Mon, Apr. 25, 4:46 AM
- With Facebook (NASDAQ:FB) CEO Mark Zuckerberg aiming to triple the company's 1.6B members, the social network is looking to ensure that building telecom networks and using the Internet becomes cheaper as the vast majority of potential users live in developing countries.
- As such, Facebook has embraced open-source technology and the company does its own work on planning the computer hardware and software it uses.
- "Our rule is 10 times faster or 10 times cheaper or both," says Facebook VP of Engineering Jay Parikh.
- The likes of Google and Amazon are using similar strategies, while equipment providers such as Cisco (NASDAQ:CSCO) are joining in as they'd "rather be on the train than in front of it."
Sun, Apr. 24, 11:41 PM
- The Information reports Google (GOOG, GOOGL) is building a startup incubator called Area 120. Teams of Google employees will be able to submit business plans to join Area 120, and those accepted can work on their projects full-time for a few months. Afterwards, they’ll be able to pitch Google on creating a new company that Google would take a stake in.
- Like other tech giants, Google has seen plenty of talented workers depart over the years to launch startups, with some of the efforts proving to be huge successes (examples include Twitter and Instagram). Area 120 represents an attempt to keep such entrepreneurial workers within the Google empire (to an extent), and profit along the way.
- Cisco (NASDAQ:CSCO) has some experience in this field, via “spin-ins” such as data center switch developer Insieme Networks (founded by Cisco engineers and acquired in full in 2013 for $863M). However, new CEO Chuck Robbins has suggested he’s not a big fan of the spin-in model, and would rather have small internal startup teams whose work remains fully owned by Cisco.
Tue, Apr. 19, 3:21 AM
- Partnering with Cisco Systems (NASDAQ:CSCO), Hyundai (OTC:HYMLF) has joined the ranks of global automakers turning to new technologies as the race to develop internet-connected cars picks up pace.
- The alliance with Cisco comes after the South Korean carmaker this month revealed a road map to developing "hyper-connected intelligent cars" as part of a long-term push into driverless vehicle technology.
Mon, Apr. 11, 4:31 PM
- Juniper Networks (NYSE:JNPR) now expects Q1 revenue of $1.09B-$1.1B and EPS of $0.35-$0.37. That's below prior guidance of $1.15B-$1.19B and $0.42-$0.46, and a consensus of $1.18B and $0.45.
- The networking hardware vendor primarily blames "weaker than anticipated demand from Enterprise and timing of deployments of certain U.S. and EMEA Tier 1 Telecoms." It previously issued soft Q1 guidance in January, while blaming "the uncertainty of the near term global macro environment and potential lumpiness in customer investment patterns." Official Q1 results are due on the afternoon of April 28.
- Juniper is down 8.4% after hours to $22.79. Carrier router archrival Cisco (NASDAQ:CSCO) is down 1.5% to $27.20. In February, Cisco reported its service provider orders were up 5% Y/Y in FQ2 (the January quarter).
Mon, Apr. 4, 7:25 AM
- March monthly performance was: +6.95%
- 52-week performance vs. the S&P 500 is: +1%
- $0.07 in dividends were paid in March
- Top 10 Holdings as of 2/29/2016: Coca-Cola Co (KO): 4.24%, Altria Group Inc (MO): 3.5%, Microsoft Corp (MSFT): 3.45%, Apple Inc (AAPL): 3.13%, AbbVie Inc (ABBV): 2.72%, International Business Machines Corp (IBM): 2.19%, McDonald's Corp (MCD): 2.08%, Cisco Systems Inc (CSCO): 1.91%, 3M Co (MMM): 1.85%, Home Depot Inc (HD): 1.8%
Tue, Mar. 22, 11:57 AM
- In his latest effort to overhaul the company he took over last year, CEO Chuck Robbins has restructured Cisco's (CSCO +0.1%) engineering ops (they employ ~25K people) into four units - Networking, Cloud Services & Platforms, Security, and Applications & IoT - with the head of each unit reporting directly to Robbins.
- As part of the shakeup, Kelly Ahuja, the SVP in charge of Cisco's service provider portfolio/strategy and an 18-year company vet, is leaving. Yvette Kanouff, formerly Cisco's SVP of cloud solutions, is now in charge of an "expanded" service provider organization that's part of the Networking unit. For now, EVP/chief development officer Pankaj Patel is in charge of Networking, but he's due to leave later this year.
- Biri Singh, named CTO by Robbins last year, will be in charge of Cloud Services & Platforms. Robbins adds he has asked Biri to "lead our efforts around Next-Generation Data Center strategy," working closely with the Networking unit and the Insieme SDN unit. He'll be in charge of Cisco's data/analytics efforts and the Intercloud platform, and oversee a Computing Systems Product Group led by SVP Liz Centoni..
