- In addition to receiving the 500,000 TelePresence, the firm has developed strategic relationships with premier global service providers, AT&T in the US and BT in Europe, to begin offering intercompany telepresence.
- WebEx launched its new version of WebEx products for the Mac users and along this line the upcoming software version 2 for the iPhone incorporates Cisco''s VPN Technology.
- The collaborative solution that integrates the WebEx product with our Unified Communication suite including the UC manager, IP Phone, TelePresence and MeetingPlace began shipping.

Cisco introduced the Cisco ASR 1000 Series Aggregation Services Routers, which help service provider and enterprise edge networks simultaneously host an ever-increasing array of resource-intensive integrated data services.

- The firm evolved its Self-Defending Network portfolio from network security offerings into a broader systems approach designed to strengthen the overall protection of networks.
- It announced additions to its physical security product portfolio, delivering new capabilities in Internet Protocol (IP)-based video surveillance and electronic access control.
- The firm announced new solutions for its Empowered Branch portfolio, including the opening of its industry-leading Cisco Integrated Services Router and Cisco Wide Area Application Services (WAAS) platforms to customers and third-party application developers.

Announced that it enhanced its Mobility Healthcare portfolio with a set of integrated solutions designed to rapidly improve staff productivity and patient care efficacy for healthcare organizations around the globe.

- Announced the development of the Cisco Academy of Digital Signage, a new qualification program for media professionals looking to create trusted, optimized content for digital signage.
- Announced Apple Mac support across its WebEx® suite of business process collaboration applications.
- Linksys® introduced the Linksys by Cisco Wireless-G IP iPhone (WIP310), the latest product in the Linksys IP phone family offering voice over IP (VoIP) connectivity via Wi-Fi Internet access.

Geographic Highlights:

- Asia Pacific, which includes India and China, continued to be very solid, as Japan was very strong and grew in the mid 20s.
- Europe, rose 14% and the US did experience challenges with growth in the mid single-digits.
- Emerging market sales tended to be very lumpy and revenues rose over 40% year-over-year, but orders grew 10%.

Strategic Insights:

- The firm is now focussing on 22 priorities with a with a collaborative structure and replicatable business process driven by the councils and boards.
- The smaller social/business networking teams are moving faster in the command and control structure and are enabling the firm’s ability to move into new market adjacencies with speed and effectiveness.
- Customers in many of the emerging countries such as India, China and the Middle East remain very optimistic about business momentum.

Acquisitions and Investments:

- Cisco announced its intent to purchase the remaining 20 percent interest in San Jose-based Nuova Systems, a startup focused on the development of next-generation products for the data center market.
- It also introduced the Cisco NexusTM 5000 Series, the first product developed by Nuova.
- The firm announced the next phase of its corporate strategy for China, marked by new public-private collaborative programs within the country that deliver upon Cisco''s $16 billion multi-year innovation and sustainability initiative.

Fiscal 2008 Outlook:

- Total revenue growth for the fourth quarter is expected to be in the range of 9% to 10% year-over-year.
- Total gross margin will be 65%, with operating expenses in the range of 36% to 37% of revenue.
- EPS will be 4 cents to 6 cents per share lower than the non-GAAP EPS primarily due to acquisition related charges and stock option expense.

Key questions and answers from the third quarter earnings call conducted by Cisco Systems Inc. (CSCO: chart) on May 6, 2008.

Inder Singh (Lehman Brothers): How are you managing your expense line in light of, the environment that you are seeing now?

John Chambers: We are going to be aggressive in expenses. We get no benefit from currency in terms of our top line, the revenue growth. When many of our peers have got as much as 6%, or7% or 8% of their growth out of a currency, we did not.

But we did unfortunately get about 3% of our growth, on the expense side from the currencies where we pay our salaries in local currency. We are going to however continue to be aggressive while staying with financial models, the 36% to 37% and staying within our gross margin guidance.

Ehud Gelblum (JPMorgan): How are you going to reaccelerate growth in some of the areas?

John Chambers: Asia-Pacific is accelerating and so the investments that we are making in certain emerging countries in Asia-Pacific were very solid and we saw that results for Asia-Pacific is back growing comfortably.

In terms of the emerging markets, they are always going to be lumpy but overtime, will continue to grow at twice the growth rate of our core markets if you will. If you look in terms of the growth on the network, the video growth how seriously other are going to evolve etcetera, you will have to spin in those areas.

The two areas that let us into the slowdown, which were the financial services and the manufacturing sector actually had their best growth in mid teens. And, now you are seeing in the area such as transportation and hospitality slow a little bit more.