Cisco Catches Fire

Updated from Nov. 8

Cisco (CSCO) soared 8% early Thursday after boosting revenue guidance for the second straight quarter.

For its fiscal first quarter ended last month, the San Jose, Calif., networking-gear company made $1.61 billion, or 26 cents a share, up from the year-ago $1.26 billion, or 20 cents a share. Revenue rose to $8.18 billion from $6.55 billion a year earlier.

Excluding certain items, latest-quarter adjusted earnings were 31 cents a share.

Analysts surveyed by Thomson Financial were looking for a 29-cent profit on sales of $7.9 billion.

"From a Cisco perspective, from a global and U.S. perspective, the momentum remains strong," CEO John Chambers said on a postclose conference call. He said the latest quarter's 25% year-on-year revenue gain was "the strongest we've seen in years" and that the current quarter's book-to-bill ratio, reflecting the proportion of orders to shipments, is above 1 -- unusual in what is typically a seasonally slow quarter.

"It's a safe assumption that orders grew faster than revenues," Chambers said on the earnings call.

Better yet, Chambers said Cisco expects to see 24%-25% revenue growth for the second quarter, reflecting the contributions of cable networker Scientific Atlanta, acquired this past spring. Wall Street was looking for 21% growth.

Chambers said organic growth, excluding the effect of recent acquisitions, should be 14%-15% for the second quarter -- at the high end of the company's previous 10%-15% guidance.

To view Robert Martorana's video take on Cisco's results, click here.