Cisco Systems Inc.
CSCOFinancial Analysis · Updated May 12, 2026 · Coverage 2026-Q2
Latest Q Revenue
$15.8B
Q3 FY2026 · +12% YoY
TTM ROIC
14%
FY2025 · NOPAT / Invested Capital (including goodwill) · WACC ~7.7% · Moat spread +6pp
Financial Snapshot
ticker: CSCO step: 04 generated: 2026-05-12 source: quick-research
Cisco Systems, Inc. (CSCO) — Financial Snapshot
Note: Cisco's fiscal year ends late July. "FY2025" = fiscal year ended July 2025.
Income Statement Summary
| Metric | FY2024 | FY2025 | FY2026E | YoY |
|---|---|---|---|---|
| Revenue | $53.8B | $56.7B | $61.2-61.7B | +8-9% |
| Non-GAAP Gross Margin | 67.5% | 66.5% | ~66% | -0.5pp |
| Non-GAAP Operating Margin | 33.0% | 32.0% | ~33% | +1pp |
| Non-GAAP EPS (diluted) | $3.73 | $3.79 | $4.13-4.17 | +9-10% |
| GAAP Net Income | $10.3B | $11.5B | ~$13B | +13% |
Segment Revenue Q2 FY26
| Segment | Revenue | YoY |
|---|---|---|
| Networking | $7.8B | +14% |
| Security | $2.0B | (incl. Splunk) |
| Collaboration | $1.1B | flat |
| Observability | $274M | +24% |
| Total Revenue | $15.3B | +10% |
AI Infrastructure Orders (Key Metric)
| Period | AI Orders |
|---|---|
| FY25 Total (vs. $1B target) | >$2B |
| Q4 FY25 alone | $800M+ |
| Q2 FY26 alone | $2.1B |
| FY26 guidance | $5B+ orders (target) |
| FY26 AI revenue conversion | ~$3B from hyperscalers |
ARR + RPO Detail (Q2 FY26)
| Metric | Value | YoY |
|---|---|---|
| Total ARR | $31B | +3% |
| Product ARR | growing 6% | |
| Total RPO | $43.4B | +5% |
| Product RPO | +8% | |
| Long-term portion RPO | $11.8B | +11% |
Cash Flow & Balance Sheet (FY2025)
| Metric | Value |
|---|---|
| Operating Cash Flow | ~$13B |
| Capital Expenditures | ~$1B |
| Free Cash Flow | ~$12B |
| Cash & Investments | ~$18B |
| Total Debt | ~$30B (mostly Splunk-related) |
Key Ratios (approximate, May 2026)
- P/E (forward): ~20x | EV/EBITDA: ~13x | Dividend Yield: ~2.0%
- Net Cash: ~($12B) net debt
- FCF Yield: ~3.6%
Growth Profile
Cisco accelerated from low-single-digit revenue growth (FY23-24) to +9% guided for FY26 — primarily driven by AI infrastructure orders. AI orders went from $2B FY25 (2x original target) to $5B+ guided FY26. Q2 FY26 product revenue grew +14% YoY. The Splunk integration is ~2 years post-close, adding 500 new logos in H1 FY26 (tracking to 1,000 by FY26 end). Margin headwind from AI infrastructure mix (lower-margin systems) offset by Splunk + recurring revenue scaling.
Forward Estimates
- FY2026E Revenue: $61.2-61.7B (mgmt guide; +8-9%)
- FY2026E Non-GAAP EPS: $4.13-4.17 (mgmt guide)
- FY2027E Revenue: ~$67B (consensus, +9%)
- FY2027E EPS: ~$4.65 (+12%)
- AI orders trajectory: $5B (FY26) → $8-10B (FY27)?
Capital Return
- Dividend $1.66 annual (~$6.5B paid)
- Buybacks: ~$5-7B annual ($15B authorization)
- Total return: ~3-4% combined yield
- 14+ consecutive years of dividend growth
Deeper Financial Analysis
The fundamental tier adds 9 additional research dimensions for $CSCO.
Revenue Breakdown
Segment revenue, geographic mix, product-line contribution margins, and cohort dynamics.
Financial Trends
Quarter-over-quarter momentum, leading indicators, and inflection point analysis.
Balance Sheet
Debt structure, liquidity runway, dilution risk, and working capital dynamics.
Capital Allocation
Buyback cadence, M&A appetite, dividend policy, and reinvestment priorities.
Returns on Capital (ROIC)
Multi-year ROIC vs. WACC, marginal returns on reinvestment, sales-to-invested-capital efficiency, and moat spread.
GET /api/v1/research/CSCO/fundamental$1.00 · Bearer token required