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Exam Code: 300-915 Practice test 2022 by team
300-915 Developing Solutions Using Cisco IoT and Edge Platforms (DEVIOT)

Exam Code : 300-915
Exam Name : Developing Solutions Using Cisco IoT and Edge Platforms - DEVIOT
Duration : 90 Min.

Exam Description Developing Solutions Using Cisco IoT & Edge Platforms v1.0 (DEVIOT 300-915) is a 90-minute test that is associated with the DevNet Professional Certification. This test tests a candidate's IoT application development knowledge as it pertains to Cisco IoT edge compute and network architecture including Cisco IOx and Cisco EFM, IoT Data Visualization, and security methods. The course, Developing Solutions using Cisco IoT & Edge Platforms, helps candidates to prepare for this exam.

1.0 Cisco Network IoT Architecture 20%
1.1 Interpret the data flow of a topology that includes:
1.1.a gateways
1.1.b access points
1.1.c firewalls (including industrial firewalls)
1.1.d routers
1.1.e switches
1.2 Describe the purpose, functionality, and use of these operational technology components:
1.2.a PLCs and operations
1.2.b embedded microcontrollers
1.2.c RTOS systems
1.2.d Cisco interfaces (serial, sensors, I2C, and USC)
1.2.e communication protocols (BLE, WiFi, Ethernet, and LoraWAN)
1.2.f communication standards (DDS, OPC UA, MT Connect, and Open PLC)
1.3 Describe IoT requirements related to networking and device configuration policies (including configuring IOS commands to enable IOx, port and protocol needs of an application, and security and prioritization of data)
1.4 Construct a workflow to connect a sensor
1.5 Troubleshoot sensor connectivity issue

2.0 Compute and Analysis 10%
2.1 Compare the characteristics, capabilities, and use of edge devices to generic compute devices
2.2 Determine the use of cloud or specific edge devices for a given application scenario
2.3 Analyze application resource usage information to determine any required changes to the application or hardware
2.4 Construct a Python script to deploy an application at the edge using FND and GMM APIs
2.5 Troubleshoot application resources usage and network connectivity issues when using FND and GMM APIs
2.6 Determine data handling procedure and action to take with edge data based on business requirements

3.0 Cisco IOx IoT Software 20%
3.1 Describe the capabilities of a Cisco IOx application
3.2 Troubleshoot a Dockerfile for Cisco IOx
3.3 Describe the process to build applications for Cisco IOx
3.4 Identify the troubleshooting approaches for a deployed application for Cisco IOx
3.5 Describe the process to deploy an Cisco IOx application into a CI/CD on platforms (such as FND, Kinetic GMM, or Directly to IOx)
3.6 Construct a Cisco IOx application to meet requirements given SDK documentation

4.0 Cisco Edge Data IoT Software 15%
4.1 Describe characteristics of edge data services
4.2 Analyze a DSLink (extracting data from a sensor)
4.3 Identify the process to send data to a public cloud provider

5.0 Open Source IoT Software 10%
5.1 Evaluate the flow and processing of data from sensor to cloud in a given scenario
5.2 Compare characteristics and usage of MQTT and AMQP
5.3 Determine the output from given messages and subscription details
5.4 Identify broker QoS level for messages in a given scenario
5.5 Diagnose issues with broker deployment and application connection

6.0 IoT Data Visualization 10%
6.1 Describe the characteristics and capabilities of data visualization tools (such as Freeboard, Grafanna, and Kibana)
6.2 Identify the data visualization technique to meet business requirements
6.3 Interpret visualized data

7.0 Security 15%
7.1 Identify methods to implement a secure software development life cycle
7.2 Identify methods to secure an application and infrastructure during production and testing in a CI/CD pipeline
7.3 Describe risk management (including security challenges in IT and operational technology)
7.4 Describe the concepts related to confidentiality, integrity, and availability
7.5 Describe the capabilities of:
7.5.a ISE and ISE integration
7.5.b pxGRID
7.5.c AMP for Endpoints proxy
7.5.d Cisco Tetration
7.5.e StealthWatch (Enterprise and Cloud)
7.5.f Cisco Cloudlock

Developing Solutions Using Cisco IoT and Edge Platforms (DEVIOT)
Cisco Developing thinking
Killexams : Cisco Developing thinking - BingNews Search results Killexams : Cisco Developing thinking - BingNews Killexams : Real connections happen when your people feel heard, says Cisco's Anupam Trehan

"To retain our people, we need to make sure that we deliver them the chance to be heard, show them that leadership is listening, and take to heart what’s most important to them."

Meet Anupam Trehan, Cisco's Vice President, People & Communities for Asia Pacific, Japan and Greater China, who has been with the IT & networking firm for more than a decade across different roles. 

In her current role, she partners with business leaders to build integrated talent and people strategies that accelerate Cisco’s growth. Together with her team across the region, she is focused on enabling teams to thrive in a workplace that is inclusive, diverse, equitable, and fun.

At HRO's Accelerate HR 2023 conference, taking place next year, you can look forward to hearing Anupam speak on the topic 'Keeping hybrid teams engaged: Exploring the next frontier of employee engagement'.

Ahead of the conference, HRO's Lara Samson catches up with her to learn more about how she and her team to build an agile and resilient workforce that is driven by purpose, while focusing on making real connections, and ensuring employees feel heard.

Interview excerpts below: 

Q What, in your view, are the top challenges and opportunities of leading HR in your sector and remit?

The pace at which technology is evolving is driving a cyclical need for skilling, reskilling, and upskilling along with new ways of doing business and new ways of working.

This fundamentally means that we need to approach our people and talent solutions differently from a retention, engagement, and attraction perspective. The key opportunity for us is to build an agile and resilient workforce that is driven by purpose.

Learning: When we look at learning against this backdrop of building agility and fungibility in talent, the way we invest in learning from an education, experience, and exposure perspective needs to shift. Technology will play a key role in defining “one size fits one” learning experiences, tailored to each individual’s needs. Industry partnerships will evolve as continuous learning take place. Learn-unlearn-relearn will be the new mantra.

The way we engage the workforce: We need to design the work experience around, and for, the employee, wherever they are. This starts with placing them, their experience, engagement, and wellbeing – at the center, supported by an inclusive culture, trust, and empathetic leadership, and with technology as an enabler.

The way work is anchored in purpose needs to evolve: At Cisco, our Purpose is to “power an inclusive future for all” and this anchors us in everything we do. We believe that any successful shift in the company’s culture must be built on a strong foundation, and this begins with the highest level of leadership. Leaders play a key role in embedding empathy, listening, flexibility, continuous learning, and creating an environment where everyone is empowered to speak up.

Q With most organisations looking to recover and rebound, where are you finding the headcount your team needs, and how are you coping with the talent shortage?

We have been on a journey over the past few years with some learnings.

First – work is now hybrid. This is a hugely discussed and debated subject with differing opinions. When you think about it, we all learn, play, connect and do more in a hybrid manner today. The need to get 'hybrid' right is so important today. At Cisco, we were a hybrid workplace long before the pandemic hit but we know that the future of work will look different. We continue to listen, learn and experiment with our people on how they best work.

Second – real connections happen when people feel heard. We found that employees who are never invited to share their perspectives or concerns are 21 times more likely to leave the company.

To retain our people, we need to make sure that we deliver them the chance to be heard, show them that leadership is listening, and take to heart what’s most important to them. We do this through our quarterly engagement pulses —check-ins with our people about top-of-mind issues, concerns, and more.

Last but not the least, people want growth – they want development and new experiences. Our skills-to-job programme Cisco Networking Academy aims to empower people with career possibilities in the tech industry. The academy has supported a total of 17.5mn students over the past 25 years globally and 1.3mn students in ASEAN since its inception. We have invested in our Apprenticeship programme, which provides both theoretical learning and practical experience to enable participants to receive the training they need for a career in technology.

We also strive to nurture leaders through our award-winning Cisco Sales Associate programme, a global, year-long graduate programme for students who share our values and are passionate about technology and innovation.

We believe that internal movement is pivotal. Our "One Cisco, Many Careers" approach offers opportunities for our people to explore various roles and responsibilities and expand their experience and contributions beyond a fixed role.

Q Brain drain is a real concern in Asia at the moment. In this time of manpower shortage, how are you and the team preparing to manage these talent-related challenges?

People are the most valuable asset in any organisation, and we believe that public-private partnerships can play a key role in helping to address the widening digital and talent gap in Asia.

This is why we continue to partner with public and private organisations, educational institutions, and non-profit organisations to provide more opportunities for digital reskilling and upskilling and empower the next generation of talents to address the headwinds and opportunities of a digital-first world.

