Cisco is the latest tech giant to engage in layoffs, cutting more than 4,000 staff and taking a $600 million restructuring charge.
The tech industry has been hit with some of the worst layoffs in recent history, impacting tens of thousands of workers. Cisco is now joining the ranks of companies joining the layoff bandwagon, with SFGATE reporting that the company plans to lay off more than 4,000 employees.
Interestingly, company spokesperson Robyn Blum said the layoffs were not about reducing headcount.
“This is not about reducing our workforce,” Blum said. “In fact we’ll have roughly the same number of employees at the end of this fiscal year as we had when we started.”
The company intends to try to “place affected employees in … open roles,” Blum added.
Similarly, Network World reports Cisco has filed an 8-K filing indicating its intention to take a $600 million restructuring charge “in order to rebalance the organization and enable further investment in key priority areas. This rebalancing will include talent movement options and restructuring.”
CFO Scott Herren also emphasized the restructuring program is not for the purpose of reducing the company’s headcount.
“And to be clear [about] this: Don’t think of this as a headcount action that is motivated by cost savings. This really is a rebalancing. As we look across the board, there are areas that we would like to invest in more. Security, our move to platforms, and more cloud-delivered products. But we’re also going to maintain our financial discipline as we do that,” Herren said.
“This is about rebalancing across the board. In a perfect world, you’d have 100% skill match, and you can take the people in the areas, or the skills in certain areas, and just move them to where we need to invest, and unfortunately, that’s not – it’s not a perfect world,” Herren added.
General Dynamics, T-Mobile, AWS, Cisco, Dell Technologies, and Splunk have formed a coalition to accelerate 5G and edge adoption.
The next generation wireless tech is already revolutionizing multiple industries and making edge computing a viable option for many companies. With high speeds and low latency, 5G is competitive with the fastest broadband available.
General Dynamics Information Technology (GDIT) has formed a coalition with like-minded companies in an effort to further the adoption of 5G and edge computing.
“We share a common vision of how 5G, edge and advanced wireless technologies can transform government operations,” said Ben Gianni, GDIT’s senior vice president and chief technology officer. “Forming this coalition will help us bring our collective strengths together to provide technical differentiation and the most beneficial solutions for our government customers.”
GDIT will focus on designing and deploying secure 5G solutions with its partners, while each member of the coalition will leverage its specialties. AWS brings its cloud infrastructure to the table, T-Mobile will provide the network bandwidth, Cisco will provide 5G and mobile edge computing solutions, Splunk will handle cybersecurity automation, and Dell will leverage its open infrastructure, edge computing, and AI abilities..
“As part of this new coalition, we can collaborate with other technology, telecommunications and government leaders to help power an inclusive future,” said Carl DeGroote, vice president of federal sales, Cisco. “We’re excited to apply our 5G core and mobile edge compute expertise to accelerate the adoption of 5G and help advance wireless and edge technologies across government agencies.”
Cisco and Microsoft have entered an unlikely partnership, paving the way for Microsoft Teams to run as the default on Cisco hardware.
Cisco and Microsoft both make video conferencing software, WebEx and Teams respectively. Given the two companies compete in the same space, a partnership is somewhat surprising, although it’s likely more an acknowledgment of Teams’ dominant position in the market.
The partnership will see Microsoft Teams run natively on select Certified for Microsoft Teams devices in the Cisco Room and Desk lineup and can even be set as the default option.
“Interoperability has always been at the forefront of our hybrid work strategy, understanding that customers want collaboration to happen on their terms — regardless of device or meeting platform,” said Jeetu Patel, EVP and GM, Security & Collaboration, Cisco. “Our partnership with Microsoft brings together two collaboration leaders to completely reimagine the hybrid work experience.”
“Our vision to make Teams the best collaboration experience for physical spaces is brought to life by our incredible ecosystem of hardware partners,” said Jeff Teper, president, collaborative apps and platforms at Microsoft. “By welcoming Cisco as our newest partner building devices Certified for Microsoft Teams, we are excited to bring leading collaboration hardware and software to market together for our joint customers.”
Few programs or platforms have seen such a meteoric rise as Teams. Prior to the pandemic, Slack, Zoom, and WebEx were major contenders in the corporate messaging and videoconferencing markets. Thanks in no small part to its being bundled as part of Microsoft 365, Teams quickly surpassed Slack and has carved out a major presence in the video conferencing market.
