A seamless and integrated digital experience is essential for consumers to maximise the potential of smart wearable health and wellbeing devices, according to new research conducted by Cisco across the EMEA region.
The research was carried out by Cisco AppDynamics and questioned 4,000 people across in the UAE, UK, France and Germany. It discovered that 83 percent of those polled believe smart wearable technology has the potential to positively transform the health of individuals and Improve public health services in general.
Wearables are increasingly popular: 38 percent of people currently use at least one wearable technology device, while 71 percent plan to increase their use of such products and related applications over the next 12 months. Thus, wearable technology has reached a defining moment in its evolution, moving from the early adopter stage through to mass adoption.
The pace of innovation in wearable healthcare products is high, and users have clear preferences for what they want their devices to do. 84 percent expect their devices to indicate early warning signs of illness and the same percentage want to Improve fitness goals. In addition, 78 percent look to wearables to help manage chronic health conditions; 79 percent to identify the spread of infectious diseases; and 77 percent to support healthy eating.
83 percent of consumers believe that having reliable, real-time access to health data and accuracy of this data is critical to a good user experience.
In fact, the quality of the experience is so important that 76 percent of those questioned said they would stop using a specific wearable device or application if they had a bad digital experience. Perhaps more worryingly for smart wearable manufacturers and app developers is that 59 percent of respondents said a bad digital experience with one wearable device or application would put them off trying other health or wellbeing wearable technology.
The biggest causes of bad digital experiences are device crashes (54 percent), slow or unresponsive performance (51 percent) and data privacy concerns (51 percent). For 84 percent of people, trust is a critical factor when choosing a wearable medical device or application brand.
Despite these reservations the overall outlook for such products and services is positive with 79 percent of consumers feeling excited about the potential benefits that wearable technology could bring.
The findings of the Cisco AppDynamics research are clear. Wearable technology brands must be able to deliver a seamless and reliable digital experience to consumers at all times. Failure to do so will see many users switch to rival products or abandon the wearable healthcare market altogether.
To avoid this, manufacturers and app developers should adopt the latest tools to manage and optimize performance and availability across a complex IT environment. This means ensuring their technologists have access to a single, unified view of IT performance, right across the IT estate — what’s called full-stack observability. Furthermore, these wearable technologies must be able to connect to this IT performance data with real-time business metrics, to quickly identify issues that may harm the end-user digital experience.
Chicago, IL – August 23, 2023 – Today, Zacks Equity Research discusses Cisco CSCO, Extreme Networks EXTR and RADCOM Ltd. RDCM.
Industry: Computer Networking
Link: https://www.zacks.com/commentary/2139015/3-networking-stocks-to-watch-for-from-a-prospering-industry
Increasing focus on cloud computing, network security, big data and cloud storage is expected to boost the performance of the Zacks Computer - Networking industry participants. Accelerated deployment of 5G is driving the proliferation of the Internet of Things (IoT), Advanced Driver Assistance Systems (ADAS), Augmented Reality/Virtual Reality (AR/VR) devices and 5G smartphones, calling for solid networking infrastructure.
This spurred demand for networking products, favoring the prospects of prominent industry players like Cisco, Extreme Networks and RADCOM Ltd.. However, negative impacts stemming from the lingering supply chain disruptions and component shortages will likely be a concern in the near term. Weak global economic conditions and rising inflation are likely to act as additional headwinds.
The Zacks Computer - Networking industry comprises companies that offer networking and Internet-connected products, including wireless (WiFi and Long-Term Evolution or LTE), Ethernet and powerline, focusing on dependability and ease of use. The products are available in numerous configurations to cater to the changing requirements of consumers in each geographic territory where it operates for smooth network connectivity and broadband access.
Some industry players also provide mission-critical IoT solutions and network security services to help clients build next-generation connected products and implement and manage critical communications infrastructures in demanding environments with enhanced levels of safety. Focus on developing IoT sensors, drones and wearables amid increasing demand for cloud computing-based contact tracing applications is driving the industry
Rapid Deployment of 5G to Boost Growth Prospects: Adopting a hybrid/flexible work model has triggered demand for network-intensive applications like video conferencing and cloud services. This is anticipated to accelerate 5G deployment through 2023 and beyond. The impending 5G boom will likely propel the industry to newer heights. The success of 5G technology hinges on substantial investments to upgrade infrastructure in the core fiber backhaul network to support growth in data services.
More efforts to develop smart connected homes, hospitals, factories, buildings, cities and self-driving vehicles bode well for industry players. These firms invest heavily in LTE, broadband and fiber to provide additional capacity and Improve Internet and wireless networks. These initiatives hold promise.
