Updated from Feb. 6
Following a Wednesday report where the San Jose, Calif., networking equipment maker met Wall Street's second-quarter estimates, the company told analysts that January was "challenging."
CEO John Chambers, speaking on a conference call, cut fiscal third-quarter guidance to 10% growth, down from the 15% previously expected. Chambers said the slump in demand he saw in January "may continue over the next several months."Shares of Cisco sank 9% in premarket trading Thursday to $21, a 52-week low. While cutting the current quarter's forecast, he did reiterate that the company's long-term annual growth rate will continue to be somewhere between 12% and 17%. The news comes after Cisco reported adjusted earnings of $2.4 billion or 38 cents a share for the quarter ended last month. That's up 15% from the pro forma profit in the year-ago period. Analysts were looking for 38 cents in adjusted earnings. Cisco typically comes in a penny higher than analysts' estimates. Sales for the quarter ended last month were $9.8 billion a 16% increase over the $8.4 billion revenue level last year. The top-line number slightly beat analysts estimates that called for sales of $9.79 billion. Cisco shares had been down one-third in the past three months as investors feared the drag from a slowing economy and a slide in tech spending.