The deal with Cisco is sure to help further Microsoft’s reach even more.
Cisco was hacked by a ransomware gang in May, with the criminals reportedly stealing 2.75GB of data and trying to extort the company.
According to BleepingComputer, Cisco confirmed the Yanluowang gang compromised the company’s network but said the bad actors only made off with non-sensitive data. The data was from an employee’s Box folder.
“Cisco experienced a security incident on our corporate network in late May 2022, and we immediately took action to contain and eradicate the bad actors,” a Cisco spokesperson told BleepingComputer.
The company said the breach did not impact its business.
“Cisco did not identify any impact to our business as a result of this incident, including Cisco products or services, sensitive customer data or sensitive employee information, intellectual property, or supply chain operations,” the spokesperson continued.
“On August 10 the bad actors published a list of files from this security incident to the dark web. We have also implemented additional measures to safeguard our systems and are sharing technical details to help protect the wider security community.”
The company also found no evidence of encrypted files that could be used in a traditional ransomware scheme, although it appears that was likely a prime goal.
“While we did not observe ransomware deployment in this attack, the TTPs used were consistent with ‘pre-ransomware activity,’ activity commonly observed leading up to the deployment of ransomware in victim environments,” the company wrote in a blog post.
Cisco and General Dynamics Information Technology (GDIT) are expanding their partnership in an effort to help government entities adopt Cisco Private 5G.
Consumer cell phones may get the lion’s share of the attention when talking about 5G, but the technology has far wider applications, especially in the business and enterprise markets. Private 5G networks are an appealing option, providing the speed and privacy that are not always possible with traditional internet service. Cisco and GDIT are working to capitalize on that with Cisco’s Private 5G.
Cisco’s Private 5G leverages the company’s mobile core technology and IoT portfolio and can easily integrate with an agency’s existing environment, including their WiFi and security options. The two companies aim to help government agencies accelerate their digital transformation, as well as better utilize AI, machine learning, and other advanced technologies.
“Adding to our portfolio of 5G capabilities, Cisco’s Private 5G offering provides GDIT with the flexibility, security, and resiliency that is required for the government sector,” said Robert C. Smallwood, Vice President of Digital Modernization and Enterprise IT Services, GDIT. “This collaboration will create a force multiplier effect that addresses our agency customers’ edge computing and IoT requirements.”
“This unique partnership combines the power of Cisco Private 5G with GDIT’s mission knowledge of customer 5G use-cases to provide a truly comprehensive solution that meets a diverse set of agency requirements,” said Carl DeGroote, Vice President of Federal Sales, Cisco. “We’re excited to continue our relationship with GDIT and work together to extend Cisco’s Private 5G solution to the public sector.”
Despite being a big supporter of hybrid and remote work, Cisco believes its current incarnation could use some work and is tackling the problem with new Webex features.
While Zoom, Microsoft Teams, and Slack often get the lion’s share of the press about remote work tools, Cisco’s Webex is a popular choice in the business and enterprise space. The company wants to tackle what it sees as some of the biggest issues with current solutions in an effort to help remote users feel more a part of company meetings.
In an interview with ZDNet, Jeetu Patel, EVP & GM, Security and Collaboration Business Units, identified three main issues with the current state of remote and hybrid videoconferencing meetings:
Remote workers can’t always see presentations and whiteboards present in the meeting.
It can be difficult to pick up on non-verbal cues via a camera.
Technical issues can impact the audio and video and impair the overall experience.
Cisco is working on some novel solutions, including Webex Whiteboard. The solution is a physical whiteboard that automatically integrates with Webex to display its contents to those connected remotely. As an added benefit, both in-person and remote attendees can interact with it.
The company is also testing People Focus, a feature that can zoom in on a person and make it easier to pick up on non-verbal cues.
Cisco is working on the audio aspect of meetings, improving noise cancellation, silencing background conversations, and removing echoes. The company’s Meraki routers can be used to seamlessly switch over to an LTE connection if the main internet connection drops.
Patel made it clear in his interview with ZDNet that these innovations are designed to help make remote and hybrid work as successful as possible, something he and Cisco see as an important factor moving forward.
“Wouldn’t it be sad if after the pandemic is over, we all said, ‘Let’s revert back and go 100% to the office?’ The beauty about what we learned in the past couple of years is that talent is available anywhere, globally. And they should be able to participate in the global economy.
“We’ve made a lot of progress over the last couple of years, and we should take that forward,” Patel continued.
