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Cisco, the networking king and economic bellwether, cleared better-than-expected earnings of $2.09 billion, or 39 cents a share, up 10.6% year-over-year, in its first fiscal quarter, which closed at the end of October. Revenues were up 5.5% to $11.9 billion despite depressed demand in key markets like Europe, down 10%, and long-term threats from widgetry like software-defined networking. CEO John Chambers called the economy "challenging." Cisco's core switching and routing sales, representing 47% of revenue, both declined 2% year-over-year, to $3.6 billion and $2.1 billion respectively. Switching was hit by slowing in the public sector and developed countries. The routing segment was hurt by weakness in service providers, especially in EMEA, although Cisco did see double-digit growth in edge routing. Europe was down 10% and government sales down 6%. Still Cisco beat... (more)

Workday to IPO Next Week

Workday, the cloud-based HR start-up co-founded by ex-PeopleSoft executives David Duffield and Aneel Bhusri, who vamoosed after Oracle acquired PeopleSoft in a hostile takeover in 2005, is set to go public next Friday. It means to sell 22.75 million Class A shares for between $21 and $24 each. Using the mid-point between those two theoretical prices it would raise $512 million and be valued at $3.85 billion. It won't finally price until October 11. Workday is using a dual-class stock structure that will keep control of the company in the hands of its founders. Duffield and Bhusri will hold about 67% of the votes once the company goes public on the New York Stock Exchange under the ticker symbol WDAY. Morgan Stanley and Goldman Sachs are the lead underwriters. The company took in a total of $175 million in venture capital that included money coming from Duffield and... (more)

Violin Gets $96 Million to Tide It Over Till IPO

Flash storage array start-up Violin Memory is storing up greenbacks. According to an amended SEC filing made late last week it's gotten $96.3 million out of what may become $130 million in new funding. All Things Digital reports hearing the financing was done at an implied valuation of $850 million to fund operations ahead of a delayed IPO that was supposed to come off late last year and is now supposedly targeted for early May. Granted that seems an awful lot of money for just a few months. Violin reportedly filed to go public under that newfangled Jumpstart Our Business Startups Act that lets companies keep their financials hush-hush until close to going public. As of last April Violin had raised $172 million, money that came from Juniper Networks, Toshiba, SAP Ventures, Highland Capital and GE Capital. The new money reportedly comes from a flock of 126 private inve... (more)

IBM Exec Out on Bail as Galleon Sinks Below the Waves

CEOs in Technology Galleon Group, the $3.7 billion hedge fund at the center of the insider trading ring that the government, its wire taps and a reportedly secret SEC data-mining project exposed last Friday, is liquidating its funds and shutting down following what amounts to a run on the bank, according to a letter sent to its investors Wednesday. Buyers are reportedly at the ready. Galleon has big positions in Google among others and was one of the three biggest technology hedge funds. If it dumps its stock, it could bring prices down. Robert Moffat, the senior IBM executive responsible for the company’s $5.4 billion hardware business who personally transmitted an acquisition offer letter to Sun on IBM’s behalf earlier this year, was indicted last week along with five other conspirators in the scheme and is out on $2 million bail. Described in a Wall Street Jour... (more)

HP Still Golden

HP revenues were up 13% year-over-year to $30.8 billion in the fiscal second-quarter ended April 30. A favorable exchange rate tickled the percentage rate to the tune of four points and HP's recent 3Com acquisition, which closed during the quarter, contributed $50 million. Earnings were up 28% to $2.2 billion or 91 cents a share. Its operating margin worked out to 9.3%, up 0.9%. HP was expected to return $1.05 a share on $29.81 billion. CEO Mark Hurd called it an "exceptional quarter with strong performance across every region." Growth was called broad-based driven with enterprise systems and storage up 31% to $4.5 billion, PCs up 21% to $10 billion, and printing up 8% to $6.4 billion. Deferred purchases are starting to come back and Hurd was relatively buoyant about Europe. CFO Cathie Lesjak said the demand environment was improving - more from SMBs than the larg... (more)

