By Nicola Leske
Feb 12 Cisco Systems Inc on Wednesday
forecast a 6 to 8 percent revenue slide this quarter, roughly in
line with Wall Street expectations, as the network gear maker
struggles with sluggish emerging markets like China.
The outlook marks another severe decline in sales for the
former high-flying tech company, which has blamed its poor run
on a boycott of U.S. equipment after revelations of American
spying efforts globally.
Cisco's outlook for the fiscal third quarter ending April
translates to a forecast for revenue of between $11.2 billion
and $11.5 billion, versus the $11.3 billion analysts expect on
Shares in the company slipped 4.3 percent to $21.89 in
extended trade, from a $22.85 close on the Nasdaq.
In the second quarter, revenue from routers and switching
equipment, which together make up slightly more than half of the
company's overall revenue, both contracted more than 10 percent.
The company reported revenue of $11.2 billion in its second
fiscal quarter, down from $12.1 billion a year earlier. Wall
Street on average expected Cisco to report of $11.03 billion,
according to Thomson Reuters I/B/E/S.
Asia Pacific sales fell 4 percent to $1.8 billion in the
fiscal second quarter ended January. But revenue in the Americas
led declines, with a 9 percent fall in the quarter.
"They put a pretty low bar for the second quarter. They
reached their numbers on the reset. It shows the environment has
stabilized," said Zeus Kerravalla at ZK research.
Cisco reported non-GAAP earnings of 47 cents per share in
the second quarter, a penny better than the 46 cents expected.
"The strong quarter is usually the fourth quarter and they
have some product transitions to go through. I am curious to see
how emerging markets did," Kerravalla said.