Cisco is launching its Webex Go phone service, designed to streamline hybrid and remote workers’ workflow, eliminating the need for multiple devices.
Webex is a popular videoconferencing application that Cisco has offered for years. Although Zoom gets the lion’s share of public attention, and has become a household name as a result of the pandemic, Webex is widely used in the corporate and enterprise markets.
Cisco is working to make it even easier for hybrid and remote workers to get the most from Webex by eliminating the need for multiple devices. Instead, enterprise-grade Webex features can be added to a user’s personal phone as a dedicated business line.
“The past year has further heightened the need for a maniacal focus on delivering an experience that delights users,” said Jeetu Patel, executive vice president and general manager, Cisco Security and Collaboration. “Our innovations released today enable enterprises to be closer to their customers than ever, helping them deliver the best possible customer experience across all channels in real time.”
Cisco hopes to make Webex Go available in the first half of 2022.
Cisco is working to reinvent itself and cash in on the modern shift to cloud computing, after years of being slow to adapt.
Once the world’s most valuable company, Cisco failed to adapt quickly enough to the shift to the cloud. The company built a lucrative business around traditional networking equipment, and didn’t offer emerging cloud giants equipment that adequately met their needs as they built out their cloud data centers.
According to Bloomberg, the company has been working to reinvent itself, with analysts seeing parallels between Cisco and Microsoft. Much like Cisco, Microsoft missed out on emerging trends, not the least of which was the rise of the smartphone and mobile computing. Under CEO Satya Nadella, however, the Redmond giant has quickly pivoted to the cloud, becoming the second-largest cloud provider in the world. As a result, Microsoft is only the second US company, behind Apple, to cross the $2 trillion valuation mark.
Despite the parallels, Cisco CEO Chuck Robbins said Cisco is in a unique position, with unique challenges.
“The challenge that we have, is that no major technology hardware company has gone through a transformation like this.”
As part of Cisco’s transformation, the company has been focusing on software and services, acquiring a slew of companies to help build its portfolio. Even there, however, the company has faced challenges and missed opportunities. Despite Webex being one of the premier videoconferencing platforms, and still a top choice among corporate users, it has largely taken a backseat to Zoom during the pandemic.
“Webex was the premier brand,” says Erik Suppiger, an analyst for JPM Securities, told Bloomberg. “The perception now is that Zoom has considerable market share advantage.”
Cisco clearly has a long road ahead of it, but the company is optimistic. In fact, it is predicting it will beat analysts expectations in the coming years, predicting its revenue will grow 5-7% each year until at least 2025.
Whether it can live up to those promises remains to be seen.
Microsoft, Amazon and Google have announced “Trusted Cloud Principles,” an industry initiative aimed at protecting customer rights in the cloud.
With the rise of cloud computing, there are a number of issues that cloud companies and regulators are grappling with, not the least of which is privacy. Different jurisdictions have different privacy laws and requirements, making it a challenge for cloud companies to do business internationally.
The three largest cloud providers — Amazon, Microsoft and Google — have created a set of Trusted Cloud Principles designed to help govern how cloud companies should operate. The initiative also has the support of Atlassian, Cisco, IBM, Salesforce and Slack.
Through this initiative we seek to partner with governments around the world to resolve international conflicts of law that impede innovation, #security, and #privacy, and to establish and ensure basic protections for organizations that store and process data in the #cloud. Through this initiative, we commit to working with governments to ensure the free flow of data, to promote public safety, and to protect privacy and data security in the #cloud.
The initiative’s website clearly outlines the group’s mission statement:
Trusted Cloud Principles signatories are committed to protecting the rights of our customers. We have agreed to strong principles that ensure we compete while maintaining consistent human rights standards.
Analysts believe Cisco may have to spend big on acquisitions if it wants to remain competitive in a changing tech landscape.
Cisco built its business on networking equipment for the enterprise, the kind of equipment companies need to run data centers and on-premise networks. As Business Insider’sAaron Holmes argues, however, Cisco is facing an existential crisis: the cloud.
Cloud computing is on the rise now more than ever. While the transition was already well underway, the pandemic and rise of the remote workforce sent the transition into overdrive. As more and more companies rely on cloud computing to handle their basic operations, the need for expensive, enterprise-grade equipment to support on-premise networks and data centers drops precipitously.
