Cisco Sees 19% Profit Drop; Acquires Chinese DVD Top Box Company DVN
Cisco Systems, Inc. (NASDAQ:CSCO) will be acquiring DVN (Digital Video Networks) for $44.5 million. Of that $44.5 million, $17.5 million will be paid up front and the rest of the $27 million will be paid based on sales performance. The deal is expected to close by the first half of 2010. DVN has about 160 million subscribers and the company plans to grow by another 200 million customers in the next 3-5 years. DVN will be rolled into Cisco’s International Cable Unit division.
Earlier today Cisco announced that their first quarter profit dropped 19% because of a drop in sales. However Cisco CEO John Chambers said that there are “strong sequential growth trends” as the economy is recovering. The profit posted was $1.79 billion for the quarter. This is down from $2.2 billion the year before. Cisco has recently partnered with VMware and EMC to sell data center products. Cisco plans to repurchase $10 billion worth of stock.This article was written by Amit Chowdhry. You can follow me at @amitchowdhry or on Google+ at +AmitChowdhry