Cisco Reports Big Drops In Q2 Sales, Profits
It wasn't entirely unexpected: Cisco had previously warned that weaknesses in its service provider business and in emerging markets would hurt sales and earnings. But that didn't take the sting out of this week's news that sales dropped almost 8 percent in the company's second fiscal quarter while net income plunged 54 percent.
Cisco said in November that second-quarter revenue would likely slide between 8 percent and 10 percent. And in December the company slashed its long-term growth outlook for the next three to five years. Cisco executives have blamed the slower sales in emerging markets to broader macroeconomic and political issues, while the service-provider business is undergoing product transitions. But the news wasn't all bad: The company reported growth in its data center business, including sales of its Unified Computing System converged infrastructure offerings.