US telecoms equipment vendor Cisco has posted strong results for the second quarter of its fiscal year 2013 (ended January 26th), and CEO John Chambers indicated in a call with analysts that he plans to transition away from the low-margin side of the set-top box business.
Cisco reported sales of US$ 12.1bn for the second quarter of its fiscal year, up 5% year-on-year, while GAAP net income rose a hefty 44% to US$ 3.1bn, helped by the reinstatement of a US federal research and development tax credit which contributed towards tax benefits of around US$ 926mn in the quarter.
Chambers commented: “We are making solid progress towards our goal of becoming the #1 IT company in the world. As new markets grow and are created, such as the Internet of Everything, it’s very easy to see how the intelligent network is at the centre of that future.”
During the call with analysts, the Cisco CEO indicated that the integration of UK-based TV technology firm NDS continues to go “very well”, driving results on both the top and bottom line, and helping it shift away from the low-margin side of the set-top box business and towards the more valuable and profitable software and service offerings.