One way we’re doing this is through our Talent Bridge programme, which connects Cisco and partner employers to Networking Academy talents. The programme offers valuable free resources for both employers and students—helping employers find technology-savvy talent and supporting students as they emerge from academic learning to begin their careers.

As part of our focus on emerging and rising talent, we created a specialised Emerging Talent Recruiting Team to identify, attract, and recruit the best early career talent. This team actively devises strategies to create new talent pipelines and expand on the existing ones with close partnerships with universities.

This includes recruiting students already getting training in Cisco Technology under our Cisco Networking Academy programme or Cisco Ideathon, our flagship talent search and university hiring programme where we award internship opportunities and full-time placements to students that exhibit inventive thinking and novel perspective.

Q Looking towards 2023, what's the biggest change that you believe needs to take place in HR?

If there’s anything we know for sure, it’s that the future is unpredictable. We are still not completely out of the woods with the pandemic, and external factors such as heightened geopolitical tensions and talk of a recession are creating uncertainties.

While these externalities are beyond our control, they highlight the need for us to stay committed to our people and our customers. A solution-oriented mindset with a focus on simplicity, scale, and relevance for People and Talent actions is key.

For us, that is cultivating an employee-centered culture that prioritises understanding the needs of employees as they manage external challenges in a changing world. That is leading by action and taking steps to support the paradigm shift that’s needed in a hybrid work world anchored in our commitment to power an inclusive future for all.

Back, bigger and better – Accelerate HR brought to you by Human Resources Online is a prominent HR event you can’t miss. Over 30 deep-dive sessions by leading workplace trailblasers and HR innovators via informative keynotes and case study-driven breakout sessions, interactive panels and debates, fireside chats, and high-value discussions with over 250 people leaders in the region. Contact us for group discounts or download the event brochure for more details.

Photo / Provided

Follow us on Telegram and on Instagram @humanresourcesonline for all the latest HR and manpower news from around the region!

Thu, 08 Dec 2022 13:05:00 -0600 en-GB text/html
Killexams : New CIO Wants Cisco to Be a Model for Hybrid Work

Fletcher Previn, Cisco Systems Inc.’s new chief information officer, said he is working to help position the networking-equipment maker as a leader in hybrid work.

“Everybody being remote in the pandemic was actually a simpler problem to solve than hybrid work,” Mr. Previn said, adding that he is focused on improving Cisco’s employee experience so workers at home aren’t disadvantaged relative to their in-office peers. Cisco’s roughly 83,000 employees have the option of working from the office or from home.

Mr. Previn, who is based in Connecticut, was appointed Cisco’s CIO in September, succeeding  Jacqueline Guichelaar, who now leads the company’s customer-experience function for the Asia Pacific, Japan and Greater China region. Mr. Previn joined Cisco in 2021 as chief digital officer from International Business Machines Corp., where he was CIO.

Months into his new role, Mr. Previn said one of his goals is to mold the San Jose, Calif.-based company into a model for flexible workplaces as more employees return to the office.

“I have the great luxury of being CIO of Cisco and to be able to go through our entire catalog and portfolio of architectures and technology and say, ‘What are the parts that are really required to solve this?” Mr. Previn said about enabling hybrid work. “The companies that get that right will win.”

Mr. Previn said he intends to further automate internal processes and fine-tune IT to make teams more agile so they can tackle more projects across software development, infrastructure, networking and cybersecurity.

“Even if you’re supporting a 30-year-old legacy application, there’s just as much space for innovation in that application as a brand-new mobile app that you build on the cloud,” he said.

Mr. Previn, who reports to Cisco Chief Operating Officer Maria Martinez, oversees a team of about 9,200 people in functions such as employee IT support, core finance and supply-chain systems, sales and marketing tools, manufacturing, and data-center and security infrastructure.

Cisco CIO Fletcher Previn

Photo: Cisco Systems Inc.

An IBM veteran of more than a decade, Mr. Previn was named that company’s CIO in 2017. At IBM, he had prioritized design thinking and user experience in an effort to attract and retain employees. Mr. Previn’s prior experience leading an IT department of more than 12,000 people prepared him for Cisco, where he has taken the same employee-centric mindset in tackling hybrid work.

Enabling hybrid work should be a priority for CIOs because it can cut office costs while improving employee productivity, said Bobby Cameron, a principal analyst at Forrester Research Inc.

“Priorities for the hybrid work environment continue to be digital tools for meetings and active collaboration,” Mr. Cameron said. “These should tie together shared information, the ability to work together on specific problems, and should help the hybrid workers engage with customers and partners in a similar fashion.”

Cisco last week reported stronger-than-expected earnings for the quarter ended Oct. 29 and revenue of about $13.6 billion as supply-chain challenges abated. The company also announced a restructuring plan, which could affect about 5% of its staff starting in the current quarter and includes reducing its real-estate portfolio to align with its hybrid work strategy. A spokesperson said the company expects to have approximately the same headcount at the end of its fiscal year, on Jul. 29, 2023, as it did when the year started.

Mr. Previn declined to say whether his team will be affected by the restructuring, but said his group is still hiring.

Write to Belle Lin at

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Wed, 23 Nov 2022 18:05:00 -0600 en-US text/html
Killexams : How Cisco keeps its APIs secure throughout the software development process

Software developers know not to reinvent the wheel. So, they lean on reusable micro-services – and their corresponding application programming interfaces (APIs) – as building blocks for application components. “Developers want to focus on the added value they can bring instead of rebuilding things that have great solutions out there already,” says Grace Francisco, vice president of developer relations, strategy, and experience at Cisco. “APIs make that easy for developers to consume.”

And they have been consuming: Nearly 90% of developers use APIs in some capacity, according to a 2020 SlashData survey.

The chaotic API landscape

While such an approach toward software development might be more efficient, it also leads to security vulnerabilities that keep CISOs up at night. With the introduction of inter-dependent SaaS, micro-services and internal and external APIs, it is getting more difficult for organizations to control which APIs are made available for internal and external consumption. Such dizzyingly interconnected cloud-native architecture brings to mind Dr. Seuss’s words from The Cat in the Hat: “This mess is so big and so deep and so tall.”

grace francisco headshot Cisco

Grace Francisco, Cisco vice president of developer relations, strategy, and experience 

The mess is also spread out. APIs are often distributed over multiple platforms that can be on-premises or in the cloud. Cloud-native architectures can’t be corralled into one tidy unit with a robust security perimeter.

Worse, APIs themselves have varying levels of security, with some scoring higher marks than others. Both internal and external APIs can be vulnerable and sometimes code can have indirect dependencies on vulnerable APIs. API vulnerabilities can occur at multiple layers, ranging from the cloud security posture, the images from which the application is built up, the configuration of the cloud-native application, the software that makes up the application itself, and the API implementation enabling the cloud-native application to communicate internally and externally.

Today’s agile development with CI/CD pipelines runs on compressed time cycles leading to more security complications. Two-week sprints are not uncommon. “You’re building and deploying so rapidly that there are some things you may not catch or understand until it’s actually in a live, running production,” Francisco says. When it comes to security, late might be better than never, but pushing security operations to the end of the development cycle wastes time and effort.

Copyright © 2022 IDG Communications, Inc.

Wed, 23 Nov 2022 15:48:00 -0600 en text/html
Killexams : Cisco shares pop on earnings beat and increased 2023 forecast

A sign bearing the logo for communications and security tech giant Cisco Systems Inc is seen outside one of its offices in San Jose, California, August 11, 2022.

Paresh Dave | Reuters

Cisco reported fiscal first-quarter results on Wednesday that beat analysts' estimates and boosted its guidance for fiscal 2023.

The stock rose about 5% in extended trading.

Here's how the company did:

  • Earnings per share: 86 cents vs. 84 cents expected, according to Refinitiv
  • Revenue: $13.6 billion vs. $13.3 billion expected by analysts, according to Refinitiv

Revenue increased 6% year over year, while net income slid 10% to $2.7 billion. The company now expects sales growth in fiscal 2023 of 4.5% to 6.5%, up from a prior forecast that called for growth of 4% to 6%.

CFO Scott Herren said in a company release that Cisco delivered "strong results" and attributed the company's guidance forecast in part to an "easing supply situation."

While Cisco's numbers topped estimates, the company is still struggling to grow as the technology world rapidly shifts to cloud and subscription software and away from buying physical boxes. Cisco's stock price is down 27% this year, while the Nasdaq has dropped 29%.

Cisco's top business segment, which includes data-center networking switches, delivered $6.68 billion in revenue, up 12% from a year earlier.

Internet for the Future, its second-largest unit, saw revenue drop 5% to $1.3 billion. The division contains routed optical networking hardware the company picked up through its 2021 Acacia Communications acquisition.

Sales in the Collaboration segment, which features Webex, contributed $1.1 billion in revenue, down 2% year over year.

