presentation.

                      ADDITIONAL FINANCIAL INFORMATION
                               (In millions)
                                (Unaudited)

                                                   October 27,    July 28,
                                                       2012         2012
                                                   -----------  -----------
CASH AND CASH EQUIVALENTS AND INVESTMENTS
Cash and cash equivalents                          $     4,773  $     9,799
Fixed income securities                                 38,464       37,297
Publicly traded equity securities                        1,763        1,620
                                                   -----------  -----------
Total                                              $    45,000  $    48,716
                                                   -----------  -----------

INVENTORIES
Raw materials                                      $       101  $       127
Work in process                                             36           35
Finished goods:
  Distributor inventory and deferred cost of sales         671          630
  Manufactured finished goods                              615          597
                                                   -----------  -----------
Total finished goods                                     1,286        1,227
Service-related spares                                     237          213
Demonstration systems                                       49           61
                                                   -----------  -----------
Total                                              $     1,709  $     1,663
                                                   -----------  -----------

PROPERTY AND EQUIPMENT, NET
Land, buildings, and building & leasehold
 improvements                                      $     4,458  $     4,363
Computer equipment and related software                  1,491        1,469
Production, engineering, and other equipment             5,495        5,364
Operating lease assets                                     312          300
Furniture and fixtures                                     494          487
                                                   -----------  -----------
                                                        12,250       11,983
Less accumulated depreciation and amortization          (8,841)      (8,581)
                                                   -----------  -----------
Total                                              $     3,409  $     3,402
                                                   -----------  -----------

OTHER ASSETS
Deferred tax assets                                $     2,061  $     2,270
Investments in privately held companies                    830          858
Other                                                      849          754
                                                   -----------  -----------
Total                                              $     3,740  $     3,882
                                                   -----------  -----------

DEFERRED REVENUE
Service                                            $     8,753  $     9,173
Product:
  Unrecognized revenue on product shipments and
   other deferred revenue                                3,074        2,975
  Cash receipts related to unrecognized revenue
   from two-tier distributors                              796          732
                                                   -----------  -----------
Total product deferred revenue                           3,870        3,707
                                                   -----------  -----------
Total                                              $    12,623  $    12,880
                                                   -----------  -----------

Reported as:
Current                                            $     8,721  $     8,852
Noncurrent                                               3,902        4,028
                                                   -----------  -----------
Total                                              $    12,623  $    12,880
                                                   -----------  -----------


                 SUMMARY OF SHARE-BASED COMPENSATION EXPENSE
                                (In millions)

                                                       Three Months Ended
                                                    ------------------------
                                                    October 27,  October 29,
                                                        2012         2011
                                                    -----------  -----------
Cost of sales -- product                            $        10  $        13
Cost of sales -- service                                     35           37
                                                    -----------  -----------
Share-based compensation expense in cost of sales            45           50
                                                    -----------  -----------

Research and development                                     84          101
Sales and marketing                                         130          142
General and administrative                                   50           48
Restructuring and other charges                              (3)          --
                                                    -----------  -----------
Share-based compensation expense in operating
 expenses                                                   261          291
                                                    -----------  -----------
Total share-based compensation expense              $       306  $       341
                                                    -----------  -----------

The income tax benefit for share-based compensation expense was $79 million and $90 million for the three months ended October 27, 2012 and October 29, 2011, respectively.


                         ACCOUNTS RECEIVABLE AND DSO
                          (In millions, except DSO)


                                         -----------------------------------
                                         October 27,   July 28,  October 29,
                                             2012        2012        2011
                                         ----------- ----------- -----------

Accounts receivable                      $     3,942 $     4,369 $     4,300
Days sales outstanding in accounts
 receivable (DSO)                                 30          34          35


           INVENTORY TURNS AND RECONCILIATION OF GAAP TO NON-GAAP
                   COST OF SALES USED IN INVENTORY TURNS
              (In millions, except annualized inventory turns)

                                                Three Months Ended
                                      -------------------------------------
                                      October 27,    July 28,   October 29,
                                          2012         2012         2011
                                      -----------  -----------  -----------

Annualized inventory turns- GAAP             11.0         11.7         11.2
    Cost of sales adjustments                (0.5)        (0.4)        (0.3)
                                      -----------  -----------  -----------
Annualized inventory turns- non-GAAP         10.5         11.3         10.9

GAAP cost of sales                    $     4,637  $     4,605  $     4,366
  Cost of sales adjustments:
    Share-based compensation expense          (45)         (54)         (50)
    Amortization of acquisition-
     related intangible assets               (134)        (100)         (87)
    Impact to cost of sales from
     purchase accounting adjustments
     to inventory                             (24)          --           --
    Significant asset impairments and
     restructurings                            --            5            5
                                      -----------  -----------  -----------
Non-GAAP cost of sales                $     4,434  $     4,456  $     4,234
                                      -----------  -----------  -----------


                REPURCHASE OF COMMON STOCK AND DIVIDENDS PAID
                                (In millions)

