思科 (CSCO) 2018 Q3 法說會逐字稿

Welcome to Cisco's Third Quarter Fiscal Year 2018 Financial Results Conference Call. At the request of Cisco Systems, today's conference is being recorded. If you have any objections, you may disconnect.

歡迎參加思科 2018 財年第三季度財務業績電話會議。應 Cisco Systems 的要求，今天的會議正在錄製中。如有異議，可斷開連接。

Now I would like to introduce Marilyn Mora, Head of Investor Relations. Thank you. You may begin.

現在我想介紹一下投資者關係主管 Marilyn Mora。謝謝。你可以開始了。

Thanks, Michelle. Welcome, everyone, to Cisco's Third Quarter Fiscal 2018 Quarterly Earnings Conference Call. This is Marilyn Mora, Head of Investor Relations, and I'm joined by Chuck Robbins, our Chairman and CEO; and Kelly Kramer, our CFO.

謝謝，米歇爾。歡迎大家參加思科 2018 財年第三季度季度收益電話會議。我是投資者關係主管 Marilyn Mora，我們的董事長兼首席執行官 Chuck Robbins 也加入了我的行列；和我們的首席財務官 Kelly Kramer。

By now you should have seen our earnings press release. A corresponding webcast with slides, including supplemental information, will be made available on our website in the Investor Relations section following the call. Income statements, full GAAP to non-GAAP reconciliation information, balance sheet, cash flow statement and other financial information can also be found in the Financial Information section of our Investor Relations website.

到現在為止，您應該已經看到了我們的收益新聞稿。電話會議後，將在我們網站的“投資者關係”部分提供相應的帶幻燈片的網絡廣播，包括補充信息。損益表、完整的 GAAP 與非 GAAP 調節信息、資產負債表、現金流量表和其他財務信息也可以在我們投資者關係網站的“財務信息”部分找到。

Throughout this conference call, we will be referencing both GAAP and non-GAAP financial results and will discuss product results in terms of revenue and geographic and customer results in terms of product orders, unless stated otherwise. All comparisons throughout this call will be made on a year-over-year basis, unless stated otherwise.

在整個電話會議中，除非另有說明，否則我們將參考 GAAP 和非 GAAP 財務結果，並將討論收入方面的產品結果以及產品訂單方面的地理和客戶結果。除非另有說明，否則本次電話會議的所有比較都將按年進行。

The matters we will be discussing today include forward-looking statements, including the guidance we will be providing for the fourth quarter of fiscal 2018. They are subject to the risks and uncertainties that we discuss in detail in our documents filed with the SEC, specifically the most recent reports on Form 10-K and 10-Q, which identify important risk factors that could cause actual results to differ materially from those contained in the forward-looking statements.

我們今天將討論的事項包括前瞻性陳述，包括我們將為 2018 財年第四季度提供的指引。它們受到我們在提交給美國證券交易委員會的文件中詳細討論的風險和不確定性的影響，特別是關於 10-K 和 10-Q 表格的最新報告，這些報告確定了可能導致實際結果與實際結果大不相同的重要風險因素包含在前瞻性陳述中的內容。

With respect to guidance, please also see the slides and the press release that accompany this call for further details. As a reminder, Cisco will not comment on its financial guidance during the quarter unless it is done through an explicit public disclosure.

關於指南，另請參閱本次電話會議隨附的幻燈片和新聞稿以了解更多詳細信息。提醒一下，除非通過明確的公開披露，否則思科不會就本季度的財務指引發表評論。

With that, I'll now turn it over to Chuck.

有了這個，我現在把它交給查克。

Thank you, Marilyn. Good afternoon, everyone. We had another great quarter. We are executing well against the strategy we put in place 3 years ago. Our innovation pipeline has never been stronger, and we continue to transform our business to reflect the way customers want to consume our technology.

謝謝你，瑪麗蓮。大家下午好。我們有另一個很棒的季度。我們對 3 年前製定的戰略執行得很好。我們的創新管道從未如此強大，我們將繼續轉變我們的業務以反映客戶希望使用我們技術的方式。

We delivered another quarter of accelerating revenue growth of 4%, solid margins and record non-GAAP EPS up 10%. Our performance was driven by the acceleration of our intent-based networking portfolio, continuing strong customer demand for our innovative solutions and the increasing value of the network. We also made steady progress in shifting more of our business toward software and subscriptions. This resulted in broad-based strength across our products and geographies.

我們在另一個季度實現了 4% 的加速收入增長，穩固的利潤率和創紀錄的非 GAAP 每股收益增長 10%。我們的業績得益於我們基於意圖的網絡產品組合的加速發展、客戶對我們創新解決方案的持續強勁需求以及網絡價值的不斷增長。我們還在將更多業務轉向軟件和訂閱方面取得了穩步進展。這導致我們的產品和地區具有廣泛的優勢。

As I talk with customers around the world, it is clear that the network is playing an increasingly critical role in helping them manage their complex environments. They are consuming services from multiple cloud providers, multiple SaaS applications, connecting billions of new devices which are generating massive amounts of data, and the network is pervasive across all of these environments. We have been evolving our portfolio to help our customers deal with this complexity and provide unprecedented simplicity, visibility and security across on-premise, hybrid and multi-cloud environments.

當我與世界各地的客戶交談時，很明顯網絡在幫助他們管理複雜環境方面發揮著越來越重要的作用。他們正在使用來自多個雲提供商、多個 SaaS 應用程序的服務，連接數十億個正在生成大量數據的新設備，並且網絡在所有這些環境中無處不在。我們一直在改進我們的產品組合，以幫助我們的客戶應對這種複雜性，並在本地、混合和多雲環境中提供前所未有的簡單性、可見性和安全性。

Now I'd like to review our momentum across key priority areas and share some of the innovations we're driving across our portfolio. First, let's start with Infrastructure Platforms. We are leading the network industry's transformation to intent-based networking across the campus, branch, data center and the edge. We are paving the way to help customers simplify and manage the network. Only Cisco offers an end-to-end, intent-based networking portfolio that delivers assurance, industry-leading security, policy-based automation and segmentation.

現在，我想回顧一下我們在關鍵優先領域的發展勢頭，並分享我們在產品組合中推動的一些創新。首先，讓我們從基礎設施平台開始。我們正在引領網絡行業向跨園區、分支機構、數據中心和邊緣的基於意圖的網絡轉型。我們正在為幫助客戶簡化和管理網絡鋪平道路。只有思科提供端到端、基於意圖的網絡產品組合，可提供保證、行業領先的安全性、基於策略的自動化和分段。

We continue to see very strong adoption of the Catalyst 9000, the fastest-ramping new product introduction in our history. This includes another quarter of high uptake of our advanced subscription offer in DNA Center, our automation and analytics platform. The Catalyst 9000 now has over 5,800 customers, up from 3,100 last quarter. This is an excellent example of how we've begun to scale our enterprise networking business into a subscription model. We've also recently introduced additional intent-based networking innovations. These include new access solutions and routing software subscriptions which expand our software-defined WAN capabilities onto any platform.

我們繼續看到 Catalyst 9000 的廣泛採用，這是我們歷史上推出速度最快的新產品。這包括我們在 DNA 中心（我們的自動化和分析平台）中的高級訂閱服務的另外四分之一的高使用率。Catalyst 9000 現在擁有超過 5,800 名客戶，高於上一季度的 3,100 名。這是一個很好的例子，說明我們如何開始將我們的企業網絡業務擴展為訂閱模式。我們最近還引入了其他基於意圖的網絡創新。其中包括新的訪問解決方案和路由軟件訂閱，可將我們的軟件定義 WAN 功能擴展到任何平台。

We are extending our leadership in data center and cloud by providing highly secure and differentiated offerings such as our ACI SDN solution. With growing 100-gig deployments, especially in cloud infrastructure, we remain well positioned for future growth with our data center switching and intent-based portfolio. We also announced new hybrid cloud workload management solutions with ACI Multi-Site Management and new flexible consumption models, including SaaS delivery for our Tetration platform. Whether deploying enterprise applications or containers in a multi-cloud environment, customers are increasingly turning to Cisco's unique architectural approach. This is leading to strong momentum with UCS, our compute platform; and HyperFlex, our hyperconverged offering, as customers benefit from simplicity and scalability to support their hybrid cloud strategies.

