Cisco CEO said company is benefitting from long-term technology shifts towards hybrid cloud, 5G and WiFi 6
Cisco has reported $13.1 billion in revenue for its fiscal fourth quarter and a net income on a generally accepted accounting principles (GAAP) basis of $2.8 billion, topping estimates in both categories. Cisco’s revenue increased by 3.4% in the 2022 fiscal year.
On an earnings call, Cisco’s Chief Financial Officer Scott Herren gave the following guidance for the 2023 fiscal year: “We expect revenue growth to be in the range of 4% to 6% year on year; non-GAAP earnings per share guidance is expected to range from $3.49 to $3.56, also up 4% to 6% year on year,” he said.
On the same call, company CEO Chuck Robbins broke its latest quarter revenue numbers down, stating that total product revenue was $9.7 billion, while service revenue was $3.4 billion.
Cisco’s Secure Agile Networks, which includes data-center networking switches, proved to be the company’s top business unit for the quarter, delivering 46% of total revenue at $6.09 billion, following by its Internet for the Future unit, which brought in $1.26 billion in revenue.
Robbins pointed to the growing list of technology transitions as a boon for the company. “Long-term megatrends like hybrid cloud, hybrid work, security, IoT, 400-gig and beyond, 5G, and WiFi 6, as well as the move toward application observability, will likely provide tailwinds to our growth,” he said. “With our portfolio in such a strong position to help our customers, I’m quite optimistic about what’s ahead. Before we discuss the quarter in detail, I want to provide some additional color on the supply situation and how we continue to build greater resiliency.”
One of the biggest transitions taking place in the technology world is the shift towards cloud and subscription-based services. On the earnings call, Robbins noted that 81% of software revenue was subscription-based, which is up two percentage points year-on-year. He further stated that the company’s total subscription revenue was $22.4 billion and total subscription revenue represented 43% of Cisco’s total revenue.
“We continue to make progress on our transformation to more software and subscription-based recurring revenue,” he said.
