Cisco Systems(CSCO) - 2025 Q4 - Annual Report

PART I Business Overview Cisco Systems, Inc. is a global technology company focused on designing and selling networking, security, collaboration, and observability technologies, deeply integrating AI into its product portfolio - Cisco designs and sells a broad range of technologies to power, secure, and gain insights from the internet, integrating Artificial Intelligence (AI) into its networking, security, collaboration, and observability portfolios[12] - The company was incorporated in California in 1984, reincorporated in Delaware in 2021, and is headquartered in San Jose, California[15] - Cisco operates globally, with business divided into three geographic regions: Americas, Europe, Middle East and Africa (EMEA), and Asia Pacific, Japan, and China (APJC)[13] - Cisco's products and technologies are categorized into networking, security, collaboration, and observability, supported by comprehensive services[14] - Cisco's strategic focus is on helping customers build modern infrastructure, defend against cyber threats, and leverage AI and data to achieve AI-ready data centers, future-ready workplaces, and digital resilience[17][22] General - Cisco designs and sells a broad range of technologies to power, secure, and gain insights from the internet, integrating Artificial Intelligence (AI) into its networking, security, collaboration, and observability portfolios[12] - The company was incorporated in California in 1984, reincorporated in Delaware in 2021, and is headquartered in San Jose, California[15] Strategy and Priorities - Cisco's strategy is to securely connect everything, helping businesses and organizations achieve growth, improve operational efficiency, and foster innovation[16] - Customers' top three priorities are: i) building modern infrastructure; ii) defending against current and future cyber threats; and iii) leveraging the power of AI and data[17] - Cisco delivers three key outcomes to customers through its "One Cisco" portfolio: i) AI-ready data centers; ii) future-ready workplaces; and iii) digital resilience[22] Products and Services - The networking business covers switching, routing, wireless, and server technologies, offering hardware, software licenses, and SaaS solutions, and has introduced AI-ready Cisco Smart Switches[28][29] - The security portfolio includes network security, identity and access management, SASE, and Threat Intelligence, Detection, and Response (TIDR) solutions, significantly enhanced by the acquisition of Splunk[34][35] - The collaboration portfolio includes the Webex suite, collaboration devices, contact center, and CPaaS, enhancing employee and customer experience through AI and machine learning[36] - Observability products provide end-to-end visibility, utilizing AI-driven insights through solutions like ThousandEyes and Splunk Observability to ensure seamless connectivity and proactive problem resolution[37] - Services include technical support and professional services, integrating AI and automation to help customers derive greater value from their technology investments[38][40] Customers and Markets - Cisco serves a broad customer base including enterprises, public sector, service providers, and cloud markets, without being limited by specific industries, geographies, or market segments[41] - Service provider and cloud customers often require a broader range of services, including design services and vendor financing, to address the scale and complexity of their networks[45] Sales Overview - As of the end of fiscal year 2025, Cisco's global sales and marketing functions employed approximately 25,600 people[46] - The company's products and services are primarily sold indirectly through channel partners (system integrators, service providers, third-party resellers, and distributors), with the remainder sold directly[46] Financing Arrangements - Cisco offers financing arrangements to eligible customers, including loans, leases, and channel financing, to help them build, maintain, and upgrade their networks[51] Acquisitions, Investments, and Alliances - Cisco acquires talent, technology, products, and markets, and establishes strategic alliances to complement and strengthen its core business[52][53][54] Competition - Cisco faces intense competition in the networking and communications equipment market from numerous vendors including Amazon, Arista Networks, Broadcom, Huawei, Microsoft, and NVIDIA[55][56] - Key competitive factors include the ability to deliver successful business outcomes, product performance, price, new product introduction, manufacturing cost reduction, value-added features (e.g., security, reliability), standards compliance, market presence, financing capabilities, and disruptive technological shifts