# Cisco Systems Inc. (CSCO) — Financial Analysis

**Exchange:** NASDAQ  
**Coverage as of:** 2026-Q2  
**Updated:** 2026-05-12  
**Tier:** Free primer (step 2 of 19)  
**Sibling pages:** /stocks/CSCO/thesis · /stocks/CSCO/memo

## 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 ($1.00) adds 8 dimensions not included here:

- Revenue Breakdown — segment revenue, geographic mix, product-line margins
- Financial Trends — QoQ momentum, leading indicators, inflection points
- Balance Sheet — debt structure, dilution risk, working capital dynamics
- Capital Allocation — ROIC, buyback cadence, reinvestment efficiency
- Earnings Analysis — beats/misses, guidance vs actuals, transcript highlights
- Competitive Positioning — market share, pricing power, peer benchmarks
- Industry Context — TAM, sector tailwinds/headwinds, regulatory backdrop

**API endpoint:** GET /api/v1/research/CSCO/fundamental

## Navigation

- Overview: /stocks/CSCO
- Financials (this page): /stocks/CSCO/financials
- Thesis: /stocks/CSCO/thesis
- Investment Memo: /stocks/CSCO/memo
- Coverage universe: /stocks