8-KEarnings & Results

CISCO SYSTEMS, INC. 8-K Report, Financial Results (May 6, 2008)

Filed May 6, 2008For Securities:CSCO

Summary

Cisco Systems, Inc. filed an 8-K on May 6, 2008, to report its financial results for the third fiscal quarter ended April 26, 2008. The filing primarily serves to furnish a press release detailing these results. Investors should note that Cisco presented both GAAP and non-GAAP financial measures, with the latter excluding items such as employee share-based compensation expense, purchase accounting adjustments, payroll taxes on stock option exercises, acquisition-related expenses, in-process R&D, amortization of intangible assets, and gains/losses on equity securities. Cisco believes these non-GAAP measures offer a more insightful view of ongoing operational trends and business performance. The company detailed its rationale for excluding these specific items, emphasizing that they are either non-cash, subject to external market forces beyond management's control, or related to past acquisitions and thus not reflective of current operational performance. This detailed explanation of non-GAAP adjustments is crucial for investors to understand the basis of Cisco's performance metrics and to compare them effectively with both historical results and industry peers who may use different adjustment methodologies.

Key Highlights

  • 1Cisco Systems reported its Q3 fiscal year 2008 financial results on May 6, 2008.
  • 2The filing includes a press release (Exhibit 99.1) containing the detailed financial results.
  • 3Cisco provided both GAAP and non-GAAP financial measures in its earnings report.
  • 4Non-GAAP measures exclude items such as share-based compensation, acquisition-related costs, and certain other expenses not considered reflective of ongoing operations.
  • 5The company explicitly detailed the rationale behind each exclusion for non-GAAP reporting.
  • 6Investors are encouraged to review both GAAP and non-GAAP figures for a comprehensive understanding of financial performance.
  • 7The report also mentions the inclusion of non-GAAP inventory turns as a key operational metric.

Frequently Asked Questions

The primary purpose of this 8-K filing is to report Cisco Systems' financial results for its third fiscal quarter ended April 26, 2008, by furnishing the accompanying press release as an exhibit.

Cisco presents both Generally Accepted Accounting Principles (GAAP) and non-GAAP financial measures. The non-GAAP measures are adjusted to exclude certain items that Cisco believes are not indicative of its ongoing operating results.

Cisco provides non-GAAP measures because management believes they offer useful information to investors and management regarding financial and business trends, presenting a clearer view of operational performance by excluding items such as stock-based compensation, acquisition-related costs, and other non-recurring or non-cash expenses.

Key items excluded from Cisco's non-GAAP results include employee share-based compensation expense, impact from purchase accounting on inventory, payroll tax on stock option exercises, compensation and R&D expenses related to acquisitions, amortization of purchased intangible assets, and significant gains or losses on publicly traded equity securities.