Cisco will hold its quarterly call with investors at 4:30 p.m. ET.

Wed, 16 Nov 2022 07:33:00 -0600 en text/html
Killexams : Cisco Systems, Inc. (CSCO) Raymond James Technology Investors Conference Transcript

Cisco Systems, Inc. (NASDAQ:CSCO) Raymond James Technology Investors Conference December 6, 2022 9:45 AM ET

Company Participants

Kip Compton – Senior Vice President-Strategy and Business Development

Conference Call Participants

Simon Leopold – Raymond James

Simon Leopold

Folks, thank you very much. My name is Simon Leopold, Raymond James' Data Infrastructure Analyst, here at our in-person tech conference in New York. It's exciting to see people again, to get dressed and to put shirt on with buttons and shoes, nice change, but we've got a session now with Cisco, Kip Compton.

So Kip, to get started, we've known each other for many years, crossed paths many times. You strike me as sort of the ultimate utility player. You've done a lot of things at Cisco side. I almost feel like no question is out of bounds, but I'm sure they are. So to help us maybe set the context for our conversation and the boundary conditions, maybe tell us a little about your current role and current focus. And we'll dive into the outline. And folks, if you have questions, raise your hand, we'll try to take questions from the audience as well.

Kip Compton

Thanks, and it's great to be here in-person. I think we've had shirts with buttons for a while, but shoes and all the rest of it is great as well as seeing everyone in-person. Before I jump in, I'm compelled by my Investor Relations team to say that I'll be making forward-looking statements that are subject to the risks in our latest filings.

With that out of the way, I've been – as you mentioned, I've been at Cisco a long time, I've done a lot of different roles. I'm currently Senior Vice President for Strategy and Business Development, for a business that internally we call Cisco networking. We're trying to simplify things, including with our organizational names.

In terms of our external reporting segments, that roughly maps to Secure, Agile networks as well as Internet for the future and represents the majority of the product revenue in business at Cisco.

Simon Leopold

And I guess in terms of, I've got sort of my notion of what to ask you about, but I think it's important for us to understand what are you spending most of your time on? What's – what are you occupied with? What do you – what keeps you busy?

Kip Compton

Yes, it's a large business. And so when you think about strategy and business development, I spend a lot of my time thinking about how can we grow the business, how can we generate more differentiation in our products that are valuable to our customers.

I spend a fair amount of time on inorganic activity as I think people who are familiar with that know you send more time on deals that you decide not to do than you do, and those are pretty important. And I spend time working with our go-to-market teams, understanding how we can accelerate the business.

Simon Leopold

And the volume question is a macro question, but I want – I understand. I want to ask it in the context of your job. But given we've got a strong U.S. dollar, recession worries, various changes by regions and products, how are you thinking about those elements influencing the way you think and what you're working on?

Kip Compton

Well, I'm in the product, our research and development side of Cisco. So we tend, frankly, to take a longer view. So we pay close attention to macroeconomic forecasts in terms of our operations and understanding how we should be managing our supply chain and our forecast and our sales and all that.

But in terms of our strategy and our research and development, we're looking out a three to five year sort of timeline. And we have – I mean we've seen – you mentioned some of the strong dollar for us over – I think 90% or more of our revenue is actually dollar denominated, and we do have some hedges in place for some of our costs. So we've so far seen a fairly material impact from that.

And in terms of softness, I mean, I think on our call, we mentioned we've seen some areas of softness, including in Europe. On the other hand, I think we just had our second biggest first quarter bookings number in the history of the company, second only to last year when things were jumping as people were building out networks in the pandemic.

So we're monitoring the situation, but we've also seen – I mean, Gartner recently published a report, surveying IT folks and companies. And I think 51% of them said technology was the last area that they plan to cut. So we're watching things carefully. We're investing for the future in R&D, but we're seeing some resiliency right now.

Simon Leopold

And the succinct next question is lessons learned from the pandemic. And what I mean by that is prior to the pandemic, maybe you might sole source certain components that now you multisource. So how has the experience in the last couple of years affected the way you think about long-term strategy?

Kip Compton

Yes, absolutely. I mean it hasn't fundamentally changed our strategy. That said, we learn and adapt to an environment just like everyone else. And so where we may have had our supply chain more optimized for certain things as we're in a time of uncertainty, clearly.

Right now, I think there's a lot of exogenous forces, certainly the pandemic and now the geopolitical environment. Our supply chain team and everyone else is adjusting to the environment that we see, going forward.

Simon Leopold

And so Cisco hosted an analyst meeting. Was it September? Lights are blur, seemed like that. But it was the first analyst meeting that the company hosted in a while, and you outlined at the time a TAM growing to $900 billion, which is pretty big. So I'm not asking you to repeat the entire content of the meeting, but help folks understand really what are the big growth drivers, what are kind of the most exciting transitional aspects of what's influencing that kind of massive TAM.

Kip Compton

Yes, absolutely. And I think you're referring to our Investor Day in September 2021. For folks who might want to look that up, all the materials are online. I think what I would say in terms of drivers over the next, let's say, three to five years, certainly, we're seeing hybrid work, IoT and then the web scalers as being three good drivers for us.

On the hybrid work side, the immediate thing you think of is our collaboration portfolio, and particularly, we believe with some of the devices that we have as companies are outfitting their campuses for hybrid work and realizing basically that every meeting is going to be a video meeting, and so every conference rep needs to have that equipment in it, that's an opportunity for us.

But in my job on the networking side, we're focused on the opportunity with the networking. And we're seeing that whenever a meeting is a video meeting because every meeting will have some remote participants, the load and the traffic on the campus networks is intense.

And that's driven a wireless and campus upgrade cycle that we think is fairly durable. That along with the traditional generational upgrades for WiFi 6 is – WiFi 6 has been very good. We're seeing 6E now kicking into gear as well.

On the IoT side, we're seeing people putting sensors into carpeted spaces and starting to use these to understand occupancy, to understand and optimize their energy usage. And actually, our office here in New York, there's some videos online Wall Street Journal just did a feature on it, where we renovated and put these technologies in as a good showcase for that.

On the web scaler side, we just continue to ride the growth there. I mean we saw a strong double-digit growth in our first quarter that just ended. We're really excited about the pipeline of technologies that we have to offer those folks and expect that to continue to drive growth as well.

Simon Leopold

So one of the things that I suspect is the way Cisco operates is the business units are sort of given their targets and you run with it, you run your business. And as long as you're running it, go. And so when we think about the – essentially, moving strategy to execution, that's the mystery to me from – as an outsider observing it. So you're looking out years and your colleagues are busy working on day-to-day, what's the process? And how does it go from your vision and your activities out years to come into the business day-to-day?

Kip Compton

Sure. Well, one thing I'd say, I mean, as you mentioned, you've known Cisco for a long time. So it's – I think it's a good observation of how we've treated our businesses in terms of autonomy. I would say, we formed the Cisco networking organization that I'm part of, we just formed in October.

And we actually brought together all of our networking businesses across both service rider and enterprise, for instance, really looking to be able to get more synergies and deliver more integrated solutions. So we're actually blending that classic model with more governance and more sort of big-picture thinking, so that we can get more efficiency as well as more differentiation.

In terms of how strategy works at Cisco, we have an annual long-range planning process, where we build three to five year plans that outline financial forecasts as well as strategies and areas that we want to enter investments we want to make. Those are presented and discussed with our CEO and his staff.

Once those are in place, we actually translate those into strategic intents for each of our businesses. And we work – my team actually works with them quarterly to monitor the progress against what needs to happen to have those strategies in place.

As well as in this environment, frankly, if there are any changes that would cause us to tweak our strategy, we're not changing strategy every quarter, of course. But depending on what's happening in the world, we might decide that an element of it should be sped up or another element maybe a little bit relatively less important. And then we repeat that process on an annual basis. So we feel good about that model.

Simon Leopold

So I want to ask about what the R&D priorities are. And I imagine there's a one-word answer, which is software. So let's go a little bit deeper.

Kip Compton

Absolutely. So when I think about it, I think in terms of two buckets for R&D, one is core technologies, and the other is essentially experiences that we're looking to invest in to deliver to our customers. So I think the core technology side, no big surprises there. By the way, software is big, but we're continuing to invest heavily in our ASIC strategy, right? Our Silicon One ASIC strategy is very important. We’re investing in our optics, which is highly differentiated and something that’s helped propel our webscaler success. We’re investing in core networking software. I think some of the things that we’ve made our name on and that we lead the world in. And we’re also investing heavily in security. So those are some of the core technology areas that we think are just important long-term plays, and that we’re pouring R&D investment into.

