- Cisco CEO Chuck Robbins told CNBC's Jim Cramer why his company issued a light quarterly and full-year forecast, including weakness in orders from its service provider customers.
- Robbins said orders from telecommunications and service providers were down 40% for the quarter.
In a Wednesday post-earnings interview with CNBC's Jim Cramer, Cisco CEO Chuck Robbins listed several factors that lead to a light quarterly and full-year forecast, including weakness in orders from its service provider customers.
"First of all, we saw more caution with our customers this quarter than we saw in the prior quarter," Robbins said, adding that inventory consumption is taking longer than the company expected. Robbins also said there was "continued weakness" in demand from its telecommunications and cable service provider clients, with orders down 40% for the quarter.
"Those three things lead us to revise guidance for the rest of the year," he said. "But we do believe that we'll get through this inventory consumption issue by the end of 2024, and hopefully the other two issues resolve themselves soon, and we see some good times ahead."
Cisco also announced on Wednesday it will be cutting 5% of its workforce, or about 4,000 jobs, mirroring layoffs happening at other tech companies. Cisco shares dipped as much as 9% in extended trading.
"Clearly when you're off plan the way we are this year, because of these issues that we talked about, we have to adjust our expenses," Robbins said. "And that's what we've done, so it won't be easy, but we'll get through it."
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