(Story updated with information on Cisco's earnings tax benefit, cash position and share price.) NEW YORK ( TheStreet) -- Cisco ( CSCO) beat Wall Street's second-quarter earnings and revenue estimates, allaying concern about tepid enterprise spending. The networking company reported revenue of $12.1 billion, up from $11.5 billion a year earlier and just above analysts' estimates of $12.06 billion. Excluding items, Cisco earned 51 cents a share, compared with 47 cents a year earlier. Analysts surveyed by Thomson Reuters were looking for 48 cents. The company's non-GAAP earnings included a tax benefit of approximately 1 cent a share thanks to the reinstatement of the U.S. federal R&D tax credit last month. "Cisco delivered record earnings per share this quarter and record revenue for the eighth quarter in a row in a challenging economic environment," CEO John Chambers said in a statement released after the market close. The CEO struck a positive tone during the conference call to discuss the results. "We continue to be pleased with the traction of our company," he said, and cited "a tone of cautious optimism" among Cisco's customers. Chambers noted particular strength in U.S. commercial orders, which he said could be an early indication of GDP growth. "U.S. enterprise and commercial, I really believe that that is the key to what the U.S. is going to do over time," he said. "At the moment, that looks good -- our pipeline is good." The CEO, however, acknowledged that other parts of the world are still challenging. "We continue to see a soft global recovery," he said, pointing to weakness in parts of Europe, particularly southern Europe. For the third quarter, Cisco predicted revenue between $12.06 billion and $12.3 billion and earnings, excluding items, between 48 cents a share and 50 cents a share. Analysts surveyed by Thomson Reuters were looking for sales of $12.22 billion and earnings of 49 cents a share. During the second quarter, Cisco's switching revenue grew 3% year over year to $3.72 billion while the company's services business rose 10% to $2.66 billion. Sales of Cisco's Next-Generation-Routing (NGN), however, slipped 6% to $1.95 billion although service-provider video climbed 20% to $1.22 billion. Collaboration revenue fell 11% to $945 million, while data-center revenue climbed 65% to $548 million. Revenue from the company's wireless business rose 27% to $520 million, although security was a more modest gainer, with sales rising 1% to $336 million. Cisco's second-quarter gross margin came in at 60.7%, down from 61% in the first quarter. In the prior year's quarter, Cisco's gross margin was 61.3%. Excluding items, the networker's gross margin was 62.3%, down sequentially from 62.7%. During the second quarter of fiscal 2012, Cisco's gross margin was 62.4%. Cisco exited the quarter with cash, cash equivalents and investments of $46.4 billion. The networking giant's shares, which closed up 0.8% during Wednesday's session, dipped 1.9% to $20.74 in extended trading. -- Written by James Rogers in New York.Follow @jamesjrogers >To submit a news tip, send an email to: email@example.com.