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How Did Cisco’s Wireless Segment Perform in Fiscal 1Q17?

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Nov. 23 2016, Updated 10:04 a.m. ET

Revenues fell 2% YoY

Cisco’s (CSCO) wireless business revenues fell 2% YoY (year-over-year) in fiscal 1Q17. Revenues in this segment fell from $646 million in fiscal 1Q16 to $632 million in fiscal 1Q17 driven by “a decline in controllers and soft E-rate funding partially offset by strong growth in Meraki with our cloud managed product line.” A wireless local area network uses radio waves to connect devices such as laptops and smartphones to the Internet.

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Wireless LAN market grew in 2Q16

According to IDC, the total WLAN (wireless local area network) market rose 6.7% YoY (year-over-year) and 6.7% on a sequential basis (quarter-over-quarter) in 2Q16. The Enterprise WLAN market rose 9.4% YoY in 2Q16.

At the end of 2Q16, Cisco Systems’ (CSCO) WLAN revenue rose 1.1% YoY, and its market share was 43.7% as compared to 45.2% in 1Q16 and 47.3% in 2Q15. Cisco’s acquisition of Meraki is one of the key revenue and growth drivers for the firm.

Hewlett Packard Enterprise (HPE) is another major player in this market with a share of 14.6% in 2Q16 as compared to 15.8% in 1Q16 and 17.1% in 2Q15. Brocade (BRCD)-Ruckus’s (RKUS) revenues grew 7.9% YoY, but its market share fell to 6.8% in 2Q16 from 7.7% in 1Q16 and 6.9% in 2Q15.

Tech (QQQ) stocks such as Ubiquiti’s and Aerohive’s revenues also rose significantly YoY in 2Q16 by 95.3% and 34.1%, respectively. While Ubiquiti accounted for 4.2% of the overall market in 2Q16, Aerohive accounted for 2.7%.

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