As a result, many analysts believe Cisco will need to make additional acquisitions to remain competitive and adapt to the changing industry. Such an acquisition could be of an up-and-coming startup that offers a product or service complimentary to Cisco’s ambitions, or it could be a larger acquisition of an established rival.
Fortunately, as Holmes points out, this is nothing new for Cisco. The company has a long history of making acquisitions and isn’t shy about ponying up when the need arises. Hopefully, company leadership realizes the current cloud transitions represents one of those times.
“We are really seeing the impact of this hybrid work model,” says Cisco CEO Chuck Robbins. “We are seeing the preparation for hybrid work and the return to the office. Customers are absolutely believing this is going to occur and they’re investing in it. Customers are turning to us to help them create the trusted workplace of the future.”
Chuck Robbins, CEO of Cisco, discusses on CNBC and in their quarterly earnings call how customers absolutely believe that the hybrid work model is in their future:
Customers Are Preparing For Hybrid Work Environment
Over the last couple of quarters, we’ve seen significant investment in next-generation wireless infrastructure to be ready for their employees to come to the office. As you load these wireless networks they are going to need campus refresh underneath them, and we’ve seen exactly that. The Catalyst 9000 platform has had four consecutive quarters of increasing growth sequentially.
We are really seeing the impact of this hybrid work model. We are seeing the preparation for hybrid work and the return to the office. Customers are absolutely believing this is going to occur and they’re investing in it.
Trusted Workplace of the Future
Let me now touch on Infrastructure Platforms. We saw strong demand across a majority of our portfolio, led by our next-generation Enterprise Networking and Service Provider solutions, as companies accelerate the modernization of their infrastructure. This modern infrastructure delivers higher performance and faster access to data while offering the best user experience in an increasingly distributed environment.
Customers are turning to us to help them create the trusted workplace of the future, with Wi-Fi access points, video endpoints, cameras and IoT sensors feeding data into DNA Center and DNA spaces. We’re enabling operations teams to remotely monitor workplace conditions for a safe return to office.
We’re also working to provide visibility beyond corporate networks, which is increasingly critical as our customers accelerate their adoption of SaaS and cloud solutions for hybrid work. At Cisco Live, we launched the industry’s first enterprise-wide full stack observability offering by integrating ThousandEyes cloud intelligence with our Catalyst switching portfolio and AppDynamics. This provides IT with visibility and actionable insights across both external and internal networks to provide a seamless digital experience for users. And with users more distributed than ever, it is vital that they have the most efficient and secure connection to the cloud.
Building the Internet of the Future
Our deep partnerships with Google, Amazon, and Microsoft allow native connectivity from our SD-WAN fabric to each of these cloud offerings. With our technology, customers can reduce deployment times and connect branch offices to cloud workloads in minutes. In our Webscale business, we delivered our sixth consecutive quarter of strong order growth, which increased over 25% in the quarter, and over 50% on a trailing 12-month basis.
Our Webscale customers are starting their 400 gig upgrade cycles and aggressively pursuing long-haul build-outs while our Carrier customers are exploring new architectures to realize the full potential of 5G. We are building the internet for the future by creating breakthrough innovation with our routing, optical and automation technologies to deliver significant economic benefits.
Customers Consuming Cisco Technology In New Ways
Recently, we launched a new routed optical networking solution, integrating our scalable, high-performance routers and Acacia’s pluggable optics, which offers significant cost savings. Last week, we announced our intent to acquire Sedona Systems to extend our cross-work automation platform to build on these capabilities. We also expanded our Silicon One platform, from a routing-focused solution to one which addresses the Webscale switching market, offering 10 networking chips ranging from 3.2 terabits to 25.6 terabits per second, making it the highest performance programmable routing and switching silicon on the market. We know our customers increasingly want to consume Cisco’s technology in new and more flexible ways.
At Cisco Live, we launched our new As a Service portfolio, Cisco Plus, and our first offer, Cisco Plus Hybrid Cloud, combining our data center compute, networking and storage portfolio. Cisco Plus includes our plans to deliver networking as a service, which will unify networking, Security, and observability across Access, WAN and Cloud domains to deliver an unparalleled experience for our customers.
Turning to Security, we had a record quarter, surpassing $875 million in revenue, up 13% as we expanded our reach with customers around the world. Our Security strategy is focused on delivering a simple and secure experience. We have an unrivaled ability to provide end-to-end Security capabilities across users, devices, applications and data, on any network or any cloud.
