8-KEarnings & Results

CISCO SYSTEMS, INC. 8-K Report, Financial Results (Nov 4, 2009)

Filed November 4, 2009For Securities:CSCO

Summary

Cisco Systems, Inc. (CSCO) filed a Form 8-K on November 4, 2009, to report its financial results for the fiscal first quarter ended October 24, 2009. The filing primarily directs investors to a furnished press release (Exhibit 99.1) and a transcript of a video by the CFO (Exhibit 99.2) for detailed information. Crucially, this report highlights Cisco's use of non-GAAP financial measures, including non-GAAP net income, non-GAAP net income per share, and non-GAAP inventory turns. The company explains that these measures exclude items such as share-based compensation expense, amortization of acquisition-related intangible assets, other acquisition-related costs, and certain tax effects. Cisco's management believes these non-GAAP figures provide a more insightful view of ongoing operating results and business trends when considered alongside GAAP measures.

Key Highlights

  • 1Cisco reported its fiscal first quarter 2010 results on November 4, 2009.
  • 2The primary disclosure of financial results is through an attached press release (Exhibit 99.1) and CFO video transcript (Exhibit 99.2).
  • 3The company emphasizes the use of non-GAAP financial measures, including net income, net income per share, and inventory turns.
  • 4Key exclusions from non-GAAP measures include share-based compensation expense and amortization of acquisition-related intangible assets.
  • 5Cisco's management uses non-GAAP measures to better understand ongoing operating results and business trends.
  • 6The company notes that non-GAAP measures are not a substitute for GAAP and may differ from other companies' non-GAAP reporting.
  • 7Changes in accounting for share-based compensation and in-process research and development are mentioned as adjustments in non-GAAP reporting for fiscal 2010.

Frequently Asked Questions

The main purpose of this 8-K filing is to report Cisco's financial results for its fiscal first quarter ended October 24, 2009. The detailed financial information is provided through an accompanying press release and a CFO's video transcript, which are furnished as exhibits to this report.

Non-GAAP financial measures are financial metrics that exclude certain items from the GAAP (Generally Accepted Accounting Principles) figures. Cisco uses non-GAAP measures, such as non-GAAP net income and non-GAAP net income per share, because management believes they provide a clearer view of the company's ongoing operational performance and business trends by excluding items like share-based compensation and acquisition-related costs, which may not reflect the core business operations.

In this report, Cisco's non-GAAP measures generally exclude share-based compensation expense, amortization of acquisition-related intangible assets, other acquisition-related costs, and certain income tax effects related to these exclusions. They also mention exclusions for enhanced early retirement benefits and significant effects of retroactive tax legislation when applicable.

Cisco explicitly states that its non-GAAP measures are not in accordance with, or an alternative for, GAAP, and may differ from non-GAAP measures used by other companies. Investors are advised to use these non-GAAP measures in conjunction with the corresponding GAAP measures and to be aware of potential differences in calculation methods.