Cisco warns revenue could drop 10%

Cisco System's CEO John Chambers warned that revenue could fall as much as 10% in the current quarter as an economic downturn spreads from the US to Europe and Asia, reports Reuters.

The company's shares fell 6% after Chamber's cautious outlook for the impact of a weaker global economy on the world's largest maker of network equipment, often seen as a bellwether in the technology sector.

'We do believe that the challenges that initially affected the U.S. have spread to other countries around the world,' Chambers reportedly said.

Analysts said that meant Cisco's peers as well as the broader technology sector could see slower spending well into 2009. Chambers said it was hard to be sure about the outlook.

Cisco, which makes routers and switches which direct Internet traffic, forecast revenue would fall 5 to 10% in the fiscal second-quarter from the year-ago period.