Cisco’s Profit Rises 35%, Beating Forecasts

Cisco Systems Inc.’s fiscal third-quarter profit rose 35% as the No. 1 computer-networking company won new customers and added profitable products, offsetting slowing sales of older equipment. Profit before charges was $483.2 million, or 45 cents a diluted share, compared with profit before a gain of $358 million, or 35 cents, a year ago. Analysts expected the company to earn 44 cents. While leading technology companies such as Intel Corp. and Compaq Computer Corp. have been hurt by falling PC prices and slowing demand, Cisco is riding a surge in Internet traffic as it pushes into the market for equipment sold to phone companies and online service providers. It’s also selling more switches that speed data on networks and commanding higher prices than its competitors because of its wide range of products. Cisco shares rose as high as $75.50, a record, in trading after the close of U.S. stock markets. The shares fell $1.31 to $73.63 before the earnings were released. The San Jose-based company’s revenue in the quarter ended April 25 rose 32.5% to $2.18 billion from $1.65 billion.