Latest news with #Hypershield
Yahoo
21-05-2025
- Business
- Yahoo
AI Security Pivot Places Cisco Systems Stock (CSCO) in Pole Position
Cisco Systems (CSCO) shares remained relatively flat despite the company surpassing expectations in its latest quarterly results published last week. The technology leader delivered both revenue and earnings beats, driven by strong performance in its security and observability segments. Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks straight to you inbox with TipRanks' Smart Value Newsletter These results underscore Cisco's continued transition from legacy networking hardware to a more diversified, higher-margin software and services portfolio. A strategic pivot toward AI-powered security solutions seems to be paying off, although the market has yet to realize it. With an expanding product mix, upwardly revised guidance, and multiple analyst upgrades, I maintain a long-term bullish outlook on Cisco. Cisco's Security segment has emerged as a key growth driver following its strategic shift toward AI-powered cybersecurity solutions. Revenue in the segment surged 54% year-over-year to $2 billion last quarter. Historically challenged by competition from pure-play cybersecurity firms like CrowdStrike (CRWD), Cisco has significantly strengthened its position through its $28 billion acquisition of Splunk. This acquisition has accelerated growth and enabled the launch of new products such as Hypershield and AI Defense—AI-driven solutions designed to secure data centers and cloud environments. Notably, both products have already been adopted by Fortune 100 companies. Splunk has also revitalized Cisco's Observability segment, which saw a 24% revenue increase last quarter. Before the acquisition, Cisco's organic observability business grew by 3–4% annually. Integrating Splunk's capabilities has created a more compelling offering for enterprises deploying AI workloads, delivering enhanced visibility and intelligence. Together, the Security and Observability segments are now central to Cisco's broader AI transformation strategy. For organizations seeking comprehensive visibility, protection, and data insight, Cisco is positioning itself as a full-spectrum solution provider. Reflecting this momentum, the company expects to generate ~$56.6 billion next quarter. That said, Cisco's $28 billion acquisition of Splunk was a significant investment, and while initial results are encouraging, the real test lies ahead as integration efforts deepen. Ideally, long-term growth is driven by organic innovation rather than large-scale acquisitions. Cisco's track record in this area has been mixed—prior acquisitions such as AppDynamics and WebEx have delivered uneven outcomes over time. Competitive pressure also remains a key concern. In the security space, Cisco faces stiff competition from specialized vendors like Palo Alto Networks (PANW), CrowdStrike (CRWD), and Zscaler (ZS). Meanwhile, in the networking segment—still responsible for roughly half of Cisco's total revenues—rivals such as Hewlett-Packard Enterprise (HPE) and Nokia continue to advance. Notably, HPE's proposed acquisition of Juniper Networks, which would significantly bolster its networking capabilities, is under scrutiny from the U.S. Department of Justice over potential anti-competitive concerns. While a delay or failure of the deal could work in Cisco's favor, the outcome could influence competitive dynamics in the sector. Cisco also relies heavily on hardware sales, exposing it to supply chain volatility and potential tariff-related margin pressures. Although growth in its Security and Observability segments is promising, these businesses are still relatively small in scale. Sustained momentum will be needed for Cisco to prove that its shift toward software and AI-driven solutions can offset the slowdown in its core networking operations. On Wall Street, CSCO earns a Moderate Buy consensus rating based on nine Buy, seven Hold, and zero Sell ratings in the past three months. CSCO's average stock price target of $70.77 implies ~11% upside potential over the next 12 months. Analyst Amit Daryanani from Evercore ISI maintained his Outperform rating on CSCO with a price target of $72. He sees Cisco as being positioned for continued growth in FY2026, driven by AI infrastructure demand and cloud deployments. Notably, he notes that Cisco AI infrastructure orders doubled to $600 million compared to the previous quarter, putting the company ahead of its $1 billion annual target. William Blair analyst Jason Ader takes a more reserved view on Cisco Systems, issuing a Hold rating with a $66 price target. Despite the company's recent strong earnings, Ader remains cautious, pointing to 'intense competition,' which he believes could limit Cisco's earnings growth to the 'mid-single-digit range.' He also warned of macroeconomic risks, including 'increased tariff rates and possible changes in semiconductor export rules,' which could further weigh on the company's long-term outlook. Cisco's quarterly results suggest that the integration of Splunk is progressing well, supporting the company's gradual shift away from lower-margin legacy hardware toward higher-margin