Cisco's stock price (CSCO on NASDAQ) increases to $28.85 from prior day low $$27.12 based on a 36% jump in net income and a 27% rise in revenues for its second quarter.
As we wrote in our January 25 article
Cisco International Sales, emerging markets continue to fuel revenue growth for the company's network and Internet equipment.
Momentum from emerging markets was certainly firing on all cylinders in Cisco's latest quarter: Overall revenue growth from emerging regions was up some 40% from last year. Russia and Africa accounted for 12% of Cisco's product orders, up from 11% in the prior quarter.
Cisco's large size allows the company to dominate emerging markets, which is why analysts expect Cisco to maintain its 40% growth rate in emerging markets for several years. In such markets, margins tend to be higher and operating expenses lower.
Many stock analysts are just now upgrading Cisco's ratings. We were ahead of the curve, writing about Cisco's global trade success over two weeks before its stellar quarterly results were released.
Our research uncovered the fact that Internet Protocol TV (IPTV), television delivered over a broadband connection, and online videos are global consumer products that require Cisco's advanced network products.
Read more about Cisco products.
Telecom carrier spending on video, cable operators' upgrades and the "healthy growth in user-generated video" is expected to strengthen demand for Cisco's products in the second half of this year and in 2008.
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