Financial Data and Key Metrics Changes - Cisco reported revenue of $56.7 billion for fiscal year 2025, representing a 5% year-over-year increase [18] - Non-GAAP EPS was $3.81, up 2% year-over-year, with non-GAAP gross margins at 68.7% [18] - Non-GAAP operating income reached $19.5 billion, a 6% increase year-over-year, while non-GAAP net income was flat at $15.2 billion [18] - For Q1 of fiscal year 2026, revenue was $14.9 billion, an 8% increase year-over-year, with non-GAAP EPS at $1, up 10% year-over-year [19] Business Line Data and Key Metrics Changes - The growth in Q1 was driven by a 15% year-over-year increase in networking revenue, with SP routing being the largest contributor [26] - Product orders grew by 13% year-over-year across all geographies and customer markets [19] Market Data and Key Metrics Changes - Strong demand for AI infrastructure from hyperscalers and telcos was noted, as they scale data centers and increase network capacity to handle AI traffic [26] - Enterprise customers are modernizing their networks for AI, indicating a broad market trend towards upgrading infrastructure [26] Company Strategy and Development Direction - Cisco is focusing on capitalizing on AI opportunities, integrating Splunk to enhance digital resilience and unify customer data for AI model building [28][29] - The company aims to grow organically and inorganically, continue dividend growth, buy back shares, and return excess cash to shareholders [20] - Cisco is positioned to play a critical role in the AI transition, with a focus on AI infrastructure, security, data management, AI-native products, and customer services [21][22][23] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting the strong performance in fiscal year 2025 and the record start to fiscal year 2026 [18][24] - The company anticipates significant growth opportunities driven by leadership in AI and secure networking [19][24] Other Important Information - Cisco returned 94% of free cash flow to shareholders in fiscal year 2025, with an annualized dividend per share of $1.64 and nearly $6 billion in share repurchases [20] - The board recommended stockholders vote against a proposal regarding the assessment of inclusion programs, which was not approved with approximately 99% of shares voting against it [16] Q&A Session Summary Question: Key trends driving recent strong growth - Cisco noted strong Q1 performance with 8% revenue growth driven by networking strength and demand for AI infrastructure from hyperscalers and telcos [26] Question: Cisco's strategy for capitalizing on AI opportunities - Cisco highlighted broad AI opportunities, emphasizing the need for customers to upgrade networks and embed security deeply into their infrastructure [28] Question: How Cisco's purpose influences business strategy - Cisco's purpose guides its operations, focusing on community resilience, responsible innovation, and energy sustainability, which are seen as beneficial for long-term shareholder value [30][31]

Financial Data and Key Metrics Changes - Cisco reported revenue of $56.7 billion for fiscal year 2025, representing a 5% year-over-year increase [18] - Non-GAAP EPS was $3.81, up 2% year-over-year, with non-GAAP gross margins at 68.7% [18] - Non-GAAP operating income reached $19.5 billion, up 6% year-over-year, while non-GAAP net income was $15.2 billion, flat year-over-year [18] - For Q1 of fiscal year 2026, revenue was $14.9 billion, an 8% increase year-over-year, with non-GAAP EPS at $1, up 10% year-over-year [19] Business Line Data and Key Metrics Changes - The growth in revenue was driven by strong demand for AI infrastructure and campus networking solutions, with product orders growing 13% year-over-year [19] - Networking revenue specifically grew by 15% year-over-year in Q1, with SP routing being the largest contributor [26] Market Data and Key Metrics Changes - Cisco experienced robust demand across all geographies and customer markets, indicating a broad-based growth [19] - The company noted strong demand from hyperscalers and telcos, which are increasing their network capacity to handle AI traffic [26] Company Strategy and Development Direction - Cisco is focusing on capitalizing on the AI opportunity, integrating AI into its product offerings, and enhancing security within its network infrastructure [28] - The company aims to grow organically and inorganically, continue dividend growth, buy back shares, and return excess cash to shareholders [20] - Cisco's strategy includes building AI-ready data centers, modernizing workplaces, and ensuring digital resilience for customers [23] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting the strong performance in fiscal 2025 and the positive outlook for fiscal 2026 [18][24] - The integration of Splunk is seen as crucial for enhancing digital resilience and enabling customers to unify their data for AI model building [29] Other Important Information - Cisco returned 94% of its free cash flow to shareholders in fiscal year 2025, with an annualized dividend per share of $1.64 and nearly $6 billion in share repurchases [20] - The company plans to publish its purpose report in mid-January 2026, detailing its commitment to community resilience, responsible innovation, and sustainability [31] Q&A Session Summary Question: Can you discuss the key trends you are seeing with your customers and what is driving this performance? - Cisco noted strong Q1 performance driven by networking strength and demand for AI infrastructure, with customers modernizing their networks for AI [26] Question: Can you discuss Cisco's overall strategy for capitalizing on the AI opportunity and how the integration of Splunk is enhancing your position? - Cisco sees broad AI opportunities and emphasizes the need for customers to upgrade their networks and embed security deeply, with Splunk integration enhancing digital resilience [28] Question: How does Cisco's stated purpose influence your business strategy and create long-term value? - Cisco's purpose guides its operations, focusing on community resilience, responsible innovation, and sustainability, which are believed to drive durable growth for shareholders [30]