software and services. While its core networking business remains a reliable revenue driver, Cisco is clearly evolving, particularly in the areas of observability and security, positioning itself to benefit from broader technology trends such as AI, cloud infrastructure, and cybersecurity. However, several execution risks remain. The full integration of Splunk is still underway, and Cisco faces intense competition from pure-play cybersecurity firms and established networking rivals. Additionally, external pressures such as rising tariffs could weigh on margins. Cisco's reliance on acquisitions for growth also raises concerns, especially given that conventional metrics do not consider the stock undervalued. Analyst sentiment remains mixed, reflecting this balance of opportunity and risk. For investors seeking diversified exposure to key technology segments with relatively lower volatility, Cisco may offer a more stable option, backed by consistent cash flow generation and a track record of returning capital to shareholders. Disclaimer & DisclosureReport an Issue
Al Bawaba
25-02-2025
- Business
- Al Bawaba
Cisco Showcases Simplicity, Security and AI Readiness at Cisco Live Amsterdam
Cisco (NASDAQ: CSCO), the worldwide leader in networking and security, highlighted innovative technology, partnerships, and skills programs to the over 17,000 IT professionals that attended its flagship technology event in the EMEA (Europe, the Middle East and Africa) region. Cisco Live EMEA provides customers with a clear vision for how the company can help simplify IT in the face of increasing complexity, and a blueprint for securely adopting and utilizing AI to empower their businesses.'Cisco is in a unique position to help guide our customers through the incredible change we're seeing right now across industries,' said Oliver Tuszik, President of Europe, Middle East and Africa, Cisco. 'From the changing nature of the workplace, to the AI revolution in data center and network infrastructure, and the need for digital resilience at all levels, Cisco has solutions for our customers' biggest challenges.' Cisco's recent CEO research highlights the dilemma customers face today as they prepare for the impact of AI. More than 70% of CEOs shared concerns about losing ground to competitors and missing out on opportunities because of IT and infrastructure gaps. They recognize the need to invest in AI skilling and workforce upskilling, alongside the technology investments. CEOs also recognized the importance of trusted partners, with 96% reporting their reliance on them to assist in future-proofing their networks for AI. Simplicity, Security and AI ReadinessAcross its portfolio, Cisco is committed to building solutions that simplify operations, embed security at all levels, and provide customers with the technology they need to embrace AI.'Every business today is working overtime to understand the opportunities and challenges of adapting how they work and serve customers in the AI era,' said Jeetu Patel, EVP and Chief Product Officer, Cisco. 'At Cisco, it's our mission to actively shape this future and help our customers around the world to win. That's what the innovations in networking, security, data centers, and more that we unveiled at Cisco Live EMEA are all about. Our customers need trusted partners to navigate this shift and we're answering the call.' Cisco introduced and is delivering impactful innovations across the unmatched breadth of its product portfolio. This includes:AI infrastructure and data center solutions to enable enterprise and service provider customers to transform infrastructure to power AI N9300 Smart Switches with Hypershield: Cisco's Smart Switches redefine adaptive and scalable AI data center architectures by embedding services directly into the network. Cisco Hypershield, which will be the first service available, eliminates the gap between security and networking layers by converging them into a single Hybrid Mesh Firewall: The N9300 Smart Switch and Hypershield integration, along with advances in firewall, management, and licensing, will enable Cisco to deliver Hybrid Mesh Firewall optimized to protect AI applications in the data center and public cloud. Cisco's Hybrid Mesh Firewall is a highly distributed security fabric managed under a single management console, delivering zero trust segmentation and protect application vulnerabilities in modern and AI Agile Services Networking: The Cisco Agile Services Networking architecture provides a blueprint for service providers as they look to enable AI connectivity and monetize assured services. The innovations introduced to deliver this architecture include Silicon One-powered platforms, coherent pluggable optics and provider management and assurance software of AI Server Family: New Cisco UCS C845A M8 server, based on the NVIDIA MGX reference architecture, brings flexibility to AI workloads. Its advanced architecture is designed to enable AI innovation, offering the computational power for intensive tasks and the efficiency required for rapid to modernize everywhere people and technology work and serve customers.Universal Zero Trust Network Access: Cisco is extending its identity-first