The Night Watch: Cisco Slumps in After-Hours After Earnings Miss

Updated from 6:16 p.m. EST

No doubt, recent earnings results have publicized just how weak business has been over the past few months.

Tonight's latest news, from

Nasdaq Composite Index bellwether

Cisco

(CSCO) - Get Report

, has revealed that even technology giants aren't immune to tough times. (

TSC's

Scott Moritz has been covering the

company's earnings news in a separate story.)

After the closing bell, Cisco reported that it missed Wall Street's earnings and revenue estimates for the fiscal second quarter. The networking equipment manufacturer announced a profit of 18 cents per share, up from the year ago result of 12 cents per share. But analysts had expected Cisco to earn 19 cents per share, according to

First Call/Thomson Financial

. Prior to today's announcement, the tech titan had beaten earnings estimates by a penny for 12 successive quarters.

Second-quarter sales jumped 55%, to $6.75 billion from $4.36 billion a year ago, leaving Cisco more than 6% short of Wall Street's $7.2 billion revenue forecast. The company didn't offer specific forward guidance in its postclose press release, but did say "we remain cautious about the implications of a brief pause in the current 10-year expansion of the U.S. economy." Cisco added that it "has never been better positioned" to help its customers.

Cisco, which has set the mood for tonight's after-hours trading session, was lately down 6.3% to $33.50 on

Instinet

and lower 6.1% to $33.56 on

Island

ECN. In recent action, about 3 million shares of the networking giant had changed hands on each platform.

Networking Stocks Fall In Sympathy

As might be expected, other networking stocks have also captured investors' attention in extended trading. Cisco rival

Juniper Networks

(JNPR) - Get Report

, which has seen volume of close to 500,000 shares on Island and nearly 300,000 shares on Instinet, was behind 2.9% to $99.25 on Instinet and down 3.1% to $99 on Island.

Separately,

PMC-Sierra

(PMCS)

, which manufactures semiconductor networking solutions, was off 4.3% to $63.69 on Instinet and lower 4.2% to $63.75 on Island. And

Sycamore Networks

(SCMR)

, a company that manufactures fiber-optic networking, dropped 3.5% to $64.26 on Island.

Large-Cap Tech Stocks Slide

Large-cap Nasdaq stocks have suffered losses alongside Cisco, a bellwether for the broader technology index, this evening.

Sun Microsystems

(SUNW) - Get Report

shed 1.6% to $27.38 on Instinet and slid 1.6% to $27.37 on Island. Sun

said today that demand in January didn't pick up from a weak December.

Dell Computer

(DELL) - Get Report

lost 1.4% to $26.50 on Instinet and missed 1.9% to $26.36 on Island.

Intel

(INTC) - Get Report

dropped 1.2% to $35 on Instinet and decreased 1.9% to $34.75 on Island. And

Oracle

(ORCL) - Get Report

declined 0.9% to $27.38 on Instinet.

Aether Systems Rocks on Fourth-Quarter Results

In other news, wireless data provider

Aether Systems

(AETH)

reported a fourth-quarter loss that beat analysts' estimates, with revenue up sharply from the year-ago period.

Aether reported a fourth-quarter loss of 90 cents per share, compared with a loss of 18 cents per share in the comparable quarter last year. According to First Call, analysts had called for the company to lose $1 per share in the latest quarter. The company reported quarterly revenue of $25.8 million, up sharply from $4 million in the year-ago period.

On the night watch, Aether gained 7.2% to $46.75 on Instinet and added 6.3% to $46.38 on Island, having dropped 6.8% in the regular session.

Digital Island Pops on Patent News

After the closing bell,

Digital Island

(ISLD)

, which provides Internet infrastructure solutions, announced that it was awarded a patent covering aspects of its broad-based inventions that improve the speed and efficiency of delivering digital content over the Internet.

As a result, postclose patrons bid Digital Island's stock up 12.5% to $5.34 on Island.

Cnet Sinks on Earnings Outcome

Elsewhere, Internet media company

CNet Networks

(CNET) - Get Report

reported fourth-quarter earnings, in line with Wall Street's forecasts, but the company narrowly missed revenue forecasts and said that revenue next year would fall short of estimates.

CNet reported earnings of 9 cents per share, matching Wall Street's targets and reversing the year-ago loss of 21 cents per share. The company reported revenue of $120 million for the fourth quarter, shy of the $122.9 million consensus estimate. What's more, CNet said that it would cut its staff by 10% and discontinue "certain non-growth or unprofitable businesses."

Shares of CNet dropped sharply in extended action, falling 11.4% to $14.06 on Island.

Futures Indicate Ugly Open

On the heels of Cisco's earnings release, the

S&P 500 futures on

Globex

were down 4.3 points at 1352 about 6 points below

fair value and suggesting weakness for Wednesday's start. The

Nasdaq 100 Securities

were behind 39 to 2,451, about 45 points below fair value and suggesting a dismal start for the Nasdaq tomorrow.

This information is provided by Instinet, a wholly owned subsidiary of Reuters (RTRSY) . For further information, please contact Instinet at www.instinet.com.

Island ECN, owned by Datek Online, offers trading, mainly in Nasdaq-listed stocks, from 7 a.m. to 8 p.m. EST.

Confused?

TheStreet.com

explains how the rules change when the sun goes down in Investing Basics: Night Owl, a section devoted to after-hours trading.