Cisco's Indian Unit Suffers Slump in Revenue Growth Amidst Global Decline
New Delhi, July 2024: Networking and technology giant Cisco has hit a speed bump as its Indian unit witnessed a slowdown in revenue growth, according to information compiled by VCCEdge, the database unit of VCCircle. The company's India unit revenue rose under 1.5% in FY24, reaching ₹12,074.5 crore, a significant decline compared to turbocharged growth in FY23.
The deceleration at Cisco India is also reflective of the company's global performance, which saw a 6% decrease in revenue for the fiscal year 2023-24 ended July 2024. The decline was attributed to weak networking business. Splunk, acquired by Cisco in a big-ticket deal worth $28 billion in 2023, contributed approximately $1.4 billion of the total revenue.
According to the company's FY24 results, net profit suffered a substantial decline, with a 40% drop in PAT (profit after tax), ending the year at ₹1,463.8 crore. This decline was also reflected in its quarterly report for Q4 FY24, where revenue continued to spiral down.
The decline in performance comes as Cisco India has been operating in the country since 1995 and boasts of seven sales offices across the country. The company announced the launch of its first manufacturing facility in India earlier this year, expected to drive $1.3 billion in revenue and create 1,200 jobs.
Notably, Cisco had previously announced plans to trim 7% of its workforce globally as part of its restructuring planning, impacting 6,000 people. The company's President of India and SAARC, Daisy Chittilapilly, remains bullish on the Indian opportunity, stating that the country is expected to be among the top five markets for Cisco in the next few years.
The launch of a new cloud region hosted within India, called Meraki India Region, was also announced earlier this year to comply with data localisation norms. However, despite these efforts, Cisco's Indian unit continues to face challenges, highlighting the evolving landscape of the technology industry in the country.