It seems that companies are cutting back on tech buying this quarter and into next year.
"In particular, this will help lower payroll and facility expenses," wrote Nikos Theodosopoulos, analyst with UBS, in a research note Tuesday. "We believe it is prudent for Cisco's management team to plan for cushion in the event of weaker than expected revenues."
That seems like a pretty extreme measure in order to lower their expenses. I guess capital spending on networking equipment is being deferred to quarters where the buyer can afford it. I mean most companies can get by with their old equipment for a few years long before they need to upgrade anything.
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