John Chambers, the longtime CEO of Cisco Systems Inc. (NASDAQ: CSCO) made a presentation to investment analysts. It contained dozens of PowerPoint slides, but the audience only cared about one. It showed that over the past two quarters, sales in China, Russia and Brazil wrecked Cisco’s short-term, and perhaps longer term, fortunes. The business press hammered the downturn in Cisco’s prospects, as dozens of media outlets predicted that Cisco’s major opportunities had died.

At the center of Chamber’s presentation was what must be considered positive news, although it was mostly overlooked. According to Reuters, he said to reporters, “If the U.S. does well we’ll pull the rest of the world out of this.” Many economists believe that the accelerated growth of the U.S. economy has already started and will only improve into 2014. Under those circumstances, America would resume its long-time role as the engine of demand for both business and consumer goods and services, with a ripple effect that will go worldwide. Chamber’s real message was optimistic. Russia and China appeared to be at the heart of his presentation. There were not.

Pessimistic analysts regard Cisco as a dinosaur, no matter where it does business. The company has too much competition in its big router business. And its expensive products will be replaced by ones that rely more heavily on software — more efficient and with lower costs to operate. The other trend that Chambers blamed for Cisco’s problems is falling sales of set-top boxes. As consumers move from the traditional boxes deployed by almost all cable companies to Internet-delivered content, set-top box revenue may continue to decline. On the other hand, while router technology may have advanced quickly, Cisco’s router systems remain at the core of much of the Internet’s infrastructure. Between the lines of Chamber’s forecasts was not a statement that Cisco had a product problem. Rather, it has a regional demand one. The risk, therefore, is that Chamber’s basic analysis of Cisco’s problems is wrong.

Ultimately, Russia and China will not kill Cisco. The company will die only if Chamber’s assessment of its product prospects is flawed.

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