Cisco CEO Chambers Says Tough Decisions AheadBy Reuters | Posted 2011-04-08 Email Print
Cisco CEO John Chambers answered press and analyst questions about the changes that he foreshadowed in a memo to employees. Chambers said the company would make some tough and bold decisions.
NEW YORK/SAN FRANCISCO, April 7 (Reuters) - Cisco Inc (NASDAQ:CSCO) Chief Executive John Chambers, days after admitting that the company he has led for 16 years had lost its way, warned of competitive pressures, depressed public sector spending and "tough decisions" that lay ahead.
Chambers told analysts and investors at a Wells Fargo technology conference on Thursday that Cisco is a "company that has many strengths, and a company that has some weaknesses," pointing to slow decision-making and weak execution.
As expected, the CEO -- one of the industry's longest-serving -- promised to invest heavily in video products, such as the corporate videoconferencing Telepresence service, but otherwise kept his cards close to the vest.
His comments reflected those he made to employees earlier this week. In a remarkably candid memo, he admitted the one-time technology bellwether and Wall Street darling would need to take bold steps to restore its tarnished credibility.
In his presentation on Thursday, he told investors to prepare for crucial changes in the weeks and months ahead, but provided little detail.
"Are we going to make some tough decision and bold decisions about where we don't spend? Absolutely," said Chambers, among the tech world's most respected corporate chieftains.
One area where Chambers made clear he wants to press ahead is video, a business where he said the company would "double down." Chambers also said the routing business is "in very good shape" but said the company faces intense competition and hurdles in the other pillar of its core business, switching.
"Switching is our challenge," he said. "It's going to be a
tough market for us" given the intensity of competition from
the likes of Juniper Networks Inc (NYSE:JNPR), Hewlett Packard Co (NYSE:HPQ), and China's Huawei Technologies Co Ltd (UL:HWT)