The Uptick in Wi-Fi 6 Networking to Drive Momentum: Brisk technological advancement, dynamic products, high-speed connectivity, low latency and evolving industry standards define the Computer Networking industry. The growing clout of the latest Wi-Fi 6-compliant residential gateways, Wi-Fi routers, set-top boxes and wireless range extenders is a testament to the same. Wi-Fi 6 — the latest 802.11ax wireless standard — is estimated to offer 30% faster network speed over 802.11ac (Wi-Fi 5). This is anticipated to bolster the industry participants’ top line.
Innovation in Networking Technologies is Opening New Business Avenues: Growing clout of Smart Home and Internet-connected products such as Smart TVs, game consoles, High Definition (HD) streaming players, security cameras, thermostats and smoke detectors continue to drive innovations in networking. The rapid proliferation of IoT, the increasing popularity of smart connected devices and the growing adoption of cloud computing in network security fuel the demand for an efficient network support infrastructure.
The advancements in AI and ML and the high adoption of cloud applications hold immense potential for companies in the industry. Enterprises are striving to manage fixed and wireless devices in a secured infrastructure. To address the demand, industry firms are driving innovation in networking technologies, including network virtualization and Software-Defined Networking (SDN), which favors growth prospects.
Increase in IT Spending Amid Economic Turmoil Bodes Well: Per a Gartner report, worldwide IT spending is expected to increase 4.3% in 2023 from 2022 levels and reach around $4.7 trillion. The report added that despite macroeconomic headwinds, enterprises are increasing spending on digital business initiatives, which bodes well for industry participants.
Gartner states that the software segment is likely to witness double-digit growth in the current year. However, consumers are deferring spending on the purchase of devices, which will likely affect the IT spending growth to an extent in 2023. Gartner expects the devices segment to decline by nearly 8.6% in 2023.
The Zacks Computer - Networking Industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank of 28, positioning it in the top 11% of more than 252 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates bright near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s positioning in the top 50% of the Zacks-ranked industries results from a positive aggregate earnings outlook for the constituent companies. Looking at the aggregate earnings estimate revisions, analysts are optimistic about this group’s earnings growth potential. The industry’s earnings estimate for 2023 has improved to earnings of $3.09 against a loss of $2.95 as of Jan 31, 2023.
Before we present a few stocks that you may want to consider for your portfolio, considering bright prospects, let us look at the industry’s exact stock-market performance and valuation picture.
The Zacks Computer – Networking industry has outperformed the S&P 500 composite and the broader Zacks Computer and Technology sector in the past year.
The industry is up 16% over this period compared with the broader sector’s gain of 13.9%. The S&P 500 has gained 6.9% over the same time frame.
On the basis of the forward 12-month price-to-earnings ratio (P/E), which is a common multiple for valuing Computer – Networking stocks, we see that the industry is currently trading at 15.58X compared with the S&P 500’s 19.10X. It is also below the sector’s forward-12-month P/E of 23.93X.
In the past five years, the industry has traded as high as 20.33X and as low as 12.56X, with media being at 15.64X.
Extreme Networks: Based in Morrisville, NC, Extreme Networks provides next-generation switching solutions that cater to the increasing requirements of enterprise local area networks or LAN, internet service and content providers.
Higher deployment of 5G base stations on accelerated demand for 5G networking is expected to boost growth prospects. Acquisitions like Ipanema bode well in the long haul. Earlier in the year, the company unveiled the ExtremeCloud Edge platform that covers public to private to edge cloud deployments and aids customers in lowering operating costs related to the management of many cloud platforms. The company expects new product innovations like universal hardware, end-to-end cloud management and enhanced AI to boost growth prospects.
Extreme Networks carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for fiscal 2024 is pegged at $1.55 per share, indicating an increase of 42.2% year over year. Shares have increased 99.6% in the past year.
RADCOM: This Tel Aviv, Israel-based company specializes in providing cloud-native, automated service assurance offerings for telecommunication operators for 5G networks.
The company recently reported its second-quarter 2023 results, with revenues totaling $12.4 million, up 11% on a year-over-year basis. The company recently unveiled a 5G assurance solution on Google Cloud. The company noted that availability on Google Cloud will extend availability of 5G assurance solutions to clients to help them streamline 5G rollouts.
RADCOM carries a Zacks Rank #1. The Zacks Consensus Estimate for the company’s 2023 earnings is pegged at 39 cents per share, up 30% in the past 60 days.
Cisco: Headquartered in San Jose, CA, Cisco provides performance management, cybersecurity and DDoS protection solutions. Cisco is riding on the growing demand for its security products. Its security portfolio benefits from the launch of new data loss prevention, firewall and zero trust capabilities. Zero Trust portfolio is riding on strong demand for its Duo offering. Optimized application experience is benefiting from strong demand for ThousandEyes.