On the experience side, we’ve seen that what customers want is simplicity. And the way we think about this is what kind of experience. These core technologies are amazing. They enable essentially the modern world. But if you can’t operate it and you can’t get the outcomes out of it that you want, it’s not very compelling. And so investing in things like Meraki dashboard and what we announced last summer, and bringing Meraki across our whole portfolio is a big part of what we invest in as well.

Simon Leopold

Now, you did make a comment earlier on about inorganic efforts, and having filed Cisco for a while, I’ve observed the strategy that, I guess, we call outsourced R&D maybe that’s a common term. But you’ve invested in private companies historically, often they become acquisitions. How do you think about that particular strategy? It may be my imagination, or it just seems like you’ve made fewer acquisitions over the last 12 months than the prior period. But there could be a lot of variables there. So maybe update us on how Cisco thinks about that strategy.

Kip Compton

Sure. So, internally we have what we call our build by partner framework. And whenever we’re looking at a new capability or getting into a new business, we’ll ask ourselves and we’ll often actually do the analysis, scenario-based analysis, hey, if we built this ourselves, what does that look like? How long would it take? How much would it cost? What kind of differentiation could we build with our technologies and our engineers? If we partnered, what does that look like?

We don’t need to do everything ourselves. We have great partnerships across the industry, including somewhere we put things on our price list where it makes sense. And then last, and the one that generates the headlines is the buy, the acquisition case. And we’ll look at what targets are out there, what would that likely cost, what kind of cultural fit? I mean, you buy a company and you get the technology, but the team bolts, that’s usually not a value creation event for us.

And so we’ll actually map out all three of those and then sit down and look and decide, what’s the best path for each area. To your point about acquisitions, we don’t have a quota. It’s like, I’d have to go look at the numbers, my perception’s kind of aligned with yours. But we don’t have sort of a plan at the beginning of the year, oh, we’re going to buy this many companies because we do look at it through this build by partner. And what we do depends on the outside environment, where – what targets are available and what makes sense from a business perspective.

Simon Leopold

And in terms of the criteria, you mentioned cultural fit, I hear that over and over and over again. What are some of the other criteria used in making these decisions?

Kip Compton

I mean, some of the criteria are somewhat deal specific. So I don’t want to suggest like we have like a scoring, rubric or something, if only it was that easy. I think how complimentary the technology is, like maybe it’s obvious, but if we’re looking for a particular capability or product and the company has it, but it has a whole bunch of other stuff that either overlaps with what we have or has things that we would not want, and so we would be potentially exiting. Those tend to not be very good deals.

Where the mission – where we buy a company and then are like, oh yes, we’re going to change what you do. We’re going to take you in a different direction after we buy them. That’s often a little bit of a warning sign. I mean the general thing that I tend to think about a lot, I mean, the strategic fit is kind of obvious. The thing that I think about a lot of times is the fact that it is far easier to buy a company than is to like integrate it and keep the team and get the multi-year successful outcome out of that company. That is the hard part. And so, if anything I tend to bias my evaluation in that area.

Simon Leopold

So I want to pivot the questions towards a subject I’ve been noodling with a bit more is around this idea of power consumption. So there’s been a lot of press lately about how much electricity data centers consume that they’re detrimental to the environment. And I read an interesting article saying, well, but if you’re not getting on a plane and flying, you’re reducing greenhouse gases. And so maybe there’s a good use. And so, I guess with rising costs of electricity, these questions have to be come up. So maybe could you talk a little bit about how you’re thinking about power consumption and the production of greenhouse gas as CO2 in the sort of engineering side and how that’s evolving with your customers and your engineering?

Kip Compton

Sure. So this is a huge focus for us, and it’s been for a while in terms of just – excuse me, our own sustainability goals. And what, I think we published some pretty ambitious and aggressive goals as a company. And part of those sustainability goals is how we reduce not just the greenhouse gases from Cisco’s own operations, but from our customers who are using our equipment. That’s part of our framework as it is for most companies. So this has been an effort for a long time.

In terms of the focus on engineering, last year I actually formed a engineering sustainability office that’s in engineering and works with all our engineering teams as well as the supply chain, as well as our Chief Sustainability Officer for all of Cisco to make sure that this is first and foremost as we’re designing products.

In terms of what we’ve seen in the market, this was important and then it became important and urgent with the rising energy costs and particularly in Europe. And what we’re seeing is that there are multiple places where we can help our customers. Customers are coming to us and one is with our Silicon One technology that is significantly more efficient on a per gigabit basis. Watts per gigabit is a metric in networking. I think we announced deployment with Deutsche Telekom publicly where they said that they reduced their power requirements by 92% on a per gigabit basis. So that’s a pretty significant improvement if you’re looking at a big energy bill.

Another area where we can help customers is with power over Ethernet technology. So this is technology that lets you send power over low voltage wiring. It turns out that this makes the power supplies much more efficient. So we’re seeing a lot of people when they renovate spaces or even build some data centers using this technology. And it improves the power supply efficiency pretty significantly.

The other area is in IoT and I mentioned earlier the sensors and environments. We did a study with Forrester using our Meraki sensors where Forrester saw a 27% energy improvement by using these sensors to trigger close the blind when it’s hot. These are some very basic things, but if you can use sensors to automate them, you can get those savings at scale.

So we see – we talked about – Chuck mentioned on our most recent conference call, we see these energy costs as obviously a potential macroeconomic headwind for everyone. But we also see there being an opportunity for us to help our customers in this area. And we’re seeing some instances of customers actually accelerate investment to get those energy savings.

Simon Leopold

So basically the scenario is a customer has a, let’s say four, five year old campus or data center network consumes more electricity than the newer generation of product. So because of that, they’re refreshing in order to reduce…

Kip Compton

That’s right.

Simon Leopold

The total cost of ownership.

Kip Compton

Maybe they were thinking of refreshing in a couple of years, and now they’re looking at that return and saying, given the energy costs, perhaps I should refresh earlier. And that’s a potential catalyst. Now, on the other side, I mean, realistically there may be customers who decide to delay projects because of energy costs. But we are seeing the energy efficiency for both the sustainability and the current economic reasons as kind of a top of mind topic.

Simon Leopold

And I want to ask about the sort of impact of hybrid multi-cloud on your business. Because it feels to us that eight and 10 years ago, Cisco sort of took the attitude of, I’m not going to sell to those guys, I’m going to just help my enterprise customers. And maybe five years ago, your corporate mind changed and said, you know what, this isn’t going to change. Let’s help the enterprises, embrace multi-cloud, hybrid cloud, we’re a neutral party. So maybe help folks understand a little bit of that history and what you’re doing to help your enterprise customers and their adoption to migration to multi-cloud.

Kip Compton

Sure. So I mean, it’s – cloud for Cisco really impacts our different businesses in different ways. So in the Campus business for instance, a lot of that is about using the cloud to make it easier to manage a campus network. You can’t move your campus switches, your access points to the cloud. You still need them in the building. But we can leverage cloud technologies to just radically simplify and accelerate how people run those networks. And Meraki is a great example of that. And our internet for the future segment, well, that’s where we’re actually helping the webscale is build their clouds with our Silicon One technologies, our Cisco 8,000 product, which is the fastest growing product in the history of the company is really being fueled by that.

On the data center side, it’s kind of what you were referring to which is okay. Most of our customers are going to be in a hybrid state. We’re bringing technologies like the Cisco network control – Cisco Cloud network controller that lets customers design and implement policies and automation and visibility across their on-prem networks as well as their VPCs at Amazon and their networks at Azure and Google Cloud as well. So helping our customers take advantage of multi-cloud for workloads in the same way that we’ve helped them take advantage of on-prem networks.

So you see us with kind of a multifaceted. In terms of the evolution of our attitude here, and I think it took us some time, the webscalers are a different kind of customer. And I think it’s – it took us some time to learn how to sell to them. I think the success we’re seeing now demonstrates that we crack the code and we form the relationships and have very tight engineering – to engineering relationships with the key webscalers and that’s enabled us to achieve that success.

Simon Leopold

Yeah, it’s sort of interesting in that from your disclosures, it works out to be 5% to 6% of revenue from public cloud, which on the surface, oh, well, that’s not a big number, but it’s a big number of a $50 billion revenue company, which would make you the biggest vendor of IT equipment or X servers into that vertical. I think that often goes miss. And so in terms of those partnerships, and from your vantage point of the enterprise, do you see the cloud players as receptive to working with you as a partner? Or do you feel like they’re more competitors?

Kip Compton

No, I don’t see them as competitors. They’re customers and partners. As you said, at this point we’re selling, they’re buying billions of dollars worth of technology from us each year. And I think particularly with what we can bring with our Silicon One technology, our optics and the Cisco 8000 platform, which is actually built on Silicon One is a pretty differentiated value proposition for them in terms of how they can really scale their network and achieve phenomenal economics and power efficiency at the same time. And that’s why you see them adopting their technology.

