Cisco CEO sees strong revenue growth next year

In a quarter plagued by financial doom and gloom from major tech firms, Cisco says it is on course to rack-up 50-60% revenue growth for 2001.

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By  Rob Corder Published  December 6, 2000

Cisco Systems president and CEO John Chambers has told analysts that he expects the company to meet previously stated revenue-growth projections and spelled out the strategic plan that he believes will keep it on track for 2001.

As in the past, Cisco will identify and capitalise on new technologies for future revenue growth, and it also intends to provide complete end-to-end networking systems either by meeting all of a customer's needs itself or by allying with major partners, Chambers said.

Cisco is positioning itself to meet the technology needs that will emerge in three to five years, Chambers said in a speech Monday at the company's annual analyst conference in San Jose, Calif. Cisco envisions a "blended vision of service provider networks, enterprise networks, and commercial networks, and it's the Internet that ties it all together," he said.

But not all of the analysts attending the two-day event are believers in Cisco's optimistic predictions based on its performance this year. "It's interesting that compared to last year when they talked a lot about service providers, that this year they've had to backpedal from that," says Sheila McGee-Smith, director at the Pelorus Group.

Chambers admitted that sales in the service provider market were somewhat disappointing this year because of an overall downturn in the high-tech sector. Still, Cisco believes it will meet previously stated projections and expects revenue growth for 2001 to reach 50% to 60%, Chambers said.

Areas targeted for growth include optical networking; converged voice, data, and video products as typified by its architecture for voice, video and integrated data (AVVID) platform; an increased presence in software applications; and a growing services business.

But even the strategy surrounding AVVID "has been very confusing, and the confusing part is whether they are an enterprise applications player or not," McGee-Smith says. "The company seems to be waffling on that, and they keep going back and forth" in terms of whether they plan to offer just hardware platforms for integrated communications or whether they plan to be a full-scale provider of the software applications and services that will run on those platforms.

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