我們通過提供高度安全和差異化的產品（例如我們的 ACI SDN 解決方案）來擴大我們在數據中心和雲領域的領導地位。隨著 100-gig 部署的不斷增長，尤其是在雲基礎設施中，我們通過數據中心交換和基於意圖的產品組合為未來的增長做好準備。我們還發布了具有 ACI 多站點管理和新的靈活消費模型的新混合雲工作負載管理解決方案，包括用於我們的 Tetration 平台的 SaaS 交付。無論是在多雲環境中部署企業應用程序還是容器，客戶越來越多地轉向思科獨特的架構方法。這導致了我們的計算平台 UCS 的強勁勢頭；以及我們的超融合產品 HyperFlex，因為客戶可以從簡單性和可擴展性中受益，以支持他們的混合雲戰略。

Now turning to Security, which is foundational to everything we do. Our architecture delivers highly effective security from the network to the endpoint to the cloud. This unique ability to bring together networking and security at scale gives us a huge competitive advantage. With the largest customer base in enterprise security, it is clear that our strategy is working. The strength we saw in the quarter is driven by our integrated architecture, combined with best-of-breed products.

現在轉向安全，這是我們所做的一切的基礎。我們的架構提供從網絡到端點再到雲的高效安全性。這種將網絡和安全大規模結合在一起的獨特能力為我們提供了巨大的競爭優勢。憑藉企業安全領域最大的客戶群，我們的戰略顯然正在奏效。我們在本季度看到的實力是由我們的集成架構與同類最佳產品相結合所推動的。

We are also leveraging artificial intelligence and machine learning to reduce time to detection and remediation. A great example of this is our Talos intelligence platform where we block 20 billion threats every day.

我們還利用人工智能和機器學習來縮短檢測和修復時間。我們的 Talos 情報平台就是一個很好的例子，我們每天在該平台上攔截 200 億個威脅。

We continue to rapidly innovate in security to address key areas of concern for our customers such as security in their complex data centers. We introduced a comprehensive, integrated data center security architecture that is designed to protect the modern data center by seamlessly following any workload anywhere across physical and multi-cloud environments.

我們繼續在安全方面進行快速創新，以解決客戶關注的關鍵領域，例如復雜數據中心的安全性。我們引入了一個全面、集成的數據中心安全架構，旨在通過跨物理和多雲環境隨時隨地無縫跟踪任何工作負載來保護現代數據中心。

Now moving to Applications. This quarter, we introduced new innovations across our collaboration portfolio with the convergence of the Cisco Spark and WebEx platforms combined with new WebEx Meetings and WebEx Teams applications. We further enhanced our AI and machine learning capabilities across our collaboration portfolio with the acquisition of Accompany, a relationship intelligence platform with robust insights and intelligence to improve meeting and team experiences. We completed this acquisition last week.

現在轉到應用程序。本季度，我們通過融合 Cisco Spark 和 WebEx 平台以及新的 WebEx Meetings 和 WebEx Teams 應用程序，在我們的協作產品組合中引入了新的創新。通過收購 Accompany，我們進一步增強了整個協作產品組合中的 AI 和機器學習能力，Accompany 是一個關係智能平台，具有強大的洞察力和智能，可改善會議和團隊體驗。我們上週完成了此次收購。

We are pleased with the consistent progress we've made to deliver on the strategy we put in place nearly 3 years ago. We have solid business momentum. We are confident in our pipeline of innovation and future growth opportunities. And our commitment to driving value for our shareholders remains as strong as ever. This is clearly demonstrated by the fact that we delivered record capital returns this quarter.

我們很高興我們在實施近 3 年前製定的戰略方面取得了持續進展。我們有堅實的業務勢頭。我們對我們的創新渠道和未來的增長機會充滿信心。我們一如既往地致力於為股東創造價值。我們本季度實現了創紀錄的資本回報這一事實清楚地證明了這一點。

As part of our commitment to shareholders, we are also very focused on our responsibility as a company to drive impact within our communities through innovation and active engagement. It is not only the right thing to do, but a key requirement for long-term business success. We are deeply committed to our long-standing efforts around sustainability, education and disaster relief as well as other key issues such as hunger and homelessness. I could not be prouder of our achievements or more excited about the impact we will have going forward.

作為我們對股東承諾的一部分，我們也非常重視我們作為一家公司的責任，即通過創新和積極參與在我們的社區內產生影響。這不僅是正確的事情，而且是長期業務成功的關鍵要求。我們堅定地致力於我們在可持續發展、教育和救災以及飢餓和無家可歸等其他關鍵問題方面的長期努力。我為我們的成就感到無比自豪，也為我們將產生的影響感到無比興奮。

Now I'll turn it over to Kelly to walk through more detail on our financials.

現在我將把它交給凱利來詳細介紹我們的財務狀況。

Thanks, Chuck. I'll start with a summary of our financial results for the quarter, followed by the guidance for Q4.

謝謝，查克。我將從本季度的財務業績摘要開始，然後是第四季度的指導。

We were pleased with the financial performance in Q3 with broad strength across the business. We executed well with very good orders momentum, strong revenue growth and solid margins.

我們對第三季度的財務表現感到滿意，整個業務都具有廣泛的實力。我們以非常好的訂單勢頭、強勁的收入增長和穩固的利潤率執行得很好。

Total revenue was $12.5 billion, up 4%, and non-GAAP EPS was $0.66, up 10%. We continue to focus on driving margins and profitability with a strong non-GAAP operating margin rate of 31.5%.

總收入為 125 億美元，增長 4%，非 GAAP 每股收益為 0.66 美元，增長 10%。我們繼續專注於提高利潤率和盈利能力，非 GAAP 營業利潤率高達 31.5%。

Let me provide some more detail on our Q3 revenue. Total product revenue was up 5%, demonstrating the strength of our portfolio. Infrastructure Platforms grew 2% with strength in all businesses with the exception of routing. Switching returned to growth with revenue growth in both data center and campus. Campus growth was driven by our new switch, the Cat 9K. We saw solid growth in wireless with strength in Meraki and our Wave 2 offerings. Data center had very strong double-digit growth driven by servers as well as HyperFlex. Routing declined largely with the continued weakness in service provider.

讓我提供有關我們第三季度收入的更多詳細信息。產品總收入增長了 5%，證明了我們產品組合的實力。基礎設施平台增長 2%，除路由外，所有業務均表現強勁。隨著數據中心和園區收入的增長，轉換恢復增長。園區的增長是由我們的新交換機 Cat 9K 推動的。我們看到無線業務穩步增長，Meraki 和我們的 Wave 2 產品實力強勁。在服務器和 HyperFlex 的推動下，數據中心實現了非常強勁的兩位數增長。由於服務提供商的持續疲軟，路由業務大幅下滑。

Applications was up 19% in total with broad strength across the businesses. We saw very solid growth in TelePresence endpoints, UC infrastructure and AppDynamics.

應用程序總數增長了 19%，各個業務領域都表現出廣泛的實力。我們看到了 TelePresence 端點、UC 基礎設施和 AppDynamics 的穩健增長。

Security was up 11% with strong performance in unified threat, advanced threat and web security. Deferred revenue grew 38% as we continue to drive more subscription-based software offers.

安全性增長了 11%，在統一威脅、高級威脅和 Web 安全方面表現強勁。隨著我們繼續推動更多基於訂閱的軟件產品，遞延收入增長了 38%。

Service revenue was up 3%, driven by growth in advanced services as well as software and solutions support.

受高級服務以及軟件和解決方案支持增長的推動，服務收入增長了 3%。

We continue to transform our business, delivering more software offerings and driving more subscriptions and recurring revenues. In Q3, we generated 32% of our total revenue from recurring offers, an increase of 2 points from a year ago. Revenue from subscriptions was 55% of our software revenue.

我們繼續轉變我們的業務，提供更多的軟件產品並推動更多的訂閱和經常性收入。在第三季度，我們從經常性優惠中獲得了總收入的 32%，比一年前增加了 2 個百分點。訂閱收入占我們軟件收入的 55%。

We drove good growth in deferred revenue, which was up 9% in total, with product up 18% and services up 4%. Deferred product revenue from our recurring software and subscription offers was $5.6 billion, up 29%.

我們推動了遞延收入的良好增長，總計增長 9%，其中產品增長 18%，服務增長 4%。來自我們經常性軟件和訂閱優惠的遞延產品收入為 56 億美元，增長 29%。

We saw strong momentum in Q3 product orders growing 4% in total. Looking at our geographies, Americas grew 4%, EMEA was up 6% and APJC was up 3%. Total emerging markets was up 7%, with the BRICS plus Mexico up 12%.