Its investments across the security business, focusing on cloud-based and AI-driven offerings, are expected to drive growth. Expanding growth opportunities for low-power-consuming technologies, including IoT, Silicon One and Power over Ethernet, bodes well for Cisco.
Cisco carries a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for fiscal 2024 earnings is pegged at $4.04 per share. Shares have increased 16.9% in the past year.
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Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report
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Cisco Systems (NASDAQ:) shares rose in early Thursday trading after the IT networking company provided positive updates on the earnings call. The stock initially fell in after-hours Wednesday after the company’s FQ4 results and guidance failed to entice investors.
The company said its revenue rose 16% year-over-year to $15.2 billion, just ahead of the consensus of $15.05 billion. For its full fiscal 2023 year, Cisco generated sales of $57 billion. Adjusted earnings per share of $1.14 also managed to come in higher than the consensus of $1.06.
"This past year was a milestone year for Cisco with record performance in both the full year and Q4," said Chuck Robbins, chair and CEO of Cisco. "We are seeing solid customer demand, gaining market share, and innovating in key areas like AI, security, and cloud. This momentum gives us confidence in our ability to capture the many opportunities ahead."
Cisco generated $6 billion in operating cash flow, which is a significant increase of 62% compared to the same period last year. Product revenue was up 20% while service revenue rose 4%. Business units Secure and Agile Networks both saw their sales rise 33% YoY, while Optimized Application Experiences jumped 15%.
Region-wise, the company witnessed the strongest growth in the Americas region, which also yielded gross margins of 65%. Overall, Cisco reported a total gross margin of 65.9%, which marks a 260-basis points expansion compared to the year-ago period. The adjusted operating margin stood at 35.4%, topping the consensus by 70 bps.
Cisco also said it made progress on business model transformation with total software revenue rising 17%. The company’s ARR (annualized recurring revenue) came in at $24.3 billion, up 5% YoY. Similarly, the RPO (remaining performance obligations) now stands at $34.9 billion, up 11% YoY.
"We delivered double-digit growth in revenue and EPS, generating strong operating leverage in Q4," said Scott Herren, CFO of Cisco. "Our business model transformation drove double-digit growth in software revenue, product ARR and total RPO, leading to greater visibility and predictability. We are committed to expanding operating leverage and increasing shareholder returns over the long term."
Following solid results, Cisco has declared a quarterly dividend of $0.39 per common share to be paid on October 25 to all stockholders of record as of the close of business on October 4.
For this quarter, the company guided for adjusted EPS of $1.03 on revenue of $14.6 billion. This revenue guide implies a 4% decline in sales on a sequential basis. Analysts were looking for adjusted EPS of $0.99 on revenue of $14.57 billion.
The adjusted gross margin is seen at 65.5% while the adjusted operating margin is expected to come in at 34.5%. Both topped the average analyst estimate.
For FY24, Cisco expects EPS in the range of $4.01-4.08 on revenue of $57-58.2 billion, which compares to the analyst consensus for adjusted earnings of $4.05 per share on revenue of $58.3 billion.
While Cisco shares initially dipped on the softer-than-expected full-year revenue guidance, they recovered to trade modestly in the green in the aftermath of the company’s FQ4 earnings call. Robbins argued that the accelerated AI transition “will fundamentally change our world and create new growth drivers for us.”
He reminded investors and analysts on the call that Cisco has been investing in AI for years, including the recently-announced AI products that were described as “market-leading.” These AI-powered products will boost productivity, enhance policy management, and simplify tasks, he said:
“Cisco's ASIC design and scalable fabric for AI position us very well to build out the infrastructure that hyperscalers and others need to build AI ML clusters. This is a huge opportunity for Cisco, and we are laser-focused on leading and winning in this space. As a result of our innovation in this area, we expect Ethernet will lead in connecting AI workloads over the next five years,” Robbins added.
Speaking specifically about Ethernet, Cisco said it has already taken orders “for over half a billion dollars” for AI Ethernet fabrics. In addition to Ethernet, security remains one of the top priorities and growth drivers for Cisco.
Along these lines, the company recently launched a new security service edge solution, which is designed to allow for better hybrid work experiences and significantly simplify access across any location, device, and application.
Generative AI technology is leveraged to Improve threat response. It helps to reduce policy complexity, while also working swiftly to detect and remove threats. Cisco said it has incorporated its Zero Trust Access (ZTA) capabilities into a native experience on ) iOS and macOS.
