Yahoo Finance Cisco (CSCO) Webex Sees User Growth Amid Coronavirus Crisis
Cisco Systems’ CSCO Webex reportedly witnessed robust traction in the past month, with people being asked to work from home amid the coronavirus pandemic.
Per a Reuters report, the video conferencing app recorded 324 million users in March, with more than double user growth in the United States. Usage growth in Europe and Asia-Pacific was four times and 3.5 times, respectively.
Notably, the app reported around 73 million meetings in March with more than 22 million of them taking place per week in the last two weeks of the month.
The surge in users bodes well for the company’s top-line growth. Moreover, it is likely to instill confidence in the company’s stock.
Notably, shares of Cisco have declined 18.5% year to date compared with the industry’s decline of 18.8% in the same time frame.
Cisco Systems, Inc. Price and Consensus
Cisco Systems, Inc. price-consensus-chart | Cisco Systems, Inc. Quote
Strong Features to Give Competitive Edge
Cisco has been strengthening Webex with new features and capabilities to improve its competitive position in the market.
Notably, the company rolled out a design update for Webex, including dedicated tabs for messages and contacts, which improved its functionalities and made it easier to use.
Cisco also overhauled the Control Hub for Webex, thus enabling admins to make modifications to their devices directly within the Hub. Admins are now able to modify settings like default call rate even from their home systems.
Further, the company enhanced the security options of Webex to protect users from Trojans, ransomware and other malicious attacks, even when they are on personal devices or are collaborating with external users.
Also, the company’s collaboration with Alphabet’s GOOGL Google G Suite to ensure inter-operability between Webex and Hangouts holds promise. Cisco also acquired Voicea to enhance Webex Assistant for Meetings with new AI-powered voice intelligence capabilities.
These initiatives are expected to aid Webex acquire new subscribers and give it an edge over competitors like Zoom Video Communications ZM and Microsoft’s MSFT Teams.
Notably, Zoom’s daily active users (DAUs) increased to 200 million as of March 2020, compared to 10 million DAUs in December, 2019. However, the company has come under the radar over its privacy and security policies. Recently, the app was prohibited from use at Elon Musk headed aerospace company — SpaceX.
Additionally, on Mar 19, Microsoft noted that Teams had 44 million daily active users (DAU), up 12 million in a week’s time.
Nevertheless, Webex’s superior security options and its end-to-end encryption capabilities are likely to aid Cisco to expand its presence in the enterprise video conferencing market. Notably, video conferencing market is expected to hit $6.65 billion by 2025 at a CAGR of 8.5% between 2020 and 2025, per Industry Arc data.
Zacks Rank
Currently, Cisco carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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