Powering Business Transformation
Wellbeing is top of mind for so many right now as we face a new way of working. This is why we launched People Insights to help people monitor and manage their wellbeing. These new features, devices and capabilities combined with Cloud Calling and Cloud Contact Center provide our customers with the most comprehensive and inclusive hybrid work platform.
Last week, we announced our intent to acquire Socio Labs. By integrating Slido and Socio Labs into our WebEx platform, we will also be able to provide the most comprehensive internal and external event management solution on the market. In summary, we had a very good quarter. I’m so proud of the continued success of the business transformation our teams are driving.
Cisco CEO Chuck Robbins: Customers Preparing For Hybrid Work Model
A new survey has qualified just how much employees want to continue working from home (WFM), to the tune of $30,000.
As restrictions lift and companies begin opening their doors, many employees are faced with the prospect of going back into the office for the first time in more than a year. While many companies are working on permanent remote or hybrid options, some are insisting on a complete return to in-office normality.
According to a new survey by Blind, an anonymous network of professionals, a Goldman Sachs professional posed the question: “Would you rather make $30k more switching to a new job that requires you to work in the office, or would you rather keep your current salary but WFH anywhere after covid?”
An average of 64% of professionals indicated they would prefer WFM, although the number for some specific companies was much higher. For example, 100% of Zillow, 70% of T-Mobile, 89% of Twitter, 71% of Walmart, 69% of Apple, 76% of Salesforce and 73% of Oracle employees would all choose WFM. In fact, Cisco, JPMorgan Chase and Qualcomm were the only companies that fell below the 50% mark.
The survey is just the latest, and most striking, indication of just how popular WFH really is.
Google has previewed its Network Connectivity Center, a tool to manage on-premise and cloud networks.
One of the biggest challenges administrators face is integrating cloud-based networks and workflows with existing on-premise networks. Network Connectivity Center is designed to help address those challenges, and make hybrid cloud solutions easier to manage.
Today, we are announcing the preview of Network Connectivity Center, which delivers planet-scale network management to simplify complex networks for your on-prem and cloud connectivity needs. Network Connectivity Center provides a single management experience to easily create, connect, and manage heterogeneous on-prem and cloud networks leveraging Google’s global infrastructure. Network Connectivity Center serves as a vantage point to seamlessly connect VPNs, partner and dedicated interconnects, as well as third-party routers and Software-Defined WANs, helping you optimize connectivity, reduce operational burden and lower costs—wherever your applications or users may be.
Google has expanded its partnership with Cisco to provide a truly turnkey solution. Together, the solution greatly simplifies “complex heterogeneous networks,” as well as reduces cost and operational burdens, while protecting mission critical applications.
“Google Cloud and Cisco continue driving innovation for our joint customers to enable secure and automated SD-WAN access from applications and services running on Google Cloud Platform,” said JL Valente, vice president, product management, for Cisco Enterprise Routing, SD-WAN and Cloud Networking. “Our latest integration not only extends the Cisco SD-WAN fabric to Google Cloud to automate provisioning of site-to-cloud connectivity effortlessly, but also gives customers the choice of using Google Cloud for providing a highly reliable, high performance global cloud network for site-to-site connectivity that can be deployed in minutes.”
Hybrid cloud options are an increasingly important segment of the industry, with IBM recently going all-in. Even AWS, once focused solely on cloud-first, has adjusted its strategy in recent years and embraced hybrid cloud solutions.
Google’s tool will make it that much easier for its customers to manage their hybrid cloud, and could help the company better compete in an increasingly important field.
In the battle for the videoconferencing market, Cisco has announced that WebEx will be gaining live translation for more than 100 languages.
Zoom may have become the poster child for pandemic-based videoconferencing, but WebEx remains a popular choice, especially among businesses, thanks to its blend of features, price and security. Like Zoom, Teams and others, WebEx has continued to evolve and add features customers need, especially as a result of the current state of remote work.
In one of its biggest additions, available for testing later this month, Cisco is adding live translation for more than 100 languages.
In late March, Webex will begin a trial of real-time translation – from English to 100+ languages (note not all dialects included in translations). That means, non-native English speakers and/or hearing-impaired participants can choose closed captioning translation from English to one of the 108 additional languages supported from Afrikaans to Zulu. Real-time translation aids understanding and creates a more inclusive meeting, where language no longer be a barrier to great collaboration.
