Cisco Outlook Misses Expectations; May Cut Jobs (1,000-2,000)

[OhioChick]

Source: Reuters

John Chambers said the company would continue a cost-cutting process that could result in a loss of 1,500 to 2,000 jobs.

By Reuters
February 4, 2009 07:55 PM

NEW YORK - Cisco Systems (NSDQ: CSCO) Inc Chief Executive John Chambers forecast a far sharper drop in current-quarter revenue than Wall Street had expected, and said the network equipment maker may cut up to 2,000 jobs as economic weakness spreads.

The forecast Wednesday pushed Cisco shares down 4 percent in after-hours trade, overshadowing its stronger-than-expected quarterly results. It also dragged down Nasdaq and Standard & Poor's 500 index futures, suggesting some turbulence could hit the tech sector Thursday.

Chambers told analysts on a conference call that he expects revenue in the current, fiscal third quarter to fall 15 percent to 20 percent from a year ago. That compared with the average analyst forecast for a 10.5 percent fall to $8.8 billion.

He said economic weakness had spread beyond the United States and Europe, with revenue from emerging markets falling 11 percent in the fiscal second quarter ended Jan. 24.

Low visibility in the current economic environment meant it was one of the most difficult periods in his career for making financial forecasts, Chambers said.

He said the company, which ended the quarter with more than 67,318 employees, would continue a cost-cutting process that could result in a loss of 1,500 to 2,000 jobs.




Read more: http://www.informationweek.com/news/infrastructure/routers/showArticle.jhtml?articleID=213200090

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Just never ends....

[CatholicEdHead]

1. Ouch

Cisco is a major networking player. They are not going away but it is a sign of the times. As long as the internet 'tubes' need to be maintained, Cisco will be there.

[brentspeak]

2. Another example how quarterly profit reports dictate a company's actions

Short-term profits for shareholders = all that matters to corporate America.