Cisco looking to grow profits faster than revenue in next 3 years

Summary:Cisco's CFO discusses the company's financial and product strategies going forward at the Goldman Sachs Technology and Internet Conference.

SAN FRANCISCO -- Cisco CFO and executive vice president Frank Calderoni addressed the keynote audience at the Goldman Sachs Technology and Internet Conference on Wednesday, starting off with some prepared remarks about Cisco's earnings last quarter and year.

Calderoni explained that the fundamental financial strategy for Cisco now is "looking at the next three years and growing out profits faster than revenue."

Looking back at the last quarter, Calderoni asserted that Cisco is "making progress" with a $11.5 billion revenue for the quarter, up 11 percent year-over-year.

On a product basis, Calderoni pointed towards several different arms of Cisco's enterprise solutions: collaboration, video, cloud, mobility and security.

The point of supporting innovation in these areas, Calderoni continued is to "take an architectual approach" and look at what customers need, their challenges, and how Cisco is meeting those issues.

For example, Calderoni cited a recent Cisco study that found mobility traffic is going to grow by "1,200 percent" over the next few years. Thus, Calderoni concluded, that Cisco's roadmap is "very much aligned" with customer demands and boosting Cisco's balance sheets.

Part of the way that Cisco is going about raising profits is cutting some of the fat. Last year, Cisco famously nixed the Flip consumer video camera brand, which Calderoni noted added "two points of growth right there."

Addressing where we will see new products from Cisco over the next two to three years, Calderoni acknowledged that the switching and routing sectors are see lower growth levels.

However, Calderoni pointed towards offsetting those lower growth trends by expanding the wireless, security, datacenter and collaboration portfolios.

"These are areas with higher growth opportunity for us," Calderoni posited.

Related:

Topics: Cisco

About

Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider, FastCompany.com, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for MainStreet.com, Irish Americ... Full Bio

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