A feisty John Chambers bows out on his final Cisco earnings call

Chambers says he'll be an advisor and a coach when new CEO Chuck Robbins takes over

Cisco Systems Chairman and CEO John Chambers worked the crowd during his keynote address on Monday at Cisco Live in San Francisco.

Cisco Systems Chairman and CEO John Chambers worked the crowd during his keynote address on Monday at Cisco Live in San Francisco.

John Chambers got a little feisty and a little sentimental in his last earnings call as Cisco's CEO on Wednesday, dismissing a criticism of the company as "garbage" and saying he hopes to be working half time by the fall because "the hunting season's coming up."

"It's been fun, it's been challenging, and I'm very humbled by having this chance for 20 years," he said.

Cisco said last week that Chambers will be replaced as CEO in July by Chuck Robbins. He'll stay on as executive chairman of the board.

"Let me first say very crisply: Chuck is the CEO. Period. He'll make the decisions," Chambers said. He'll be an advisor to Robbins and be involved "where he wants me to be."

Chambers will help with the parts of the job he enjoys most, he said, including the vision, strategy, meeting customers and working on acquisitions. He insisted he'll be a "wingman" and not in the driving seat.

"I'm trying, in this job, to be working about half time," he said.

Chambers is one of the last longtime CEOs to step down from the old guard of tech companies, following the likes of Microsoft's Steve Ballmer and Oracle's Larry Ellison, who changed his title to CTO and chairman of the board last year.

Chambers seemed to enjoy his last earnings call, taking congratulations from financial analysts who enjoy a cozy relationship with the company. He said he's been a "less than perfect CEO" and predicted humbly that Cisco will "do better after me than during my time."

He said a few times that he was breaking his "golden rule of 20 years" by speaking more frankly than usual on the call.

"We don't comment on acquisitions," he said at one point, "but I wouldn't bet on the one you heard today," apparently dashing a rumor circulating earlier Wednesday that Cisco might buy security firm FireEye for US$9 billion.

He fired back at an analyst who questioned the health of Cisco's switching business, dismissing as "garbage" the idea that rivals would undercut it with commodity servers and software, and saying that talk has proved "entirely wrong."

"I will never apologize for growth in the mid-single digits on switching," he said.

He ended on a poetic, almost metaphysical note, telling a story about how he went for a run Wednesday morning hoping to set a personal best time but was stopped in his tracks by a deer -- "the biggest buck I've ever seen, 12-point or 14-point."

"I looked it right in the eyes," Chambers said. "At first I was annoyed because I was trying to set my time, and then I realized you should just enjoy the moment."

He missed his best time by 10 seconds, he said.

Cisco's financial results allowed him to go out on a relatively high note. Revenue for the quarter ended April 25 was up 5 percent from a year earlier, to $12.1 billion. Profit rose 6 percent, to $0.54 per share.

The company is still hurting where it has been for the past several quarters, with declining product orders for service-provider equipment and flat results in emerging markets. Service-provider results were especially bad in the U.S., with orders down 17 percent. Chambers blamed carrier consolidation and slow spending in part but said Cisco is still working to turn around its lagging service-provider video business.

Gains in some emerging economies, like Mexico's, were offset by big declines in a couple of important markets: Orders fell 41 percent in Russia and 20 percent in China.

North American enterprises, a mainstay of the company, were a high point with 21 percent growth in orders. And the products Cisco wields in the software-defined networking arena continued to grow strongly, Chambers said. For example, customers using the Application Policy Infrastructure Controller, which is at the core of the company's Application Centric Infrastructure architecture, grew to 580 from just 300 the previous quarter.

For the current quarter, Cisco forecast revenue growth of between 1 percent and 3 percent.

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