Cisco reported a 4 percent increase in revenues for its third fiscal quarter 2018, compared to the same quarter a year ago. And it reported non-GAAP net income of $3.2 billion or $0.66 per share, an increase of 10 percent year over year.
Cisco CEO Chuck Robbins attributed a lot of the company’s recent success to its intent-based networking initiative, which he first unveiled in June 2017. And he especially called out Cisco’s Catalyst 9000 Ethernet switch family that is an integral part of the intent-based networking portfolio.
Of the Catalyst 9K, Robbins said on an earnings call with investors that it was “the fastest ramping, new product introduction in our history.” The Catalyst 9000 now has over 5,800 customers, up from 3,100 last quarter. “If you think about that, it means we added over 40 customers per day that acquired the Catalyst 9000 for the first time,” he said.
Asked how much of the company’s installed base was actually represented by the Catalyst 9K, Robbins said the company has about 840,000 customers, and many of them are beginning to replace older Cisco platforms with the 9K. And they’ll eventually refresh all of their networks with it, making it their standard platform.
“This architecture has a long future for us,” said Robbins. “And there is a portfolio of products that fit within it. They’re buying into this automation strategy of which the entire portfolio will fit over time. I would say that there is a very long list of customers that are still available to us to deliver this platform.”
Recently, Arista announced it would compete in campus switching. Robbins said Cisco’s campus customers are looking for more than just switching. They want switching along with routing and wireless products. “Our customers don’t want to have an automation platform that handles switching: They want an automation platform that handles the enterprise,” he said. “Over time as we integrate our automation platform in the data center and the campus, you’ll be looking at the ability to automate from the data center to the campus to the wireless network to the routing, and frankly, the security architecture. And we think that is a unique architecture that we can deliver.”
Ever since Robbins became CEO about three years ago he’s been pushing the company toward a more software-focused strategy. But the company is working to reduce the operating costs of selling software.
On yesterday’s earnings call, he said the company is building a business model with an internal customer success organization that will, over time, take on more responsibility for all of the functions of selling and renewing software. “That’s the model,” said Robbins. “That’s one of the key reasons that we brought in Maria Martinez, who is now our chief customer experience officer, who has a long experience of doing that in several software companies.”
Martinez joined Cisco in April. Previously she was president of sales and customer success with Salesforce.