Cisco Says It Will Cut 4,000 Jobs
NEW YORK (AP) — Cisco’s earnings and revenue grew in the latest quarter as demand for its computer networking equipment increased. But CEO John Chambers called the global economy “challenging and inconsistent,” and the company said it is cutting about 4,000 jobs, or about 5 percent of its workforce.
The company’s revenue guidance for the current quarter was weaker than Wall Street expected, and shares fell sharply in extended trading.
Cisco Systems Inc. earned $2.23 billion, or 42 cents per share, in the three months that ended on July 27. That’s up from $1.92 billion, or 36 cents per share, a year earlier.
Adjusted earnings were 52 cents per share in the latest quarter, squeaking past Wall Street’s expectations by a penny. This figure excludes charges stemming from a patent settlement with TiVo and other one-time items.
Revenue rose 6 percent to $12.42 billion from $11.69 billion.
Analysts, on average, had expected revenue of $12.41 billion, according to a poll by FactSet.
Cisco’s performance is widely regarded as a bellwether for the technology industry. That’s because the San Jose company cuts a broad swath, selling routers, switches, software and services to corporate customers and government agencies. In addition, Cisco’s fiscal quarters end a month later than most other major technology companies, giving it additional time to assess economic conditions.
“Now, more than ever, our customers and our partners want Cisco’s help navigating the inconsistent global landscape successfully,” Chambers said in a statement.
For the current quarter, Cisco said it expects revenue to grow by 3 percent to 5 percent year over year. Analysts are expecting $12.72 billion, a 7 percent increase from last year’s $11.9 billion.
The company’s fell $2.49, or 9.4 percent, to $23.89 in extended trading after the results were released. The stock closed up 6 cents at $26.38 in the day’s regular trading session.Related