Financial Analysis of Cisco Systems

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Financial Analysis Of Cisco Systems (2005 – 2007) Document Owner(s) Elvira Solanes, Keith Allen, Sachin Yadav,Vijay Shankar, Xiaochen Wu Table of Contents Introduction 3 Company Overview 3 Financial Summary 3 Product Lines 4 Routing 4 Switching 4 Enterprise IP Communications 5 Security 5 Home Networking 5 Optical Networking 5 Storage Area Netwroking 5 Wieless Technology 5 Social Responsibility 5 Corporate Governance 6 Reporting Strategy 6 Organization Structure 6 Operating Environment 7 Risks 8 Legal 8 General management outlook 9 Additional notes 10 Financial performance/ position analysis 11 Quantitative analysis on financial performance 12 P/E (Price Earnings ratio) 12 Profitability…show more content…
It did so in order to better focus its resources on changing customer needs as well as emphasize its strengths in the market place. The organizational structure now consists of centralized engineering and marketing organizations. This way the company has the ability to prevent product and resource overlaps and more effectively allocate its resources to areas yielding optimum profitability. The engineering side has eleven technology groups with people heading multiple groups and reporting to one person who then reports to the CEO. The marketing side has one head who reports to the CEO as well. Operating Environment From incorporation in 1984 until around 2004, Cisco monopolized the industry of commercial routers and networking products. However, competition from rising giants like Juniper Networks Inc. (JNPR), Nortel Networks Corp (NT) and to some extent also Alcatel-Lucent (ALU) has given Cisco growing competition. Cisco is now in a position where competition drives its operating practices and inspires constant improvements in areas such as customer service and sales/marketing in order to maintain its market leadership. Though Cisco has lost market share to rising competitors, overall outlook remains good with new product lines set for production.
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