back to article That chill in the air isn't just autumn, it's Cisco's cooling finances: CEO warns of slipping sales

Cisco is the latest tech biz to warn of a looming slowdown in spending as the network giant on Wednesday gave worse-than-expected guidance for the coming financial quarter. For the first quarter of fiscal 2020 [PDF], ended October 26, Switchzilla performed as follows: Revenues of $13.2bn were up one per cent on the year-ago …

  1. Anonymous Coward
    Anonymous Coward

    Just curious ..

    .. is that slowing market because people have realised that Huawei allows security evaluations where Cisco does not?

    For me, that would have quite an influence on my choice.

    1. Duncan Macdonald Silver badge

      Re: Just curious ..

      Not just that - the fact that Huawei products tend to be far cheaper than the equivalent Cisco products and the repulsion of much of the world to Trump's persecution of Huawei also have a large effect.

    2. Anonymous Coward
      Anonymous Coward

      Re: Just curious ..

      The key is:

      "Asia and Japan, which are supposed to be Chipzilla's growth areas, actually fell by eight per cent."

      Based on earlier statements by Cisco, the 8% drop is largely as a result of a 10% drop in sales in China due to the US-China trade sanctions.

      I would be surprised if Cisco was able to get the majority of that business back.

      I haven't seen any evidence that this is security related, only speculation and the speculation tends to ignore any impact of trade sanctions.

  2. Anonymous Coward
    Anonymous Coward

    Gross profit margin still at a rapacious 64.3% though, so no need for a whip-round for them yet.

  3. Nunyabiznes Silver badge

    Hmmm

    I wonder what set(s) of equipment Cisco will retire support for earlier than expected to push sales?

    1. sanmigueelbeer Silver badge

      Re: Hmmm

      I wonder what set(s) of equipment Cisco will retire support for earlier than expected to push sales?

      Cisco's new-ish cash cow is Smart Dumb Licensing.

      It didn't work (well) in the old system, it won't work in this new one either.

      (Dis)Connecting people!

  4. SRF

    A Shambles

    In the last year or so I have had to tackle the Cisco Webex offering. As a lawyer, I was looking at the contract. Cisco were unable to provide me with a link to all the documents, polcies, pricelists and whatever they considered part of the agreement. They could not even provide a complete list. Everything was a series of nested links, within documents. Frequently the trail led into a passwprd protected area that they couldn't or wouldn't help you through.

    My best advice to the business: Avoid. Do not contract with Cisco. The best advice not being commercially helpful, the advice had also to be: There are no guarantees as to what you think you are signing up to are what the outturn will be. I was even dealing with their legal team.

    I am all for robust negotiations, tough contract even. But contracts whose terms are obscured by beaucracy and ad hoc fiefdoms around a business concealing things is not, as I see it an appropriate way of doing business, let alone acceptable. A the very least it leads to poor busines relations and is a hostage to future litigation.

    If my experience is a snapshot of how Cisco is organsed and run, no wonder its finances look unstable.

    1. Anonymous Coward
      Anonymous Coward

      Re: A Shambles

      Same experience trying to buy AppDynamics and Umbrella and other none core services that Cisco has. Even if you want to buy, it’s like going into a black hole with no path forward at times. As a previous AppDynamics customer we used to be able to go on the site and buy a 5-10k per month subscription in minutes, and then Cisco bought them... literally 2 months chasing sales team to get a price / proposal and no end in sight. Similar experience in other areas. Have my fingers cross that they don’t ruin Duo and Meraki.

      Oh and those lovely FirePower devices that the sales team rams down your throat but barely work for even the basic of things... a simple access control list change used to take seconds and has now turned into a 30-60 minute job. All the forums, TAC are talking about it but absolutely no acknowledgement from the company.

      In summary, they are letting core networking customers down, UCS is still okay but cloud is there now, and all their other services don’t see to be a priority for anyone.

  5. Anonymous Coward
    Anonymous Coward

    Not relevent

    Unfortunately, the partner I work for just aren't seeing the requirement for traditional Cisco gear anymore. The competition has caught up in many areas and tends to be cheaper. The exceptions seem to be Cisco Meraki and Umbrella which we can't sell enough of.

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