John T. Chambers, Cisco Systems’ chief executive, of Cisco reported sluggish growth in its fiscal second quarter and made a disappointing forecast.
His statement that spending by government agencies on technology equipment remained depressed because of the economy and that it probably would get worse in the near future helped sent company shares down about 9 per cent in after-hours trading.
Chambers explained that Cisco was in transition, in part because of a raft of new products in its switching business. He said that because of declines in sales of consumer product and switches, Cisco expected only 4 to 6 per cent revenue growth in the current quarter. He predicted that growth would improve to 8 to 11 per cent in Cisco’s fourth quarter.
Cisco said that net income in its second quarter fell 18 per cent to $1.5 billion from $1.9 billion a year earlier. Revenue climbed 6 percent to $10.4 billion from $9.8 billion a year earlier.