A 46 Percent Drop in Profit and Cisco Still Beats Estimates?

Hard to believe that this is good news: Cisco reported a 46 percent decline in quarterly profit this afternoon, posting Q4 earnings of 31 cents a share on sales of $8.54 billion, compared with 40 cents a share on sales of $10.36 billion in the same period last year.

An appalling drop. But one that investors welcomed, because as lousy as its performance might seem, Cisco’s earnings still managed to beat the Street. Analysts who follow the company had expected it to report earnings of 29 cents a share on revenue of $8.52 billion.

Is this what they mean by “green shoots”? Sigh.

“Cisco delivered very solid quarterly and annual results in a challenging economic environment, as we continued our focus on disciplined execution and our customers’ success,” Cisco CEO John Chambers said in a statement. “We are confident in our strategic position in both existing and thirty adjacent markets. We saw a number of positive signs this quarter in the economy and in our business, especially comparing our sequential quarter-over-quarter order trends. If we continue to see these positive order trends for the next one to two quarters, we believe there is a good chance we will look back and see that the tipping point occurred in our business in Q4.”

Cisco (CSCO) shares are up two percent at $22.60 on the news.