我們看到第三季度產品訂單增長勢頭強勁，總計增長 4%。從我們的地理位置來看，美洲增長了 4%，EMEA 增長了 6%，APJC 增長了 3%。新興市場總量增長了 7%，其中金磚國家和墨西哥增長了 12%。

In our customer segments, enterprise was up 11%, commercial grew 7%, public sector was up 2% and service provider declined 4%.

在我們的客戶群中，企業增長 11%，商業增長 7%，公共部門增長 2%，服務提供商下降 4%。

From a non-GAAP profitability perspective, total Q3 gross margin was 63.9%, down 0.5 points. Product gross margin was 62.9%, down 0.3 points. And service gross margin was 66.9%, down 0.9 points. We continue to be negatively impacted by the higher memory pricing we have discussed over the past several calls, which we expect to continue in the near term. Our operating margin was strong at 31.5%.

從非美國通用會計準則盈利能力的角度來看，第三季度總毛利率為 63.9%，下降 0.5 個百分點。產品毛利率為62.9%，同比下降0.3個百分點。服務毛利率為66.9%，下降0.9個百分點。我們繼續受到我們在過去幾次電話會議中討論的更高內存定價的負面影響，我們預計這種情況將在短期內繼續存在。我們的營業利潤率高達 31.5%。

When we look at the impact of acquisitions on our results year-over-year, there's been 120 basis point positive impact on revenue and a negative $0.01 year-over-year impact on our non-GAAP EPS.

當我們查看收購對我們業績的同比影響時，我們發現對收入產生了 120 個基點的積極影響，對我們的非 GAAP 每股收益產生了 0.01 美元的負面影響。

In terms of the bottom line, non-GAAP net income of $3.2 billion was up 6%, while GAAP net income was $2.7 billion. We grew non-GAAP EPS 10% to $0.66, while GAAP EPS was $0.56.

就利潤而言，非 GAAP 淨收入為 32 億美元，增長 6%，而 GAAP 淨收入為 27 億美元。我們將非 GAAP 每股收益增長 10% 至 0.66 美元，而 GAAP 每股收益為 0.56 美元。

We delivered operating cash flow of $2.4 billion, down 28%. We paid $1.3 billion of onetime foreign taxes during the quarter related to the Tax Cuts and Jobs Act. Operating cash flow increased 11% normalized for these tax payments.

我們交付了 24 億美元的運營現金流，下降了 28%。我們在本季度支付了 13 億美元的與《減稅和就業法》相關的一次性外國稅款。這些稅款支付後，經營現金流正常化後增加了 11%。

We repatriated $67 billion of our offshore funds to the U.S. and ended Q3 with total cash, cash equivalents and investments of $54.4 billion, with $47.5 billion available in the U.S.

我們將 670 億美元的離岸資金匯回美國，截至第三季度，現金、現金等價物和投資總額為 544 億美元，其中 475 億美元在美國可用。

From a capital allocation perspective, we returned $7.6 billion to shareholders during the quarter that included $6 billion of share repurchases and $1.6 billion for our quarterly dividend.

從資本配置的角度來看，本季度我們向股東返還了 76 億美元，其中包括 60 億美元的股票回購和 16 億美元的季度股息。

We recently announced an agreement to sell our Service Provider Video Software Solutions business. We expect this transaction to close in Q1 fiscal year '19 subject to any regulatory approvals and customary closing conditions. We are continually looking to optimize our portfolio.

我們最近宣布了一項出售我們的服務提供商視頻軟件解決方案業務的協議。我們預計該交易將在 19 財年第一季度完成，但須獲得任何監管批准和慣例成交條件。我們一直在尋求優化我們的產品組合。

To summarize, Q3 was a good quarter with solid top line growth, strong profitability and order growth. We continue to make solid progress on our strategic priorities, making key investments to drive our long-term growth.

總而言之，第三季度是一個不錯的季度，收入增長穩健，盈利能力強勁，訂單增長強勁。我們繼續在我們的戰略重點上取得穩步進展，進行關鍵投資以推動我們的長期增長。

Let me reiterate our guidance for the fourth quarter of fiscal year '18. This guidance includes the type of forward-looking information that Marilyn referred to earlier.

讓我重申我們對 18 財年第四季度的指導。本指南包括 Marilyn 之前提到的前瞻性信息類型。

We expect revenue growth to be in the range of 4% to 6% year-over-year. We anticipate the non-GAAP gross margin rate to be in the range of 63% to 64%. The non-GAAP operating margin rate is expected to be in the range of 29.5% to 30.5%. And the non-GAAP tax provision rate is expected to be 21%. Non-GAAP earnings per share is expected to range from $0.68 to $0.70.

我們預計收入同比增長將在 4% 至 6% 之間。我們預計非美國通用會計準則毛利率將在 63% 至 64% 的範圍內。非 GAAP 營業利潤率預計在 29.5% 至 30.5% 之間。非美國通用會計準則的稅收撥備率預計為 21%。非 GAAP 每股收益預計在 0.68 美元至 0.70 美元之間。

I'll now turn it back to Marilyn so we can move on into the Q&A.

現在我將把它轉回瑪麗蓮，這樣我們就可以繼續進行問答環節了。

Thanks, Kelly. Michelle, let's go ahead and open the line for questions. (Operator Instructions) So with that, I'll turn it to you, Michelle.

謝謝，凱利。米歇爾，讓我們開始提問吧。（操作員說明）所以，我會把它交給你，米歇爾。

James Faucette from Morgan Stanley Investment Research.

摩根士丹利投資研究部的 James Faucette。

Great. Chuck and Kelly, I guess I wanted to ask, as you -- one of the key things that investors are looking at is the continued growth in subscriptions, et cetera. And it seems like the deferred continues to grow nicely. One of the key questions that we have though is, as you continue to show good demand for the new Catalyst 9K products and distribution expands, what are you seeing in terms of attach rates for subscriptions to that new product? Are they maintaining the levels that you had seen at the early stages of launch or are they starting to normalize back to more traditional levels? Just trying to get a little color on how well that tying strategy is working for you.

偉大的。查克和凱利，我想我想問的是，投資者正在關注的關鍵問題之一是訂閱量的持續增長，等等。似乎延期繼續良好增長。不過，我們面臨的一個關鍵問題是，隨著您繼續表現出對新 Catalyst 9K 產品的良好需求和分銷範圍的擴大，您認為該新產品的訂閱附加率如何？他們是保持您在發布早期看到的水平，還是開始正常化回到更傳統的水平？只是想了解一下搭售策略對您的效果如何。

Yes, James, thanks for the message. I'll comment. And then if Kelly wants to add anything, we'll let her do that as well. I would say it's been very consistent over the last 4 quarters, I think, since we put it in the marketplace in Q4 of last fiscal year. I think we had 1 month of activity. So it's been incredibly consistent. We're really pleased with the acceptance of this product. I think adding 2,700 more customers in the quarter, if you think about that, that means we added over 40 customers per day that acquired a Catalyst 9000 for the first time. And the acquisition of that product, in my opinion, is a clear belief in the next-generation architecture with the automation platform that we're announcing, which is what the advanced subscription model requires. And so I think that's reflected in the continued high uptake that we see on the advanced subscription. Kelly?

是的，詹姆斯，謝謝你的留言。我來評論然後，如果 Kelly 想添加任何內容，我們也會讓她添加。我想說，自從我們在上一財年第四季度將其投放市場以來，我認為它在過去 4 個季度中一直非常穩定。我想我們有 1 個月的活動。所以它一直非常一致。我們對這款產品的接受度感到非常高興。我認為本季度增加了 2,700 多個客戶，如果您考慮一下，這意味著我們每天增加 40 多個首次購買 Catalyst 9000 的客戶。在我看來，收購該產品是對我們宣布的具有自動化平台的下一代架構的明確信念，這正是高級訂閱模型所需要的。因此，我認為這反映在我們在高級訂閱中看到的持續高吸收率。凱莉？

Yes. No, I think that covers it. Vast majority is the Advantage, which has the advanced features and the higher margin profile. And then the only other thing I would add is, it is very evenly spread across commercial, enterprise and public sector in terms of the demand and where we're seeing all the business.

是的。不，我認為這涵蓋了它。絕大多數是優勢，它具有高級功能和更高的利潤率。然後我要補充的唯一一件事是，就需求和我們看到所有業務的地方而言，它非常均勻地分佈在商業、企業和公共部門。

Rod Hall from Goldman Sachs.

