Networking and connectivity giant Cisco has announced a new initiative that aims to help customers overcome financial challenges and uncertainty in the technology market.
With the new Cisco Capital Business Acceleration Program, customers purchasing products or solutions before July 29 can defer all payments until 2024, with those payments based on the total amount financed and contract terms.
Cisco said its aim is to provide organizations with improved access to digital transformation solutions and navigate an “evolving economic landscape” at a time when cash flow is a top concern.
“The Cisco Capital Business Acceleration Program is in response to customer and partner requests to help mitigate financial challenges based on overall market uncertainty and the impact that it is having on their businesses,” said Kristine A. Snow, SVP and president at Cisco Capital.
“Our goal is to provide payment options that allow continuous technology investment to maintain productivity and business continuity while minimizing cash outlays.”
Offered through Cisco Capital, all Cisco solutions are eligible for the program, including hardware, software, services, as well as select partner services and third-party hardware.
Additionally, the Cisco Refresh portfolio of certified remanufactured products also qualifies for the scheme, which the firm said will help businesses acquire competitively priced and ready-to-ship hardware.
“Customer success is our priority,” Snow added. “The new program is designed with this in mind and will help address some of our customers’ most pressing concerns.”
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The ‘buy now, pay later’ benefit of the Cisco Capital Business Acceleration Program is similar to the 90-day payment holidays the company has previously offered customers even before this year’s economic issues took hold.
During the COVID-19 pandemic, the company launched its Business Resiliency Program to help customers defer payments for new equipment by three months to help ease financial difficulties brought on by the global health crisis.
The verbiage used in 2020’s announcement and the latest from Cisco is similar, both highlighting that “cash flow is a top concern” for Cisco customers.
How quickly the company will be able to fulfill orders remains to be seen. Cisco suggested earlier this year in its Q2 earnings call that its record backlog of orders wouldn’t be cleared at least until the end of 2023, which means some equipment may not even arrive long before the final bill is due in 2024.
Cisco’s Q2 earnings
Back in February, the company revealed better-than-expected results, with total revenue clocking in at $13.6 billion - a 7% year-over-year hike for the quarter. Net income was down approximately 7% to $2.77 billion, however.
Overall, the firm raised its full-year revenue guidance to 9% to 10.5% growth year-over-year thanks to its increased recurring revenue and improved supply conditions.
On the company’s quarterly conference call, CEO Chuck Robbins was buoyant about the year ahead.
“Fiscal '23 is shaping up to be very strong, fueled by demand for our cloud-driven networking portfolio, our continued business transformation success, and an improving supply situation,” he said.
The call delivered welcome news to customers and shareholders. Cisco was one of the major tech firms that were hit especially hard by the pandemic-related global supply chain issues.
The ongoing difficulties left the networking giant facing a near-$14 billion order backlog as of February this year.