Simon Leopold

And you mentioned a little bit earlier the effort to extend the Meraki model, let’s not take for granted that everybody knows what that meant.

Kip Compton


Simon Leopold

Maybe unpack that a little bit in terms of helping us understand the importance of doing that and what it is?

Kip Compton

Sure. So Meraki dashboard is a cloud management tool. So Meraki customers are able to manage their networks by just going to essentially a website in their browser, and they can see their whole network and manage everything from there. And because we’ve got all of that telemetry and all of that configuration information in the cloud, we’re able to provide recommendations, provide more powerful tools and generally make it much easier for our customers. We also on that platform have an incredibly rich set of APIs and a very strong developer ecosystem and partner ecosystem around it, where people are able to build solutions on top of and around the Meraki cloud. And getting all of that – getting essentially the network control plane to the cloud is really key there because developers can access that as opposed to a situation where you’ve got different controllers On-Prem in different enterprises.

So we don’t break out Meraki separately in our results. It’s embedded in things like wireless switching, routing, but it has certainly – it’s certainly been buttressing our market share, and we’ve certainly seen a lot of customers interested in the simplicity that cloud management delivers. And we really think that that cloud management is that the key. I talked about delivering experiences before. We think that’s the key to delivering the simplicity that our customers are looking for. Customers – if customers don’t know what operating system their Meraki products are running, they use the Meraki dashboard, and that’s a full stack dashboard with your full networking stacks, a route, switch, wireless. But now we’ve integrated a bunch of other products. So we have Meraki sensors, we have Meraki cameras, we have cellular gateways. We have systems manager for managing devices all integrated in a dashboard. And as we bring all these products together across different domains of the customer’s infrastructure in one dashboard, that enables us to make it simpler for them as well, because they can implement policies or track usage across these different domains.

Simon Leopold

And how do you think about making that management solution multi-vendor? So if the customer chooses to buy a particular component from somebody that’s not Cisco, which might happen occasionally. Do you integrate that? Do the customers lose any features or capabilities? How do you think about that?

Kip Compton

It’s a great question. I mean, honestly, right now we’re focused on bringing that simplicity across our entire portfolio, and that’s sort of job one. And last summer we announced, okay, what I described with Meraki is great, but Catalyst is the – our largest, frankly, the world’s largest campus portfolio of networking equipment. It’s the most powerful in terms of feature sets and performance, the most powerful campus portfolio in the world. We’re really focused right now on bringing that Meraki simplicity across into our – the rest of our campus portfolio.

And we think that’s the key thing for us to focus on right now. That’s what our customers frankly are asking for more than anything. And that’s something actually we’ve been working on for several years. And we have right now available for our customers cloud monitoring, where they can register their catalyst equipment with the Meraki cloud. They can now go into the Meraki cloud and see all of their catalyst equipment, see the topology, see the status, do troubleshooting. And we’ve actually added that Meraki entitlement into our DNA licenses. So now the people with the DNA licenses associated with the catalyst switches have the option of On-Prem management with DNA center or cloud management with the Meraki cloud.

Simon Leopold

So you might imagine, I talked to some of your competitors on occasion. One of the things that they consistently point out as a challenge for Cisco is the complexity. And so they’ll cite the fact that Cisco has multiple versions of every product, and it’s hard to deal with, and I get it, because if you are a massive company with a full portfolio, their complexity just comes along with that.

Kip Compton

That’s right.

Simon Leopold

And so how do you counter the challenge when your competitors who are maybe more narrow, more point focused, argue that well, Cisco’s complex and we’re [ph] easy?

Kip Compton

Oh, well, I mean, I think, I mean, the breadth of our portfolio, it’s immense and outpaces just about any of our competitors. And we haven’t done as much in the past probably to simplify that as we could. I think you’re going to see us using cloud management to bring that simplicity, frankly, without compromising the breadth or power of our portfolio. I think if you’re a point competitor in one domain, it’s a lot easier to be simple. I mean, they have a simpler portfolio, but what we are seeing and what we’re responding to is customers want simplicity. We’ve seen the growth and the power of that Meraki model. And we think bringing that to the rest of our customer base is the best thing that we can do to address complexity.

Simon Leopold

So as we’re about to run out of time, I always like to close with a question that it’s really meant fairly for – from your vantage point. So not CEO, CFO, but from your vantage point, what do you think is least appreciated by the investment community about Cisco?

Kip Compton

Well, I liked your point about the size of our webscale business. So that’s…

Simon Leopold

Keep publishing that for short.

Kip Compton

Sure. That’s great. I mean, I think the size of our software business, I think we did over $15 billion in software revenue last year. We’re – we’d like to push faster. You joked earlier about how my R&D priorities are software, software and software. We’d like to push, wish faster on that. But we’re at 43% of – since all of our revenues recurring. We’re at a point now where 85% of that software revenue is subscription, only 15% perpetual as we’ve been executing on that transition. So I think I’m – I think that’s an undertold story. At the same time, frankly, we’re not done. We feel a lot of urgency as well as a lot of opportunity to continue driving more software value for our customers and more predictable recurring software revenue for the company.

Simon Leopold

Oh, great. Well, thank you very much, Kip. Appreciate you joining us folks. Thanks for joining us with Cisco at our fireside. My job is to make sure you get to your next meeting on time.

Kip Compton

Thank you.

Simon Leopold

Thank you.

Question-and-Answer Session

Q -

Tue, 06 Dec 2022 03:36:00 -0600 en text/html
Killexams : Cisco Just Demonstrated the Power of Stock Buybacks

Networking-equipment giant Cisco Systems (CSCO -1.01%) reported results this Wednesday, covering the first quarter of fiscal-year 2023. The company generated adjusted earnings of $0.86 per diluted share, surpassing Wall Street's consensus earnings estimate of $0.84 per share.

Investors and analysts applauded Cisco's strong results, and the stock price closed 5% higher on Thursday. However, I don't see a ton of headlines mentioning one of Cisco's most shareholder-friendly qualities: The company is shoveling billions of dollars straight into the pockets of shareholders. I'm particularly impressed by Cisco's effective use of stock buybacks.

Cisco's buybacks make a difference

Fun fact: If not for the anti-dilutive effects of the buyback program, Cisco would barely have satisfied the consensus-earnings target.

Cisco's adjusted net income increased by 2% year over year, landing at $3.5 billion. At the same time, the stock-repurchasing program reduced the share count by 12 million stubs in the first quarter. The canceled stock adds up to 127 million shares on a trailing basis, which works out to a 3% reduction.

In a world where Cisco doesn't worry about share-count reductions, this-quarter's earnings would have landed at $0.84 per share, but only by the skin of its proverbial teeth. With three significant digits, you'd be looking at earnings of $0.856 per share, a rounding error away from missing the analyst target.

OK, that's no surprise

The lower share count shouldn't surprise anyone, especially since the bulk of this-year's buybacks fell in the second quarter of 2022. That period was covered in last-February's earnings update, giving everybody nine months to update their earnings estimates accordingly. The exercise above is just a bit of calculator-based entertainment, illustrating how generous Cisco's buyback program really is.

Cisco has invested an average of $1.1 billion per quarter in stock buybacks over the last three years. Dividend payments averaged $1.6 billion per quarter over the same period. That adds up to $1.69 billion of cash per quarter, sent right back to shareholders in the form of buybacks and dividends. Free cash flows in this time span averaged $3.53 billion per quarter, so the shareholder-bound cash returns consumed 48% of Cisco's average cash profits.

CSCO Stock Buybacks (Quarterly) Chart

CSCO Stock Buybacks (Quarterly) data by YCharts.

Cisco loves to share its cash profits with you, the shareholder

This generous cash return is no accident. Cisco has a history of generating massive cash flow and sharing them freely with stock owners.

On the earnings call, Cisco CFO Scott Herren said that the dividend-payout and buyback activity were "in line with our long-term objective of returning a minimum of 50% of free cash flow annually to our shareholders." That's been an official Cisco policy since the fourth quarter of 2019, three years ago.

I love seeing this shareholder-friendly policy in a veritable cash machine such as Cisco Systems. Even in an off-year like 2022, the company amassed $12.8 billion of trailing free cash flows -- and sent half of it right back to shareholders.

CSCO Free Cash Flow Chart

CSCO Free Cash Flow data by YCharts.

Today, Cisco's stock comes with a shrinking share count and a beefy dividend yield of 3.3%. You should expect the dividend payments to continue rising modestly over the years, while buybacks are adjusted to meet that 50% cash-sharing ambition, year by year. These qualities make Cisco a great buy for income investors, who value a free-flowing stream of cash profits and a tight commitment to cash-based profit sharing.

Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Cisco Systems. The Motley Fool has a disclosure policy.

Thu, 17 Nov 2022 22:55:00 -0600 Anders Bylund en text/html
Killexams : Is It Time to Buy Cisco Stock?

Shares of networking hardware giant Cisco Systems (CSCO -0.98%) have trended lower this year, just like most other tech stocks. A 25% decline in the stock price has made it look cheap. Cisco reported adjusted earnings per share of $3.36 in fiscal 2022, which ended July 30, putting the price-to-earnings ratio at 14.

That's not a particularly optimistic valuation for a company that is the overwhelming leader in its core markets. Cisco held a 42.3% share of the ethernet switch market in the second quarter, more than quadruple its next-largest competitor. In the service provider and enterprise router market, Cisco captured roughly one-third of all sales.

Despite Cisco's dominance, the company is prone to big drops in demand when economic uncertainty runs high. Cisco's products are mission critical, but it's also easy for an enterprise customer to delay upgrades during tough economic conditions.

With a recession a possibility in 2023, is now the time to buy Cisco stock?

So far, so good

Looking at Cisco's latest quarterly results, the company appears to be doing just fine. Revenue rose 7% year over year to $13.6 billion in the fiscal first quarter ended Oct. 29, and adjusted EPS jumped 5% to $0.86.

Importantly, Cisco's guidance for the full year is optimistic. The company sees revenue growing by between 4.5% and 6.5%, with non-GAAP EPS solidly above fiscal 2022 levels.

Cisco's transformation into a solutions provider is making the company's results a bit more predictable. While selling hardware is still the core business, the company has grown into a recurring revenue powerhouse. Subscriptions generated $5.9 billion of revenue in the first quarter, about 43% of total revenue. Of that, software subscription revenue was $3.3 billion, while service subscription revenue totaled $2.5 billion.

Cisco's results this year will be partly driven by a big backlog of orders. The company expects to end the fiscal year with a backlog that's two to three times larger than historical levels. Supply chain constraints throughout the pandemic have held up hardware shipments, and any software subscriptions tied to that hardware also got caught up in the backlog. Cisco's software subscription revenue surged 11% in the first quarter, as some of those subscriptions got delivered, although the company still has more than $2 billion of software in its backlog.

Even if global economies enter recession next year, Cisco's enormous backlog and its trove of subscription revenue should help prop up sales for a while, even if underlying demand deteriorates.

Product orders are tumbling

While Cisco expects revenue to grow this year, it's already seeing its customers pulling back on new orders. Total product orders plunged 14% in the first quarter. Europe, the Middle East, and Africa was the worst geographic segment for Cisco, with product orders down 23%. The company pointed to sky-high energy prices in Europe as one reason for the pullback, but it noted that some of its product lines that focus on lowering energy consumption could do well in this environment.

While orders were down, this was still the second-largest order tally for the first quarter in Cisco's history. Cisco had a difficult comparison against an extremely strong quarter for orders last year.

And it wasn't all bad news: Product orders coming from U.S. enterprise customers grew slightly, partly offsetting weakness from other customer groups.

Cisco's order backlog gives it visibility into revenue over the next few quarters, but if product orders continue to deteriorate, the company will work through that backlog and once again be at the mercy of end-market demand. And if a recession does strike next year, a prolonged period of weak product orders seems likely.

Is Cisco stock a buy?

Cisco's dominant market position and inexpensive valuation make it one of the most appealing tech stocks to buy right now. However, anyone who's considering investing in Cisco needs to understand that the company's revenue and profits can be a bit volatile. An overloaded backlog is smoothing things out right now, but that can't last forever.

Be ready for a revenue and profit decline sometime next year if global economies continue to deteriorate. In the long run, Cisco is aiming to grow revenue and profit by 5% to 7% annually. But that won't happen every year. If you're a long-term investor able to stomach some temporary setbacks, Cisco is a great stock to buy.

Mon, 21 Nov 2022 16:20:00 -0600 Timothy Green en text/html
Killexams : Is Cisco Systems Stock a Buy Now? No result found, try new keyword!Cisco's (NASDAQ: CSCO) stock price jumped 5% on Thursday, Nov. 17, after the networking hardware and software giant posted its latest earnings report. For the first quarter of fiscal 2023, which ... Sat, 19 Nov 2022 22:40:00 -0600 text/html Killexams : Cisco Systems, Inc. (CSCO) Management Presents at Credit Suisse 26th Annual Technology Conference (Transcript)

Cisco Systems, Inc. (NASDAQ:CSCO) Credit Suisse 26th Annual Technology Conference Transcript November 29, 2022 1:40 PM ET

Company Participants

Kip Compton - Senior Vice President, Strategy and Business Development

Conference Call Participants

Sami Badri - Credit Suisse

Sami Badri

All right. Thank you, everyone, for joining us.

Kip Compton


Sami Badri

Kip, please go ahead.

Kip Compton

Yeah, that’s good.

Sami Badri

Yeah. Actually, you can sit right here if you want as well.

Kip Compton

That would be great.

Sami Badri

Yeah. All right. Thank you, everyone, for joining us. I am Sami Badri with Credit Suisse Equity Research. We have Kip Compton, today, CTO and SVP of Strategy and Operations and specifically the Enterprise Networking and Cloud business for Cisco. Thank you very much for joining us.

Kip Compton


Sami Badri


Kip Compton

Great to be here.

Question-and-Answer Session

Q - Sami Badri

Yeah. So one thing I want to open up a very broad statement here, a broad question is, there are several technological industry tailwinds that are currently ongoing today from 5G, WiFi 6, you name it, there seems to be a big tailwind embedded in the technology sector across all the various sub-segments. Could we talk about which of these drivers are most relevant to Cisco?

Kip Compton

Sure. So before I begin, I want to say that, I am going to make forward-looking statements and they are subject to the risks and our latest filings. So with that out of the way, there are a lot of tailwinds. We are seeing networking right now is -- maybe it’s cliche, but maybe more important to a lot of our enterprise customers than even it has been in the past.

The three that I would highlight perhaps are: IoT, hybrid work, and the web -- the growth in the web scalers that we are seeing. So on the IoT side, you think of industrial IoT and some of the things, but we are actually seeing a growth in Smart Buildings and sensors and all kinds of things in the enterprise Power over Ethernet. Lighting, for instance, is driving a lot of growth and certainly a catalyst for our campus business.

On hybrid work, at the beginning of pandemic, a lot of people made very quick technology calls to make it so all their employees could work from home. Now they’re taking much more strategic approach and they are looking at their return to office and hybrid work and realizing pretty much every meeting is a video meeting now, even when most people are in the office, there are still people who are remote. And that’s driving a really significant change in the amount of traffic and traffic patterns in the enterprise and we think that’s going to continue to be a catalyst for some time.

And then on the web scalers, it’s just driven by the continued incredible growth in that segment, and we are seeing new builds of AI and ML networks that are even more sort of network intensive and that’s contributing to our growth there.

Sami Badri

Got it. And then when you think about Cisco’s R&D investments, where would you say is kind of the biggest concentration?

Kip Compton

I will probably divide that into two buckets, the way I think about it. I mean, there’s core technology. So I mean, huge investments in optical, our Silicon One ASIC strategy, our security technologies and core networking software that powers the Internet. Those are the core technologies where we made huge long-term investments and we are going to continue to do that to differentiate and lead the market.

The other category I’d say is we are increasingly investing to deliver experiences. And I think the success that we have seen with Meraki is maybe the primitive example of this. But all of our customers are looking for simpler ways to consume technology. Simplicity is winning.

So we are increasingly investing in cloud management platforms that deliver simplicity and you will see us increasingly bring AI and ML into those platforms to make it even easier for people to run their networks.

Sami Badri

Got it. Got it. One thing I wanted to hit or kind of discuss with you is the market share of Cisco across various product segments. Where is Cisco most resilient from a market share perspective? And over the next kind of three years to five years, how would you expect market positioning to actually evolve?

Kip Compton

Yeah. This is -- I mean, it’s on everyone’s mind, certainly including ours, and it’s a super tricky environment right now. I -- one of the conversations this morning, it’s a great environment for networking for the reasons I mentioned earlier. If you are trying to track market share, it’s a terrible environment, and of course, it’s because of the supply chain. And market share is counted on revenue, revenue requires us to ship. Shipping is dependent on supply chain.

And just to deliver you an idea of the diversity and lead times that we are seeing and why this complicates how we calculate and others track our market share, we have some products that are as short as three-week lead time right now. We have other products that are 40 weeks, 50-plus weeks still. And there’s not a lot of rhyme or reason to that. It’s based on various component availability and our competitors have a similar landscape. So I’d just say it’s super difficult to track and understand market share right now.

