3Com falls on revenue concerns
Shares fall after the troubled networking-equipment maker says it now faces greater uncertainty for revenue growth in the fourth quarter.
The Santa Clara, Calif.-based company said on March 21 that it anticipated revenue in the range of $550 million to $600 million for the quarter ending June 1, but it now expects a "wider range" of results. In a Securities and Exchange Commission filing on Wednesday, the company cited the "current difficult economic environment," "operational restructuring" and other expenses for the revision.
The stock fell 37 cents, or 6 percent, to $5.80 in late trading.
On Monday, 3Com said it would cut its work force by 3,000 people, or 30 percent, in an effort to trim costs by $1 billion.
3Com, like other companies in the sector, has been hit as sales of equipment to telecommunications carriers and business customers have stalled. Cisco Systems and Nortel Networks have also slashed their work forces.
Tuesday afternoon, Cisco beat lowered expectations. Excluding charges, Cisco lost $2.69 billion, or 37 cents per share, compared with a net income of $641 million, or 8 cents, a year ago.
3Com has trying to get on track by restructuring several times over the past two years. Earlier this spring, the company laid off 1,200 employees and closed down its consumer business, which included its Audrey Web-surfing appliance and Kerbango Internet radio.