"At Apple, we believe deeply in providing privacy and security that is built in from the ground up,” said Susan Prescott, Apple’s Vice President of Enterprise & Education Marketing. “Later this year, iPhone, iPad, and Mac will have native support for network relays. Together with Cisco Secure Access, enterprises will have a secure and seamless remote access solution, to do their best work from anywhere, on the best devices for business.”
Back to AI, CFO Herren urged patience as the benefits from AI investments are not yet in P&L. Herren said that:
Cisco is “invested early in the AI game” and it remains hopeful that it can become one of the bigger beneficiaries as the company is “getting early success.”
Cisco stock was also boosted by CEO comments that the company gained more than 3 percentage points of market share YoY in its three largest networking markets: Campus switching, wireless LAN, and SP routing.
“We expect further share gains in these areas as market share numbers are released for calendar Q2,” Robbins said on the call.
Cisco reported a solid set of results for its fourth fiscal quarter, as well as offered an FQ1 forecast that topped analyst estimates. This, coupled with positive updates on the earnings call about the AI transition helped offset a weaker-than-expected full-year revenue guidance.
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Shane Neagle is the EIC of The Tokenist. Check out The Tokenist’s free newsletter, Five Minute Finance, for weekly analysis of the biggest trends in finance and technology.
Companies increasingly look to the cloud to run high-performance computing (HPC) workloads. In some cases, they need cloud HPC’s burst capabilities; in others, it is because they cannot fully utilize an on-premises supercomputer. Regardless, HPC workloads involve large-scale computations to solve complex problems—requiring massive amounts of data, storage and high-speed networking distributed across many machines. Easy-to-use tools are also needed to ensure that customers can spend their time on actual computation rather than managing infrastructure.
AWS has put itself at the forefront of the cloud HPC trend with capabilities ranging from advanced job orchestration and cluster management to an enhanced compute fabric to a file system that scales to millions of IOPS. The company has realized that many of its customers need instances optimized for specific HPC workloads that provide performant, cost-effective solutions. Recently AWS announced the general availability of the Amazon EC2 Hpc7a instance as an upgrade to one of its three existing HPC choices. In this article, we review these HPC instances with a focus on the new addition to the family, then take a deeper dive into some of the use cases for all this HPC horsepower.
Boundless HPC capacity, built from the latest technologies
The cloud removes the traditional challenges associated with on-premises clusters: fixed infrastructure capacity, technology obsolescence and high capital expenditures. Customers can quickly migrate to newer, more powerful compute instances as they become available on AWS, removing the risk of on-premises CPU clusters becoming obsolete or poorly utilized as needs change.
AWS now has four HPC-optimized EC2 instances. First, Hpc7g instances—based on AWS Graviton3E processors—provide low latency and high network performance for MPI-based applications. (Message Passing Interface, or MPI, is a specification for cluster computing). Second, Hpc6id instances are for memory-bound and data-intensive workloads such as finite element analysis (more on that below) and seismic simulations. Finally, we have the Hpc6a and the new Hpc7a instances for compute-intensive applications such as computational fluid dynamics and weather prediction.
Better performance compared to the previous generation
The new Amazon EC2 Hpc7a instances feature 4th Gen AMD EPYC (Genoa) processors. Compared with Hpc6a instances, Hpc7a instances have twice the core density at up to 192 cores, 2.1 times higher memory bandwidth throughput, twice the memory capacity at 768GB and three times higher network bandwidth.
To enable fast, low-latency inter-node communications, these instances come with 300 Gbps of Elastic Fabric Adapter (EFA) network bandwidth, powered by the AWS Nitro System. Hpc7a instances also feature DDR5 memory, which provides 50% higher memory bandwidth compared to DDR4 memory to enable high-speed access to data in memory.
The new instances scale more efficiently on fewer nodes when compared to Hpc6a instances. There are four different sizes, all of which have the same memory capacity and interconnect speed: 24 cores, 48 cores, 96 cores and 192 cores.
The most accurate weather forecasting requires high-performance computing.
AWSHPC drives more efficient weather forecasting
One application for the new Hpc7a instances is weather forecasting. This goes far beyond the weather reports we check to know how to dress for the day, or to find out if it will rain during a road trip.
Two types of organizations need to run the workloads that meet these forecasting needs. The first type includes the many startups that ingest weather data from the National Oceanic and Atmospheric Administration (NOAA) and similar organizations, process it and sell the outputs to customers such as insurers and weather-dependent companies. Before the cloud, this type of work was not economically feasible because it would require purchasing an on-premises supercomputer that would sit idle 90% of the time.
The second type of organization is large-scale businesses and government labs that run continuous weather models and long-term climate research workloads. These organizations typically have enough tasks to keep an on-premises supercomputer busy. For them, the cloud presents an economical alternative for numerical weather prediction and climate modeling.