and new business models[58] Research and Development - Cisco regularly introduces new products and features, allocating R&D budget to networking, security, collaboration, and observability technologies, with continuous investment in emerging technologies like AI[60][61] Manufacturing - Cisco relies on contract manufacturers for production, utilizing third-party companies for circuit board assembly, testing, repair, and product assembly services, and employs proprietary software for product configuration and quality control[62] Patents, Intellectual Property, and Licensing - Cisco protects its proprietary technology and products through patents, copyrights, trademarks, and trade secret laws, but rapid technological change and legal uncertainties mean future success primarily depends on employee innovation skills[64] - Many products contain third-party licensed software or intellectual property, and the inability to obtain or renew licenses on favorable terms could adversely affect the business[65] Government Regulation - Cisco is subject to evolving laws and regulations in the U.S. and abroad concerning privacy, data protection, cybersecurity, AI, taxation, trade, and environmental sustainability, with non-compliance potentially causing significant business harm[68][69] Talent and Culture - Cisco is committed to attracting, retaining, and developing talent to achieve its purpose of "powering an inclusive future for all," and has been recognized as a top workplace for many years[70][71] 2025 Fiscal Year Employee Composition | Category | Number of Employees (Approx.) | | :--- | :--- | | Total Employees | 86,200 | - The company offers market-competitive, performance-based compensation and benefits, focusing on employee health, safety, and well-being, including mental and physical health resources and flexible hybrid work models[74][75][76] - Cisco invests in employee development, providing personalized learning opportunities and leadership development programs, and uses data insights to match talent with opportunities[77][78] Information about our Executive Officers Executive Officer Information as of August 31, 2025 | Name | Age | Position | | :--- | :--- | :--- | | Charles H. Robbins | 59 | Chair and Chief Executive Officer | | Mark Patterson | 55 | Executive Vice President and Chief Financial Officer | | Jeetendra Patel | 54 | President, Chief Product Officer | | Deborah L. Stahlkopf | 55 | Executive Vice President and Chief Legal Officer | | Thimaya Subaiya | 47 | Executive Vice President, Operations | | Oliver Tuszik | 57 | Executive Vice President, Global Sales | Risk Factors This section details various risks and uncertainties that could materially and adversely affect Cisco's business, operating results, and financial condition - Cisco's operating results may fluctuate due to global economic conditions, demand volatility, sales cycles, competition, new technology adoption, sales channel changes, manufacturing costs, inventory management, and accounting estimates[87][89] - Supply chain issues, including financial problems of contract manufacturers or component suppliers, component shortages, or increased manufacturing costs, could adversely affect business and operating results[94][95] - The development and use of AI technology may lead to legal and/or regulatory actions, reputational damage, and risks related to intellectual property, privacy, and data protection[111] - Failure to anticipate and respond to emerging technology trends and changes in customer demand, or to successfully develop and launch new products and services, could harm Cisco's operating results and market share[115][116] - Cyberattacks, data breaches, or other incidents affecting Cisco's solutions and IT environment, as well as similar incidents in customer or third-party vendor networks, could lead to liability claims, legal/regulatory actions, and reputational damage[144][146] Risks Related to our Business and Industry - Uncertain global economic and market conditions, including tariffs, inflation, and geopolitical conflicts, may lead to reduced product demand, increased price competition, and higher operating costs[88][90] - Sales to service provider and cloud markets are highly volatile, with the timing of large orders difficult to predict, potentially leading to revenue forecasting challenges and fluctuating operating results[101][103] - Cisco's growth depends on market expansion, existing product enhancements, and timely introduction of new products; failure to accurately predict customer demand and technology trends could harm the business[115][116] - Acquisitions involve difficulties in integrating operations, systems, technology, and personnel, potentially diverting management attention and posing financial and operational