Zero Trust Network Access (ZTNA) with Hybrid Private Access to optimize in-office experience and keep sensitive data private. Along withPolicy Assurance to predict and prevent policy-related access disruptions, Cisco is enabling customers to make zero trust truly universal in both coverage and Friction Workplace Connectivity: To deliver a full complement of integrated workplace wireless infrastructure solutions that provide innovative intelligence, security, and assurance, Cisco is introducing an expanded portfolio of Wi-Fi 7 access points for small and mid-size deployments, along with high-powered stackable access AI Assistant for Webex Contact Center: To improve agent and customer service experiences, the Cisco AI Assistant for Webex Contact Center is now generally available. This includes context transfer summaries, dropped call summaries, Agent Wellbeing and automatic customer satisfaction scores (Auto CSAT). The company has also announced that features including suggested responses, real-time transcription for agents, wrap-up summaries and mid-call summaries will be available in Q2 2025. Cisco Room Bar BYOD: According to a recent Frost and Sullivan report*, 56% of video-enabled spaces are currently Bring-Your-Own-Device (BYOD). To enable seamless collaboration in any space, Webex unveiled the Cisco Room Bar BYOD. The Room Bar BYOD allows you to join any meeting hosted on your laptop via USB-C and provides a cost-effective and scalable solution that features AI-powered capabilities to empower businesses with high-quality meeting assurance and security solutions that encompass a customer's entire digital footprint so they can stay ThousandEyes Traffic Insights: Generally available in March, Cisco ThousandEyes Traffic Insights extends visibility deeper into on-premises networks by correlating traffic flows with synthetic measurements for end-to-end assurance of every digital experience. The out-of-the-box Cisco integration enhances digital resilience by enabling customers to accelerate remediation and rapidly pinpoint performance issues. New Cisco and Splunk integrations now available: Cisco Secure Application for Splunk AppDynamics and Cisco Talos Threat Intelligence now integrate with Splunk security solutions, enhancing visibility and threat detection. Application attack data from Cisco Secure Application for Splunk AppDynamics flows into Splunk Enterprise Security, enabling faster security investigations. Additionally, real-time threat intelligence from Cisco Talos is now available for Splunk Enterprise Security, Splunk SOAR, and Splunk Attack Analyzer. Solving AI ChallengesCisco's portfolio gives customers and partners solutions to accelerate AI adoption, but challenges remain. Recognizing the need to tackle the energy efficiency challenges imposed by AI workloads, as well as the deepening skills gap that has developed due to the ever-evolving AI landscape, Cisco has introduced new partnerships and programs at Cisco Live Alliances: The Cisco Engineering Alliances program is designed to accelerate building new validated solutions to solve some of our customers' most pressing challenges. Cisco has signed alliances with Vertiv, DeepCoolAI, Green Revolution Cooling and Asperitas to deliver liquid cooling solutions, addressing the ever-increasing thermal density in AI data centers. Additionally, Cisco has signed alliances with Panduit, MHT Technologies and ThinLabs to deliver end-to-end direct current microgrid solutions leveraging Power-over-Ethernet (PoE) and Fault Managed Power (FMP) to reduce energy use in smart buildings. AI Skilling: Cisco continues to enhance its offerings in AI skilling by launching its newest AI Skills Journey program to build critical AI Infrastructure skills from entry to expert — available on As a part of this effort, Cisco Learning & Certifications has updated current certifications, including Cisco Certified Network Associate (CCNA), Cisco Certified Network Professional (CCNP) and Internetwork Expert (CCIE). These updated certifications reflect the AI and cybersecurity skills needed to achieve impactful business outcomes. Select programs will be complimentary through March 24. AI-led Customer Experience Cisco also announced the first, jointly developed AI Agent from its strategic partnership with Mistral AI, one of Europe's leading providers of AI solutions. The AI Renewals Agent greatly enhances and streamlines the renewal proposal creation process at Cisco by consolidating both structured and unstructured data from over 50 signals and sources and providing real-time sentiment analysis, summarized recommendations, intelligent automation, and personalization, all tied to customer outcomes and key performance indicators (KPIs). The new agent is the latest AI innovation for Cisco's Customer Experience (CX) organization and continues to demonstrate how Cisco is delivering against its vision of using AI to make every customer experience personalized, proactive and predictive, and delivering unique outcomes that exceed customers' expectations. © 2000 - 2025 Al Bawaba (
Yahoo
13-02-2025
- Business
- Yahoo
Cisco Systems Inc (CSCO) Q2 2025 Earnings Call Highlights: Strong AI Demand and Product ...
