Cisco Systems Inc Q4 2015 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: James Faucette - Morgan Stanley - Analyst : I just wanted to ask a question related to security. That was an area in an otherwise strong quarter that was a little bit below at least where we had modeled. Just wondering if you could give a little view on maybe what transpired and how you think about security and what needs to happen there to drive that growth. And as part of that, are you comfortable with your current portfolio in security or should we expect you to look to make additions there to make it increase even further the competitiveness? Thank you.

Question: Simona Jankowski - Goldman Sachs - Analyst : I just wanted to ask a question on the backlog. It was down year over year even though book-to-bill was strong, as was deferred. I was just curious if you can help us reconcile that. And related to that, enterprise I think you said was down 1% year over year, even though you had very strong bookings there last quarter. So, just wanted to understand the dynamics there, as well.

Question: Amitabh Passi - UBS - Analyst : Chuck, welcome on your first call. I wanted to piggyback on the last question. I had a similar question on switching. Last quarter I think there was some concern about switching sales having peaked two quarters ago. I think you saw a sequential uptick in switching. How should we be thinking about the cadence in your overall switching business? Is this a business that you feel comfortable growing in this 1%, 2%, 3%, lower single-digit percent range?

Question: Brian Modoff - Deutsche Bank - Analyst : If you could add up your services revenue including Meraki, including some of the enterprise products, what's the revenue base on that? What's the overall growth rate and trend in that business? Thanks.

Question: Brian Modoff - Deutsche Bank - Analyst : Meraki, your recurring revenue stream -- your services plus your recurring revenue streams. And what's the growth rate and what's the trend in that? Thanks.

Question: Tal Liani - BofA Merrill Lynch - Analyst : I want to go back to the question on switching because I'm trying to understand. This is a major upgrade and still we don't see the numbers picking up materially. The sequential growth we're seeing is below what we've seen the last two years. And I'm wondering, can you go over what's offsetting the gross in 3K and 9K? Why are the numbers not showing much greater increase given the magnitude of the cycle? Thanks.

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : On the service provider side, you're now getting back to some good revenue momentum. I was wondering, how much of that comes from a change in the landscape in how operators are looking at spending, and how much is much more related to your own dynamics and your own product cycle. And then when we look at the second half of the year, of the calendar year, could you give us a sense of how you see the market evolving, especially your largest clients in the US? Thank you.

Question: Mark Sue - RBC Capital Markets - Analyst : Maybe a question on how we should think about Cisco's long-term growth on an adjusted basis considering Cisco has and will continue to make acquisitions. And increasingly you're taking a fresh look at divesting businesses. So, can we return to your 3% to 6% long-term growth rate post the SFA divestiture? And concurrently, how should we start modeling the revenue impact as we transition to subscription and as Cisco moves faster to software?

Question: Simon Leopold - Raymond James & Associates, Inc. - Analyst : I wanted to come back to the routing segment. The results this quarter certainly were a bit better than what we were modeling. But when we compare your results to some of your closest competitors, it does appear that at least in their June ending quarters they grew a bit faster. So, maybe you could help us understand what might be going on in the routing market overall as well as your competitive position and market share. Thank you.

Question: Jess Lubert - Wells Fargo Securities, LLC - Analyst : I was hoping you could share with us how much your business is now coming from the Web 2.0 vertical, the trends you're seeing there, how material the opportunity with these customers may be for your prospects in FY16. And then the service business saw nice improvement so any insight as to what drove the improvement there and if there's any reason to believe service growth could accelerate as customers move forward with more complex network architectures. Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 12, 2015 / 8:30PM, CSCO.OQ - Q4 2015 Cisco Systems Inc Earnings Call

Question: George Notter - Jefferies LLC - Analyst : Somewhat impressed with the growth rates you guys are putting up in the commercial segment on year-on-year product orders. You've had a string of fairly attractive year-on-year growth rates. But can you talk about what's going on there? Obviously Meraki is a part of the story. I know you guys are trying to push that cloud management system onto other products in the portfolio. Can you just talk generally about the initiatives you have going on in commercial and how you keep driving that growth going forward? Thanks.

Question: Paul Silverstein - Cowen and Company - Analyst : Very straightforward, if you could talk about pricing across regions in general. And Kelly, can you remind us what cloud titans are as a percentage of revenue?

Question: Tim Long - BMO Capital Markets - Analyst : I just want to talk a little bit about the emerging markets. It sounds like the US performance has been outstanding, just some of the countries were highlighted as a problem. Could you give us a little view on how long do you think before we can start to see a more broad-based recovery in the emerging Markets? And what pieces of your business do you think are most likely to drive that? Thank you.

Question: Jayson Noland - Robert W. Baird & Company, Inc. - Analyst : A follow-up to Europe -- how much of that is macro and how much of that is US dollar strength? And then, Chuck, if you can comment on any headcount reductions to start the fiscal year. Cisco's made some cuts the last couple years.