This summary is based on the third quarter fiscal 2008 earnings call conducted by Cisco Systems Inc. (CSCO: chart) on May 6, 2008.

Management:

- Chairman and CEO: John Chambers
- CFO: Frank Calderoni
- EVP of Worldwide Operations and Business Development: Rick Justice
- SVP of Software Group: Don Proctor
- SVP of Corporate Development and Consumer and Small Business Group: Ned Hooper
- Chief Executive of Service Providers Video Technology Group: Jim McDonald
- SVP of Corporate Communications: Blair Christie

Key Investors Issues

- Revenue rose 10.4% to $9.8 billion, from $8.87 billion in the prior year.
- Net income decreased 5% to $1.77 billion or 29 cents a share.
- The firm repurchased $2 billion of common stock.

Year to Date Highlights:

- Revenue increased 13.7% to $24.5 billion, from $21.5 billion in 2007.
- Net income was up 11.8% to $6.04 billion or 97 cents a share.
- The firm has repurchased and retired 2.5 billion shares of Cisco common stock at an average price of $20.51 per share.

Third Quarter Highlights

Total revenue of $9.8 billion, was a 10.4% increase from $8.87 billion in the prior year on strong order growth.

- Routing revenue continue to be strong at $2 billion, up 14% year-over-year due primarily to continued growth in the high end router portfolio at 26% year-over-year with particular strength in CRS-1 and the 7600 product families.
- Switching revenue was $3.2 billion, an increase of 3% year-over-year driven by growth in the 6 switching portfolio.
- Advanced Technologies revenue totaled $2.4 billion representing an increase of 17% year-over-year led by strong performance in Unified Communication and Video Systems.
- Other product revenue totaled $569 million, an increase of 3% year-over-year.

Total service revenue was $1.6 billion, up 15% year-over-year as a result of solid growth across all geography.

- Total revenue growth by geography grew in the range of 5% year-over-year in the US and Canada to a high of 44% in emerging markets.
- The non-GAAP service margins was 62.7%, down from 63.5% last quarter and these will typically experience some variability over time due to various factors such as the changes in mix between technical support services and advanced services.

Net income was $1.77 billion or 29 cents a share representing a decrease of 5% from $1.87 billion or 30 cents a share as a result of a charge of $246 million or 4 cents per share relating to the intent to purchase, remaining interest in Nuova Systems.

- Operating expenses as a percent of revenue were approximately 36% up from 35.2% in 2007.
- Interest in other income was $168 million lower than the guidance of $200 million due to macroeconomic conditions, which resulted in lower gains from the sale of fixed income and public equity investment.

Head count totaled 65,225, a net increase of 1,100 from the prior quarter, a result of Cisco hires in engineering, sales and in services.

- Cash generated from operations was $3 billion and the firm repurchased $2 billion of common stock.
- In Japan, the firm is beginning to see the second phase of next generation network build outs from the source of other customers and the new momentum being created from the organization changes there.
- The firm believes phase II of the internet will be driven by collaboration enabled by networked Web 2.0 technologies.

Innovation Leadership:

- The Cisco Nexus 7000 series was the recipient of the Interop 2008 product of the year of the award, in the IT infrastructure category.
- Cisco Wide Area Application Engine and the Cisco Wide Area Application Services software were awarded for application optimization.
- The firm now has 11 products family, with order run rates about $1 billion and many of them continue to gain share in the respective product categories.
- Entertainment innovation will be based upon visual networking and will change everything from the way people interface between family and friends to how they watch sporting events with the community.

The ASR 1000, is the leading edge product in terms of hardware, software, ASICs and revenue generation for the service provider, customers at the edge.

- It is the most powerful compact router ever to address the edge and to put in perspective 160 times more processing power in many ways than its predecessor.
- It also contains the most complex ASIC design in history for network product with nearly 800 million transistors on the chip and for a point of comparison the CRS was the prior leader with over 180 million transistors on its key architecture.
- The firm also introduced the Nexus 5000, the industry''s first open standards-based access-layer switch to support I/O consolidation at the rake level.

New business-to-business TelePresence capabilities are just being delivered and it really opens up the market opportunities for customers.