8-KEarnings & Results

CISCO SYSTEMS, INC. 8-K Report, Financial Results (Nov 5, 2008)

Filed November 5, 2008For Securities:CSCO

Summary

Cisco Systems, Inc. (CSCO) filed an 8-K on November 5, 2008, to report its financial results for the first fiscal quarter ended October 25, 2008. The filing primarily served to furnish a press release detailing these results, which included both GAAP and non-GAAP financial metrics. Investors should note that Cisco utilizes non-GAAP measures to provide a clearer view of its ongoing operational performance by excluding items such as employee share-based compensation, purchase accounting adjustments, payroll taxes on stock option exercises, acquisition-related expenses, in-process R&D, amortization of intangibles, and significant gains/losses on equity securities. The company's management uses these non-GAAP figures internally for budgeting and performance reviews, believing they offer valuable insights into business and financial trends, particularly in inventory management as indicated by non-GAAP inventory turns. While these non-GAAP measures are not replacements for GAAP figures and have limitations, their presentation alongside GAAP results aims to offer investors a more comprehensive understanding of Cisco's operational profitability and efficiency, especially during periods of economic uncertainty.

Key Highlights

  • 1Cisco Systems filed an 8-K on November 5, 2008, announcing results for its fiscal first quarter ended October 25, 2008.
  • 2The filing includes a press release (Exhibit 99.1) containing detailed financial results.
  • 3Cisco presents both GAAP (Generally Accepted Accounting Principles) and non-GAAP financial measures.
  • 4Non-GAAP measures are used to provide insights into ongoing operational performance and financial trends.
  • 5Key exclusions from non-GAAP measures include share-based compensation, acquisition-related costs, and gains/losses on equity securities.
  • 6Management uses non-GAAP figures for internal budgeting and performance evaluation.
  • 7Specific mention of non-GAAP inventory turns as a metric for inventory management efficiency.

Frequently Asked Questions

The primary purpose of this 8-K filing is to publicly report Cisco Systems' financial results for its fiscal first quarter ended October 25, 2008, by furnishing a press release that contains these results.

Non-GAAP financial measures are financial metrics that exclude certain items from the standard GAAP (Generally Accepted Accounting Principles) figures. Cisco uses them to provide investors and management with a clearer view of the company's ongoing operational performance by removing the impact of items like stock-based compensation, acquisition-related expenses, and gains/losses on certain investments, which may not reflect the core business's day-to-day operations.

Cisco typically excludes expenses such as employee share-based compensation, the impact of purchase accounting adjustments to inventory from acquisitions, payroll taxes on stock option exercises, compensation and in-process R&D expenses related to acquisitions, amortization of acquisition-related intangible assets, and significant gains or losses on publicly traded equity securities. They also exclude related tax effects.

The filing explicitly states that these non-GAAP measures are not in accordance with, or an alternative for, GAAP, and may differ from non-GAAP measures used by other companies. They are not based on a comprehensive set of accounting rules and should be used in conjunction with the corresponding GAAP measures.