Cabletron beats analyst expectations by a penny

Cabletron Systems topped analyst forecasts by a penny in the third quarter.

After market close Wednesday, the holding company for network technology firms reported fiscal third-quarter net income of $6.9 million, or 4 cents per share, excluding special charges. First Call/Thomson Financial's survey of 13 analysts predicted a profit of 3 cents per share.

Third-quarter revenue rose 10.1 percent sequentially to $265.3 million from $241.1 million in the second quarter.

Cabletron's good quarter is good news for a networking market that has been hammered by concerns of a slowdown in equipment sales to telecommunications service providers and businesses. Foundry Networks and 3Com, for example, have announced earnings warnings for their current quarters.

In February, Cabletron announced plans to split itself into four separate companies targeting different areas of the networking market.

The bulk of Cabletron's revenue came from the Enterasys Network unit, which boosted revenue 8 percent sequentially to $205.8 million. Cabletron's Riverstone Networks subsidiary, which makes routers and switches for metro service providers, saw the fastest growth--30 percent to $26.8 million.

Aprisma Management Technologies, a Cabletron subsidiary that sells network management software, saw its third-quarter revenue increase 50 percent, from $13.1 million to $19.7 million. Network consulting unit GlobalNetwork Technology Services increased its third-quarter revenue 91 percent, from $6.8 million to $13 million.

Cabletron plans initial public offerings for each of the four new companies, with Riverstone being the first. Despite unfavorable market conditions, Riverstone in September filed to go public, hoping to raise $118 million by selling about 10 million shares at $12 to $14 a piece.

Including amortization and other charges, Cabletron in the third quarter lost $35.5 million, or 19 cents per share.