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Cisco CEO brushes off Brexit and other crises

Chuck Robbins has been speaking about the networking business’ resilience in the face of multiple geopolitical trends and crises, and says his customers just can’t stop spending

The world’s rapidly changing and volatile geopolitical dynamics may be dominating mainstream headlines, but they have failed to take the spring out of Cisco’s step, CEO Chuck Robbins said as he unveiled another set of solid quarterly results at the networking behemoth.

“I’ve been amazed at the resilience we’ve seen around the world in light of all the macro environment and the geopolitical dynamics, whether it’s a shutdown, or US-China trade, or Brexit, or stress in Italy, or political unrest in certain emerging countries,” said Robbins on an earnings call transcribed by Seeking Alpha.

“Our enterprise customers don’t view this technology any more as an optional enabler of a strategy that they’ve come up with,” he said. “They now view the technology as a core part of their strategy.

“Many of the strategies they’re driving around revenue growth don’t work if they don’t continue to invest in technology. They can’t just stop – they have to keep executing.

“And I’d say that most of them have a paranoia that if they do stop investing, their competitors will not and they’ll fall behind.”

Over recent weeks, Cisco has cemented its transition into the world of software-led networking with multiple announcements, many of them made at its Cisco Live Europe customer event in Barcelona.

The firm’s “datacentre anywhere” vision brings a range of innovations spanning networks, hyper-convergence, security and automation, all now well-established elements of enterprise IT strategies.

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“This quarter, we again demonstrated that we have built a resilient growth engine that is firing on multiple cylinders,” said Robbins. “Our strategy is delivering unprecedented innovation. We delivered revenue growth across all geographies and businesses, strong margins, double-digit non-GAAP earnings per share growth, and continued solid cash generation.”

Sales of $12.4bn (£9.66bn) – excluding Cisco’s service provider video software business, which was divested in October 2018 – rose by 7% year on year, while net income of $2.8bn reversed the net loss of $8.8bn in the equivalent quarter last year, which was thanks to a one-off charge related to new US tax legislation.

Read more on Software-defined networking (SDN)

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