risks[120][121] - Product quality issues may lead to decreased revenue, gross margins, and net income, as complex products can contain defects or vulnerabilities[125] Risks Related to Intellectual Property - Cisco's proprietary rights may be difficult to enforce, and patents, copyrights, trademarks, and trade secrets could be challenged, invalidated, or circumvented, especially in a rapidly changing technology industry[140][141] - Third parties may assert patent infringement claims, leading to costly litigation, diversion of management's attention, or the need to develop non-infringing technology or enter into licensing agreements[142] - The company relies on third-party licensed software or other intellectual property, and the inability to obtain necessary licenses or unfavorable terms could materially harm the business[143] Risks Related to Cybersecurity, Privacy, and Regulatory Requirements - Cisco regularly experiences cyberattacks and unauthorized access attempts, with the emergence of AI capabilities leading to new or more effective attack methods, potentially causing operational disruptions, data breaches, and reputational damage[145][146] - Vulnerabilities and security flaws in products and services, as well as customers' failure to deploy security updates promptly, could lead to liability claims and reputational harm[147] - Evolving and complex global privacy and data protection laws and regulations mean failure to adequately protect and use data could result in legal/regulatory actions and reputational damage[148][149] - Changes in regulatory requirements, such as economic sanctions, export controls, telecommunications regulations, and government procurement policies, could significantly impact product sales and usage[150] Risks Related to Ownership of Our Stock - Cisco's common stock price has historically been volatile, influenced by factors such as differences between actual financial results and analyst expectations, competitor announcements, market speculation, and macroeconomic and political conditions[151] Unresolved Staff Comments There are no unresolved staff comments in this company report - There are no unresolved staff comments in this company report[152] Cybersecurity Cisco recognizes the importance of maintaining trust and has established processes to identify, assess, and manage cybersecurity risks, with board oversight - Cisco has a Security & Trust Organization (S&TO) and a Chief Security & Trust Officer responsible for monitoring, detecting, investigating, responding to, and escalating internal and external cybersecurity threats and incidents[154][158] - S&TO collaborates with Cisco's Talos threat intelligence group and third parties to share and receive threat intelligence, and operates a third-party risk management program to identify and manage cybersecurity risks from suppliers[155] - Cisco embeds security into products and services through its Secure Development Lifecycle (CSDL) and provides mandatory cybersecurity training for employees[156] - The Board of Directors, through its Audit Committee, receives reports from the Chief Security & Trust Officer on cybersecurity risks at least four times annually and provides oversight[160] Properties Cisco's global headquarters is in San Jose, California, with additional U.S. facilities and international operations primarily conducted through leased premises - Cisco's global headquarters is located in San Jose, California, U.S., with additional facilities in Research Triangle Park, North Carolina, and Richardson, Texas[162] - International operations are primarily conducted through leased premises, with major locations including Australia, Belgium, Canada, China, Germany, India, Israel, Norway, Poland, and the United Kingdom[163] Legal Proceedings This section refers to Note 14, "Commitments and Contingencies - (f) Legal Proceedings," in the Consolidated Financial Statements for a description of the company's legal proceedings - For a description of the company's legal proceedings, refer to Note 14, "Commitments and Contingencies - (f) Legal Proceedings," in the Consolidated Financial Statements[164] Mine Safety Disclosures This item is not applicable - This item is not applicable[165] PART II Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities This section discloses market information for Cisco's common stock, the number of shareholders, and the company's stock repurchase activities, including a five-year total shareholder return comparison, with $5.995 billion in repurchases in FY2025 - Cisco's common stock trades on the Nasdaq Global Select Market under the ticker symbol CSCO[169] - As of August 28, 2025, Cisco had 30,790 registered shareholders[169] Issuer Purchases of Equity Securities (Q4 Fiscal Year 2025) | Period | Total