Cisco's collaboration sales have grown for the first time in a year.
As recorded in its latest earnings call for Q1 FY24, Cisco posted a three percent rise in collaboration sales, crediting an increase in calling and contact centre revenues, which have compensated for the ongoing decline in sales produced by its meetings business.
Scott Herren, Chief Financial Officer at Cisco, stated:
Collaboration was up three percent, driven by growth in calling and contact centre, partially offset by a decline in meetings."
There were brief allusions to Webex's operational quarter, with Cisco CEO and Chairman Chuck Robbins highlighting Webex's new AI-powered features as well as the hybrid workspaces illustrated at this year's WebexOne conference: "In our Collaboration portfolio, we recently introduced a range of truly game-changing AI capabilities spanning the entire Webex suite, as well as new devices for reimagined workspaces at our WebexOne event."
More broadly, Cisco reported fiscal first-quarter net income of $3.6 billion, compared to $2.7 billion the previous year's Q1. Revenue grew to $14.7 billion from $13.6 billion the year prior, an increase of eight percent.
Non-GAAP net income was $4.5 billion, up 28 percent year over year, and the non-GAAP operating margin was reported as 36.6 percent. "Our disciplined expense management and the tailwinds from our business model transformation resulted in our highest non-GAAP gross margin in over 17 years and record non-GAAP operating margin," was Robbins' analysis.
Robbins described these results as "the strongest first quarter results in Cisco's history in terms of revenue and profitability".
However, despite the business reporting adjusted earnings for Q1 of $1.11 per share versus estimates of $1.03, as well as revenue of $14.67 billion compared to an expectation of $14.63 billion, the market didn't respond well to Cisco's revised guidance for Q2 the rest of the year.