DTN is an example of a company in the first category that specializes in subscription-based analysis and delivery of real-time weather information. DTN’s sophisticated, high-resolution models require continual processing of vast amounts of data from global inputs. Using Amazon EC2 Hpc6a instances, DTN has effectively doubled its high-resolution global weather modeling capacity from two to four times daily.
These new instances enable ensemble runs, something that’s difficult with fixed-capacity on-premises environments. An ensemble forecast is a collection of multiple forecasts that are run simultaneously, preserving the initial conditions. The result is a spread of outcomes from which a probability density function can be derived—promoting greater accuracy in the ultimate forecast.
HPC helps car makers optimize aerodynamics for their vehicles.
AWSSolving significant challenges in the auto industry
HPC also has multiple applications in automotive design and analysis. One big challenge, for instance, is optimizing a vehicle's aerodynamic shape for better fuel efficiency. Aerodynamic simulation in a wind tunnel with a clay model is expensive and time-consuming. Using fluid dynamics, however, an HPC instance can run thousands of design simulations to identify the best candidates, shortening the time it takes to put a physical prototype on the road.
Finite element analysis is a different approach used in crash analysis. Auto makers have to do an immense amount of this analysis, which traditionally involves crashing cars inside a dedicated crash facility—which is incredibly expensive. It is much more economical to crash virtual cars inside a computer, which is where the new AWS HPC instance shines.
Comparing the performance of Hpc7a to the previous generation, Ferrari reports a 30% performance improvement for computational fluid dynamics (CFD) workloads and a 25% performance improvement for finite element analysis (FEA). These advances speak to the significant business impact of the new AWS instances.
Wrapping up
As HPC workloads increase in complexity, there is always the insatiable need for more computing, memory and network performance to reduce the time to complete the tasks at hand. As more customers bring HPC workloads to EC2, Amazon is responding to align its instances with workload requirements.
When we look across the many critical use cases discussed above, the clear message is that customers need many performant, cost-effective instances optimized for each specific HPC workload. The cloud is a boon for HPC because it offers access to effectively unlimited infrastructure so customers can scale on demand yet pay for only what they use. That’s how customers can sidestep the traditional challenges of capacity, obsolescence and cost created by on-premises clusters.
AWS service levels ensure that there is elasticity from 100 instances to 1,000 instances and beyond in minutes. Eliminating job queue times and being able to scale the cluster as needed, when needed, vastly improves efficiency—and ultimately reduces customers’ time to market. The new instances AWS has rolled out will only increase these benefits for the companies poised to take advantage of them. As AI and other cutting-edge areas of tech continue to create more complex and intensive workloads, I’ll be interested to see which sectors make the most of cloud HPC’s capabilities.
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Senior Vice President and Global Innovation Officer at Cisco, Dr. Guy Diedrich, in this interview with Emma Okonji, speaks about the exact launch of Cisco’s EDGE Centre in Nigeria and how it will enhance digital transformation and provide access to digital job opportunities in Nigeria and Africa
What are some of the benefits of the recently launched Cisco EDGE Centre in Nigeria, and how will Nigeria benefit from it?
The Cisco EDGE Centre was launched in Nigeria last week and it is located inside TD Africa’s Tech Experience Centre in Victoria Island, Lagos. The Cisco EDGE hub will function as an incubator, providing Small, Medium and Micro Enterprises (SMMEs) with access to state-of-the-art Cisco communication and collaboration technology, alongside training and enablement programmes. In addition, SMMEs will be able to connect with global Cisco experts, who can support them develop business ideas and concepts in a digital world.
EDGE stands for ‘Experience, Design, GTM (Go to Market) and Earn’ and has the objective to share business knowledge to stimulate innovation, help develop small and medium businesses in the digital age, speed up their entry to market and as a result create new jobs for the local economy. The centre hosts three key functions under one roof: It provides a space where local partners can showcase technologies and host client events; it brings resources and tools to local innovators and entrepreneurs to help them develop more secure, intelligent, and connected solutions; and offers training programmes and education in the most advanced digital technologies.
With its vibrant economy and young population, Nigeria stands to benefit from the promise of an inclusive digital future. Cisco is here to help Nigeria with digital skills development, innovation and incubation as well as cutting edge technologies. Cisco welcomes Nigeria to the Cisco Country Digital Acceleration program and look forward to working with businesses, government, and academia, enabling them to take the lead in shaping the future and driving social and economic inclusion.
How will Cisco collaborate with the federal government to further drive digital transformation in Nigeria?