                    October 27,  July 28,  April 28, January 28, October 29,
Three Months Ended      2012       2012       2012       2012        2011
                    ----------- ---------- --------- ----------- -----------
Repurchase of
 common stock under
 the stock
 repurchase program $       253 $    1,800 $     550 $       466 $     1,544
Dividends paid              744        425       432         322         322
                    ----------- ---------- --------- ----------- -----------
Total               $       997 $    2,225 $     982 $       788 $     1,866
                    ----------- ---------- --------- ----------- -----------

Press Contact:
Robyn Jenkins-Blum
Cisco
+1 (408) 853-9848
Email Contact

Investor Relations Contact:
Melissa Selcher
Cisco
+1 (408) 424-1335
Email Contact

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@ThingsExpo Stories
The Workspace-as-a-Service (WaaS) market will grow to $6.4B by 2018. In his session at 16th Cloud Expo, Seth Bostock, CEO of IndependenceIT, will begin by walking the audience through the evolution of Workspace as-a-Service, where it is now vs. where it going. To look beyond the desktop we must understand exactly what WaaS is, who the users are, and where it is going in the future. IT departments, ISVs and service providers must look to workflow and automation capabilities to adapt to growing demand and the rapidly changing workspace model.
As organizations shift toward IT-as-a-service models, the need for managing and protecting data residing across physical, virtual, and now cloud environments grows with it. CommVault can ensure protection &E-Discovery of your data – whether in a private cloud, a Service Provider delivered public cloud, or a hybrid cloud environment – across the heterogeneous enterprise. In his session at 16th Cloud Expo, Randy De Meno, Chief Technologist - Windows Products and Microsoft Partnerships, will discuss how to cut costs, scale easily, and unleash insight with CommVault Simpana software, the only si...
Hadoop as a Service (as offered by handful of niche vendors now) is a cloud computing solution that makes medium and large-scale data processing accessible, easy, fast and inexpensive. In his session at Big Data Expo, Kumar Ramamurthy, Vice President and Chief Technologist, EIM & Big Data, at Virtusa, will discuss how this is achieved by eliminating the operational challenges of running Hadoop, so one can focus on business growth. The fragmented Hadoop distribution world and various PaaS solutions that provide a Hadoop flavor either make choices for customers very flexible in the name of opti...
One of the biggest impacts of the Internet of Things is and will continue to be on data; specifically data volume, management and usage. Companies are scrambling to adapt to this new and unpredictable data reality with legacy infrastructure that cannot handle the speed and volume of data. In his session at @ThingsExpo, Don DeLoach, CEO and president of Infobright, will discuss how companies need to rethink their data infrastructure to participate in the IoT, including: Data storage: Understanding the kinds of data: structured, unstructured, big/small? Analytics: What kinds and how responsiv...
Since 2008 and for the first time in history, more than half of humans live in urban areas, urging cities to become “smart.” Today, cities can leverage the wide availability of smartphones combined with new technologies such as Beacons or NFC to connect their urban furniture and environment to create citizen-first services that improve transportation, way-finding and information delivery. In her session at @ThingsExpo, Laetitia Gazel-Anthoine, CEO of Connecthings, will focus on successful use cases.
Sensor-enabled things are becoming more commonplace, precursors to a larger and more complex framework that most consider the ultimate promise of the IoT: things connecting, interacting, sharing, storing, and over time perhaps learning and predicting based on habits, behaviors, location, preferences, purchases and more. In his session at @ThingsExpo, Tom Wesselman, Director of Communications Ecosystem Architecture at Plantronics, will examine the still nascent IoT as it is coalescing, including what it is today, what it might ultimately be, the role of wearable tech, and technology gaps stil...
The true value of the Internet of Things (IoT) lies not just in the data, but through the services that protect the data, perform the analysis and present findings in a usable way. With many IoT elements rooted in traditional IT components, Big Data and IoT isn’t just a play for enterprise. In fact, the IoT presents SMBs with the prospect of launching entirely new activities and exploring innovative areas. CompTIA research identifies several areas where IoT is expected to have the greatest impact.
Wearable devices have come of age. The primary applications of wearables so far have been "the Quantified Self" or the tracking of one's fitness and health status. We propose the evolution of wearables into social and emotional communication devices. Our BE(tm) sensor uses light to visualize the skin conductance response. Our sensors are very inexpensive and can be massively distributed to audiences or groups of any size, in order to gauge reactions to performances, video, or any kind of presentation. In her session at @ThingsExpo, Jocelyn Scheirer, CEO & Founder of Bionolux, will discuss ho...
Cloud data governance was previously an avoided function when cloud deployments were relatively small. With the rapid adoption in public cloud – both rogue and sanctioned, it’s not uncommon to find regulated data dumped into public cloud and unprotected. This is why enterprises and cloud providers alike need to embrace a cloud data governance function and map policies, processes and technology controls accordingly. In her session at 15th Cloud Expo, Evelyn de Souza, Data Privacy and Compliance Strategy Leader at Cisco Systems, will focus on how to set up a cloud data governance program and s...
