Cisco predicts weak quarter, job cuts
Cisco has predicted a weaker than expected performance for the quarter to end July
Cisco has warned that it expects a weaker than expected performance in its financial fourth quarter, which began in May.
Speaking in an analyst call to announce fiscal Q3, Cisco CEO John Chambers warned that sales growth in Q4 will be between 0% and 2%, below analyst expectations of 7%.
The company also warned that is looking to cut jobs, with a target of saving $1bn per year. Job cuts were most likely to come through early retirement programmes, although Cisco has already shed 550 jobs with the closure of its Flip unit.
For the quarter ended 30th April, Cisco reported sales were up 4.8% to $10.9 billion, although income was down 17.6% to $1.8bn from $2.2bn in the same period of 2010.
"This quarter played out as we expected," said Chambers. "We have acknowledged our challenges. We know what we have to do. We have a clear game plan, and we are a company with a track record of market-shaping innovation."