- SVP David Goeckler will continue to be in charge of Security products. Rowan Trollope, SVP of Cisco's IoT and Collaboration Technology Group, will be in charge of the IoT & Applications unit.
- Eight months ago: Robbins goes outside Cisco to appoint CTO, chief digital officer
Fri, Mar. 11, 11:08 AM| Fri, Mar. 11, 11:08 AM | 1 Comment
Wed, Mar. 9, 7:20 PM
- IDC estimates the enterprise Wi-Fi market grew 5.9% Y/Y in Q4, and 3.7% over the whole of 2015. The firm blames recent slow growth on macro uncertainty and delayed spending ahead of the full availability of (mobile-friendly) Wave 2 802.11ac Wi-Fi systems. The consumer market, where firms like Netgear (NASDAQ:NTGR) and D-Link compete, declined 3.9% in Q4 and 4.8% in 2015.
- Cisco (NASDAQ:CSCO) is still the enterprise market's dominant vendor, even if its share has been slipping a bit. IDC respectively assigns Cisco Q4 and full-year enterprise Wi-Fi shares of 45% and 47%, down from 48.1% and 47.8% a year earlier. Cisco's wireless revenue (dominated by Wi-Fi) was flat Y/Y in the company's January quarter at $613M.
- #2 HP Enterprise (NYSE:HPE), which acquired Wi-Fi hardware/software vendor Aruba Networks last year for $3B, is estimated to have a 16.9% 2015 share (up 70 bps Y/Y) after factoring sales from both Aruba and HP proper. Thanks in part to Aruba, HPE reported 54% Y/Y networking sales growth for its January quarter, allowing the company's enterprise hardware unit to see positive growth in spite of server, storage, and tech services declines.
- #3 Ruckus Wireless (NYSE:RKUS) is estimated to have a 6.9% share, up from 2014's 6.3%. Aerohive (NYSE:HIVE), which has benefited from the FCC's E-Rate program for school broadband connectivity, is assigned a 2.1% share.
Wed, Mar. 9, 1:54 PM
- Looking to better compete against common rivals such as Cisco, HP, and Dell, Juniper (JNPR +1.5%) and Lenovo (OTCPK:LNVGY) have struck a global reseller deal and product-integration partnership encompassing each company's data center hardware lineups.
- Some of the elements of the deal: 1) Companies will be able to buy Juniper's networking hardware from Lenovo, which bought IBM's x86 server unit in 2014. 2) Juniper and Lenovo plan to develop "simplified" data center management and orchestration tools using the latter's Network Director and Contrail SDN software, and the former's xClarity management software. 3) The companies plan to develop "go-to-market plans and a tailor-made resell model to address unique localization requirements in China."
- The deal is also said to cover hyper-converged (integrated server/storage/networking) and hyper-scale data center hardware - EMC, Cisco, HP, Dell, and Oracle are all going after the hyper-converged market, while many Internet companies (as well as some enterprises) have embraced hyper-scale data center architectures.
- Juniper's enterprise revenue rose 8% Y/Y in Q4 to $386.4M, and accounted for 29% of its total revenue. News of the Lenovo deal comes a week after Cisco (NASDAQ:CSCO) unveiled a refresh for its Nexus data center switch line, as well as new switch ASICs (referred to as Cloud Scale) said to deliver unmatched performance and latency.
Tue, Mar. 8, 1:59 PM
- Continuing its heady M&A pace, Cisco (CSCO +0.2%) has bought Synata, a developer of search technology declared (by Synata) to be "the easiest and fastest way to integrate, index, and analyze massive amounts of enterprise data." Terms are undisclosed.
- Cisco plans to integrate Synata's technology with its Spark Web collaboration service - it competes against offerings from both established players such as Microsoft (Skype), and upstarts such as Slack and Atlassian. Spark was among the products covered by Cisco's alliance with Apple to create "a seamless experience" between iPhones and desk phones in environments using Cisco conferencing hardware/software.
- Exec Rob Salvagno: "Synata’s technology allows users to search both on-premise and cloud-based applications simultaneously from one platform. Their search technology will also work within Cisco Spark’s unique approach to end-to-end encryption in the cloud, which makes them a great fit for our team ... Today’s acquisition builds on the success of other recent acquisitions in collaboration like Collaborate.com, Assemblage, Tropo, and Acano."
- Cisco's collaboration product revenue rose 3% Y/Y in the January quarter to $1.02B. Synergy Research recently estimated Cisco Cisco had 16% of the collaboration market in Q4, good for first place. Microsoft was #2, and Avaya #3.
- Recent Cisco acquisitions
Wed, Mar. 2, 12:55 PM
- Cisco (CSCO -0.3%) is paying $320M in cash and assumed equity awards, plus retention-based incentives, to buy Leaba Semiconductor, an Israeli networking chipmaker that has been in stealth mode since its founding in 2014.
