IBM, EMC, Cisco, HP and others are all saying that customers are becoming cautious about the economy and pulling back on tech spending. This pullback is more like tapping the brakes, but there's economic uncertainty for sure. The catch is this slowdown could accelerate the thinning of the enterprise megavendor herd.
Outside the tech sector, companies such as UPS, 3M and other industrial giants also noted a slowdown as China's growth slows and Europe continues to struggle. The Commerce Department reported that new orders for computers and electronics fell 2.5 percent in September from August. Communication equipment new orders fell 4.5 percent in September from August.
EMC CEO Joe Tucci noted a "more uncertain global economic environment" as did other tech chiefs. IBM CFO Mark Loughridge said Big Blue saw a solid start to the third quarter, but "a fall-off in our growth rates in the third month of the quarter." "From a geographic perspective, it was really a fall-off that we saw in North America and our growth markets unit," he added.