Windows Sales Weaken for Second Time in a Row

Microsoft came in with its fiscal Q3 numbers Thursday and Windows revenues were off for the second quarter in a row. This time they dipped 4% compared to last year settling at $4.44 billion because of Apple and a nasty 40% year-over-year decline in netbooks. Two weeks ago IDC called PC shipments off 3.2% in calendar Q1 and Microsoft, unlike Intel, figures that the market was off 1%-3%, making its performance roughly in line with analysts' findings. Still and all total revenues cleared $16.43 billion, up 13% over last year, against Wall Street expectations of $16.19 billion, with earnings up 31% to $5.23 billion if only because of a nickel-a-share tax credit. Actually EPS came in where the stock market predicted at 56 cents a share. CFO Peter Klein called the PC environment "mixed," and, as expected, the enterprise proved to be stronger than the consumer. Business PC ... (more)

Dani Gets 30 Months in the Slammer

Ex-beauty queen-turned-inside trader Danielle Chiesi, the ex-lover of ex-IBM server chief and ex-CEO candidate Robert Moffat, was sentenced to 30 months in jail Wednesday followed by two years probation and 250 hours of community service. She pleaded guilty to three counts of conspiracy to commit securities fraud in January after her case was severed from her buddy's Galleon hedge fund founder Raj Rajaratnam, who was subsequently found guilty of 14 counts of securities fraud and conspiracy. Rajaratnam is expected to be sentenced to a very long time in the slammer in late September. Wiretaps of Chiesi and Rajaratnam's trading inside information on companies like AMD and IBM were a high point of his trial. Her lawyers had asked for less than 27 months arguing that she was the victim of a "toxic," psychologically manipulative sexual relationship with Mark Kurland, h... (more)

Cloud Player Drops IPO Plans

Spooked by the "volatile economic climate" and "current market conditions," GlassHouse Technologies, which provides cloud, virtualization, security and next-generation data center consulting and managed services, has dropped its plans to IPO. It said it would withdraw the registration statement that it filed with the SEC last year thinking it could raise $75 million. It'll be the second time GlassHouse has scrubbed an IPO. It wanted to raise $100 million in 2007 but pulled those papers two years later because of market conditions too. The 10-year-old Pennsylvania company has raised close to $87 million over five rounds from VCs, according to CrunchBase, including not insignificant contributions from Cisco and Citrix. ... (more)

OK, So Here’s the Plan: Yahoo’s CEO

Yahoo's still wet-behind-the-ears CEO Scott Thompson, who just laid off 2,000 Yahoos to save $375 million a year, has laid out the gist of the expected reorg he has in mind for the joint, and naturally his internal memo escaped into the wild. Whether there's a redemptive strategy in it to stop Yahoo's revenues from being chipped away by Facebook and Google rather than just an exercise in moving the deck chairs around on the Titanic isn't clear. In the memo Thompson confirmed what is already widely known: Yahoo's Chief Product Officer Blake Irving is leaving and taking the centralized products group with him. The company is supposed to be reorganizing around customers and starting May 1 it will be divided into three operating groups - Consumer, Regions and Technology - "charged with delivering the best customer experiences." The Consumer group will also be divided i... (more)

Google’s Stock to Split 2 for 1

Rather than pay a cash dividend, which is culturally repugnant to so-called growth stocks, Google said late Thursday, after posting better-than-expected results, that it would repay its stockholders, who must be dizzy from all its up and down movement, by giving them more non-voting stock, effectively a two-for-one tax-free stock split. It will create a “new class C stock” that trades under a different ticker symbol. In a letter on the Google web site Google founders Larry Page and Sergey Brin restated their control over the massive company because they, along with chairman Eric Schmidt, own the only real voting stock, which won’t be part of the split. They also hold a lot of the non-voting Class A stock and even as Class B holders will get the new class C stock. Page said in passing that Google isn’t planning any big acquisition soon. Google has its eye on Apple’... (more)

Apple Taunts the Bears, Posts Blow-Out Quarter

After the bears lopped $70 billion off of Apple's value in the last few days, the company went bear hunting Tuesday crushing estimates. Net profits in the March quarter were up 94% year-over-year to $11.6 billion returning $12.30 a share compared to estimates of $10.04 on revenues of $39.28 billion against projections of $36.81 billion. Apple sold a completely unexpected 35.1 million iPhones, up 88% and only two million short of Christmas, plus 11.8 million iPads - up 151% even though the new one was only released mid-quarter - and even a respectable 7.7 million iPods, down 15%. Macs, another spot that had the bears worried, were good for four million units, up 7% and in line with estimates, although Apple admitted they suffered iPad cannibalization. International sales accounted for 64% of revenue. China, which kicked in $7.9 billion worth of revenues, helped boost... (more)