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Cisco Gets Boost From the Cloud, Cost-Cutting: CEO

Wednesday, 8 Feb 2012 | 6:20 PM ET

Cisco's better-than-expected revenue growth was from more than "routing and switching," CEO John Chambers told CNBC Wednesday, it was also data centers, cloud computing and $1 billion in cost-cutting measures.

Cisco
Cisco

"It goes way beyond routing and switching, which was also good. It goes into collaboration, it goes into cloud, data centers and architecture," Chambers said after Cisco's earnings and revenue handily beat analyst expectations. "So we were pleased with the quarter. It’s a journey but it was a good start."

He added that Cisco "achieved our $1 billion goal on cost reductions a quarter earlier, but we reorganized ourselves to be aligned with how our customers make decisions. Our relationships with our customers have never been tighter and you’re gonna see some pretty good numbers" in the enterprise, data center and commercial parts of the business, he said.

Cisco's Chambers Explains Earnings
John Chambers, Cisco chairman & CEO, discusses how Cisco is navigating challenges in this tough environment including Europe's debt crisis and last year's flooding in Thailand: "We're a little more optimistic about Europe," he says.

One big drag — the public sector. "Government spending will go in waves," he said, particularly U.S. federal government spending, which he sees getting weaker before it gets better. But that is balanced by continued spending around the globe, including in northern Europe, which Chambers said has "a little more balance...than people may think."

He said after investing six years ago in what is now the cloud, Cisco is gaining market share from competitors, including Hewlett-Packard .

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