There was good news in some areas. Product orders in the U.S. enterprise and commercial sector rose in the high single digits, the company said. The company has high hopes for its Application Centric Infrastructure platform, unveiled last week in conjunction with its buyout of Insieme Networks. Chambers said the company is still committed to developing markets and stands by its long-term growth forecast of between 5 percent and 7 percent annual revenue growth.
But financial analysts on the call expressed surprise at the grim forecast, and Cisco's stock was down about 10 percent in after-hours trading on Thursday.
For the first quarter, Cisco reported net income of $2 billion, down 4.6 percent from $2.1 billion a year earlier, measured according to generally accepted accounting principles. On a per-share basis, that came out to $0.37, down from $0.39. Not counting certain one-time items, Cisco earned $0.53 per share, exceeding analysts' forecast of $0.51 per share.