Cisco Holds Steady in Q2

After announcing disappointing guidance last quarter, Cisco Systems Inc. (Nasdaq: CSCO) didn't quite redeem itself when sharing earnings for its second fiscal quarter of 2005 (see Cisco Reports Q2).

For the second quarter ended Jan. 29, Cisco reported profits of $1.4 billion, or 21 cents per share, on revenues of $6.1 billion -- very close to the previous quarter's profits of $1.4 billion, or 21 cents per share, on revenues of $6 billion (see Cisco Disappoints With Q1).

Cisco's pro forma net income came to 22 cents per share, exactly matching analyst expectations as tallied by Reuters Research. Revenues likewise matched analyst expectations.

That's not a bad thing at all, to be sure, but investors had gotten used to Cisco beating estimates by a penny per share, a pattern the company has been breaking of late. In early after-hours trading, Cisco stock fell 46 cents (2.5%) to $17.78.

Worse, Cisco predicted revenue growth of zero to 2 percent for the third quarter, which ends in April. Analysts were expecting the company's revenues to grow 2 percent. Chambers noted that the third quarter will have one less week than usual -- but it's likely analysts already knew that.