John Chambers' plan to put Cisco Systems (Nasdaq: CSCO) back on a path of focused growth appears to be working as the networking vendor reported $11.3 billion in net sales for its fiscal first quarter that ended on Oct. 29, a 4.7 percent increase over the same period in 2010.
Click here for details of Cisco's fiscal Q1 2012 results.
Due to the uneasy global economic state, financial analysts forecast the vendor would report $11.03 billion in sales during the quarter.
Chambers attributed the better results to the fact that its large service provider and government customers did not reduce their spending as much as initially thought.
The vendor said it's largely completed its restructuring and it expects only $0.01-$0.02 per share in additional charges in the current fiscal year.
From a segment perspective, the results were more of a mixed bag.
Cisco's core switching business sales remained flat at $3.6 billion, while IP routers declined 3 percent to $2.1 billion. On a brighter note, collaboration revenues rose 12 percent to $1.1 billion and video systems were up 13 percent to $879 million.
Despite the positive Q1 results, Chambers is remaining cautiously optimistic about how the company will fare in 2012.
"There will always be challenges," he said. "We are watching very closely the developments in Europe and the global economy, public sector spending, India business, and the fallout from the flooding in Thailand."
As it looks to revive growth, Chambers said one of the company's goals is to find ways to more effectively challenge competitors like Huawei, which has been stealing away market share.
"In the past we have been a little too gentle," he said.
For fiscal Q2 Cisco has forecast that sales will rise 7 to 8 percent, which would mean about $11.13 to $11.20 billion in revenue, surpassing analyst revenue forecasts of $11.14 billion.