Cisco CEO Sees Weakness But Doesn't Expect Layoffs
Cisco Systems is facing weakness around the world because of a slowdown in “all four major segments” of its business, John Chambers, CEO and chairman told CNBC.
But the company isn't planning any layoffs, Chambers said in an interview.
The world's largest network equipment maker, often seen as a barometer in the technology sector, reported higher-than-expected earnings Wednesday but said revenue could fall 5 to 10 percent in the current quarter.
Cisco's profit got a boost as phone companies and businesses bought more routers and switches to cope with growing Internet traffic, despite a weaker global economy.
Watch the accompanying video for the full interview with Chambers.
“The financial crisis you saw in September became the economic and stock market crisis of October and it spread from the U.S. to Europe and around the world and then into Asia,” said Chambers.
The company also reiterated its long-term revenue growth projection.
Chambers said he felt positive about the business outlook of the United States. He said that because it was the first one to enter the economic slowdown, it will be the first one out.
“I’m a little more optimistic about the future of the United States,” he said. “Therefore, when we look at our plans, we’re beginning to invest aggressively in the U.S.”
He added that from now on, President-elect Obama, Speaker Pelosi, Majority Leader Reid, businesses, Republicans and Democrats will have to “come together to focus on jobs and growth.”
Chambers also said he believes there will be a second wave of innovation coming through in the high tech industry, which will drive productivity.
“So you will see us be aggressive through this downturn,” he said.