The feature will likely help WebEx make inroads in multi-language teams, providing an effective way to communicate without purchasing expensive, third-party translation services.
The feature is expected to be generally available in May.
Cisco has completed its acquisition of Acacia, closing a $4.5 billion deal that faced legal hurdles just months ago.
Acacia Communications makes optical interconnect technologies that helps companies deliver faster network performance, cloud services and distributed resources. Acacia’s technology compliments Cisco’s own tech, and will help the company continue to evolve.
In early January, Acacia tried to terminate its merger agreement with Cisco, citing a failure to meet various regulatory requirements. Cisco fought back, claiming all requirements had been met, and sued to keep the deal alive.
Despite the lover’s quarrel, it appears the two companies have made up…or at least come to terms. Oracle has announced it has closed the deal.
“We are thrilled to welcome the Acacia team to Cisco,” said Chuck Robbins, Cisco chairman and CEO. “Our Internet for the Future strategy puts Acacia’s high-speed coherent optics technologies front and center as we work to empower webscale companies, service providers and data center operators to meet today’s fast-growing demands for data.”
While the deal was originally valued at $2.6 billion, the final price comes to a total of “$115.00 per share in cash, or approximately $4.5 billion on a fully diluted basis, net of cash and marketable securities.”
IBM has announced that its hybrid cloud service is now generally available to all clients, a major step in the company’s transformation.
IBM announced in October that it would split into two companies. Its legacy business would be spun out as a separate company, while the core business focused on hybrid cloud. Since the announcement, IBM has been on a buyingspree, snapping up smaller companies and startups that can help it achieve its goal.
The company’s hybrid cloud service is now widely available, via its IBM Cloud Satellite service. The service is also integrated with Lumen Technologies’ edge platform to bring IBM’s cloud offerings to edge computing clients.
“With the Lumen platform’s broad reach, we are giving our enterprise customers access to IBM Cloud Satellite to help them drive innovation more rapidly at the edge,” said Paul Savill, SVP Enterprise Product Management and Services at Lumen. “Our enterprise customers can now extend IBM Cloud services across Lumen’s robust global network, enabling them to deploy data-heavy edge applications that demand high security and ultra-low latency. By bringing secure and open hybrid cloud capabilities to the edge, our customers can propel their businesses forward and take advantage of the emerging applications of the 4th Industrial Revolution.”
IBM is working with more than 65 ecosystem partners — including Cisco, Dell and Intel — to ensure customers can run their hybrid cloud workloads in any environment, thanks to IBM Cloud Satellite. Service partners will also offer migration and deployment services to help customers make the transition. IBM Cloud Satellite customers will have access to Red Hat OpenShift-certified software via the Red Hat Marketplace.
“IBM is working with clients to leverage advanced technologies like edge computing and AI, enabling them to digitally transform with hybrid cloud while keeping data security at the forefront,” said Howard Boville, Head of IBM Hybrid Cloud Platform. “With IBM Cloud Satellite, clients can securely gain the benefits of cloud services anywhere, from the core of the data center to the farthest reaches of the network.”
Cisco has sued Acacia to keep its $2.6 billion acquisition deal alive after Acacia tried to back out.
Cisco announced in July 2019 that it was purchasing Acacia for $2.6 billion. Acacia makes optical components that would aid Cisco in its efforts to gain a meaningful share of the 5G network market. Since the announcement, the two companies have been working through the regulatory hurdles necessary for the acquisition to proceed. Acacia, however, is using one of those regulatory hurdles as a reason to try to back out.
According to a company statement, Acacia is terminating the merger agreement because it did not receive approval from a Chinese agency in time.
Because approval of the Chinese government’s State Administration for Market Regulation was not received within the timeframe contemplated by the merger agreement, Acacia did not have an obligation to close the merger before the arrival of the January 8, 2021 extended end date. As such, Acacia exercised its right to terminate the proposed transaction in accordance with the terms of the merger agreement.
Cisco has challenged Acacia’s stand, claiming that all conditions have been met, including approval from China’s regulator. Cisco applied for a court mandate prohibiting any termination of the merger agreement until a court could weigh in. Cisco was granted the order on Friday.
At this point, it remains to be seen how the merger will play out, but it appears any resolution may not be as amicable as hoped.
Cisco has reportedly decided to pull the plug on its plans to build a business around smart cities.
