Cisco is believed to be in early stage discussions with Gameplay about taking a stake of up to 20 per cent in the UK-based online games company.
The networking giant is interested in Gameplay's multi-platform technology, which enables games players to compete against each other using mobile phones and PC- and TV-based internet connections.
The move could be good news for Gameplay, which said last week that it intended to axe 275 jobs across Europe and shut all eight of its UK stores in an attempt to become profitable more quickly. In October, the company reported a full-year operating loss of £23m.
But analysts are also voicing concerns over Cisco's second quarter earnings, which are scheduled to be announced after the bell tomorrow. The First Call analysts' consensus estimates the supplier will earn 19 cents per share before one-off charges, and turn in revenues of about $7.2bn, although individuals believe some sales could be lower.
Worries over Cisco's figures hit the technology sector at the end of last week amid general fears of an industry slowdown. Cisco has previously cited poor demand for networking products, and John Chambers, its chief executive, has been saying for weeks now that the three months that ended in January were "more challenging" than forecast.
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