Strong financial results from Internet infrastructure equipment maker Cisco Systems are a good sign that the economic recovery is under way.
The company on Wednesday reported that profits for its second fiscal quarter, which ended January 23, were up 23 percent compared to a year ago. The company reported profits of $1.9 billion, or 32 cents a share. A year ago, it reported a profit of $1.5 billion, or 26 cents a share.
Revenue was $9.8 billion, an 8 percent increase compared to the same period a year ago. Cisco had not seen year-over-year revenue growth since October 2008. Analysts had expected the company to report revenue of $9.4 billion.
CEO John Chambers said he saw positive results across the board and he indicated the economic environment is improving globally.
"During the quarter we saw dramatic across-the-board acceleration and sequential improvement in our business in almost all areas," he said in a statement.
Results from Cisco are closely watched by others in the technology sector as well as those outside of technology. Cisco sells its routers and switches to large businesses and Internet service providers. And more spending among its customers could signal an overall return to spending by corporate customers.
During the recession, technology companies reigned in spending. But now it looks like companies are ready to start spending again to upgrade their networks.