Investing in Cisco Cyber security: Are businesses really making a sound effort?


Businesses keeps increasing their bar in Cyber securityperspective. Demands keeps increasing with the increasing cyber threats. Thereare several factors which drives the demands, hence there is constant need toupgrade, new strategies will require new funding and new ways to fight threats.

All around the world, there has been a spike incyber-related breaches over the past two years. These threats work directly andindirectly and go beyond traditional risks. As a result, corporate areincreasing their spending on Cyber security. Industry estimates corroborate thetrend. According to Gartner’s ‘2019 Worldwide Security Spending Projection’,worldwide spending on IT security will jump 8.7% this year, up to $124 billionas against the general IT spend, which is expected to grow by 3.2% this year.

There are several factors which are responsible for the ITspike . Here’s a small list of factors that have led to the current spike inspends:

The rise in compliance and regulations

Innovation led technology transformation

Small and medium enterprises and start ups

The dearth of necessary skills

Cisco's (NASDAQ:CSCO) Cyber security business is gettingbetter with each passing quarter. The networking specialist's Cyber securityrevenue now exceeds many  pure-playspecialists thanks to the scale of its business, and it won't be long before itestablishes a vice like grip over the market.

Cisco's Cyber security revenue shot up 12% annually to $627million, making Cyber security Cisco's fastest-growing segment.

Cyber security is Cisco's fastest-growing segment, but itonly provides around 5% of its total revenue. This means that the Cyber securitybusiness isn't moving the needle in a big way for Cisco just yet, but at thesame time, investors cannot ignore that Cyber security is driving atransformation at Cisco.

As it stands, recurring revenue now makes up 32% of thecompany's top line, up 1 percentage point from the prior-year period.Additionally, subscription revenue now makes up 56% of the company's softwaresegment compared to 51% in the prior-year period. The improvement in thesemetrics led to a 23% annual jump in Cisco's deferred revenue from software andsubscription sales last quarter to $6.1 billion.

This is a step in the right direction for Cisco, asrecurring revenue sources generally yield higher profitability, since it costsless to service an existing customer than going out to acquire a new one.Additionally, Cisco can cross-sell any new Cyber security features to itsexisting customers and boost margins, since it will be able to lower the costof sales. Now, there isn't any hard evidence to prove how much of a catalyst Cyber security growth is to Cisco's margins, but there's a way to establish thepositive correlation between the two. Back in 2016, Cyber security was just 3.8%of Cisco's total revenue. As the contribution of this business to Cisco's topline has improved, so has the company's margin profile.

Cyber security could be a big driver of Cisco's growth in thelong run, as the company is positioning itself to grab a bigger piece of thisspace by using acquisitions and its influence in networking hardware. At thesame time, Cyber security will allow the company to grow its business profitablybecause it has the potential to generate stronger margins. This is one of thereasons why analysts expect Cisco's earnings growth to clock a higher annualgrowth rate of nearly 9% over the next five years as compared to the 5.5%annual increase it has clocked in the last five.

Cisco Cyber security Specialist

The Cisco Cyber security Specialist certification recognizes security professionals who have attained specialized in-depth expertise and proven knowledge in the essential areas of proactive cyber threat detection and mitigation.

Overview

The Cisco Cyber security Specialist certification recognizes security professionals who have attained specialized in-depth expertise and proven knowledge in the essential areas of proactive cyber threat detection and mitigation.

Designed for professional security analysts and leveraging the features of Cisco and other network security products used today, the Cisco Cyber security Specialist certification focuses on the topics of event monitoring, security event/alarm/traffic analysis, and incident response.

Prerequisites

No prerequisites are required; however a thorough understanding of TCP/IP and a working knowledge of CCNA Security is highly recommended.




By haripriya.krishnakum Krishnakumar | 17 Oct 2019 | 0 Comments