來自高盛的 Rod Hall。

I just wanted to try to dig under the covers a little bit on the revenue guidance. Obviously, service provider orders are weak and sounds like routing's weak, in line with that. Just wondering if you could, Kelly, maybe give us any idea how much service provider video is affecting that guide and also the routing within that guide, like what are you assuming there. Are you assuming routing continues to kind of drag that growth down? And then I have a follow-up.

我只是想嘗試深入了解收入指導。顯然，服務提供商的訂單很弱，聽起來像是路由的疲軟，符合這一點。只是想知道你是否可以，凱利，也許可以告訴我們有多少服務提供商視頻正在影響該指南以及該指南中的路由，就像你在那裡假設的那樣。您是否認為路由會繼續拖累該增長？然後我有一個後續行動。

Yes. So in general, I think the trends on both routing and service provider video, which is in the other bucket, have been consistent. And we're not assuming any improvement in either of those. So I would say our guide includes what we see. We feel really good about the rest of the portfolio, actually. And we see very good growth there, but those 2 trends are not improving. So that's basically what I have included.

是的。所以總的來說，我認為路由和服務提供商視頻的趨勢是一致的。而且我們不假設其中任何一個都有任何改善。所以我想說我們的指南包括我們所看到的。實際上，我們對投資組合的其餘部分感覺非常好。我們看到那裡的增長非常好，但這兩個趨勢並沒有改善。所以這基本上就是我所包含的內容。

Okay. And then, Kelly, could you also comment on the OpEx to sales? It's ticking up a little bit in the guide, at least implied. And I'm wondering if you could maybe give us any color on what's moving around in OpEx for fiscal Q4.

好的。然後，凱利，你能否也對銷售的運營支出發表評論？它在指南中有所調整，至少是暗示的。我想知道您是否可以給我們介紹一下第四財季運營支出的變化情況。

Yes, sure. On OpEx, it's mainly driven by -- the increase is mainly driven by the acquisitions we've run, specifically AppDynamics. As you know, when we bought AppDynamics, very early stage. We're in heavy investment phase with them. So that's part of it as well as we've consolidated now BroadSoft. And then that also has a fairly high OpEx impact. If I back out -- if you look at my OpEx growth for the quarter, which was up a little less than 6%, 4 points of that alone is just purely the acquisitions. And that's, as I mentioned, the impact of acquisitions on my top line and it's hurting me on EPS. It's mainly in the OpEx line. So that's what's driving that. We're being very disciplined within the rest of the business to managing the portfolio. So I think it'll continue kind of in that range as we look forward to Q4, but that's kind of the underlying driver.

是的，當然。在 OpEx 上，它主要是由 - 增長主要是由我們進行的收購推動的，特別是 AppDynamics。如您所知，當我們購買 AppDynamics 時，還處於非常早期的階段。我們正處於對他們的大量投資階段。所以這是它的一部分，我們現在已經整合了 BroadSoft。然後這也有相當高的 OpEx 影響。如果我退出——如果你看看我本季度的運營支出增長，增長略低於 6%，其中 4 個百分點純粹是收購。正如我所提到的，這就是收購對我的收入的影響，它對我的 EPS 造成了傷害。它主要在 OpEx 線上。這就是驅動力。我們在其他業務中非常嚴格地管理投資組合。所以我認為隨著我們期待第四季度，它會繼續保持在這個範圍內，但這是潛在的驅動因素。

Ittai Kidron from Oppenheimer & Co.

來自 Oppenheimer & Co. 的 Ittai Kidron

Chuck, I had a couple of questions. First, on the Catalyst 9K, good progress, but help us understand how big is your Catalyst installed base from a customer standpoint? What percent of it do you really think the Cat 9K is relevant to? Because it's hard to gauge whether you're moving too slow or too fast. 40 customers a day sounds like a lot, but maybe for a company like Cisco it's not fast enough. So help me understand how do you think about driving that throughout your installed base especially with now Arista potentially coming to the marketplace. And then second question, I had a question about China. Clearly, relations there have not been on the good side recently. And you've been somewhat a little bit more optimistic on that country over the last year. What are you seeing out of there? And how do you take that into your outlook commentary?

查克，我有幾個問題。首先，在 Catalyst 9K 上，進展良好，但幫助我們從客戶的角度了解您的 Catalyst 安裝基數有多大？您真正認為 Cat 9K 與它相關的百分比是多少？因為很難判斷你是走得太慢還是太快。每天 40 個客戶聽起來很多，但對於像 Cisco 這樣的公司來說，這可能還不夠快。因此，請幫助我了解您如何考慮在整個安裝基礎上推動這一點，尤其是現在 Arista 可能進入市場。然後是第二個問題，我有一個關於中國的問題。顯然，最近那裡的關係並不好。在過去的一年裡，你對那個國家的看法稍微樂觀了一點。你從那裡看到什麼？您如何將其納入您的前景評論？

Okay. First of all, thanks, Ittai, and thanks for the positive comments. On the 9K, I think that we have roughly 840,000 customers. And I would say that there's a very long list of customers that are still available to us to deliver this platform. If you look at -- the products that we have put in the market and the new Catalyst 9K family are sort of like -- if you stack our portfolio and you say, we have a very low-end switch and then you have the old Catalyst 3000, the old Catalyst 4000, those are kind of the platforms that the current 9K family replace. So there's still a very long tail of customers.

好的。首先，感謝 Ittai，感謝您的積極評價。在 9K 上，我認為我們大約有 840,000 名客戶。我要說的是，我們仍然可以提供一長串客戶來交付這個平台。如果你看一下——我們投放市場的產品和新的 Catalyst 9K 系列有點像——如果你疊加我們的產品組合，你會說，我們有一個非常低端的交換機，然後你有舊的Catalyst 3000，舊的 Catalyst 4000，這些都是當前 9K 系列所取代的平台。所以仍然有很長的客戶尾巴。

The other thing you have to remember is, many of these customers are buying the 9K and then it will become the standard platform. And they'll refresh the balance of their networks. The other thing I'll point out is that I think we said on one of the calls a while back that the enterprise segment, we would expect to lag the commercial segment with the 9K. And we did, in fact, see the enterprise business improve, and the 9K was part of that. So I think we still feel good about it. And this architecture has a long future for us. And there's a portfolio of products that sit within it. So I think if we're really honest, the number of customers who are making the decision to upgrade to the 9K, I would say it's not necessarily because, wow, what a new fantastic new Ethernet switch. It's really because they're buying into this automation strategy of which the entire portfolio will sit over time. And I think that's what we're banking on. And that's where we're banking on the long-term success.

您必須記住的另一件事是，這些客戶中的許多人都在購買 9K，然後它將成為標準平台。他們將刷新他們網絡的平衡。我要指出的另一件事是，我認為我們在一次電話會議上說過，企業部門，我們預計 9K 會落後於商業部門。事實上，我們確實看到了企業業務的改善，而 9K 是其中的一部分。所以我認為我們仍然對此感覺良好。這種架構對我們來說有很長的未來。其中包含一系列產品。所以我認為，如果我們真的很誠實，決定升級到 9K 的客戶數量，我會說這不一定是因為，哇，這是一個多麼棒的新以太網交換機。這真的是因為他們正在購買這種自動化策略，隨著時間的推移，整個投資組合都會採用這種策略。我認為這就是我們所依賴的。這就是我們寄希望於長期成功的地方。

So the China question, look, if you look at our China business this quarter, we actually saw strength in switching in both the enterprise and commercial segments. And overall, I think there's still uncertainty there. But I believe, and I have been optimistic, and I remain optimistic that the 2 countries will come to some closure on the trade issues and that we'll get stability there. And I think -- we still believe in it. It's going to be, obviously, the largest economy in the world in the coming decade. And we remain committed and actually, we're doing pretty well. If you look at the SP routing business in China, it continues to be stressed, like it is around the world, but much of the other portfolio elements, we're very pleased with.

所以中國問題，看，如果你看看本季度我們的中國業務，我們實際上看到了企業和商業領域的轉換實力。總的來說，我認為那裡仍然存在不確定性。但我相信，而且我一直很樂觀，我仍然樂觀地認為，這兩個國家將在貿易問題上達成某種共識，我們將在那裡實現穩定。而且我認為 - 我們仍然相信它。很明顯，它將成為未來十年世界上最大的經濟體。我們仍然致力於，實際上，我們做得很好。如果你看看中國的 SP 路由業務，它會繼續受到壓力，就像它在世界各地一樣，但我們對其他許多投資組合元素感到非常滿意。

Vijay Bhagavath from Deutsche Bank Securities.