- Leaba's site only describes the company as "a fabless semiconductor company providing innovative solutions for significant infrastructure challenges." Cisco merely says Leaba has "a team with a strong and successful track record of designing leading edge networking semiconductors that provide innovative solutions to address significant infrastructure challenges," and that the purchase will help accelerate Cisco's plans for its next-gen products. Leaba's CEO and CTO were previously co-founders of Dune Networks, a provider of Ethernet switch fabric chips that was sold to Broadcom for $178M in 2009.
- Though also using off-the-shelf network processors (NPUs), Cisco continues heavily relying on internally-developed ASICs to power its switches and routers. In 2013, the company unveiled the nPower X1, which powers its CRS and NCS core router lines. Last year, EZchip (recently acquired by Mellanox) disclosed Cisco doesn't plan to use the company's NPUs in next-gen edge router line cards, as it does in current line cards.
- News of the deal comes just a day after Cisco announced it's buying cloud app management software provider CliQr Technologies for $260M+, and a month after it announced a $1.4B+ deal to buy IoT service provider Jasper Technologies.
Tue, Mar. 1, 7:04 PM
- In a move declared to be the company's biggest within the data center since the 2009 launch of its UCS server line, Cisco (NASDAQ:CSCO) has unveiled HyperFlex, a line of integrated server/storage systems that the company promises can be set up in minutes and independently scale server (compute) and storage capacity. (Press Release)
- HyperFlex supports both SSDs and hard drives, and both blade and rack server nodes. It also integrates with Cisco's UCS management software and fabric interconnect switches. Like some rival systems, storage from different nodes is pooled into a common data store, and data is dynamically placed within different tiers (DRAM, flash, disk) based on performance needs.
- Cisco has also launched new hardware for its Nexus 9000 data center switch line. The new switches support 100Gbps ports - Cisco promises pricing on par with what has been provided for 10/40Gbps switches - as well as cloud services for managing capacity and dealing with congestion. The older Nexus 3000 switch line has also been updated.
- HyperFlex takes aim at EMC's VCE converged infrastructure unit - in 2014, Cisco cut its stake in VCE to 10% from 35%. It will also square off against Oracle's engineered systems, IBM's PureSystems line, and HP Enterprise's ConvergedSystem line. IDC estimates EMC/VCE, HP, and Oracle each had over 20% of a $1.6B integrated systems market in Q3.
- ABR Investment's Brad Gaswirth considers the HyperFlex launch a negative for both EMC and NetApp (NASDAQ:NTAP) - Cisco and NetApp have partnered to provide FlexPod, a reference architecture featuring the former's UCS servers and Nexus switches, and the latter's FAS storage systems. IDC estimates Cisco/NetApp's reference system sales totaled $309M in Q3.
- Gaswirth also deems the broader adoption of converged infrastructure hardware a negative for storage connectivity hardware provider QLogic (NASDAQ:QLGC) - QLogic's Fibre Channel adapters/switches help connect standalone servers and storage arrays.
- Earlier: Cisco paying $260M+ to buy cloud app management software firm
Tue, Mar. 1, 10:19 AM
- Still hungry to grow its software/services exposure via M&A, Cisco (CSCO +0.5%) is buying CliQr Technologies, a provider of software for orchestrating app deployment and management across data centers and public/private clouds, for $260M in cash and assumed equity awards, plus retention-based incentives. The deal is expected to close in FQ3 (the April quarter).
- CliQr's platform lets users create a single profile for deploying an app across multiple environments and server types, optimizes app performance and ensures consistent policies across locations, and provides a common interface for managing cloud environments, apps, and users. Cisco notes CliQr's products are already integrated with its ACI SDN/network virtualization platform and its UCS server line, and plans to further integrate them with the company's data product lineup.
- VMware, Red Hat, and IBM are among the other firms to have shown an interest in cloud orchestration. News of the deal comes eight months after Cisco announced it's buying cloud service management software firm Piston Cloud Computing. A month ago, the company announced it's spending $1.4B+ to buy major IoT service provider Jasper Technologies.
Fri, Feb. 26, 6:34 PM
- Cisco (NASDAQ:CSCO) had 56% of the global switch and router market in both Q4 and 2015 (even with 2014), estimates Synergy Research. The market's next four biggest players - Juniper, HP Enterprise, Huawei, and Alcatel-Lucent - each had shares in the 6%-8% range.
- Synergy estimates Cisco had 69% of the Q4 enterprise router market, and 42% of the service provider router market. Its share of the enterprise Ethernet switch market, which accounts for nearly 60% of the total switch/router market, is pegged at slightly above 60%.
- The total market is believed to have grown a modest 3% in 2015, mostly due to enterprise Ethernet switching growth (boosted by healthy data center switch demand). Weak telecom capex weighed on service provider router sales.