Financial Data and Key Metrics Changes - Cisco reported revenue of $56.7 billion for FY 2025, representing a 5% year-over-year increase [17] - Non-GAAP EPS was $3.81, up 2% year-over-year, with non-GAAP gross margins at 68.7% [17] - Non-GAAP operating income reached $19.5 billion, up 6% year-over-year, while non-GAAP net income was $15.2 billion, flat year-over-year [17] - For Q1 FY 2026, revenue was $14.9 billion, an 8% increase year-over-year, with non-GAAP EPS at $1, up 10% year-over-year [18] Business Line Data and Key Metrics Changes - Software and subscriptions now account for more than half of Cisco's revenue, indicating a shift towards recurring revenue models [17] - Networking revenue grew by 15% year-over-year in Q1 FY 2026, driven by strong demand for AI infrastructure [25] Market Data and Key Metrics Changes - Product orders grew 13% year-over-year across all geographies and customer markets in Q1 FY 2026 [18] - Strong demand from hyperscalers and telcos for AI infrastructure and increased network capacity was noted [25] Company Strategy and Development Direction - Cisco is focusing on capitalizing on the AI transition, with a strategy that includes enhancing AI infrastructure, security, and data management [20][21] - The integration of Splunk is seen as crucial for building a comprehensive data fabric that allows customers to unify their data and build AI models [28] - The company aims to return more than 50% of free cash flow to shareholders, having returned 94% in FY 2025 [19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the opportunities in the AI era, highlighting the need for modern infrastructure to support AI workloads [22] - The company anticipates strong growth driven by its leadership in AI and secure networking, positioning itself for what is expected to be its strongest year yet [18][23] Other Important Information - Cisco's annual meeting included discussions on corporate governance, executive compensation, and stockholder proposals, with significant support for most proposals [15] - The company plans to publish its purpose report in mid-January 2026, detailing its commitment to community resilience, responsible innovation, and sustainability [30] Q&A Session Summary Question: Key trends driving recent company performance - Cisco noted strong Q1 performance with 8% revenue growth, driven by networking strength and demand for AI infrastructure from hyperscalers and telcos [25] Question: Cisco's strategy for capitalizing on AI opportunities - The company highlighted broad AI opportunities, emphasizing the need for customers to upgrade networks and embed security deeply into their infrastructure [27] Question: Influence of Cisco's purpose on business strategy - Cisco's purpose guides its operations, focusing on community resilience, responsible innovation, and sustainability, which are seen as beneficial for long-term shareholder value [29]

Financial Data and Key Metrics Changes - In Q4 FY 2025, total revenue was $14.7 billion, up 8% year over year, with non-GAAP net income at $4 billion, up 12% [21][22] - Non-GAAP earnings per share (EPS) was $0.99, reflecting a 14% increase, indicating strong operating leverage [22] - For the full fiscal year, revenue reached $56.7 billion, a 5% increase, with non-GAAP EPS at $3.81, up 2% [28][29] Business Line Data and Key Metrics Changes - Total product revenue was $10.9 billion, up 10%, with networking revenue increasing by 12% and security revenue up by 9% [22][23] - Services revenue remained flat at $3.8 billion year over year [23] - Collaboration revenue grew by 2%, driven by solid growth in devices, while observability revenue increased by 4% [23] Market Data and Key Metrics Changes - Product orders in Q4 grew by 7% year over year, with service provider and cloud orders up 49% [7][25] - Enterprise product orders increased by 5%, while public sector orders decreased by 6% [8][25] - The Americas saw a 5% increase in product orders, EMEA grew by 10%, and APJC was up by 7% [25] Company Strategy and Development Direction - Cisco is focusing on AI infrastructure, with over $2 billion in AI infrastructure orders for FY 2025, more than double the original target [7][11] - The company aims to leverage its refreshed product portfolio to meet the growing demand for AI and network modernization [6][10] - Cisco is positioned to support the transition to AI by providing critical infrastructure and security solutions [12][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand for Cisco's technology, particularly in AI and networking, despite a complex operating environment [6][19] - The company anticipates continued growth in AI-related orders and infrastructure as enterprises modernize their networks [11][62] - Management highlighted the importance of security in the AI era, emphasizing the need for integrated security solutions [15][79] Other Important Information - Cisco returned $2.9 billion to shareholders in Q4 FY 2025, totaling $12.4 billion for the fiscal year, representing 94% of free cash flow [6][29] - The company has a strong cash position with $16.1 billion in cash, cash equivalents, and investments [27] - Cisco's partnership with NVIDIA is expected to enhance its capabilities in AI infrastructure [11][80] Q&A Session Summary Question: Guidance and AI Opportunity - Analyst inquired about the deceleration of growth in guidance and whether it reflects conservatism or changes in demand [34] - Management clarified that the deceleration is related to year-over-year comparisons and not indicative of a demand change [36] Question: Security Growth Outlook - Analyst asked about the growth outlook for security products post-Splunk acquisition [39] - Management expressed optimism, noting double-digit growth in security orders excluding U.S. Federal [42] Question: Pull Forward Concerns - Analyst raised concerns about potential pull forwards in orders due to federal budget cuts and tariffs [50] - Management stated they have not observed significant pull forwards and provided metrics to support this [52][54] Question: Networking Cycle Sustainability - Analyst questioned the sustainability of networking growth rates amid potential spending slowdowns [84] - Management indicated strong demand signals from customers and confidence in continued growth [87] Question: AI Orders and Revenue Translation - Analyst asked about the translation of AI orders into revenue for FY 2026 [66] - Management confirmed that approximately $1 billion in revenue was recognized from AI orders in FY 2025 [71] Question: Identity and Security Partnerships - Analyst inquired about partnerships outside of NVIDIA in the AI space [91] - Management confirmed ongoing collaboration with AMD and emphasized the importance of identity in Zero Trust architectures [93][94]