德意志銀行證券的 Vijay Bhagavath。

Chuck, Kelly, these are solid results here. You beat on all major categories. A quick question for you. A bigger-picture question actually, Chuck and Kelly as well which is, as your software subscription attach rate sees strength, could we see the sales OpEx, for example, start to trend down? Are you already seeing that impact to your sales OpEx line? And then just a quick tactical question in terms of, approximately, what was the run rate of the SP Video business you've sold to Permira? Because that would help us to inflate your July quarter guidance if it wasn't sold so that it helps us in kind of this if-what scenario basis.

查克、凱利，這些都是可靠的結果。您擊敗了所有主要類別。一個快速的問題。Chuck 和 Kelly 實際上還有一個更大的問題，即當您的軟件訂閱附加率看到優勢時，我們是否可以看到銷售運營支出開始下降？您是否已經看到對您的銷售運營支出線的影響？然後是一個快速的戰術問題，大約是您出售給 Permira 的 SP Video 業務的運行率是多少？因為如果它沒有售出，這將幫助我們誇大你的 7 月季度指導，這樣它可以幫助我們在這種如果 - 什麼場景的基礎上。

Yes. Let me give some color around how we see the sales model evolving. And then I'll let Kelly answer the financial side of those questions for you. Vijay, I think what you're going to see is that we're actually building a traditional -- I'll say a traditional software model where we have a customer success organization that over time will take on more responsibility for all of the functions in the software company, the whole adoption expansion and particularly, the renewal space, which will allow us to renew a lot of these offers over time. It's a multiyear renewal window. But renewing over time at a much lower cost of sale, I would suggest that, that may give us either some, obviously, operating leverage or it may give us the ability to invest in more R&D or other areas. But that's the model. That's one of the key reasons that we brought in Maria Martinez, who is now our Chief Customer Experience Officer, who is helping us build out that capability, who has a long experience of doing that in several software companies. So that is one of the major efforts that we have underway right now to not only increase our ability and our rates of renewal, but also to do that at a much different cost structure going forward. Kelly?

是的。讓我談談我們如何看待銷售模式的演變。然後我會讓凱利為你回答這些問題的財務方面。Vijay，我想你會看到我們實際上正在構建一個傳統的——我會說一個傳統的軟件模型，我們有一個客戶成功組織，隨著時間的推移，它將對所有功能承擔更多責任在軟件公司，整個採用範圍擴大，特別是更新空間，這將使我們能夠隨著時間的推移更新很多這些產品。這是一個多年更新窗口。但隨著時間的推移，以更低的銷售成本進行更新，我建議，這可能會給我們帶來一些明顯的運營槓桿，或者它可能會讓我們有能力投資更多的研發或其他領域。但這就是模型。這是我們聘請 Maria Martinez 的關鍵原因之一，她現在是我們的首席客戶體驗官，正在幫助我們建立這種能力，她在多家軟件公司擁有長期的經驗。因此，這是我們目前正在進行的主要努力之一，不僅要提高我們的能力和更新率，而且要在未來以截然不同的成本結構來做到這一點。凱莉？

Yes. And just on the SPVSS business, we will -- it is in my guidance right now because we're going to -- obviously, we continue to run this business until the deal closes. It is the majority of what's in the other bucket, Vijay. So it's the bulk of that. But like we did when we divested the set-top box business, once we closed the transaction, we'll give you all the history so we can adjust the model and go forward from there. So you'll have complete visibility all the way through the P&L once we close the transaction.

是的。就 SPVSS 業務而言，我們將 - 這是我現在的指導，因為我們將 - 顯然，我們將繼續經營這項業務，直到交易完成。它是另一個桶 Vijay 中的大部分內容。所以這是其中的大部分。但就像我們剝離機頂盒業務時所做的那樣，一旦我們完成交易，我們就會給你所有的歷史記錄，這樣我們就可以調整模型並從那裡繼續前進。因此，一旦我們關閉交易，您將在整個損益表中擁有完整的可見性。

Pierre Ferragu from New Street Research.

來自 New Street Research 的 Pierre Ferragu。

I just wanted to...

我只是想...

Pierre, can you speak up just a bit?

皮埃爾，你能說一下嗎？

Yes. Okay. Is it better now?

是的。好的。現在好點了嗎？

Yes.

是的。

Yes.

是的。

So on the gross margin, so you still suffer from these DRAM prices. Has it like improved or is that -- has the pressure like increased sequentially compared to last quarter? And then we've had this pricing for some time now in the market, and I was wondering if -- how are you going to reflect that in your pricing strategy? And when should we expect you to start like passing on these extra costs to your client? And then lastly on the gross margin, I assume that you're still like increasing very fast your share of software and subscription services in your revenue mix. So it should have a positive impact on gross margin. If you can comment on that as well that would be great.

所以在毛利率上，你仍然會受到這些 DRAM 價格的影響。與上一季度相比，它是否有所改善或者是 - 壓力是否連續增加？然後我們在市場上已經有一段時間了這種定價，我想知道是否——你將如何在你的定價策略中反映這一點？我們什麼時候應該期望您開始將這些額外費用轉嫁給您的客戶？最後關於毛利率，我假設你仍然喜歡快速增加你的軟件和訂閱服務在你的收入組合中的份額。因此，它應該對毛利率產生積極影響。如果你也能對此發表評論，那就太好了。

Sure. So I'll take that. So first, on the memory. So yes, memory is still hurting us year-over-year. In my product gross margin, it hurt us to the tune of about 60 basis points year-over-year. So more than what we were down year-over-year. It is marginally less bad than it was last quarter, which was marginally less bad than it was a quarter before then. So the slope of the increases are getting less, though it's still increasing year-over-year. So it was about 60 basis points.

當然。所以我會接受的。首先，關於內存。所以是的，記憶仍在年復一年地傷害著我們。在我的產品毛利率中，這對我們造成了大約 60 個基點的同比損失。所以比我們同比下降的還要多。它比上個季度稍微好一點，上個季度比之前的一個季度稍微好一點。因此，增長的斜率越來越小，儘管它仍在逐年增加。所以大約是60個基點。

I would say, in terms of pricing, we had another very, very good quarter for price. We always have price erosion. But like you saw last quarter, our price erosion was at the very low end of what we've seen over the last 3 years, and that continues. And part of that reason of why that continues is, we have been passing on the memory DRAM cost increases through price increases on our servers, like we have been as well as a lot of our peers as well as our product managers in other parts of the portfolio have been really -- being very disciplined about looking at where we have some price elasticity and have been selectively and surgically looking for areas that we could take advantage of price elasticity. So I feel really good about where our price index was this quarter, much in line where it was last quarter.

我會說，就定價而言，我們有另一個非常非常好的價格季度。我們總是有價格侵蝕。但就像你在上個季度看到的那樣，我們的價格下跌處於過去 3 年的最低水平，而且這種情況還在繼續。這種情況持續的部分原因是，我們一直在通過服務器的價格上漲來轉嫁內存 DRAM 成本的上漲，就像我們以及其他地區的許多同行和產品經理一樣。投資組合確實 - 在尋找我們具有價格彈性的地方時非常有紀律，並且一直在有選擇地和外科手術地尋找我們可以利用價格彈性的領域。因此，我對本季度的價格指數感到非常滿意，與上一季度的價格指數非常一致。

And then to your third point on the software being a benefit, that is true, though, I will say, a portion of that is getting offset now that we're ramping the Catalyst 9K so quickly. And as you know, a portion of that gets deferred because it's a subscription. That has a negative impact on our rate as well. So this quarter, it was about 30 basis points alone just for the Cat 9K alone now becoming bigger in the revenue contribution and impact on our rate.

然後是你關於軟件的第三點是一個好處，這是真的，但我會說，現在我們正在如此迅速地提升 Catalyst 9K，其中一部分正在被抵消。如您所知，其中一部分會被推遲，因為它是訂閱。這對我們的利率也有負面影響。因此，本季度，僅 Cat 9K 就增加了大約 30 個基點，現在在收入貢獻和對我們利率的影響方面變得越來越大。

So again, the 3 things are: 60 basis points on memory, 30 basis points on the Cat 9 impact and then we had pretty strong price and some favorable mix coming through from software. The only other last point I will make, we had a very, very strong quarter on our UCS, our server business. And that has a little bit of negative mix for us as well, okay?

所以，這 3 件事是：內存 60 個基點，Cat 9 影響 30 個基點，然後我們有相當強勁的價格和來自軟件的一些有利組合。我要說的最後一點是，我們的服務器業務 UCS 有一個非常非常強勁的季度。這對我們也有一點負面影響，好嗎？

Paul Silverstein from Cowen and Company.

