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Analytics, automation and AI critical to Cisco’s growth

Cisco CEO Chuck Robbins has been talking about the criticality of analytics and automation technology to the enterprise network

Cisco CEO Chuck Robbins has called out analytics, automation, artificial intelligence (AI) and machine learning as crucial to the future of the company’s networking business.

On an analyst conference call transcribed by Seeking Alpha marking the end of Cisco’s fiscal third quarter, Robbins reiterated the supplier’s focus on delivering value through secure, software-defined, automated and intelligent networks.

“As our customers add billions of new connections in the years ahead, the network will become more critical than ever,” he said. “They will be looking for intelligent networks that deliver automation, security and analytics that help them derive meaningful business value from these connections.

“These will be delivered through a combination of new platforms as well as software and subscription-based services, which we’ve been focused on accelerating over the last 18 months.

“My vision for this company is to be the most relevant and most important partner for our customers as they enable their digital businesses – and we will deliver on that vision.”

Robbins referred back to a number of acquisitions Cisco has made in recent months, notably AppDynamics in January, which it is using to give customers more visibility across networking, datacentre, security and applications; and MindMeld, bought earlier this month, which brings Cisco an AI platform to build new conversational interfaces between humans, applications and devices.

During the third quarter, total sales at the networking sector kingpin dropped by 1% year on year to $11.9bn because of a 2% decline in its Asia Pacific, Japan and China region – the Americas and EMEA were flat. Net income rose by 7% to $2.5bn.

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Product sales at Cisco were flat and services sales down 2%. Wireless, security and switching products sold best during the quarter, while next-generation routing, collaboration, datacentre and service provider video sales were all down.

Robbins said that overall, he was pleased with the progress being made on Cisco’s multi-year transformation.

But he also highlighted some weak spots, notably in US federal spending, which is currently heavily disrupted by budget uncertainty under the Trump administration, and the UK, where he described the post-Brexit referendum fall in sterling as “real and impactful” on Cisco’s local business.

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