Cisco Systems, Inc. (NASDAQ:CSCO) Q1 2020 Earnings Conference Call - Final Transcript
Nov 13, 2019 • 04:30 pm ET
non-GAAP operating margins along with solid operating cash flow. We continued to invest in innovation and expand our market opportunities, while maintaining our commitment to maximizing shareholder return.
Over the last year, many of you have heard me talk about the resilience of the global macro environment. However, on our last earnings call, we indicated that we had begun to see some weakness and that weakness continued throughout Q1 and was more broad based. While the main challenges continue to be service provider and emerging markets, this quarter we also saw relative weakness in enterprise and commercial. Despite these headwinds and because of key decisions we made four years ago to change our business model, we remain well positioned to capitalize on the tremendous opportunities across cloud, automation, 5G, security, and collaboration.
Our transition to software continues to progress, and we are on track with where we said we would be at the end of fiscal year 2020. This transition to software not only aligns to how our customers want to consume our technology, but we also believe it will lessen the impact of macroeconomic shifts in the future.
Despite the current uncertainty, our innovation pipeline remains strong. At our annual Partner Summit last week, we announced several exciting additions to our portfolio, including network automation and analytics, cloud-based networking, collaboration, as well as new security capabilities. Over the next couple of months, you will see us deliver even more innovation to help our customers achieve their business objectives.
Now I'd like to share some recent highlights across the business. Our enterprise networking portfolio continued to grow as customers increasingly adopt our intent-based networking portfolio, spanning our Catalyst 9000 family of switches, Meraki cloud-based platforms, and next-generation data center solutions. Our customers today are running applications across multiple cloud environments, and this shift requires a fundamental change in how they build their networks and their security architectures.
To help them achieve this, we are automating connectivity across any cloud. A good example of this is our recently announced partnership with Microsoft to help our customers improve network connectivity with the highest level of security from branch offices to cloud-based applications by integrating Cisco's SD-WAN solution with Azure's Virtual WAN.
To further extend our enterprise networking leadership, we continue to expand our cloud managed network and security offerings. Last week we also announced an expansion of our Meraki portfolio, including continued integration between Meraki's dashboard and Cisco switching portfolio, as well as innovative new LTE-based WAN connectivity solutions. We believe our planned acquisition of Acacia will also play a critical role in building upon the strength of our switching, routing, and optical networking portfolio. By utilizing our innovations across silicon, software, and optics, we are enabling our customers to transform their networks.
Now let's turn to security which is always at the heart of everything we do. It's deeply integrated into the fabric of our entire portfolio to help secure our customers' data, and address their modern application in multi-cloud environments.