"That's probably going to get tougher before it gets better and that might last for a good little while," Chambers said during a conference call.
Sales are also reportedly weaker in India and for overall government purchases.
But sales orders in North and South Americas increased 4 percent during the recent quarter and sales in Asia increased 12 percent, according to news reports.
Chambers is still cautious about the next year, given conditions facing many businesses.
"Many of our customers continue to anticipate a challenging next 12 months on a global basis and therefore these CEOs will remain conservative both in their IT expenditures but also in their hiring," Chambers said.
Bloomberg points out that new business leads to some 80 percent of Cisco’s quarterly sales.
Cisco also predicted sales and profits which are “in line with estimates,” Bloomberg said. Cisco, for instance, predicted it will see between 45 cents to 47 cents a share in profits during the current quarter. Analysts have projected 46 cents a share, Bloomberg said.
Also, sales are predicted to increase between 4 and 6 percent compared to the same quarter last year. That works out to between $11.6 billion and $11.9 billion for the current quarter. Bloomberg said analysts have predicted $11.7 billion in sales for the current quarter.
Meanwhile, the dividend hike got praise from several analysts. "It's a significant increase and now they've got a real yield," BGC analyst Colin Gillis told Reuters News Service.
Last month, Cisco acquired NDS (News - Alert) Group.
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Edited by Braden Becker
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