Cisco is taking extraordinary measures to cut costs and has had its first ever 4-day shut down to conserve money. Generally this is a good thing to do but in this case, investors are nervous and not acting rationally and the stock is don almost 6% so far today. There is obviously continuing deterioration in world financial markets and Cisco’s move is smart.
What is not mentioned in this report is the fact that this is the first time in my memory that Cisco is in a macro environment where little to no hiring is being done. So shuttering plants worldwide does not lead to mass defections to other sectors which are hiring.
This is perhaps one of the few silver linings in a dark cloud.
Om Malik has salient comments on the matter and points to a lack of 2009 visibility. I agree with Om.