Cisco Net Beats Views; Sales Best In 3 Years But Some Want More; Shares Lower After Hours; Many analysts had hoped Cisco would meet or beat Juniper's sales forecast.(A)

Byline: MIKE ANGELL

Network gear spending is back -- but not as strongly as some people had hoped.

The leading maker of networking equipment, Cisco Systems Inc., reported strong fiscal second-quarter numbers Tuesday, echoing similar results from its smaller peers. Cisco's report was another sign that spending on telecom gear is growing again after shrinking for three years. Still, Cisco's sales forecasts were short of some expectations, and the company's shares fell in after-hours trading.

Cisco also reported some problems with manufacturing, which may have bothered investors. Even so, analysts see Cisco as the premiere company in data networking.

"Things are darn good for this company," said Merriman Curhan Ford & Co. analyst Chet White. "They had such a lull. We haven't had service providers and Fortune 500 companies investing in networking, and that seems to be happening now."

For the second quarter in a row, Cisco beat analysts' expectations. The company earned 18 cents a share in the quarter ended Jan. 24, up 20% from a year earlier. Analysts polled by Thomson First Call expected Cisco to earn 17 cents a share.

Including the effects of a charge relating to an acquisition, Cisco earned 10 cents a share.