Shares Purchased (Millions) | Average Price Per Share (USD) | Total Shares Purchased Under Publicly Announced Plans or Programs (Millions) | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (Millions of USD) | | :--- | :--- | :--- | :--- | :--- | | April 27 to May 24, 2025 | 7 | $60.71 | 7 | 15,023 | | May 25 to June 21, 2025 | 5 | $64.63 | 5 | 14,659 | | June 22 to July 26, 2025 | 7 | $68.36 | 7 | 14,174 | | Total | 19 | $64.65 | 19 | | - As of July 26, 2025, approximately $14.2 billion remained authorized for stock repurchases under the program, with no termination date[167] Five-Year Cumulative Total Shareholder Return Comparison for Cisco Systems, Inc., S&P 500 Index, and S&P Information Technology Index (as of July 2025) | | July 2020 | July 2021 | July 2022 | July 2023 | July 2024 | July 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Cisco Systems, Inc. | $100.00 | $123.13 | $103.83 | $123.09 | $116.78 | $172.19 | | S&P 500 | $100.00 | $108.39 | $150.48 | $143.50 | $161.94 | $232.22 | | S&P Information Technology | $100.00 | $147.03 | $138.92 | $176.00 | $235.11 | $292.59 | Reserved This item is reserved Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides a detailed discussion and analysis of Cisco's financial condition and operating results for fiscal years 2025 and 2024, highlighting revenue growth, margin changes, and capital allocation 2025 and 2024 Fiscal Year Key Financial Data Summary | Metric | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | % Change | | :--- | :--- | :--- | :--- | | Revenue | $56,654 | $53,803 | 5% | | Gross Margin | 64.9% | 64.7% | 0.2 percentage points | | R&D Expenses | $9,300 | $7,983 | 16% | | Sales and Marketing Expenses | $10,966 | $10,364 | 6% | | General and Administrative Expenses | $2,992 | $2,813 | 6% | | Total Operating Expenses as % of Revenue | 41.1% | 39.3% | 1.8 percentage points | | Operating Income as % of Revenue | 20.8% | 22.6% | (1.8) percentage points | | Net Income | $10,180 | $10,320 | (1)% | | Diluted Earnings Per Share | $2.55 | $2.54 | —% | - Fiscal year 2025 total revenue grew 5%, with product revenue up 6% and service revenue up 3%, primarily driven by Splunk's contribution[180] - Fiscal year 2025 operating margin decreased by 1.8 percentage points, mainly due to increased amortization of acquired intangible assets, stock-based compensation expenses, and fees related to a legal dispute with a supplier[181] - In fiscal year 2025, revenue in the Americas, EMEA, and APJC regions increased by $1.7 billion, $700 million, and $500 million, respectively[182] - In fiscal year 2025, security product revenue grew 59%, observability grew 26%, collaboration grew 1%, while networking product revenue decreased 3%[182] OVERVIEW - Cisco's total revenue grew 5% in fiscal year 2025, with product revenue up 6% and service revenue up 3%, primarily driven by Splunk's contribution[180] - Total revenue for the fourth quarter of fiscal year 2025 increased 8% year-over-year, with product revenue up 10% and service revenue flat[186] Other Key Financial Metrics for Fiscal Years 2025 and 2024 | Metric | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | | :--- | :--- | :--- | | Cash and Cash Equivalents and Investments | $16,110 | $17,854 | | Operating Cash Flow | $14,193 | $10,880 | | Remaining Performance Obligations | $43,533 | $41,048 | | Common Stock Repurchases | $5,995 | $5,764 | | Dividends Paid | $6,437 | $6,384 | | Inventory | $3,164 | $3,373 | | Total Debt | $28,093 | $30,962 | CRITICAL ACCOUNTING ESTIMATES - Cisco's revenue recognition involves significant judgment in allocating multiple performance obligations, determining transaction prices (including estimating variable consideration), and estimating standalone selling prices (SSP)[190][192][193] - Inventory valuation and purchase commitments to contract manufacturers and suppliers are based on future demand forecasts; a sudden significant decline in demand or rapid technological change leading to inventory obsolescence could necessitate increased impairment provisions[195][197][198] - Valuation and impairment testing of goodwill and purchased intangible assets require significant estimates and judgments regarding future cash flows, useful lives, and discount rates, which are inherently uncertain and unpredictable[201][204][207] - Determining income tax provisions involves assessing uncertain tax positions and judging deferred tax asset valuation allowances; the effective tax rate is influenced by factors such as changes in tax laws and tax audit outcomes[208][209][211] RESULTS OF OPERATIONS Revenue Composition (FY 2023-2025) | Revenue Category | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | FY 2023 (Millions of USD) | % Change 2025 vs. 2024 | | :--- | :--- | :--- | :--- | :--- | | Product | $41,608 | $39,253 | $43,142 | 6% | | Services | $15,046 | $14,550 | $13,856 | 3% | | Total | $56,654 | $53,803 | $56,998 | 5% | Revenue by Geographic Segment (FY 2023-2025) | Geographic Segment | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | FY 2023 (Millions of USD) | % Change 2025 vs. 2024 | | :--- | :--- | :--- | :--- | :--- | | Americas | $33,656 | $31,971 | $33,447 | 5% | | EMEA | $14,824 | $14,117 | $15,135 | 5% | | APJC | $8,174 | $7,716 | $8,417 | 6% | | Total | $56,654 | $53,803 | $56,998 | 5% | - Fiscal year 2025 product revenue increased 6%, primarily driven by the enterprise market and service provider and cloud markets, particularly from hyperscale customers' AI infrastructure revenue[221] Product Revenue by Category (FY 2023-2025) | Product Category | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | FY 2023 (Millions of USD) | % Change 2025 vs. 2024 | | :--- | :--- | :--- | :--- | :--- | | Networking | $28,304 | $29,229 | $34,570 | (3)% | | Security | $8,094 | $5,075 | $3,859 | 59% | | Collaboration | $4,154 | $4,113 | $4,052 | 1% | | Observability | $1,055 | $837 | $661 | 26% | | Total | $41,608 | $39,253 | $43,142 | 6% | - Fiscal year 2025 product gross margin increased by 0.2 percentage points, primarily due to Splunk's contribution and productivity improvements, partially offset by pricing impacts, legal dispute fees with a supplier, and amortization of acquired intangible assets[235] - Fiscal year 2025 R&D expenses increased 16%, sales and marketing expenses increased 6%, and general and administrative expenses increased 6%, mainly due to higher employee-related expenses, stock-based compensation, and cash compensation from acquisitions[247][248][249] - Fiscal year 2025 operating income decreased 3%, and operating income as a percentage of revenue decreased by 1.8 percentage points, primarily due to increased stock-based compensation, amortization of purchased intangible assets, and legal dispute fees with a supplier[256] - Fiscal year 2025 interest income decreased, and interest expense increased, resulting in a net interest and other income (loss) of negative $660 million, compared to positive $53 million in fiscal year 2024[257] - The effective tax rate for fiscal year 2025 decreased to 8.3%, primarily due to a $720 million tax benefit related to U.S. tax law and increased excess tax benefits from stock-based compensation[260] LIQUIDITY AND CAPITAL RESOURCES Cash and Cash Equivalents and Investments (as of July 26, 2025) | Category | July 26, 2025 (Millions of USD) | July 27, 2024 (Millions of USD) | Increase/Decrease (Millions of USD) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | $8,346 | $7,508 | $838 | | Available-for-Sale Debt Investments | $7,381 | $9,865 | $(2,484) | | Marketable Equity Securities | $383 | $481 | $(98) | | Total | $16,110 | $17,854 | $(1,744) | - Net cash and cash equivalents and investments decreased by $1.744 billion in fiscal year 2025, primarily due to returning cash to shareholders (dividends of $6.4 billion, stock repurchases of $6.0 billion) and net debt repayments of $2.8 billion, partially offset by $14.2 billion in operating cash flow[265] Free Cash Flow (FY 2023-2025) | Metric | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | FY 2023 (Millions of USD) | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | $14,193 | $10,880 | $19,886 | | Purchases of Property and Equipment | $(905) | $(670) | $(849) | | Free Cash Flow | $13,288 | $10,210 | $19,037 | - Cisco aims to return at least 50% of its free cash flow to shareholders annually through cash dividends and common stock repurchases[268] - Inventory decreased 6% at the end of fiscal year 2025, while inventory purchase commitments to contract manufacturers and suppliers increased 47%, totaling a 26% increase, primarily to meet hyperscale customers' demand for Cisco Silicon One and other products[276] Remaining Performance Obligations (as of July 26, 2025) | Category | July 26, 2025 (Millions of USD) | July 27, 2024 (Millions of USD) | Increase/Decrease (Millions of USD) | | :--- | :--- | :--- | :--- | | Product | $21,572 | $20,055 | $1,517 | | Services | $21,961 | $20,993 | $968 | | Total | $43,533 | $41,048 | $2,485 | | Short-term RPO | $21,723 | $20,882 | $841 | | Long-term RPO | $21,810 | $20,166 | $1,644 | | Total | $43,533 | $41,048 | $2,485 | - Total remaining performance obligations increased 6% in fiscal year 2025, with approximately 50% expected to be recognized as revenue within the next 12 months[291] Contractual Obligations (as of July 26, 2025) | Category | Total (Millions of USD) | Less than 1 Year (Millions of USD) | 1 to 3 Years (Millions of USD) | 3 to 5 Years (Millions of USD) | More than 5 Years (Millions of USD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Operating