Cisco's software push fuels Q4 profit & revenue growth

Irving Hamilton
August 17, 2018

In an interview with CRN after reporting record revenue for the fourth quarter, Robbins doubled down on the idea that the channel can play just as large a role in the transition to a new multi-cloud, software-focused business model as it has in Cisco's traditional business.

A Cisco Systems sign is seen outside a Cisco health clinic at Cisco Systems in San Jose, California, U.S., March 22, 2018.

"We're seeing the returns on the investments we are making in innovation and driving the shift to more software and subscriptions", Chief Financial Officer Kelly Kramer told analysts on a post-earnings call. Subscriptions, which provide a more steady revenue stream, represented 56% of total software revenue in the reported quarter, the company said.

For its fiscal 2019, Cisco anticipates revenue growth ranging from 5 per cent to 7 per cent. ®.

"We had a very strong finish to a great year and generated our highest quarterly revenue of $12.8 billion", he said.

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Revenue in the security business, which offers firewall protection and breach detection systems, rose 12% to $627 million, beating estimates of $615.8 million.

Revenue from the unit with the traditional business of switches and routers, rose 7 percent.

Q4 revenues increased by 12 per cent to $12.8 billion, while the full year figure rose by three per cent to $49.3 billion.

Networking infrastructure still accounts for the majority of its income, with the transition to multicloud environments and intent-based networking cited as two examples of success, but application revenue was up 10 per cent and security continues to rise.

Of the company's total revenue for the quarter, 32 per cent was recurring, which is up 1 per cent from the same quarter a year ago.

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