NEW YORK (Reuters) - Cisco Systems Inc (CSCO.O) gave a weaker-than-expected revenue growth forecast and said its U.S. and European customers were being increasingly cautious, sending its shares down 7 percent on Wednesday.
The technology bellwether, which makes network equipment for phone companies and other businesses, also said it would not provide a view for fiscal 2008 due to uncertainty.
Cisco forecast fiscal third-quarter revenue to rise 10 percent year-on-year, short of the 15 percent growth expected by Wall Street, according to Reuters Estimates.
The outlook overshadowed a 7.2 percent increase in Cisco's second-quarter profit, which was in line with expectations.
"We are seeing our U.S. and European customers being increasingly cautious," Chief Executive John Chambers said on a conference call.
His comments also dragged down other technology shares in extended trading. Hewlett-Packard Co (HPQ.N) shares fell 1.8 percent, IBM (IBM.N) fell 1.5 percent, Microsoft Corp (MSFT.O) fell 1.4 percent and Google Inc (GOOG.O) lost 1.3 percent.
Cisco is the world's top maker of the routers and switches that direct traffic on data networks. It earns much of its revenue from enterprises which buy its equipment to run office networks.
Its shares have fallen about 28 percent since Chambers said in November that the company was seeing dramatic decreases in orders from U.S. banks.
For the fiscal second quarter ended January 25, Cisco said the profit was $2.1 billion, or 33 cents per share, compared with $1.9 billion, or 31 cents a share, in the year-ago quarter.
Earnings per share before unusual items were 38 cents, matching the average analyst forecast according to Reuters Estimates.
Sales rose 16.5 percent to $9.8 billion, in line with expectations.
Cisco has been moving into new markets such as video conferences and high-end video conferences, and also owns television set top box maker Scientific Atlanta.
Moving into the second half of its fiscal year, Chambers said the San Jose, California-based company was in good shape with a product pipeline that is well developed, and it's seeing balanced momentum across its core and advanced technology groups.
Cisco shares initially rose after the results to $23.84, but then fell to $21.42 following Chambers' outlook. The stock earlier closed 0.8 percent lower on Nasdaq at $23.08.
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