- Synergy's Jeremy Duke: "[Cisco's] dominance is more pronounced on the enterprise side where HPE is the only other vendor with a double-digit market share, while on the service provider side ALU, Juniper and Huawei are all pushing hard and all have double-digit market shares. Part of the thinking behind Cisco’s partnership with Ericsson (NASDAQ:ERIC) is to help it strengthen its sales channel into service providers and to further increase its share of this market segment." On that note, Cisco and Ericsson recently claimed they already have over 200 joint customer engagements to go with a handful of initial deals.
- Cisco is coming off a January quarter (FQ2) in which switch product revenue fell 4% Y/Y to $3.48B, and router product revenue rose 5% to $1.85B. Both SDN/NFV and the use of white-box hardware by cloud giants are viewed as long-term threats.
Tue, Feb. 23, 9:12 AM
- Two weeks after upping its dividend and adding $15B to its buyback program, Cisco (NASDAQ:CSCO) has priced a $7B, 6-part, debt offering.
- The offering consists of: 1) $1B of floating-rate notes due Feb. 2018, sporting an interest rate of LIBOR + 60 bps. 2) $1.25B of 1.4% notes due Feb. 2018. 3) $1B of 1.6% notes due Feb. 2019. 4) $2.5B of 2.2% notes due Feb. 2021. 5) $500M of 2023 notes due Feb. 2023. 6) $750M of 2.95% notes due Feb. 2026.
- The networking giant had $60.4B in cash at the end of its January quarter, and $24.6B in debt. However, only $3.9B of the cash was in the U.S., and thus usable for capital returns without incurring new taxes.
- Cisco's deal highlights the ability of blue-chip tech companies to continue securing fairly low interest rates, even as corporate junk bond yields surge. Apple recently sold $12B worth of debt at low rates.
- CSCO -0.8% premarket to $26.43.
Thu, Feb. 11, 1:20 PM
- Even with equity markets selling off once again, Cisco (CSCO +9.8%) has held onto the after-hours gains seen yesterday after the company beat FQ2 estimates, issued in-line FQ3 guidance, announced a $15B buyback hike and $0.05/share dividend hike, and reported product orders rose 2% Y/Y (better than feared).
- Jefferies' George Notter has upgraded Cisco to Buy, and upped his target by $1.50 to $27.50. He cites the dividend hike, a historically low valuation (6.4x Jefferies' base 2017 EPS estimate), a belief Cisco will offset the impact of macro pressures by cutting costs, and lower concerns about emerging markets exposure. He also thinks Cisco "has an opportunity to capture significant new growth opportunities in Security and/or Hyper-converged Storage."
- Raymond James' Simon Leopold (Outperform, $28 target): "We believe Cisco continues to execute well while undertaking a business transition to a more software centric model. Some softening, such as enterprise switching, will fuel worries about the macro-environment, but Cisco’s Service Provider sales provides offsets ... the software story remains attractive: ACI’s run-rate is over $2 billion, SaaS grew in the double digits (WebX, Meraki, Security), and security deferred revenue grew 26%."
- Piper's Troy Jensen (Overweight rating, $30 target): "[W]e continue to believe CSCO’s product portfolio is strengthening in the marketplace ... Also, as shown by the sequential margin improvement we believe the company is making good strides with cost controls. Given the global macro growth concerns we do believe weaker spending habits could prevail in the near future, but with a ~4.6% dividend yield, and a $15B increase to its stock repurchase program, we believe shares are too cheap to ignore."
- Nomura's Jeff Kvaal (Neutral, $30 target) isn't as enthusiastic about Cisco's numbers. "[U]npacking the moving pieces suggests Cisco’s macro concern is indeed showing up in the numbers. Business slowed to below plan immediately entering 2016 across the globe. The greatest impacts were in switching (down 13% QoQ) and former growth driver data center (down 4% QoQ) ... Product deferred revenue growth decelerated from 16% to a still healthy 11% and the book to bill was only approximately 1.0."
- Many analysts are pleased with Cisco's deferred revenue growth - software/subscription growth helped the deferred revenue balance rise 8% Y/Y to $15.2B. On the other hand, the 3% Y/Y drop seen in Data Center (UCS server) sales has been an area of concern - on the earnings call (transcript), CEO Chuck Robbins blamed the decline on macro pressures and tough comps.
- Cisco's core switching business was also soft, declining 4% - the company blamed weak campus switch demand caused by macro issues. Routing revenue rose 5%, collaboration 3%, security 11%, and service provider video (boosted by Chinese demand) 37%. Wireless (Wi-Fi) was flat.
- Cisco's FQ2 results/FQ3 guidance, details and buyback/dividend hike
Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol based networking products and services related to the communications and information technology industry. It provides a broad line of products for transporting data, voice, and video within buildings and across campuses. The... More
Industry: Networking & Communication Devices
Country: United States
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