Leases | $1,748 | $429 | $569 | $381 | $369 | | Purchase Commitments to Contract Manufacturers and Suppliers | $7,599 | $7,202 | $320 | $77 | — | | Other Purchase Obligations | $8,136 | $2,399 | $3,247 | $2,383 | $107 | | Long-Term Debt | $24,753 | $1,751 | $4,502 | $3,500 | $15,000 | | Transition Tax Payable | $1,595 | $1,595 | — | — | — | | Other Long-Term Liabilities | $1,745 | — | $298 | $221 | $1,226 | | Total by Period | $45,576 | $13,376 | $8,936 | $6,562 | $16,702 | | Other Long-Term Liabilities (Future Payment Timing Uncertain) | $2,240 | | | | | | Total | $47,816 | | | | | Quantitative and Qualitative Disclosures About Market Risk Cisco's financial position is exposed to interest rate, equity price, and foreign currency risks, which the company manages through portfolio management and derivative instruments - Cisco's financial position faces interest rate risk, equity price risk, and foreign currency risk, which are managed using derivative instruments[301][498] Hypothetical Fair Value of Available-for-Sale Debt Investments (as of July 26, 2025) | | 150 Basis Point Decrease in Interest Rates | 100 Basis Point Decrease in Interest Rates | 50 Basis Point Decrease in Interest Rates | Fair Value as of July 26, 2025 | 50 Basis Point Increase in Interest Rates | 100 Basis Point Increase in Interest Rates | 150 Basis Point Increase in Interest Rates | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Available-for-Sale Debt Investments (Millions of USD) | $7,454 | $7,430 | $7,405 | $7,381 | $7,356 | $7,332 | $7,307 | - As of July 26, 2025, Cisco held $24.8 billion in fixed-rate senior notes; a 50 basis point increase or decrease in market interest rates would respectively decrease or increase the fair value of fixed-rate debt by approximately $800 million[304] - The fair value of Cisco's marketable equity investments and private equity investments is subject to market price fluctuations, with private equity investments carrying inherent risks of total loss[306][307] - In fiscal year 2025, foreign currency fluctuations (after hedging) reduced the combined R&D, sales and marketing, and general and administrative expenses by approximately $16 million (0.1%)[309] Financial Statements and Supplementary Data This section includes Cisco's consolidated financial statements, related notes, and reports from independent registered public accounting firms and management on internal controls - Independent registered public accounting firms have audited Cisco's consolidated financial statements and internal control over financial reporting, deeming them fairly presented in all material respects and effective, respectively[316][317] - Management is responsible for establishing and maintaining effective internal control over financial reporting, assessing its effectiveness, and concluded that Cisco's internal control over financial reporting was effective as of July 26, 2025[331][333] Consolidated Balance Sheet Summary (as of July 26, 2025) | Asset | July 26, 2025 (Millions of USD) | July 27, 2024 (Millions of USD) | | :--- | :--- | :--- | | Cash and Cash Equivalents | $8,346 | $7,508 | | Investments | $7,764 | $10,346 | | Accounts Receivable, Net | $6,701 | $6,685 | | Inventory | $3,164 | $3,373 | | Financing Receivables, Net | $3,061 | $3,338 | | Total Current Assets | $34,986 | $36,862 | | Property and Equipment, Net | $2,113 | $2,090 | | Goodwill | $59,136 | $58,660 | | Purchased Intangible Assets, Net | $9,175 | $11,219 | | Deferred Tax Assets | $7,356 | $6,262 | | Total Assets | $122,291 | $124,413 | | Liabilities and Equity | | | | Short-Term Debt | $5,232 | $11,341 | | Accounts Payable | $2,528 | $2,304 | | Deferred Revenue | $16,416 | $16,249 | | Total Current Liabilities | $35,064 | $40,584 | | Long-Term Debt | $22,861 | $19,621 | | Deferred Revenue (Non-Current) | $12,363 | $12,226 | | Total Liabilities | $75,448 | $78,956 | | Total Equity | $46,843 | $45,457 | | Total Liabilities and Equity | $122,291 | $124,413 | Consolidated Statements of Operations Summary (FY 2023-2025) | Metric | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | FY 2023 (Millions of USD) | | :--- | :--- | :--- | :--- | | Total Revenue | $56,654 | $53,803 | $56,998 | | Total Cost of Sales | $19,864 | $18,975 | $21,245 | | Gross Margin | $36,790 | $34,828 | $35,753 | | Total Operating Expenses | $25,030 | $22,647 | $20,722 | | Operating Income | $11,760 | $12,181 | $15,031 | | Interest and Other Income (Loss), Net | $(660) | $53 | $287 | | Income Before Provision for Income Taxes | $11,100 | $12,234 | $15,318 | | Provision for Income Taxes | $920 | $1,914 | $2,705 | | Net Income | $10,180 | $10,320 | $12,613 | | Diluted Earnings Per Share | $2.55 | $2.54 | $3.07 | Consolidated Statements of Cash Flows Summary (FY 2023-2025) | Cash Flow Category | FY 2025 (Millions of USD) | FY 2024 (Millions of USD) | FY 2023 (Millions of USD) | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | $14,193 | $10,880 | $19,886 | | Net Cash Flow from Investing Activities | $1,733 | $(20,478) | $(5,107) | | Net Cash Flow from Financing Activities | $(15,815) | $6,844 | $(11,626) | | Cash and Cash Equivalents, End of Period | $8,910 | $8,842 | $11,627 | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure There are no changes in accountants or disagreements with accountants on accounting and financial disclosure in this company report - There are no changes in accountants or disagreements with accountants on accounting and financial disclosure in this company report[583] Controls and Procedures Management concluded that Cisco's disclosure controls and procedures are effective, and internal control over financial reporting is effective with no significant changes in Q4 FY2025 - As of the end of this reporting period, Cisco's disclosure controls and procedures were assessed as effective[584] - Management assessed and concluded that Cisco's internal control over financial reporting was effective as of July 26, 2025[585] - No significant changes in internal control over financial reporting occurred during the fourth quarter of fiscal year 2025[586] Other Information This section discloses a Rule 10b5-1(c) trading plan adopted by Oliver Tuszik, EVP and Head of Global Sales, for the sale of approximately 49,067 shares - Oliver Tuszik, Cisco's Executive Vice President and Head of Global Sales, adopted a Rule 10b5-1(c) trading plan on June 20, 2025, to sell approximately 49,067 shares of stock[587] Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This item is not applicable - This item is not applicable[588] PART III Directors, Executive Officers and Corporate Governance Cisco has adopted a code of ethics for its principal executive and financial officers and will disclose any amendments or waivers via its investor relations website or Form 8-K - Cisco has adopted a code of ethics applicable to its principal executive and financial officers, available on the company's investor relations website[591] - The company has adopted an insider trading policy to promote compliance with insider trading laws and Nasdaq listing standards[592] - Other information required for this item is incorporated by reference into the proxy statement for the 2025 Annual Meeting of Shareholders[593] Executive Compensation The information required for this item is incorporated by reference into the company's proxy statement - The information required for this item is incorporated by reference into the company's proxy statement[594] Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required for this item is incorporated by reference into the company's proxy statement - The information required for this item is incorporated by reference into the company's proxy statement[595] Certain Relationships and Related Transactions, and Director Independence The information required for this item is incorporated by reference into the company's proxy statement - The information required for this item is incorporated by reference into the company's proxy statement[596] Principal Accountant Fees and Services The information required for this item is incorporated by reference into the company's proxy statement - The information required for this item is incorporated by reference into the company's proxy statement[597] PART IV Exhibits and Financial Statement Schedules This section lists the financial statements, schedules, and exhibits included in this report, such as consolidated financial statements, corporate charters, and debt indentures - The financial statements for this report can be found in the "Index to Consolidated Financial Statements" on page 52[599] - All financial statement schedules have been omitted as the required information is not applicable or is presented in the financial statements or notes[599] - The Exhibit Index begins on page 104, listing various documents including merger agreements, corporate charters, debt indentures, equity incentive plans, and credit agreements[600][601][602][603] Form 10-K Summary This report does not contain a Form 10-K summary - This report does not contain a Form 10-K summary[604] SIGNATURES This section contains the signatures of authorized representatives for the Form 10-K annual report, including the Chairman and CEO, EVP and CFO, and SVP and Chief Accounting Officer - The Form 10-K annual report has been signed by Charles H. Robbins, Chairman and Chief Executive Officer; Mark Patterson, Executive Vice President and Chief Financial Officer; and M. Victoria Wong, Senior Vice President and Chief Accounting Officer[609][612]