Cisco's (Nasdaq: CSCO) net profit was down 17.6% year-on-year to US$1.8bn during the fiscal third quarter of 2011, ended April 30, according to financial results released by the company.
Net sales were up 5% during the quarter to US$10.9bn, from US$10.4bn in 3Q10, but higher cost of sales and operating expenses dragged on the bottom line.
"This quarter played out as we expected," said Cisco CEO and chairman John Chambers. "We have acknowledged our challenges. We know what we have to do."
Last month, Chambers sent a message to all staff members addressing the state of the company and promising upcoming changes in operations, saying Cisco had "disappointed" investors and "confused" its employees.
"We have been slow to make decisions, we have had surprises where we should not and we have lost the accountability that has been a hallmark of our ability to execute consistently for our customers and our shareholders," Chambers said in the letter. "That is unacceptable. And it is exactly what we will attack."
During the quarter, Cisco bought 54mn shares of common stock through its repurchase program at an average price of US$18.39 per share. Since the start of the program, the company has repurchased and retired 3.4bn shares, with US$11.7bn remaining to buy back stock.
Cisco also highlighted the acquisition of privately held software provider newScale and the completed acquisitions of digital media processing platforms provider Inlet Technologies and network configuration and change management provider Pari Networks.
Use this link to view the results.
At time of publication, Cisco was trading on Nasdaq at US$17.01, down 4.33% on market jitters over the company's growth prospects.