Cisco Chambers describes business outlook as 'extremely challenging'

"Extremely challenging" was how Cisco CEO John Chambers described the outlook for the next few quarters, as Cisco Wednesday reported its fiscal second-quarter results that matched analysts' expectations. Sales were up 16.5% year over year with Cisco finishing its most recent quarter with earnings -excluding charges - of $2.4 billion, or 38 cents per share, on $9.8 billion in revenue. Chambers said: ""We are seeing our U.S. and European customers becoming increasingly cautious. This was my key take-away from the World Economic Forum two weeks ago." Cisco expects revenue to grow approximately 10% year over year during the third quarter, Chambers said. Analysts had been expecting revenue growth in the 15% mark. Chambers' cautiousness was a marked change from his bullish remarks of just a month ago when he said 12% to 17% growth was feasible in the forseeable future. Despite the gloom there was some spark of optimism - Chambers said the lower valuations of tech companies could help Cisco pick up bargains as it continues to hunt for more acquisitions.

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