On May 16, 2023, the National Information Technology Development Agency (NITDA), signed MoU with Cisco to help promote digital transformation and bridge digital skills gap in Nigeria. NITDA is also in talks with Cisco on how Cisco can collaborate with government to build public digital infrastructure in Nigeria in order to digitise some key sectors like agriculture and healthcare. Through our Corporate Social Responsibility (CSR) programme, Cisco will be investing in Nigeria to transform her digital transformation agenda.
How will such collaboration help Nigeria to achieve its planned 95% attainment of digital literacy by 2030?
The Director General of the National Information Technology Development Agency (NITDA), Kashifu Inuwa Abdullahi, had said that NITDA developed several initiatives that would help drive digital transformation in the country and that NITDA had gone ahead to sign the National Digital Literacy Framework that would help identify competency areas. Cisco is already in collaboration with NITDA though the Cisco Network Academy that is designed to develop digital skills among Nigerians. With such collaboration, Cisco can help Nigeria to achieve its planned 95 per cent digital literacy attainment by 2030.
A lot of Nigerian youths are migrating to other countries in search of jobs and better living condition. How will Cisco accelerator programme help Nigeria address the mass movement of youths?
Again the Director General of NITDA had said that the agency drafted the National Business Process Outsourcing (BPO) strategy that would allow companies outsource their non-core businesses to other companies, a development that will enable Nigerians with the required skills, to handle such outsourced jobs. The Director General of NITDA also said such strategy would help in engaging the youths and make them remain in Nigeria and work from Nigeria, for companies located outside of Nigeria.
On the part of Cisco, we will deliver Nigerians the opportunity to acquire digital skills that will enable them live and work anywhere from Nigeria. With technology evolution, people can work from their homes without going to the office, and this way, Nigerians can work for any company in the world, while living in Nigeria, provided they have the digital skills, which Cisco is offering through our various training initiatives.
How will Cisco Edge help address the dearth of digital skills in Nigeria?
The Cisco Edge centre is designed to provide comprehensive approach in building a sustainable innovation ecosystem here in Nigeria. The idea is to train people on critical digital skills like networking, cybersecurity, programming and management skills. The skills training will come in the form of entrepreneurship, where they will have access to mentorship. So Cisco recognises the potentials in Nigeria and through our Edge centre, will train more Nigerians on critical digital skills that will help address the dearth of digital skills in the country. The Cisco Edge centre will offer them the opportunities to start their own business and create job opportunities. Cisco is working with the United States of America in some forms of partnerships to offer entrepreneurship education to communities in Bauchi State and other states in Nigeria.
What is the duration of training at the Cisco EDGE Centre and what courses are available to Nigerians?
The duration of the training depends on the particular course that the student is interested in because different courses have different duration periods. For example, basic cybersecurity training for cybersecuriy technicians can be done in few weeks, but training in a more advanced cybersecurity course to get certification, like the top level security architecture, takes years. The CCNA and the CCNP courses could take months. The Cisco EDGE Centre allows candidates to continue in their education to get different categories of digital skills that will enable them get digital jobs.
We have different cohorts that can take between 20 to 25 persons for a training of 90 days duration, depending on the course.
How does Cisco intend to address gender balance among its instructors, giving the instance where Cisco currently has 336 instructors in the Cisco Networking Academy and only 10% is female?
Cisco is gender sensitive, both in recruitment and in admitting candidates into its training programmes. Among the 400,000 students already trained in the Cisco Networking Academy since its inception in Nigeria, 44 per cent of the population is female. The females get access to the same technology education and training that Cisco offers.
Is Cisco going to merge the existing Cisco Networking Academy with the Cisco Edge Centre that has just been launched or one of them will be discontinued?
There is no plan for merger of Cisco Networking Academy and the Cisco Edge Centre because one is a sub-set of the other. The Networking Academy has been running for some time now, and we have trained close to 20 million students globally and currently, 3.6 million students enrolled in the academy, undergoing different trainings across the globe. So the Edge Centre is giving access to education to people who want to further advance the training already received at the Cisco Networking Academy. The Edge training will offer specialised and advanced training and offer access to Cisco mentorship and digital skilled job opportunities.
Tell us more about the Cisco Digital Accelerator Programme?
The Cisco Accelerator Programme provides access to connectivity, healthcare, education, among others, and connectivity is key to everyone. It is about connecting the unconnected and providing inclusive feature for all. What Cisco is doing with Accelerator Programme is consistent with what the Nigerian government is doing through NITDA. Countries are investing in the Cisco Accelerator Programme and Nigerian government is investing in it also. Access to connectivity will create next generation jobs, build a sustainable innovative ecosystem and contribute to Gross Domestic Product (GDP) growth.
