Cisco growth gathers pace - with sales up by almost one-fifth in the UK

Cisco sees strong growth in data centre networking hardware sales as demand from cloud takes off

Networking giant Cisco has posted revenues up seven per cent in its second quarter to the end of January as its return to growth gathered pace - with sales up by 17 per cent in the UK.

Overall, revenues grew from $11.2bn in the second quarter of 2014 to $11.9bn in the same quarter of fiscal 2015, an increase of seven per cent. Net income grew even more strongly, up from $1.4bn to $2.4bn.

Cisco's long-standing CEO John Chambers claimed the increase in revenues was due to the result of a three-year transformation programme. "Our strong momentum is the direct result of how well we have managed our company transformation over the last three plus years and our leadership position in the key technology transitions of cloud, mobility, big data, security, collaboration, and the Internet of Everything," said Chambers.

Revenue for the first six months of fiscal 2015 was $24.2bn, compared with $23.2bn for the first six months of fiscal 2014.

The company attributed the strong sales growth to demand for networking equipment in data centres, in particular, driven by demand for cloud computing services, which also helped increase sales of switching products. In wireless, which posted revenue growth of 18 per cent, year-on-year, the company's Meraki cloud networking business doubled in size, year-on-year.

The only blackspot for the company came in the Asia-Pacific region, where it has been hit by increased circumpsection over US-designed networking products in the aftermath of the Edward Snowden US National Security Agency (NSA) disclosures.

According to Skyhigh Networks, European enterprise cloud service adoption increased by 33 per cent in 2014, which no doubt accounts, at least in part, for the increase in demand for data centre products that Cisco experienced in the second quarter.

"The average European employee uses 23 cloud services, many of which represent unsanctioned or shadow IT and highlight the growing risk and opportunity for IT teams to securely enable cloud services within their organisations," said Kamal Shah, vice president of products and marketing at Skyhigh Networks.