Cisco Systems (CSCO) cut its three- to five-year long-term earnings and revenue growth on Thursday.
The company cut its three- to five-year revenue growth down to 3% to 6%, vs. its previous estimate of 5% to 7%. Cisco also cut its earnings-per-share growth from 7% to 9%, to 5% to 7%. Cisco cites conservative customer spending, poor sales in routers and switches and trouble in emerging markets as reasons for the cuts. According to Cisco’s Chief Executive John Chambers, the company often sees negative effects in the industry earlier than others in the market and acts as a “canary in the coal mine,” reports Reuters.
Cisco has also suffered from slow sales of set-top-boxes to video service providers. Despite these slow sales, Cisco announced that it doesn’t plan to leave the market. The company did say that when it chooses to switch to more profitable products, that it would be a multi-year switch for the company, Reuters notes.
Cisco expects to see an increase in the areas of mobility and wireless, datacentre and services in the next three to five years.