Cisco revenue grows 8% to $12.9 bn in Aug-Oct lifted by networks

Cisco has reported that its revenue increased 8 percent to $12.9 billion in Q1 FY 2022 (for the period ended October 30, 2021).
Cisco networking businessCisco has generated sales revenue of $5.967 billion (+10 percent) from Networks; $1.109 billion (–7 percent) from Hybrid Work; $895 million (+4 percent) from Security; $1.374 billion (+46 percent) from Internet for the Future; $181 million (+18 percent) from Optimized Application Experiences; and $3.371 billion (+1 percent) from Services.

Cisco’s product revenue increased 11 percent and service revenue grew 1 percent in the first quarter.

Revenue by geographic segment was: Americas up 5 percent, EMEA up 11 percent, and Asia Pacific including Japan, China and India up 15 percent.

Cisco in a earnings release said product revenue performance was led by growth in Secure, Agile Networks up 10 percent, Internet for the Future up 46 percent, End-to-End Security up 4 percent, and Optimized Application Experiences up 18 percent. Hybrid Work was down 7 percent.

Cisco said total gross margin, product gross margin, and service gross margin were 62.4 percent, 61.5 percent, and 65.2 percent, respectively, as compared with 63.6 percent, 62.7 percent, and 65.8 percent, respectively, in the first quarter of fiscal 2021.

Cisco’s revenue growth is not impressive considering the fact that it makes several acquisitions.

Cisco closed the acquisition of Epsagon, a privately held modern observability company with expertise in distributed tracing solutions for modern applications and technologies, including containers and serverless environments.

In addition, Cisco announced its intent to acquire replex GmbH, a privately held enterprise software company based in Germany.

The San Jose, California-based company said orders grew by 33 percent in the first quarter ended Oct. 30, suggesting strong demand, but supply issues prevented this from translating into revenue right away.

Cisco Systems forecast current-quarter revenue below expectations as supply chain shortages and delays drive up costs.

The #1 network supplier for enterprises said it expects second-quarter revenue to grow 4.5 percent to 6.5 percent year-over-year, compared with Wall Street expectations of about 7.4 percent.