來自 Cowen and Company 的 Paul Silverstein。

Against my better judgment, I'm going to ask you a wide-open question, which is for either or both of you, Chuck and Kelly. What are you most excited about in terms of upside opportunity, whether revenue or margin? And what are you most concerned about in terms of downside risk?

根據我更好的判斷，我要問你一個開放性問題，這是給你們中的一個或兩個人的，Chuck 和 Kelly。在上行機會方面，您最興奮的是什麼，無論是收入還是利潤率？就下行風險而言，您最擔心的是什麼？

So I'll start, Paul, and thank you for that -- the opportunity. Listen, I think that what I am most optimistic about is the renewed innovation that we have brought and will continue to bring in our enterprise portfolio, particularly into our core franchises, which was one of the things -- when I spoke to many of you when I became CEO 3 years ago and even when we were on the road last year, I said the #1 priority for us right now. Obviously, we're going to continue the business model evolution, but the #1 priority was to get the enterprise portfolio and particularly the switching business stabilized, which our teams have done a great job.

所以我要開始了，保羅，感謝你給我這個機會。聽著，我認為我最樂觀的是我們已經並將繼續將創新引入我們的企業產品組合，特別是我們的核心特許經營權，這是其中之一 - 當我與你們中的許多人交談時當我 3 年前成為 CEO 時，甚至去年我們在路上時，我都說了我們現在的第一要務。顯然，我們將繼續業務模型的發展，但首要任務是讓企業產品組合，尤其是交換業務穩定下來，我們的團隊在這方面做得很好。

And even if you look at the security portfolio with the team, and then I will tell you on the enterprise routing space, Kelly talked a little bit about the overall routing business. But SP routing is about half. And the enterprise routing, I will tell you that our teams have been working hard on the integration with the Viptela acquisition into our enterprise routing portfolio. And I actually feel really good about how that's coming along, and I'm optimistic about where that goes in the future. And I'm very optimistic about the overall innovation within the intent-based networking portfolio that we're going to bring forward over the next months, quarters and years.

即使你和團隊一起看安全產品組合，然後我會告訴你企業路由空間，Kelly 談到了整體路由業務。但是SP路由大約是一半。至於企業路由，我會告訴你，我們的團隊一直在努力將 Viptela 收購整合到我們的企業路由產品組合中。事實上，我對這種情況的進展感覺非常好，而且我對未來的發展方向持樂觀態度。我對我們將在接下來的幾個月、幾個季度和幾年內推出的基於意圖的網絡產品組合中的整體創新非常樂觀。

I guess if I had to say what I would be most concerned about in general, it's just sort of the macro and/or some geopolitical risk. I mean, you've got -- you've obviously got lots of trade discussions, which I remain optimistic on. But as long as there's uncertainty, then we wait and see. Obviously, the dollar rising, while we had a good quarter in emerging countries, and we're pleased with our execution there, the rising dollar obviously is another macro issue, but I'm very pleased with what the teams are executing on right now. And that's how I'd leave it. Kelly, any comments? Good.

我想如果我必須說出一般來說我最關心的是什麼，那就是宏觀和/或一些地緣政治風險。我的意思是，你有 - 你顯然有很多貿易討論，我對此仍然持樂觀態度。但只要存在不確定性，我們就會拭目以待。顯然，美元升值，雖然我們在新興國家有一個很好的季度，我們對我們在那裡的執行感到滿意，美元升值顯然是另一個宏觀問題，但我對團隊目前的執行情況感到非常滿意.這就是我離開它的方式。凱利，有什麼意見嗎？好的。

Jeff Kvaal from Nomura Securities International.

野村證券國際的 Jeff Kvaal。

You spoke about your progress in the data center switching side of things. I'm wondering if you could help us understand how things are going in the enterprise data center market and how your relationships are progressing in the web-scale data center market or just web-scale in general would be helpful to us outside of data center switching.

您談到了您在數據中心交換方面的進展。我想知道您是否可以幫助我們了解企業數據中心市場的發展情況以及您的關係在網絡規模數據中心市場或一般網絡規模上的進展情況對數據中心以外的我們有幫助交換。

Thanks, Jeff. So I'm very happy with what our teams are doing in the data center switching market. In general, I think that the 100-gig transition, we're pleased with the return to growth in both the data center and the campus from a switching perspective.

謝謝，傑夫。因此，我對我們的團隊在數據中心交換市場所做的工作感到非常滿意。總的來說，我認為 100 兆的過渡，我們對數據中心和園區從交換角度恢復增長感到滿意。

On the web-scale side, I would say the story continues to remain as I've articulated it. We continue to make progress. You've seen the announcement we made, obviously, with Google. We continue to work and execute on the details of those solutions that we announced with them. You'll see more coming out later this year from us there. We continue to engage deeply with all of these players. We've had continued progress with several of them and continued favorable discussions. But these are -- as I've said repeatedly, some of these are multiyear architectural decisions, and they take a while. But again, I'm optimistic and pleased with where we are right now.

在網絡規模方面，我會說這個故事繼續如我所闡述的那樣。我們繼續取得進展。您顯然已經看到我們與 Google 一起發布的公告。我們將繼續努力並執行我們與他們一起宣布的那些解決方案的細節。你會在今年晚些時候看到更多來自我們的產品。我們將繼續與所有這些參與者深入接觸。我們與他們中的一些人取得了持續的進展，並繼續進行了有利的討論。但這些——正如我反复說過的，其中一些是多年的架構決策，它們需要一段時間。但同樣，我對我們現在的處境感到樂觀和高興。

And I think the other thing I'd point out is that, this environment that our enterprise customers are facing right now where, literally, 4 or 5 years ago, they thought they were going to move to the public cloud and have a much simpler IT world. They now find themselves with 3 or 4 public cloud providers that they're consuming services from. They have 50, 60, 100 SaaS providers. We're beginning to see this real explosion of IoT devices at the edge. They still have their private data centers. Those have not gone away. You've got all of the mobility in customers and suppliers. And so the network is so fundamental to making all that work. And the web-scale providers know that as well, which has really enabled us to build these broad relationships that extend well beyond just the data center. So we're still pleased with where we are and we have a long way to go.

我想我要指出的另一件事是，我們的企業客戶現在所面臨的這種環境，從字面上看，在 4 或 5 年前，他們認為他們將遷移到公共雲並擁有一個更簡單的IT世界。他們現在發現自己擁有 3 或 4 個公共雲提供商，他們正在使用這些提供商的服務。他們有 50、60、100 個 SaaS 提供商。我們開始看到邊緣物聯網設備的真正爆炸式增長。他們仍然擁有自己的私人數據中心。那些並沒有消失。您擁有客戶和供應商的所有流動性。因此，網絡對於實現所有這些工作至關重要。網絡規模的提供商也知道這一點，這確實使我們能夠建立這些廣泛的關係，這些關係遠遠超出了數據中心。所以我們仍然對我們所處的位置感到滿意，我們還有很長的路要走。

George Notter from Jefferies.

來自 Jefferies 的 George Notter。

I wanted to circle back to a conversation from prior earnings calls. You guys had talked about the revenue headwind associated with the move to more subscription-oriented models. And Kelly, I'm wondering if you can give us an update there. Is that still a headwind this quarter? And how do you see that progressing going forward?

我想回到之前的財報電話會議上的談話。你們談到了與轉向更多面向訂閱的模式相關的收入逆風。凱利，我想知道你是否可以在那裡給我們更新。本季度這仍然是逆風嗎？您如何看待未來的進展？

Yes, sure. Thanks. And so yes, the headwind is still there because we are very much increasing the number of offers that we have as well as the revenue dollar that we're putting on the balance sheet. So the headwind is increasing. And just as we had talked in the past, now that the enterprise portfolio with the Cat 9K is starting to hit revenue, the headwind is increasing. So we said in the past it was 1.5 to 2 points. It definitely now is approaching the 2 to 2.5. And as we ramp more and more of the portfolio, we'll continue to see that.

是的，當然。謝謝。所以是的，逆風仍然存在，因為我們正在大大增加我們提供的報價數量以及我們在資產負債表上投入的收入美元。所以逆風在增加。正如我們過去所說的那樣，現在帶有 Cat 9K 的企業產品組合開始影響收入，逆風正在增加。所以我們過去說是1.5到2分。它現在肯定正在接近 2 到 2.5。隨著我們增加越來越多的投資組合，我們將繼續看到這一點。

Srini Pajjuri from Macquarie Capital.

