Cisco Q2 Earnings

Cisco Systems reported sales of $6.5 billion, a 9.7 percent increase over the year-ago quarter and just below Wall Street analysts’ forecast of $6.58 billion, according to a Thomson FirstCall survey of analysts. The company posted pro forma earnings per share of $0.25, excluding an expense for stock options, beating Wall Street’s forecast by a penny, according to Thomson. This is the first quarter in which Cisco included the compensation expense, which shrunk its profits. Including the expenses, the company’s net income for the fiscal first quarter of 2006 was $1.3 billion, or 20 cents per share, compared with $1.4 billion, or 21 cents a share, in the same quarter a year ago, which excluded the options expenses. Cisco said it would have earned net income of $1.1 billion, or 17 cents a share, in the same quarter a year ago if it had included the expenses. Cisco’s pro forma gross margin was at 68.1 percent.