Cisco (CSCO - Free Report) recently announced it plans to acquire Burlingame, CA-based July Systems. The private company provides cloud-based mobile application platform.The financial terms have been kept under wraps.
July Systems facilitates digitization of physical business enterprises with their subscription indoor location software service. The company’s flagship product, Proximity MX integrates with WiFi network and other location technologies, including GPS and Bluetooth Beacons. This helps it to connect with the user’s device, even if an app isn’t installed. Consequently, the enterprises can boost end user engagement with notifications via SMS, E-mail or API.
With this buyout, Cisco will strengthen its Enterprise Wi-Fi platform by bolstering advanced indoor-based location services capabilities. The tech giant aims to conclude the buyout in first quarter of fiscal 2019. Per the press release, July Systems team will join the company’s Enterprise Networking Group.
July Systems boasts of valuable customers, comprising SAP SE (SAP - Free Report) , lululemon athletic (LULU - Free Report) , among others. The private company has partnered with Cisco Connected Mobile Experience (CMX) as an OEM, Amazon’s (AMZN - Free Report) Amazon Web Services (AWS), to mention a few.
The proficiency that July Systems brings on board will power Cisco’s intent-based networking movement.
Digitizing Buildings: Key Catalyst
Enterprises can enhance business value a great deal by leveraging their in-building Wi-Fi. It enables them to offer acomprehensive range of indoor-based location services. The more customized approach a business takes, the higher will be customer engagement.The data-driven location analytics leads tomeaningful visitor behavior insights, consequently enhancing employee and customer experience.
The service can be offered to diversified industries as hotels, healthcare, logistics, manufacturing, government, retail, education and sports arenas. Cisco may scale industry-specific solutions. We believe Cisco’s 5G initiatives will receive a boost from the acquisition.
What the Investors Need to know
Cisco has returned 43.5% in the past year outperforming the industry’s rally of 39.2%.
Per a MarketsandMarkets report, digital transformation market is envisioned to grow at a CAGR of 19.1% to $493.39 billion by 2022 from $205.99 billion in 2017. Per ResearchAndMarkets data, global 5G market is expected to reach $251 billion by 2025, growing at a CAGR of around 97% from 2020.
The aforementioned reports reinforce our belief that this acquisition holds promise. Cisco remains well poised to leverage the modern technology at various levels of its operations and gain a competitive edge.
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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