How Much Of Cisco’s Revenue Growth Will Come From Applications In The Next 2 Years?

by Trefis Team
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Cisco‘s (NASDAQ:CSCO) Applications business houses the company’s collaboration offerings (unified communications, Cisco TelePresence and conferencing), IoT software from Jasper and analytics software from AppDynamics. The segment’s solutions are primarily software-oriented (sold on-premise and on-demand) and are delivered across channels (fixed and mobile networks across all connected devices) and media formats (messaging, voice and video). Due to the multichannel nature of the portfolio of the Applications business’ offerings, the related analytics help to ascertain a coherent view of the entire ecosystem.

We expect the Applications segment’s revenues to grow from $5 billion in fiscal 2018 to $6.3 billion in fiscal 2020, a CAGR of 9.3%, versus our estimated company-wide revenue CAGR of 1.9% for the same period. Consequently, the Applications division is expected to contribute 27% to Cisco’s growth by 2020.

We have created an interactive dashboard on Cisco’s Applications Division’s Contribution. You can modify any of the key drivers to visualize the impact of changes on the company’s revenue estimates, and see all of our Technology company data here.

The growth in Cisco’s Applications business is likely to be driven by an increasing number of connected devices, expanding boundary of cloud and higher focus on edge computing. Furthermore, as the volume of traffic across networks continues to grow, the increasing need to be able to analyze data and adjust delivery is also likely to give a boost to the segment’s growth.

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