Cisco 2012 Annual Report Download - page 3

Cisco Systems, Inc. 1
Annual Report 2012
Letter to Shareholders
To Our Shareholders, Reflecting on fiscal 2012, it was a year
in which Cisco struck a balance between
staying the course where appropriate,
adjusting when needed, and continuing
to reinvent ourselves. And what we are
most proud of is that we did what we
said we would do—we delivered for our
shareholders, customers, and partners.
There are a number of key takeaways
from fiscal 2012. Cisco grew earnings
per share at more than twice the pace
of revenue for the fiscal year. We also
positioned ourselves for the future
in terms of product innovation and
gaining market share across most of
our categories, including those in which
we were already leading. Additionally,
we were able to pull away from many
of our competitors by delivering unique
value to customers and partners, for
which we achieved exceptional customer
and partner satisfaction levels. And we
significantly improved shareholder value.
Despite the macroeconomic challenges,
including uncertainty in the European
market and lackluster global public
spending, that impacted many in our
industry, fiscal 2012 was a very solid year
for Cisco.
During the fiscal year, we continued
our focus on Cisco’s transformation, an
effort we began in the second half of
fiscal 2011. We invested in the things
that were working, realigned resources
to support key opportunities, evolved
our leadership, and strengthened our
operational discipline. We exited the
fiscal year at a lower expense run-rate
than we were operating under at the
start of the year. We are pleased with
our progress to date, and we remain
focused on creating greater value for our
customers, partners, employees—and for
you, our shareholders.
THE RIGHT VISION AND STRATEGY
Our vision and strategy—to become our
customers’ most strategic business
partner by delivering intelligent
networks and technology and business
architectures built on integrated products,
services, and software platforms—is,
in our view, enabling our customers’
success, as well as our own. Our success
in the service provider market is one of
the best examples of how our vision and
strategy is working. In this market, we
have evolved from being a box provider
to being a technology provider to being
one of our customers’ top strategic
business partners by solving their most
complex issues. We set our sights on
this market over a decade ago, and by
staying the course and adjusting when
needed, we believe we have broken away
from most of our peers in the industry
as we have helped our service provider
customers achieve their technology and
business goals.
If you think about what we did with
The London 2012 Games, it’s a great
example of our ability to strategically
partner—in this case, with the British
Government, the London Organizing
Committee of the Olympic and
Paralympic Games, British Telecom,
and broadcasters such as NBC—to drive
incredible outcomes and experiences
for London 2012 participants, attendees,
and viewers. Cisco provided network
infrastructure for the London 2012
Games that enabled 1,800 Wi-Fi hot
spots and 80,000 data connections and
had a capacity four times larger than the
network infrastructure in any previous
“There is no question that our industry is rapidly changing, and both Cisco and the network are at the heart of the major
market transitions underway. We believe that our long-term strategy, which is focused on delivering intelligent networks
and technology and business architectures built on integrated products, services, and software platforms, is the right
one to help our customers achieve their top priorities and fuel our success over the long run.”
- John Chambers, Chairman and CEO