The EDGE Centre is part of Cisco’s Digital Accelerator (CDA) program in Nigeria. CDA was founded in 2015 and has since evolved into programs in 49 countries, and Nigeria making it 50 countries, with over 1,600 active or completed projects – encompassing over two-thirds of the world’s population and 75 per cent of global GDP. The focus areas for Cisco’s CDA programmes are in education, transportation, security, health, connectivity, among others. In May this year, under the scope of CDA, Cisco and NITDA signed a memorandum of understanding (MoU) with the aim to support the nation’s digital transformation agenda and contribute towards digital skills training and development.
A key pillar of the CDA program in Nigeria is Cisco Networking Academy, which currently trains over 120,000 students at 228 academies across the country. Cisco Networking Academy, one of the longest-standing IT skills-to-jobs programs in the world, has over the past years, equipped over 400,000 people in Nigeria with digital and cybersecurity skills.
Tells us about the Cisco Social Justice Programme and how it aligns with the global awareness initiative on social justice?
The Cisco Social Justice Programme started as US Central Justice Programme in 2020 to address what is going on in US. It is about providing education to the people, offering economic empowerment and increasing number of SMEs for US and later we decided to take across the world. We encourage our team members to volunteer service offerings around the world and developing schools around the world. We focus on entrepreneurial development with the goal to uplift communities in the areas of education, empowerment and critical human needs and around climate.
With the Cisco Social Justice Programme, we ensure that every employee identifies his or her role to develop communities.
What are your views about the digitisation and digital transformation, in relation to perceived loss of jobs?
It is obvious that the ongoing digital transformation and digitisation of processes across globe will displace jobs by 2025. In fact digitisation will displace as much as 85 million traditional jobs, but it will also create as much as 97 million digital jobs by 2025.
New digital jobs will be created and companies should begin the process of retraining their workers that are trainable and place them on the jobs that have demand for digital skills and higher pay. Digitisation will create opportunities to train millions of workers with digital skills from now till 2025. In Nigeria, there are youths who are young and determined to learn. So the Cisco EDGE Centre will offer them access to training and education that will lead to digital transformation.
How will you describe Cisco’s training programme and its goals at the global level?
Since the inception of Cisco Networking Academy, we have trained millions students around the world, and we are inspired by the achievements of those trained by Cisco. We get reports how they are developing their economies and creating digital jobs across the world. I am proud about the technology innovation going on in Nigeria. With its youths population and determination to learn new skills, there is no question that Nigeria will grow to become one of the leaders in the global technology space.
Our goal at Cisco is to empower an inclusive future for all in order to bridge the existing digital divide by giving access to technology education, healthcare and connectivity. One of our basic commitments is to focus on the digital divide from the education perspective.
Another area that is key for Cisco, is the sustainability initiative of Cisco where we think of how to use our technology to develop and sustain development globally. Cisco has a $100 million grant to drive its sustainability programmes and to support startups to scale up in their sustainability projects. I see tremendous growth in Nigeria and Africa and in communities.
So Cisco is the worldwide technology leader that securely connects everything to make anything possible. Our purpose is to power an inclusive future for all by helping our customers re-imagine their applications, power hybrid work, secure their enterprise, transform their infrastructure, and meet their sustainability goals.
What are the building blocks for Cisco’s digital skills training initiative?
The building blocks are many and are centered on networking, cybersecurity, programming and management. The first is about inclusive infrastructure that is designed to connect several applications from libraries, systems, hospitals, homes and government entities, followed by education, security and resilient critical infrastructure where data is kept and stored.
Cisco Systems Inc. may have reported its strongest annual revenue growth in a decade, but it’s headed down a much more anemic path this fiscal year — and even early traction with artificial intelligence won’t save it from that fate.
On Wednesday, the networking giant reported a better-than-expected fiscal fourth quarter, including a 16% boost in revenue that helped bring its annual growth rate to 11%. But Cisco CSCO also delivered a dim outlook for its current fiscal year, which translated to expectations for revenue growth...
Cisco Systems (NASDAQ:) shares rose in early Thursday trading after the IT networking company provided positive updates on the earnings call. The stock initially fell in after-hours Wednesday after the company’s FQ4 results and guidance failed to entice investors.
The company said its revenue rose 16% year-over-year to $15.2 billion, just ahead of the consensus of $15.05 billion. For its full fiscal 2023 year, Cisco generated sales of $57 billion. Adjusted earnings per share of $1.14 also managed to come in higher than the consensus of $1.06.
"This past year was a milestone year for Cisco with record performance in both the full year and Q4," said Chuck Robbins, chair and CEO of Cisco. "We are seeing solid customer demand, gaining market share, and innovating in key areas like AI, security, and cloud. This momentum gives us confidence in our ability to capture the many opportunities ahead."
