(Reuters) - Cisco Systems Inc on Wednesday forecast that within four years, about half its revenue will come from software and other recurring sales, but its chief financial officer told Reuters high chip prices in its hardware business will keep pressuring overall profits. The company gave a fiscal 2025 revenue forecast with a midpoint of $62.9 billion, saying it expects a compound annual growth rate of 5% to 7%. Cisco predicted the same growth rate for adjusted profits, targeting a midpoint of $4.07 per share in fiscal 2025. Piper Sandler analyst James Fish told Reuters that Cisco's outlook implies that profit margins will stay flat, but Wall Street was hoping for margin growth from Cisco's shift to software. Cisco Chief Financial Officer Scott Herren said the company's software units do have higher margins than its hardware business, but some subscription revenue will also come from services that have lower margins than software.