Containers and microservices have become topics of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 16th Cloud Expo at the Javits Center in New York June 9-11 will find fresh new content in a new track called PaaS | Containers & Microservices Containers are not being considered for the first time by the cloud community, but a current era of re-consideration has pushed them to the top of the cloud agenda. With the launch of Docker's initial release in March of 2013, interest was revved up several notches. Then late last...
Roberto Medrano, Executive Vice President at SOA Software, had reached 30,000 page views on his home page - http://RobertoMedrano.SYS-CON.com/ - on the SYS-CON family of online magazines, which includes Cloud Computing Journal, Internet of Things Journal, Big Data Journal, and SOA World Magazine. He is a recognized executive in the information technology fields of SOA, internet security, governance, and compliance. He has extensive experience with both start-ups and large companies, having been involved at the beginning of four IT industries: EDA, Open Systems, Computer Security and now SOA.
HP and Aruba Networks on Monday announced a definitive agreement for HP to acquire Aruba, a provider of next-generation network access solutions for the mobile enterprise, for $24.67 per share in cash. The equity value of the transaction is approximately $3.0 billion, and net of cash and debt approximately $2.7 billion. Both companies' boards of directors have approved the deal. "Enterprises are facing a mobile-first world and are looking for solutions that help them transition legacy investments to the new style of IT," said Meg Whitman, Chairman, President and Chief Executive Officer of HP...
The industrial software market has treated data with the mentality of “collect everything now, worry about how to use it later.” We now find ourselves buried in data, with the pervasive connectivity of the (Industrial) Internet of Things only piling on more numbers. There’s too much data and not enough information. In his session at @ThingsExpo, Bob Gates, Global Marketing Director, GE’s Intelligent Platforms business, to discuss how realizing the power of IoT, software developers are now focused on understanding how industrial data can create intelligence for industrial operations. Imagine ...
Operational Hadoop and the Lambda Architecture for Streaming Data Apache Hadoop is emerging as a distributed platform for handling large and fast incoming streams of data. Predictive maintenance, supply chain optimization, and Internet-of-Things analysis are examples where Hadoop provides the scalable storage, processing, and analytics platform to gain meaningful insights from granular data that is typically only valuable from a large-scale, aggregate view. One architecture useful for capturing and analyzing streaming data is the Lambda Architecture, representing a model of how to analyze rea...
SYS-CON Events announced today that Vitria Technology, Inc. will exhibit at SYS-CON’s @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Vitria will showcase the company’s new IoT Analytics Platform through live demonstrations at booth #330. Vitria’s IoT Analytics Platform, fully integrated and powered by an operational intelligence engine, enables customers to rapidly build and operationalize advanced analytics to deliver timely business outcomes for use cases across the industrial, enterprise, and consumer segments.
The explosion of connected devices / sensors is creating an ever-expanding set of new and valuable data. In parallel the emerging capability of Big Data technologies to store, access, analyze, and react to this data is producing changes in business models under the umbrella of the Internet of Things (IoT). In particular within the Insurance industry, IoT appears positioned to enable deep changes by altering relationships between insurers, distributors, and the insured. In his session at @ThingsExpo, Michael Sick, a Senior Manager and Big Data Architect within Ernst and Young's Financial Servi...
SYS-CON Events announced today that Open Data Centers (ODC), a carrier-neutral colocation provider, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. Open Data Centers is a carrier-neutral data center operator in New Jersey and New York City offering alternative connectivity options for carriers, service providers and enterprise customers.
The explosion of connected devices / sensors is creating an ever-expanding set of new and valuable data. In parallel the emerging capability of Big Data technologies to store, access, analyze, and react to this data is producing changes in business models under the umbrella of the Internet of Things (IoT). In particular within the Insurance industry, IoT appears positioned to enable deep changes by altering relationships between insurers, distributors, and the insured. In his session at @ThingsExpo, Michael Sick, a Senior Manager and Big Data Architect within Ernst and Young's Financial Servi...
PubNub on Monday has announced that it is partnering with IBM to bring its sophisticated real-time data streaming and messaging capabilities to Bluemix, IBM’s cloud development platform. “Today’s app and connected devices require an always-on connection, but building a secure, scalable solution from the ground up is time consuming, resource intensive, and error-prone,” said Todd Greene, CEO of PubNub. “PubNub enables web, mobile and IoT developers building apps on IBM Bluemix to quickly add scalable realtime functionality with minimal effort and cost.”
Sensor-enabled things are becoming more commonplace, precursors to a larger and more complex framework that most consider the ultimate promise of the IoT: things connecting, interacting, sharing, storing, and over time perhaps learning and predicting based on habits, behaviors, location, preferences, purchases and more. In his session at @ThingsExpo, Tom Wesselman, Director of Communications Ecosystem Architecture at Plantronics, will examine the still nascent IoT as it is coalescing, including what it is today, what it might ultimately be, the role of wearable tech, and technology gaps stil...