來自麥格理資本的 Srini Pajjuri。

I guess my question is on the recurring revenue. It dipped a little bit to 32%. If you could give some color on that. And also, I think your target long term is exceeding 37% in fiscal '20. Is that primarily a function of Cat 9K ramping in volume? Are there any other products that could contribute to that? And also, I'm wondering if you need to expand the subscription model to other products to achieve that goal.

我想我的問題是關於經常性收入。它略微下降至 32%。如果你能給它一些顏色。而且，我認為你的長期目標是在 20 財年超過 37%。這主要是 Cat 9K 音量上升的功能嗎？還有其他產品可以為此做出貢獻嗎？而且，我想知道您是否需要將訂閱模式擴展到其他產品以實現該目標。

Yes. So thanks for the question. So yes, on the recurring revenue, it's basically in the rounds. If I look at our product recurring revenue, again, it continues to grow over 30% to over 30% of our total product revenue. And overall, total recurring revenue is again growing in the double digits. So it's really the math and a little bit of the mix now that we have product revenue growing so much faster than services that's driving kind of just the pure math of the round from 33% to 32%. But we feel great about how it's progressing.

是的。所以謝謝你的問題。所以是的，就經常性收入而言，它基本上是循環的。如果我再看看我們的產品經常性收入，它會繼續增長 30% 以上，占我們產品總收入的 30% 以上。總體而言，總經常性收入再次以兩位數增長。所以這真的是數學和一點點組合，現在我們的產品收入增長速度比服務快得多，這只是純粹的數學計算，從 33% 到 32%。但我們對它的進展感覺很好。

Yes, if you go to our Financial Analyst Conference, we feel we're right on track of what we projected as that goes out to fiscal year '20. The only caveat I'll give you on that is, when we go into our fiscal year '19, we have to adopt the new revenue standard, which will have some implication on some of the products that are included in this. So we plan to have a call where we can go through the anticipated area that will be impacted to give you guys more clarity. And then we'll adopt that Day 1 of our fiscal year '19. But overall, we feel great about the traction. We're executing very well. And we're on track, if not slightly ahead, of what we expected when we talked at the Financial Analyst Conference.

是的，如果你去參加我們的金融分析師會議，我們覺得我們正朝著 20 財年的預期前進。我要給你的唯一警告是，當我們進入 19 財年時，我們必須採用新的收入標準，這將對其中包含的一些產品產生一些影響。因此，我們計劃召開一次電話會議，討論預計會受到影響的區域，讓大家更加清楚。然後我們將採用我們 19 財年的第一天。但總的來說，我們對牽引力感覺很好。我們執行得很好。我們正朝著我們在金融分析師會議上所預期的方向發展，即使不是略微領先。

And Srini, just one last comment on the part of your question where you asked if we would need to extend this to other parts of our portfolio. I mean, we will. If you look at the new enterprise routing, some of the comments I made in my opening was that we're extending our software and subscription business in the routing space. Many of those are software solutions. So we'll continue to evolve. And frankly, it's driven by how our customers want to consume the technology, which is great. And as Kelly said, it will create a short-term headwind, but we think long term for the business it's absolutely the right thing to do.

Srini，就您詢問我們是否需要將其擴展到我們產品組合的其他部分的問題部分，最後發表一點評論。我的意思是，我們會的。如果你看一下新的企業路由，我在開場白中發表的一些評論是，我們正在擴展我們在路由領域的軟件和訂閱業務。其中許多是軟件解決方案。所以我們會繼續發展。坦率地說，它是由我們的客戶如何使用這項技術驅動的，這很棒。正如凱利所說，這將造成短期不利因素，但我們認為從長遠來看，這絕對是正確的做法。

Jim Suva from Citigroup Global Markets.

花旗集團全球市場部的 Jim Suva。

I have a brief question for Chuck and then Kelly, more of a clarification one. But Chuck, there wasn't any mention yet, at least on the Q&A, about competitors going into the campus side of things with Arista making an announcement. How do you look at that? I know competition isn't anything new. But do you need to step up your sales efforts? Or how should we think about that? And then Kelly, for the CFO question. How should we think about, you've got time now to think about the tax law, sort through all the changes. Is your outlook kind of 21% outlook long term? And stock cadence, you did a lot more stock buyback this quarter than normal with your new announcement. How should we think about those financial metrics?

我有一個簡短的問題要問 Chuck，然後是 Kelly，更多的是澄清問題。但是查克，至少在問答環節中，還沒有提到競爭對手進入校園方面的事情，而 Arista 則宣布了這一點。你怎麼看？我知道競爭並不是什麼新鮮事。但是您需要加大銷售力度嗎？或者我們應該如何考慮？然後是凱利，關於首席財務官的問題。我們應該如何考慮，你現在有時間考慮稅法，整理所有的變化。你的前景是 21% 的長期前景嗎？還有股票節奏，本季度你在新公告中進行了比往常更多的股票回購。我們應該如何考慮這些財務指標？

Yes. So let me hit the first one. Relative to the competition in the campus, what I would say is that, look, we launched this architecture last June. And I think our customers have been incredibly excited about it. One of the very important things that we did is we made the architecture and DNA Center backwards compatible with at least one generation of our wireless products, our switching products, our routing products, et cetera. And I think that taking a look at all of those products is incredibly important because our customers don't want to have an automation platform that handles switching. They want an automation platform that handles the enterprise -- at a minimum, the enterprise network. And then over time, as we integrate our automation platform in the data center and the campus, you'll be looking at the ability to automate from the data center to the campus to the wireless network to the routing and frankly, the security architecture. And we think that is a unique architecture that we can deliver. We are leading right now. We see incredible acceleration of the Cat 9K and adoption by our customers. And we're very comfortable with where we are in this transition.

是的。所以讓我打第一個。相對於校園裡的競爭，我想說的是，你看，我們去年六月推出了這個架構。我認為我們的客戶對此非常興奮。我們所做的一件非常重要的事情是我們使架構和 DNA 中心向後兼容至少一代我們的無線產品、我們的交換產品、我們的路由產品等。而且我認為查看所有這些產品非常重要，因為我們的客戶不希望擁有處理切換的自動化平台。他們想要一個處理企業的自動化平台——至少是企業網絡。然後隨著時間的推移，當我們在數據中心和校園中集成我們的自動化平台時，您將看到從數據中心到校園到無線網絡到路由以及坦率地說，安全架構的自動化能力。我們認為這是我們可以提供的獨特架構。我們現在處於領先地位。我們看到 Cat 9K 的驚人加速和我們客戶的採用。我們對我們在這個過渡中所處的位置感到非常滿意。

And on the tax question. So again, we feel really good about where we stand in terms of that. As we said in the call, we brought back $67 billion from overseas. And we -- like we said in last quarter's earnings, we announced a big increase to our share buyback authorization. So we have $25 billion remaining in our share buyback. And we anticipate using that in the next, basically, 18 to 21 months. So we're being very aggressive there, like we had stated we would be once we got our cash back. So that's going well. As far as the tax rate, we also stated in Q2 that we expect our tax rate to be in the 21% for fiscal year '18. And we expect it to go down to 20% in fiscal year '19 when we get the full benefit of the U.S. -- the new U.S. federal rate. So overall, we feel great about the tax law and the implications for us.

關於稅收問題。因此，我們再次對我們在這方面的立場感到非常滿意。正如我們在電話中所說，我們從海外帶回了 670 億美元。而且我們——就像我們在上個季度的收益中所說的那樣，我們宣布大幅增加我們的股票回購授權。因此，我們的股票回購還剩下 250 億美元。我們預計在接下來的 18 到 21 個月內使用它。所以我們在那裡非常積極，就像我們說過的那樣，一旦我們拿到現金，我們就會這樣做。所以一切順利。至於稅率，我們還在第二季度表示，我們預計 18 財年的稅率將達到 21%。我們預計當我們充分享受美國的好處時，它會在 19 財年下降到 20%——新的美國聯邦利率。所以總的來說，我們對稅法及其對我們的影響感覺很好。

Mitchell Steves from RBC Capital Markets.

來自加拿大皇家銀行資本市場的米切爾史蒂夫斯。

I actually wanted to circle back a little bit and poke at the recurring revenue piece. And now that it's 32%, and you're noting that you got 120 basis points from acquisitions. Can you help me understand what really drove the decline Q-over-Q from 33% to 32% given that the acquisitions you guys had done have been software in nature?