Cisco generated $6 billion in operating cash flow, which is a significant increase of 62% compared to the same period last year. Product revenue was up 20% while service revenue rose 4%. Business units Secure and Agile Networks both saw their sales rise 33% YoY, while Optimized Application Experiences jumped 15%.
Region-wise, the company witnessed the strongest growth in the Americas region, which also yielded gross margins of 65%. Overall, Cisco reported a total gross margin of 65.9%, which marks a 260-basis points expansion compared to the year-ago period. The adjusted operating margin stood at 35.4%, topping the consensus by 70 bps.
Cisco also said it made progress on business model transformation with total software revenue rising 17%. The company’s ARR (annualized recurring revenue) came in at $24.3 billion, up 5% YoY. Similarly, the RPO (remaining performance obligations) now stands at $34.9 billion, up 11% YoY.
"We delivered double-digit growth in revenue and EPS, generating strong operating leverage in Q4," said Scott Herren, CFO of Cisco. "Our business model transformation drove double-digit growth in software revenue, product ARR and total RPO, leading to greater visibility and predictability. We are committed to expanding operating leverage and increasing shareholder returns over the long term."
Following solid results, Cisco has declared a quarterly dividend of $0.39 per common share to be paid on October 25 to all stockholders of record as of the close of business on October 4.
For this quarter, the company guided for adjusted EPS of $1.03 on revenue of $14.6 billion. This revenue guide implies a 4% decline in sales on a sequential basis. Analysts were looking for adjusted EPS of $0.99 on revenue of $14.57 billion.
The adjusted gross margin is seen at 65.5% while the adjusted operating margin is expected to come in at 34.5%. Both topped the average analyst estimate.
For FY24, Cisco expects EPS in the range of $4.01-4.08 on revenue of $57-58.2 billion, which compares to the analyst consensus for adjusted earnings of $4.05 per share on revenue of $58.3 billion.
While Cisco shares initially dipped on the softer-than-expected full-year revenue guidance, they recovered to trade modestly in the green in the aftermath of the company’s FQ4 earnings call. Robbins argued that the accelerated AI transition “will fundamentally change our world and create new growth drivers for us.”
He reminded investors and analysts on the call that Cisco has been investing in AI for years, including the recently-announced AI products that were described as “market-leading.” These AI-powered products will boost productivity, enhance policy management, and simplify tasks, he said:
“Cisco's ASIC design and scalable fabric for AI position us very well to build out the infrastructure that hyperscalers and others need to build AI ML clusters. This is a huge opportunity for Cisco, and we are laser-focused on leading and winning in this space. As a result of our innovation in this area, we expect Ethernet will lead in connecting AI workloads over the next five years,” Robbins added.
Speaking specifically about Ethernet, Cisco said it has already taken orders “for over half a billion dollars” for AI Ethernet fabrics. In addition to Ethernet, security remains one of the top priorities and growth drivers for Cisco.
Along these lines, the company recently launched a new security service edge solution, which is designed to allow for better hybrid work experiences and significantly simplify access across any location, device, and application.
Generative AI technology is leveraged to Improve threat response. It helps to reduce policy complexity, while also working swiftly to detect and remove threats. Cisco said it has incorporated its Zero Trust Access (ZTA) capabilities into a native experience on ) iOS and macOS.
"At Apple, we believe deeply in providing privacy and security that is built in from the ground up,” said Susan Prescott, Apple’s Vice President of Enterprise & Education Marketing. “Later this year, iPhone, iPad, and Mac will have native support for network relays. Together with Cisco Secure Access, enterprises will have a secure and seamless remote access solution, to do their best work from anywhere, on the best devices for business.”
Back to AI, CFO Herren urged patience as the benefits from AI investments are not yet in P&L. Herren said that:
Cisco is “invested early in the AI game” and it remains hopeful that it can become one of the bigger beneficiaries as the company is “getting early success.”
Cisco stock was also boosted by CEO comments that the company gained more than 3 percentage points of market share YoY in its three largest networking markets: Campus switching, wireless LAN, and SP routing.
“We expect further share gains in these areas as market share numbers are released for calendar Q2,” Robbins said on the call.
Cisco reported a solid set of results for its fourth fiscal quarter, as well as offered an FQ1 forecast that topped analyst estimates. This, coupled with positive updates on the earnings call about the AI transition helped offset a weaker-than-expected full-year revenue guidance.
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Shane Neagle is the EIC of The Tokenist. Check out The Tokenist’s free newsletter, Five Minute Finance, for weekly analysis of the biggest trends in finance and technology.