Smart cities are considered the future of urban planning, using sensors, Internet of Things (IoT) devices and other electronics to improve the city’s functioning. Everything from utilities to hospitals to policing to medical care to IT services to traffic and transportation can be greatly improved and made more efficient.
Cisco had bet heavily on the technology, centering its efforts around its Cisco Kinetic for Cities software. According to The Wall Street Journal, however, the company is now abandoning its efforts.
“We recently decided to stop sales and eventually support for the Cisco Kinetic for City product line to align our product investment to evolving market needs and customer requirements,” a company spokesman told The Wall Street Journal.
Cisco has been working for some time to transition into software and services, relying less on hardware. Its latest earnings report showed the strategy is beginning to pay off, especially during the pandemic. Nonetheless, it appears the smart city business presented too many challenges for continued investment.
Cisco has announced its quarterly results, beating analyst estimates thanks to strong services and security.
Cisco reported revenue of $11.9 billion, with net income coming in at $2.2 billion. The company’s $0.76 earnings per share was higher than consensus forecasts of $0.70.
“Cisco is off to a solid start in fiscal 2021 and we are encouraged by the signs of improvement in our business as we continue to navigate the pandemic and other macro uncertainties,” said Chuck Robbins, chairman and CEO of Cisco. “Our focus is on winning with a differentiated innovative portfolio, long-term growth and being a trusted technology partner offering choice and flexibility to our customers. We see many great opportunities ahead as every company in every industry is accelerating its digital-first strategy.”
In particular, the company has been working to transform its business to more of a service-oriented approach, thereby insulating it from pandemic-like situations. Service revenue was up 2%, while Security was up 6%, leading Product revenue.
“Our Q1 results reflect good execution with strong margins in a challenging environment,” said Kelly Kramer, CFO of Cisco. “We continued to transform our business through more software offerings and subscriptions, driving 10% year over year growth in remaining performance obligations. We delivered strong growth in operating cash flow and returned $2.3 billion to shareholders.”
“We have a significant business that is related to corporate headquarter facilities and there are no people in those headquarters right now,” says Cisco CEO Chuck Robbins. “So there is a lot of discussion around what does corporate real estate look like? I personally believe that once we get through the vaccine period that people will want to get back to the offices in general. It’s going to be fine.”
Chuck Robbins, CEO of Cisco Systems discusses the impact of COVID on their business strategy considering Q4 earnings and how this will impact their future:
There Are No People In Headquarters Right Now
It doesn’t feel much different today than it did 90 days ago. We have a significant business that is related to corporate headquarter facilities and there are no people in those headquarters right now. So there is a lot of discussion around what does corporate real estate look like? I personally believe that once we get through the vaccine period that people will want to get back to the offices in general. It’s going to be fine.
We are going to use this opportunity to actually shift our investments and prepare for that moment. I think that when we get to the other side of this thing that with the strategy and the portfolio we have we are going to be fine.
Why Webex Didn’t Carry The Day For Us
I heard several comments that are questioning why Webex didn’t carry the day for us today. Webex grew double digits so we had good success with it. But in the context of our almost $50 business, it’s a small percentage. It’s a very small number in that context. We had success, it’s still growing and the teams are doing a great job.
There is a whole lot of innovation that is planned over the coming months for that platform. We’re excited about what’s going on. As we’ve talked about, it is secure and enterprise-grade and that’s where it shines.
There Are No People In Headquarters Right Now, Says Cisco CEO Chuck Robbins
Cisco has announced the release of SecureX, it’s open, cloud-native security platform.
The company unveiled SecureX at RSA Conference, and is touting it as “a simpler, more consistent experience across endpoints, cloud, network, and applications.” The new platform has been in the works for 2.5 years, and builds on existing services, such as Cisco Threat Response.
“SecureX provides unified visibility across all parts of your security portfolio – Cisco or third-party solutions – delivering metrics, activity feed and the latest threat intelligence,” writes Jeff Reed on the company’s blog. “I am particularly excited about the operational metrics capabilities of SecureX: Mean Time to Detection, Mean Time to Remediation, and Incident burndown times. These metrics are derived from full case management capabilities native to the SecureX platform. Case management enables SecureX customers to assign cases, track them to closure, and add relevant artifacts captured during investigation.”
SecureX offers features such as unified visibility, automation, playbooks and managed threat hunting to help companies quickly identify, respond to and remediate threats. Cisco is also touting the speed with which companies will see a return on their investment.
The company promises the platform will continue to evolve and help companies’ security keep pace.