Release Date: February 12, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Strong demand growth in the Nexus portfolio and data center switching, with significant year-over-year growth in key segments. Innovation in product development, particularly in security and networking, has been at an unprecedented pace over the last 12 to 18 months. AI-driven demand is contributing to increased orders, with significant investments in AI infrastructure by enterprises and telcos. Successful integration and performance of Splunk, with double-digit growth and profitability ahead of expectations. Continued strength in the telco segment, driven by network upgrades in anticipation of AI-driven demand. Gross margin guidance indicates a potential decline due to proposed tariffs, impacting cost structures. Concerns over potential impacts of tariffs on demand, although no current evidence of demand pull-forward. Enterprise orders showed slower growth compared to previous quarters, raising concerns about demand consistency. Security and observability segments are still ramping up, with some products needing more time to gain traction. Competitive pressures from white box ODMs and other alternatives in the market could pose risks to Cisco's market share. Warning! GuruFocus has detected 10 Warning Signs with CSCO. Q: Can you provide more details about the new 9,300 Nexus switch and why AMD was chosen over NVIDIA for this product? Also, is the demand for AI still a significant driver for your business? A: The 9,300 Nexus switch is a breakthrough product that integrates security deeply into the network, allowing for network services to run at the speed of the ASICs. The choice of AMD was based on an analysis that deemed it the best solution. Demand for AI remains a significant driver, with many customers preparing their networks for AI-driven services. (Charles Robbins, CEO) Q: How are enterprise customers approaching AI investments, and what impact does this have on Cisco's business? A: Enterprises are in the early stages of AI investment, focusing on identifying use cases. We are seeing spending on AI-driven infrastructure, and we believe the opportunity in leveraging proprietary data for AI is substantial. Our innovations like AI pods and Hypershield are positioned to support these developments. (Charles Robbins, CEO) Q: What factors are influencing the projected decline in gross margin for the next quarter? A: The projected decline in gross margin to 67%-68% is primarily due to the anticipated costs of proposed tariffs, including a 10% increase in China and 25% in Canada and Mexico. We have built these costs into our guidance to protect against potential impacts. (Richard Herren, CFO) Q: Are you seeing any changes in demand due to tariffs, and how are hyperscaler deployments progressing? A: We haven't observed any pull-forward in demand due to tariffs. The environment is fluid, and we are prepared to mitigate impacts through supply chain adjustments. Hyperscaler deployments are progressing rapidly, with some customers increasing their targets significantly. (Richard Herren, CFO; Charles Robbins, CEO) Q: Can you provide an update on the performance of Splunk and the trends in security and observability? A: Splunk is performing well, growing double digits and ahead of expectations. The perceived decline is due to the timing of fiscal quarters. In security, we are seeing growth in demand, with new innovations like Cisco Security and XDR gaining traction among enterprise users. (Richard Herren, CFO; Charles Robbins, CEO) For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
