F5 Networks sees weakness spilling into 2013
(Reuters) - Network gear maker F5 Networks Inc (FFIV.O) forecast a weak first-quarter as its large U.S. enterprise and telecoms customers reduced spending, sending its shares down as much as 12 percent in trading after the bell.
F5 expects first-quarter earnings to be between $1.14 and $1.16 per share, before items, on revenue of $363 million to $370 million.
Analysts were expecting earnings of $1.20 per share on revenue of $373.5 million, according to Thomson Reuters I/B/E/S.
The company said on a conference call that macroeconomic uncertainty led many of its larger customers to slow down or reduce spending.
Network equipment makers have been hit as telecom service providers -- their biggest customers -- cut spending due to a faltering U.S. recovery and weakness in Europe.
Rival Juniper Networks Inc (JNPR.N) forecast current-quarter results below expectations on Tuesday, citing cautious customer spend.
F5 said on the call that it had "reasonable" sales growth for orders up to $1 million in size, but saw a drop off in orders above $1 million.
Electronic parts distributor Avnet Inc (AVT.N), one of F5's biggest distributors, said earlier this month that it expects first-quarter revenue at the low end of its prior forecast, indicating depressed technology spending particularly in the Americas.
F5 posted an adjusted fourth-quarter profit of $1.12 per share, below analysts' expectations of $1.18 per share.
While revenue grew in double digits for the eleventh straight quarter, it missed analysts' estimates.
Shares of the company were trading at $83.29 after market. They closed at $93.32 on the Nasdaq on Wednesday.
(Reporting By Aurindom Mukherjee and Neha Alawadhi in Bangalore; Editing by Akshay Lodaya and Roshni Menon)
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