We did some internal analysis and we actually shared on our recent earnings call a few things on our view of market share. We felt like we are holding our own in-campus switching, SP routing, wireless and optical as examples, and growing share in blade servers, telepresence and voice. So that’s what we are seeing in terms of the landscape. We think as the supply chain situation continues to resolve itself that the market share accounting will become a little bit more transparent and things will normalize itself.

In terms of what’s resilient, I mean, I come from the engineering product development side of the house. So my view of resiliency is where we have differentiation and there’s a few examples. I mean, in SP routing, a lot of it is driven by the incredible growth of our Cisco 8000 platform, fastest-growing platform in the history of the company and that’s powered by and differentiated by our second one ASIC strategy.

You see us in optical, just bringing incredible technology from Acacia and other areas. And also being able to take that best-in-class technology and integrate it vertically into a networking stack, which just drives greater efficiency and simplicity for our customers.

And then wireless and campus switching, Meraki is a major factor there. The simplicity and the experience that we are able to deliver with that model is winning in the marketplace and is helping to make our wireless and campus switching market shares more resilient.

Sami Badri

Got it. Got it. For my next question, I was hoping we could kind of talk about the record performance you discussed on the last quarterly call and maybe you could talk about them by product SKU and you kind of alluded to some of them now. The main ones that you guys called out was the Catalyst 9000, the Series 8000, Meraki, ThousandEyes and Duo. Could we kind of dissect each of these product lines and just discuss what are the key growth drivers of each of these?

Kip Compton

Sure. No. And it’s great to have -- frankly, we have quite a few products in different parts of our portfolio doing so well. The Catalyst 9000 in wireless, I will kind of lump together, because some of the drivers there are the same and I mentioned it earlier, the return to office and the fact that every meeting is a video meeting is causing some pretty massive campus refreshes.

That, coupled with the sort of traditional and ongoing more rapid refresh of wireless driven by new wireless standards. We have seen a lot of refreshes driven by WiFi 6. Recently, we see 6E on the horizon that’s driving similar refreshes.

And by the way, not a new phenomenon, but one of the things that we see with these WiFi 6 and 6E refreshes is that it tends to drive a switch upgrades as well, because they deliver -- those wireless standards deliver more than 1 gigabit of performance. So it triggers our customers to invest in switches that are multi-gigabit or M-gig capable.

On the Cisco 8000, it’s driven by the web scaler growth. And as I mentioned earlier, in addition to the normal incredible growth that we see out of the web scalers, we are seeing these AI and machine learning network deployments emerging, which are bringing a greater level of network intensity and more opportunity for us.

On Meraki, it’s the simplicity of the Meraki dashboard along with the full stack management capability. So a customer is able to go in and manage their switches, their wireless, their routing, their cameras, their sensors, for instance, all in one unified place and that’s something that’s very, very powerful.

ThousandEyes is another area where we saw incredible growth. This is a really fantastic asset. This is actually the first M&A transaction that we closed virtually. It was at the beginning of the pandemic. It was the first deal we had done without in-person meetings.

I think the timing worked out really well. ThousandEyes gives customers end-to-end visibility over their own networks, but also public networks, as well as the cloud. So they can understand the application performance that customers or employees are getting and this actually become super critical when you have people working from home, because they are calling the IT department and trying to figure out what’s going on and all of a sudden, it’s not enough for the IT department just to be able to see their own network. So that’s being driven by hybrid work and hybrid cloud in a big way.

And I think last one you mentioned was Duo. That’s Zero -- driven by Zero Trust for the same hybrid work environment, where increasingly people are not in the office, obviously, the security perimeter type model breaks down and you need people to be able to work efficiently and securely from anywhere that drives Zero Trust architecture and Duo is a leader there. So those are some of the drivers.

Sami Badri

And then if you were to think about maybe the one technology or the one solution that seems to be, by far, the leading reason why customers are spending money, upgrading and doing what they are doing mainly to modernize or maybe even upgrade their networks. What would be that technology?

Kip Compton

Well, I mean, I would say, first of all, the network seems to be more important even than it was in the past. Maybe it’s because of remote work, maybe the -- just the acceleration of some trends that were already in place because of the pandemic.

So we are seeing people really seeing their network -- their investment in their network is critical to their success. And even as they move very close to the cloud, you actually need a great network if you are going to get a great cloud experience.

So I think it’s -- again, it’s probably a combination of the things I have talked about. The hybrid work, including the return to office and what that means is key. Hybrid cloud drives investment in networks. IoT is a factor of 5G on the service provider side and also some interest in private 5G on the enterprise side are all catalysts.

Sami Badri

Got it. Got it. I want to shift gears a little bit and talk about Cisco’s business model transition from predominantly transactional or perpetual to more subscription and software. Could we kind of talk about how this transition is going and I know you guys released the Catalyst 9000 with a subscription offering.

Kip Compton


Sami Badri

And I guess the investor base is expecting this to kind of go into other product groups at some point. Could we kind of go through that path and how the transition is actually going?

Kip Compton

Sure. So I mean, we feel like we are on track. I think last quarter we said 43% of our revenue is recurring and that -- I think that’s aligned with the rough time line we talked about at Investor Day, I think, it was last year.

A lot of people question like do -- are we just growing our recurring software because of the hardware attach? And for sure, that’s growing. And we won’t hesitate, frankly, to attach recurring software value to our large scale hardware businesses, because that brings a lot of value to our customers. It brings an acceleration of the scale of recurring software for us as well.

We are also, though, seeing success in what I will call hardware independent recurring revenue, software businesses, SaaS businesses. In fact, we already talked about a couple of them, Duo and ThousandEyes. Our Cloud Calling business is doing extremely well as a Cisco Contact Center.

So we are able -- I believe we are able to drive a balanced strategy where we drive recurring software revenue attached to hardware like the play that we are still running with the Cisco 9000, as well as businesses that are SaaS properties that are hardware independent.

Sami Badri

Got it. Got it. I wanted to kind of shift gears and talk about some of the redesign efforts that you guys have been kind of going through. And I think one of the main product lines is the Nexus 9000 and you have really seen it. So how long does it normally take for product redesigns to take place? And has this kind of impacted or cost Cisco market share at least in the most recent quarters?

Kip Compton

It’s a great question. It’s -- there’s not a set - I mean, as you probably appreciate, there’s not a set answer for how long a redesign takes. What I would say is it really depends most of all on how -- when we are redesigning, usually, there’s a product and we have one component that has a very long lead time that, and of course, we can’t ship the product unless you have all of the components. And so we will redesign in an effort to remove that component from the product, so we can ship it more quickly.

The length of time it takes us to accomplish a redesign is determined by a bunch of things. But how intertwined the particular component is with the rest of the product and how similar or different the replacement or alternative component is, is what drives kind of the differences in terms of how long it takes us to accomplish that.

We are almost always talking about months. So I have not seen redesigns get done in a few weeks. I have not seen redesigns take an extended period of time either. We have done quite a few redesigns. It is, as you alluded to, sometimes a little bit disruptive to our innovation engine.

So if we have product development teams who are focused on innovating and bringing new value to our customers, we have to ask them to pivot and do a redesign program that can impact our roadmap. But it’s -- it became extremely clear to us that, perhaps, the feature our customers need it most was to be able to actually get the product. And so I think it was the right call.

That’s actually given us some good results, without getting into specifics. We did have one product where we executed a redesign and we started shipping it and we were able to immediately drop the lead time for our customers from 40 weeks to 12 weeks on that particular product. So it can have a really significant impact and we are continuing to use targeted redesign efforts on our longest lead time of products where we can make a big difference.

Sami Badri

And then maybe just for an idea, I guess, because Data Center switching is going through redesign, that may potentially put into one of the more longer lead time categories, right, just because it’s currently an ongoing process?

Kip Compton

Yeah. We do -- I mean, we do think that -- we -- in particular, from a market share perspective, we do degree -- do believe that, to some degree, the longer lead times that we have right now in that product are impacting how market share is counted. I mean, I don’t want to get into exactly which product you will be designing at any particular moment in time. But those longer lead time products are exactly the candidates that we would be targeting.

Sami Badri

Got it. I wanted to kind of go back to a couple of references that were made on the fiscal 1Q 2013 call and it has a lot to do with energy efficiency. And I think I counted it multiple times.

Kip Compton


Sami Badri

I think I counted three times, right? And I guess like the big question when people talk about Cisco and the outlook on potentially like what happens in an economic downturn, what seems to be a comment made from at least the Cisco team is energy efficiency is a much bigger deal than we ever really…

Kip Compton


Sami Badri

… thought and that is kind of like the driver for why spend should be maintained. But maybe we can kind of get your take, like, how front and center’s energy efficiency coming up across your entire customer base versus maybe a select few that are sensitive?

