On Wednesday, Cisco Systems Inc (NASDAQ:CSCO) reported its third quarter earnings and discussed the following topics in its earnings conference call. Here’s what executives shared with investors and analysts.
Tal Liani – Bank of America Merrill Lynch: My question is about the environment. I do the math right, you’re guiding for product revenues to be down 3%, 4% sequentially and I think some assumptions on services. What’s the risk that the environment is just trending down given the portfolio is in such a good shape right now, what risk that we’re just going to have another downturn like we had two to three years ago?
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John T. Chambers – Chairman and CEO: It’s a very fair question. Obviously one that we looked at very, very much. Over the last several months. When I talk to our customers they do not see that occur in their environment and traditionally even areas that have been going slow, like service providers and also the financial services industry group said their plans are to spend more the second year. However, Tal in the very next sentence they said, we are waiting to see what happens in Europe and what happens with government policy. So there’s nothing that we see in this environment that indicates either on our behalf our product portfolio as you said the most competitive ever and we think as the market share numbers come out, we will gain share in the majority of the market areas when they’re reported is in very good shape. The service providers, I think we’re in the strongest position and I think you’ll see us maintain that and almost across every product area, we are continuing to gain share mind and usually market share. In the commercial marketplace, if their business is good they spend. So, again, when we look at it, Rob, we saw a good spend in the commercial marketplace, especially in the beyond the top 2000 fortune type of account. The public sector was a little bit better than we thought that, Tal, in terms your modeling, we view it as pretty flat as you go forward. There’ll be segments that we’ll be up and segments typically down, we’ll probably talk about that in Q&As a little bit later. The enterprise is one that had changed in terms of consumer IT confidence – in terms of customer IT confidence on spending versus the last quarter and that’s got a little bit tougher. When I talk to my peers in the industry and (make no) mistake how they’ve been doing that, we can almost finish each other’s sentences on what we’re seeing around the globe from the enterprise customers. Again, not a view that things are turning down, but just very steady improvement in a uncertain and cautious wait and see type of environment in that perspective. So, while we will always watch the numbers, Tal, and we do worry when you see a trend occurring that it could be an indication of a bigger issue. I think right now I’d classify it is uncertainty and looking to see more certainty on the global economy and in Europe, and secondly more certainty in terms of government policies that can have major impacts on their business. So, it’s a nice way of saying that we’re not sure. We sure don’t like the trend in the enterprise IT spending, although we think in our product areas we control our destiny in terms of share market.
Simona Jankowski – Goldman Sachs: I just want to follow-up on the service provider business where in particular you cited the strength in APJC, and I think, you also cited those several large multiyear projects in that area that are being completed or were completed. Are those being replaced and if not, should we expect a step down in revenues in that particular area?
John T. Chambers – Chairman and CEO: Well, I think, the right way to look at it, Simona, and thank you, because we knew there would be questions on revenue growth versus order growth. The right way to think about it is what is you order growth in terms of the momentum. If you watch there will be times when there are large shipments i.e. that occurred this last quarter that bumped Asia Pacific, Japan and China up 24%, that will not occur in the next quarter. So I would watch the booking order great numbers. Now to your question, in Asia Pacific, Japan and China, we’re doing very well in the service provider market. If you look at key accounts in Japan like NTT, a Softbank, et cetera, you are seeing us gain both share of wallet and dramatic share of opportunities to monetize their networks. We talked earlier about the Korean Telecom, me and Rob, which the team just did an amazing job going from the data center all the way up to Smart Services at the end. I was just in China and India, in about whatever – a month ago, and at that time when I talked to the Chinese service providers, including the content providers and even the smart grid environments, the grid network. They understood the value of an architectural play very, very well in China. Then when I went to India, it was a shocker, and Gary, which account I’m talking about in this, for the first time one of the major telcos there who has traditionally had everybody imaginable in their network, and viewed their job as being the systems integrators, is now seriously looking at us for truly an end-to-end type of architecture. So, Simona, service provider very strong Asia-Pacific, Japan and China; we’d anticipate continuing to get our share plus some in that environment. We saw service provider in the U.S. very solid with a 9% increase, and I think, we’re doing better in the MSOs as well as in the traditional telco group. Latin America was a little bit weaker than we’d like to see and that has to do with some of the European service providers business in Latin America on it. Europe we were good in what we call our select top 5 or 6 service providers, with good – I think, the growth is almost 20% year-over-year, if I remember right, but we were not near as good in the individual country service providers. They are starting to see the effect of the economic and other challenges. So, Simona, it’s a nice way of saying, trending in terms of what’s available looks good, and we believe we’ll continue to get our share plus some in service provider, barring a major surprise.