我實際上想稍微回過頭來看看經常性收入部分。現在它是 32%，你注意到你從收購中獲得了 120 個基點。考慮到你們所做的收購本質上是軟件，你們能幫我理解是什麼真正導致 Q-over-Q 從 33% 下降到 32% 嗎？

Yes. I mean, again, I think, basically, AppDynamics has been in the numbers as we go along. I would say, BroadSoft has a mix of both perpetual and recurring, so it is not all recurring. I would say the bigger impact on the numbers, and again, it's really just the mix of the products. When we have product revenue growing 5%, services growing 3%. And within that product revenue, we had very, very strong server revenue growth, which has a very low software recurring proponent of it. That's what's really driving it. As I said, overall, the growth of product recurring revenue was over 30%, like it has been for the last 5 quarters. So that just continues to grow. It's really more the denominator of total revenue that's driving just the slight round down to 32%.

是的。我的意思是，我認為，基本上，隨著我們的發展，AppDynamics 一直在數字中。我想說的是，BroadSoft 混合了永久性和經常性，所以它並不都是經常性的。我會說對數字的影響更大，而且，這實際上只是產品的組合。當我們的產品收入增長 5% 時，服務增長 3%。在該產品收入中，我們的服務器收入增長非常非常強勁，而軟件的經常性支持者非常少。這才是真正的驅動力。正如我所說，總體而言，產品經常性收入的增長超過 30%，就像過去 5 個季度一樣。所以這只會繼續增長。實際上，更多的是總收入的分母導致略微下降至 32%。

Tal Liani from Bank of America.

美國銀行的 Tal Liani。

Security was up 11%, which is an acceleration from previous quarters -- the previous 2 quarters. Can you talk about what went right and what went wrong with security this quarter? And what are the things that are driving this acceleration?

安全增長了 11%，比前兩個季度有所加速。您能談談本季度安全方面哪些方面做得對，哪些方面出了問題嗎？推動這種加速的因素是什麼？

Yes. Thanks, Tal. So look, we remain confident in the security architecture that we built, even when we had some deviation in the revenue run rate over the last year. And I think that as you look at the architecture that we have, which extends from e-mail to endpoints to the network to the cloud and then has this massive state machine where we can correlate threats and then dynamically defend, it's a unique proposition. And we say that we have this integrated architecture but also best-of-breed products. So where we are convincing customers that the architecture is right, then we're winning. And I think that our teams are doing a really good job. I think that the engineering teams have continued to add new features and new capabilities that our customers are adopting. And I think it's as simple as that. It's just -- it's we have reasonably good traction in the field right now.

是的。謝謝，塔爾。所以看，我們對我們構建的安全架構仍然充滿信心，即使我們在去年的收入運行率上有一些偏差。而且我認為，當您查看我們擁有的架構時，它從電子郵件擴展到端點，再到網絡再到雲，然後擁有這個龐大的狀態機，我們可以在其中關聯威脅然後動態防禦，這是一個獨特的主張。我們說我們擁有這種集成架構，但也有同類最佳的產品。因此，在我們說服客戶架構正確的地方，我們就贏了。我認為我們的團隊做得非常好。我認為工程團隊繼續添加我們的客戶正在採用的新特性和新功能。我認為就這麼簡單。這只是——我們現在在這個領域有相當好的吸引力。

And can you share with us maybe the areas where you think you need to strengthen your portfolio?

您能否與我們分享您認為需要加強投資組合的領域？

Well, I mean, we have -- the great thing about this architecture when we build it is that you can continue to add virtually any source of threat intelligence to this because it's built to digest massive amounts. I mean, we see 20 billion threats every day. So you can assume that we can add any sort of capability that we like. That includes threat sources and frankly, the same thing from a defense perspective. So within the portfolio, I think there's always an opportunity for our teams to continue to improve and continue to add features. And there's a lot of good competition in the space. It's very fragmented. So we just continue to execute against delivering that architecture.

好吧，我的意思是，我們有——當我們構建這個架構時，它的偉大之處在於你可以繼續向其中添加幾乎任何威脅情報來源，因為它是為消化大量信息而構建的。我的意思是，我們每天都會看到 200 億個威脅。所以你可以假設我們可以添加任何我們喜歡的功能。這包括威脅來源，坦率地說，從防禦的角度來看也是如此。因此，在產品組合中，我認為我們的團隊總是有機會繼續改進並繼續添加功能。這個領域有很多很好的競爭。它非常分散。因此，我們只是繼續執行以交付該架構。

Mark Moskowitz from Barclays Capital.

巴克萊資本的馬克莫斯科維茨。

Just one more revenue question for me. Kelly and Chuck, how should we think about the second half of calendar '18 relative to your fourth quarter revenue guidance in terms of the 4% to 6% goalpost year-over-year? Is there any inflection point with respect to the selling cycle? We've heard anecdotally from some of our checks that it is a slightly longer selling cycle as customers try to understand more the subscription element. And as they do become more receptive, could you actually see accelerating revenue growth maybe closer to that 6% or better as you go into the October, January quarters?

我還有一個收入問題。凱利和查克，我們應該如何看待 18 年下半年相對於你的第四季度收入指導，即同比增長 4% 到 6%？銷售週期是否存在拐點？我們從一些支票中聽說，由於客戶試圖更多地了解訂閱元素，因此銷售週期略長。隨著他們變得更容易接受，當你進入 10 月、1 月的季度時，你真的能看到加速的收入增長可能接近 6% 或更好嗎？

Mark, so as you guys know, we really do just give guidance one quarter in advance. And we feel very good about the guidance we gave of the 4% to 6% growth. As we look forward though, just to give you some color, context, in the Cat 9K, the demand is great. We have fantastic demand. We are taking orders like crazy. And there's great adoption out there by our customers that we don't see slowing down. So we feel great about that. But again, there's a lot of moving parts, and we'll take it one quarter at a time. The only other thing I just want to remind you is, we do have -- when our fiscal year starts in August for '19, we do have the tweak on the new revenue standard that we'll take you through any implications of. So feel really good about the Q4 guide, and we're just going to take it one quarter at a time.

馬克，正如你們所知，我們真的只是提前四分之一給出指導。我們對我們給出的 4% 至 6% 增長的指導感到非常滿意。不過，正如我們期待的那樣，只是為了給您一些顏色和背景，在 Cat 9K 中，需求很大。我們有很好的需求。我們正在瘋狂地接受訂單。我們的客戶採用率很高，而且我們看不到放緩的趨勢。所以我們對此感覺很好。但同樣，有很多活動部件，我們將一次處理四分之一。我只想提醒你的另一件事是，我們確實有 - 當我們的財政年度於 19 年 8 月開始時，我們確實對新的收入標准進行了調整，我們將帶你了解它的任何影響。所以對 Q4 指南感覺非常好，我們將一次使用一個季度。

All right. Good.

好的。好的。

So I want to just thank everybody for joining us today. We appreciate you spending time with us. Appreciate the opportunity to answer your questions. And Marilyn, I'll kick it back to you for the details on the next call.

所以我只想感謝大家今天加入我們。感謝您與我們共度時光。感謝有機會回答您的問題。瑪麗蓮，我會在下一次電話會議上將詳細信息反饋給您。

Great. Thanks, Chuck. Cisco's next quarterly earnings call, which will reflect our full year 2018 fourth quarter and annual results, will be on Wednesday, August 15 at 1:30 p.m. Pacific time, 4:30 p.m. Eastern time. Again, I'd like to remind the audience that in light of Regulation FD, Cisco's policy is not to comment on its financial guidance during the quarter unless it is done through explicit public disclosure. We now plan to close the call. If you have any further questions, feel free to contact the Cisco Investor Relations department, and we thank you very much for joining the call today.

偉大的。謝謝，查克。思科的下一個季度財報電話會議將於美國東部時間 8 月 15 日星期三下午 1:30 召開，屆時將反映我們 2018 年第四季度和全年的全年業績。太平洋時間下午 4:30東部時間。再次，我想提醒聽眾，根據 FD 法規，思科的政策是不評論其本季度的財務指導，除非通過明確的公開披露來完成。我們現在計劃結束通話。如果您有任何其他問題，請隨時聯繫思科投資者關係部門，我們非常感謝您今天加入電話會議。

And thank you for participating on today's conference call. If you would like to listen to the call in its entirety, you may call (888) 568-0890. For participants dialing from outside the U.S., please dial (402) 998-1566. This concludes today's call. You may disconnect at this time.

感謝您參加今天的電話會議。如果您想完整收聽電話會議，可以致電 (888) 568-0890。對於來自美國境外的參與者，請撥打 (402) 998-1566。今天的電話會議到此結束。此時您可以斷開連接。