Kip Compton

Sure. I mean, it’s -- I think there’s really two things coming together here. One is the long-term sustainability targets that almost all of our customers have and they are trying to get to net zero and that is always -- that has put a focus on energy efficiency. Obviously, the more energy the product uses in general the more carbon it contributes.

The other thing that’s really come into the picture in the last year or so is just the rise in energy prices around the world, but especially in Europe. That’s brought a renewed focus to energy efficiency from our customers. So it’s part of their sustainability goals, but it’s also now a direct economic situation.

And I think we -- I think on our conference call, one of the things you are referring to, as Chuck mentioned a few technologies that he felt could help. Because we see this energy efficiency thing as perhaps a double-edged sword. Some people may delay projects because of the cost of the energy that they are paying on other things or that the project itself would incur.

On the other hand, we are also seeing it as something that causes people to look at new technologies that could help them with their energy efficiency. And I think we mentioned Power over Ethernet, Silicon One and IoT.

As Chuck mentioned, there are those three technologies that Cisco could help our customers with their energy efficiency needs. And briefly, Silicon One, it’s pretty obvious, it’s a much more efficient, especially on a watt per gigabit type basis solution.

On the IoT side, it’s about deploying sensors and making buildings smarter so that you can save energy and even make better use of that space.

On the Power over Ethernet side, it’s about just a more efficient energy transmission. So we have a lot of customers looking at using Power over Ethernet for their lighting in their office buildings, for instance, and they can actually save power, because the transition of the energy is -- of the electricity is more efficient and also because the Power over Ethernet infrastructure gives the much finer grain visibility and control over where that power is going.

So he mentioned those three technologies as things that our customers are looking at from Cisco to help them. I’d also note that we have seen greater interest in sort of sustainability solutions and those include like sustainable Data Center solutions and Smart Buildings in particular.

And if you are interested in this, we recently renovated our One Penn Plaza office in New York City and redid it with the latest Smart Building technologies. There’s a number of videos and other materials online if you want to check out what we are talking about here.

I’d also note, in addition to these technologies, we are seeing some customers, particularly in Europe, starting to look at their equipment and considering an early refresh, because they will have equipment in place, perhaps, it’s not fully depreciated, but they see their energy bill, their electricity bill and they see that newer equipment could be significantly more efficient.

And in some cases, we see customers putting together business cases to move forward with an early refresh, because they would rather get to that lower energy cost than finish depreciating a less efficient piece of equipment.

Sami Badri

Got it. One quick follow-up on something you said earlier is, if you were to look in history, right, the last time customers really were very sensitively focused on energy efficiency for the equipment, right? Has there ever really been as important as this time today or has there always kind of been a top criteria for customers and their solution set deployments?

Kip Compton

I mean it’s always been a criteria. I mean, I would say, qualitatively, to me, it’s coming up more right now. I think the confluence -- I think what I haven’t seen before is the confluence or the intersection of the energy costs and the sustainability targets that companies have. And I think those two things are coming together in a different way right now than I have seen in the past.

Sami Badri

Got it. Got it. I wanted to touch on specific demand drivers in customer verticals, right? If we look at from public safety or the Public Sector to Commercial, to Enterprise, how would you kind of characterize drivers specifically to those verticals?

Kip Compton

Sure. So Enterprise, it’s a lot of things I have mentioned, hybrid cloud, 5G, 400G and beyond, IoT and hybrid work are all top of mind with our Enterprise customers and driving interest and demand. We think we are really well positioned there with solutions.

On the service provider side, we are seeing solid demand, frankly, led by the web scalers, again, and that’s something that we see continuing. On Public Sector, in the U.S., we saw a little bit of a pause with the election, but we are expecting to see things pick up, and perhaps, a tailwind from the investments in the Inflation Reduction Act.

Sami Badri

Got you. Got you. I wanted to go back to a question I actually overlooked on my list, but it has to do with software attached to hardware. When you think about Cisco over the next couple of few years, is software growth becoming more independent or more dependent on hardware shipments and hardware growth?

Kip Compton

Oh! I don’t know how to quantify that. I mean, like, I said earlier, we are focused on growing recurring revenue software. And we will have a balanced strategy where it makes sense and there’s value to the customer to attach that to our hardware base, like, we have done with the Catalyst 9000, or frankly, like, is inherent in the Meraki business model. We are absolutely pursuing that.

And we are seeing some high-quality results there. Meraki, for instance, if a customer doesn’t renew their Meraki subscription, the hardware that they have bought becomes unusable. So that tends to drive a very, very high quality renewal rate on that business. So we are very pleased with the results there.

But then we are driving the growth and I think I mentioned Duo, ThousandEyes, Cloud Calling and Contact Center, as examples. We are building and buying and growing hardware independent SaaS businesses as well.

So I don’t know, I’d have to go look at our models and see if we had numbers. But we are less focused on like a percentage here or there and more, like, well, okay, recurring software, how do we grow that? How do we find opportunities to bring that kind of ongoing value to our customers and get that predictability for Cisco.

Sami Badri

Got it. Got it. I wanted to kind of close out the final question with what keeps you up at night as a CTO just because the world is obviously changing very fast and there are multiple technologies and probably multiple opportunities for certain technologies to either be displaced or to be adopted. So how would you…

Kip Compton


Sami Badri

How would you characterize what keeps you up at night?

Kip Compton

Actually, I don’t see badly.

Sami Badri


Kip Compton

But in terms of what’s top of mind. Lately, what I have been pondering is, given all of the change, it feels like a much more dynamic world. I mean the panic certainly herald in a new level of uncertainty, but now, obviously, geopolitically and in other ways, it feels like a much more dynamic environment than we have had in the past and I think that’s here to stay.

So thinking a lot about how we strike the balance as we are responding to things that come up now, like, the supply chain things that we talked about, how do we strike a balance there in responding to those things in ways that deliver us more resiliency and flexibility going forward, because I think, we are in a different period with a lot of change and we have a very large and complex business, so it’s important for us to think about that.

Sami Badri

Got it. Got it. Well, I appreciate your time. We went through the question list and thank you very much for joining us today.

Kip Compton

Thank you.

Sami Badri

Absolutely. All right. Great. Thanks.

Tue, 29 Nov 2022 07:34:00 -0600 en text/html
Killexams : Planet, Cisco join hands for portable data centre

MAI-listed Planet Communication Asia, a digital tech service provider, has joined hands with global tech giant Cisco Systems to develop a prototype mobile data centre to facilitate the smart city initiative.

The move comes as the government is pushing for smart city development.

On Wednesday, the National Steering Committee on Smart City Development, chaired by Deputy Prime Minister Prawit Wongsuwon, approved 15 additional places across 14 provinces for smart city development, bringing the total number to 30 locations in 23 provinces.

The government expects to see 20 billion baht in private investment in smart city development.

"We see an increase in demand for smart city initiatives where local cities will see the rise of investment in intelligence technology to Improve people's quality of life in health, education, safety and environment," said Prapat Rathlertkarn, chief executive of Planet.

With smart city development, cities need to use more data from various devices, such as CCTV cameras, sensors and the Internet of Things, and an edge data centre is needed to support data transmission and facilitate the processing of a high volume of data and analytics in the local area.

The use of edge data centres will entail flexibility and reduce costs while supporting high-speed data transmission to the centralised data centre, Mr Prapat said.

From experience with Banchang Smart City in Rayong, the company has developed a "planet edge data centre" as a prototype of the mobile data centre.

This edge data centre is ready to use and quick to be deployed, he said. It entails flexibility, less customisation and scalability in line with city needs.

It supports instant access to information, data security and data analysis, which could be a boon for digital transformation for any urban areas which want to pursue digital city development, Mr Prapat said.

With the size of a standard shipping container, it can be shipped almost anywhere, which can also respond to the needs in remote areas of the country.

The development is in partnership with Cisco Systems, which supports hardware and solutions for the project, he said.

"We aim to have 20 provinces adopt this mobile data centre by 2023, particularly in the Eastern Economic Corridor," Mr Prapat said.

Taveewat Chantaraseno, managing director of Cisco Thailand and Myanmar, said Thailand was selected for its Country Digital Acceleration (CDA) programme in October last year.

This three-year programme will support funding and technologies which will build the country's tech inclusiveness in five areas, covering smart city, transportation, healthcare, 5G and cybersecurity.

The collaboration on the mobile data centre under the CDA programme is a major milestone in Thailand's digitisation journey, which will further propel economic resilience and social inclusion, he said.

The mobile data centre can help reduce capital expenditure by up to 50%, support 12-16 weeks in deployment and come with high energy efficiency, he added.

Fri, 11 Nov 2022 13:39:00 -0600 en text/html
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