Cisco Systems (CSCO  ) has taken a hit after an underperforming earnings report, which was credited to slowing tech spending in the broader economy. Shares of the communications technology company, which produces hardware and software for enterprises in all sectors of the economy, tumbled by 8% last week. Cisco had been aggressively targeting emerging markets and infrastructure for software service providers, but in the most recent earnings report that it put out, it noted that losses in those sectors had spread to other areas of their business. This is likely due to a slowdown in overall tech spending, especially in a lagging China. Analysts have cut their price targets accordingly, with even analysts with the most optimistic opinions on the technology company paring back their expectations.

The consensus for Cisco's third quarter earnings report was an earnings per share of 81 cents and a total revenue of $13.08 billion. Cisco beat both of these consensus expectations, slightly overperforming against revenue with a stated $13.16 billion while topping earnings per share by three cents. However, the share price suffered due to other factors that threaten the longer-term stability, such as a 5% decline in enterprise spending year on year and a 13% decline in service provider spending.

The air of confusion and uncertainty surrounding the global economy is causing difficulties in companies that mainly target business to business spending. Cisco in particular noted that the impending British exit from the European Union and the large open question that is economic relations between the United States and China is causing large companies to reconsider large technology purchases. Those big purchases from dominant players in global industry had been the driving force behind Cisco's share price, which had more than doubled in price since 2016 before hitting a skid in the middle of 2019. In the year 2019, Cisco has grown by 5% to date.