Cisco 2008 Annual Report Download - page 14

2008 Annual Report 19
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
The Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements
regarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933 (the “Securities
Act”) and the Securities Exchange Act of 1934 (the “Exchange Act”). All statements other than statements of historical facts are statements
that could be deemed forward-looking statements. These statements are based on current expectations, estimates, forecasts, and
projections about the industries in which we operate and the beliefs and assumptions of our management. Words such as “expects,”
“anticipates,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “continues,” “endeavors,” “may,” variations of such
words and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to projections
of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or
circumstances are forward-looking statements. Readers are cautioned that these forward-looking statements are only predictions and are
subject to risks, uncertainties, and assumptions that are difficult to predict, including those identified below, as well as on the inside back
cover of this Annual Report to Shareholders and under “Part I, Item 1A. Risk Factors,” and elsewhere in our Annual Report on Form 10-K.
Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no
obligation to revise or update any forward-looking statements for any reason.
Overview
We sell Internet Protocol (IP)-based networking and other products and services related to the communications and information technology
industry. Our products and services are designed to address a wide range of customers’ business needs, including improving productivity,
reducing costs, and gaining a competitive advantage. Our corresponding technology focus is on delivering networking products and
solutions that simplify and secure customers’ infrastructures and offer integrated services. Our products and services help customers
build their own network infrastructures that support tools and applications that allow them to communicate with key stakeholders, including
customers, prospects, business partners, suppliers, and employees. At a high level, we group our product offerings into the following
categories: our core technologies, routing and switching; advanced technologies; and other products. In addition to our product offerings,
we provide a broad range of service offerings, including technical support services and advanced services. Our customer base spans
virtually all types of public and private agencies and businesses and primarily consists of large enterprise companies, service providers,
commercial customers, and consumers.
In fiscal 2008, we achieved record financial results. Our results for fiscal 2008 reflected increases in net sales, net income, and net
income per diluted share from fiscal 2007, as we have continued to achieve balance in year-over-year revenue growth from our products
and services, customer markets, and geographic theaters. We believe this balance is attributable in part to the successful implementation
of our strategy. Net income and net income per diluted share increased by 10% and 12%, respectively, in fiscal 2008 compared with
fiscal 2007.
Strategy and Focus Areas
We believe the growth we experienced in fiscal 2008 was attributable to the continued deployment by customers of our end-to-end
architecture and the convergence of data, voice, video, and mobility into IP networks. In addition, our approach of achieving balance
across products and services, customer markets and geographic theaters contributed to our growth and strong financial position.
Video applications, including IP television (IPTV), Cisco TelePresence systems, unified communications, physical security and other
video products, have the potential to accelerate the growth of bandwidth demand and to increase loads on networks, which may require
upgrades to existing networks. We delivered several new products during the year, and we are pleased with the breadth and depth of
our innovation across all aspects of our business and the impact that we believe this innovation will have on our long-term prospects.
From a geographic perspective, we are focusing on expanding our presence in the Emerging Markets theater, and we are making
additional investments in emerging countries, China and India in particular. From a customer markets perspective, we are continuing
to invest in the enterprise, service provider, commercial, and consumer markets.
The investments we have made and our architectural approach are based on the belief that collaboration and networked Web 2.0
technologies that enable user collaboration, including unified communications and Cisco TelePresence systems, and the increased use of
the network as the platform for all forms of communications and information technology will create new market opportunities for us. As part
of the second major phase of the Internet, we believe the industry is evolving as both personal and business process collaboration enabled
by networked Web 2.0 technologies help to increase innovation and productivity. We will endeavor to lead this market transition both
through product development and adoption in the external customer marketplace and through our own internal adoption and use.