Cisco Systems, Inc
.
CSCO
is slated to report first-quarter fiscal 2021 results on Nov 12.
The company is likely to have benefited from strong uptick in network security solutions, triggered by coronavirus crisis induced Internet traffic growth led by work-from-home and stay-at-home wave.
Moreover, ongoing momentum in Webex services on growing clout of video conferencing is likely to have acted as a tailwind.
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here
to know how Cisco’s overall fiscal first-quarter performance is expected to be.
Momentum in Security Offerings Remains Noteworthy
Robust adoption of web security, unified threat, network security and advanced threat solutions in the fourth quarter of fiscal 2020, is likely to have sustained in the quarter to be reported, primarily driven by growth in Internet traffic, and rising spend on cybersecurity as employees work remotely amid social distancing norms.
Cisco’s expanded family of cloud security solutions and differentiated end-to-end approach that helps in securing identity, endpoints and the network might have expanded customer base in the fiscal first quarter, courtesy of rising security headwinds faced by enterprises globally.
Moreover, robust adoption of cloud-based solutions, including Duo and Umbrella, bodes well.
Also, growing clout of latest security solutions, including SecureX and Secure Remote Worker, bodes well.
Cisco Systems, Inc. Revenue (Quarterly)
Cisco Systems, Inc. revenue-quarterly
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Cisco Systems, Inc. Quote
The Zacks Consensus Estimate for Security is pegged at $850 million, indicating an improvement of 4.3% from the year-ago quarter.
Strength in Webex Solutions Hold Promise
Cisco’s Applications segment’s fiscal first-quarter performance is expected to have benefited from strong uptick in enterprise collaboration offerings including Webex Meetings, Webex Devices and Webex Teams.
Coronavirus crisis induced work-from-home wave has triggered demand for teleconferencing, workspace collaboration and telehealth services. This, in turn, is likely to have bolstered the adoption of Cisco’s Webex solutions in the quarter to be reported.
Notably, Cisco, currently carrying a Zacks Rank #3 (Hold), updates its Webex portfolio on a monthly basis to aid users enhance productivity with advancements in video conferencing.
This integration of AI and machine learning (ML) capabilities aimed at improving engagement is expected to have further increased adoption of Webex services in the quarter to be reported.
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.
Consequently, this is expected to have aided the company strengthen competitive position in the enterprise communication market against
Microsoft
’s
MSFT
Teams,
Slack
WORK
and
Zoom Video Communications
ZM
.
Further, incremental adoption of business resiliency solutions to aid enterprises boost workforce and workplace productivity is likely to have favored segmental performance.
Strength in the company’s latest solutions focused on distance learning and telehealth services, in a bid to capitalize on the growing clout of web-based learning and healthcare trends, might have favored the fiscal first-quarter performance.
The Zacks Consensus Estimate for Applications revenues stands at $1.35 billion, suggesting a decline of 9.9% from the year-ago reported figure.
Solid Catalyst 9000K Adoption: A Key Catalyst
Growing clout of Cisco’s campus switches including Cat9K and Nexus 9K, are likely to have benefited Infrastructure Platforms segment’s performance in the fiscal first quarter.
Moreover, during the quarter under review, the company announced partnership with Qwilt and Digital Alpha (DA), to roll out a new as-a-service offering based on Open Caching, with BT as the flagship customer, in a bid to enhance commercial Content Delivery Network (CDN) market. The synergies from the partnership might get reflected in the to-be-reported quarter’s results.
However, increasing investments on product enhancements amid stiff competition from Arista and Juniper in networking infrastructure market may have limited margin expansion in the fiscal first quarter.
Further, decline in IT spending and coronavirus pandemic-induced broader macroeconomic weakness across small and medium sized businesses is likely to have affected the to-be-reported quarter’s performance.
The Zacks Consensus Estimate for Infrastructure Platforms revenues stands at $6.401 billion, suggesting a decline of 15.1% from the year-ago reported figure.
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