Revenue growth across business segments
In this series, we have seen that Cisco (CSCO) experienced revenue growth across major business segments in fiscal Q4 2018. The company’s Infrastructure Platform business revenue rose 7% YoY (year-over-year), while its Applications revenue rose 10% and Security revenue rose 12% in fiscal Q4 2018. Cisco’s broad portfolio of solutions drove product revenue in Q4 up by 7%.
While Cisco’s wireless growth was driven by strength in Meraki and Wave 2 offerings, Data Center revenue rose in the double digits driven by servers and HyperFlex. This growth was offset by weakness in service provider routing.
Applications revenues rose 10% as Cisco experienced solid growth in unified communications, telepresence, App Dynamics, and conferencing, while the double-digit growth in Security was a result of the strong performance in network security, unified threat, web security, policy, and access.
Subscription and recurring revenue
Cisco continues to focus on software offerings and increasing subscription as well as recurring revenue. In Q4, recurring revenue accounted for 32% of total revenue. In comparison, revenue from subscriptions rose five percentage points and accounted for 56% of total software revenue. Deferred revenue rose 6% with product revenue rising 15% and services rising 1%. Deferred product revenue from recurring software and subscription offers rose 23%.
Cisco’s revenue in fiscal Q4 rose 90 basis points due to acquisitions. Company CEO Chuck Robbins stated, “We returned to growth, invested in our core franchises, delivered new innovative platforms, and continued to shift our business to more software and subscriptions. Our record results demonstrate the strength of our business as well as the strategic focus and execution that we have delivered over the past twelve months.”