Bellwether Cisco cuts growth forecasts
Networking vendor industry bellwether Cisco has shaved its mid-term revenue growth forecasts, blaming ongoing depressed spending by telecom operators and its emerging market customers.
The company now expects average revenue growth of between 3% and 6% over the next three to five years, Bloomberg reported, citing comments by CFO Frank Calderoni.
This compares to a previous forecast, confirmed as recently as last month, of 5% to 7% revenue growth over this time.
Cisco's reduced forecast suggests that operator capex could remain constrained over the next few years. Cisco could also be bracing for the threat to its market dominance posed by the SDN trend.
In related news, Reuters quotes Cisco CEO John Chambers as stating that the company expects a long battle ahead to improve its flagging business in China. The company's Chinese revenue fell 18% in the October quarter, contributing significantly to the decline in revenue from emerging markets.
Cisco last month suggested that a backlash in China against the revelations of US government spying from Edward Snowden contributed to this revenue decline.
Chambers told reporters that the company will periodically send executives including himself to China to attempt to improve its relations in the market.
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