Shares of Cisco on Thursday plummeted nearly 10 percent after the networking giant gave a cautious outlook for the near-term future in spite of solid quarterly earnings.
The stock had tumbled 9.9 percent, or $1.86, to $16.92, on the NASDAQ as of 2:10 p.m. ET.
Cisco said it anticipates sales will grow 2-5 percent this quarter, falling below forecasts on Wall Street, CNNMoney reported.
“We sure don’t like the trend in the enterprise IT spending,” Cisco Chief Executive John Chambers was quoted as saying. “People are in this uncertain environment, and when they’re uncertain, unfortunately, you don’t spend.”
In its most recent quarter ending April 28, enterprise growth year over year was negligible (1 percent), Cisco reported Wednesday in its earnings.
However, total revenues grew to $11.59 billion from $10.87 billion in the year-ago quarter. Cisco’s commercial segment reported the best growth (8 percent), followed by the service provider (5 percent) and public sectors (3 percent).
Cisco’s profit grew to $2.17 billion from $1.81 billion.
“We are successfully executing against our long-term strategic plan of growing profit faster than revenue,” Chambers declared, “and in a cautious IT spending environment, we continue to outperform our competitors.”