Business Description
Cisco Systems, Inc. is a leading global technology company focused on designing, producing, and marketing Internet Protocol (IP)-based networking equipment, software, and associated products within the communications and information technology industries. The company operates extensively across major regions including the Americas, Europe, the Middle East, Africa, and the Asia Pacific, specifically covering Japan and China. Its comprehensive product lineup features switching solutions for both enterprise campuses and data centers. Cisco's enterprise routing segment is crucial for securely and reliably interconnecting public, private, wired, and mobile networks, ensuring vital connectivity across corporate campuses, data centers, and branch offices. Additionally, the company provides a range of wireless products offering seamless indoor and outdoor roaming for voice, video, and data applications. Security forms a significant pillar of its offerings, encompassing network defense, identity and access management, secure access service edge (SASE), alongside threat intelligence, detection, and response capabilities. For collaboration, Cisco delivers the Webex Suite, dedicated devices, contact center platforms, and communication platform-as-a-service (CPaaS). These end-to-end collaboration solutions are adaptable, available in cloud, on-premise, or hybrid environments, facilitating clients' migration to cloud-based systems. Moreover, their observability suite provides network assurance, monitoring, and analytics. Beyond its product portfolio, Cisco offers extensive customer support and services, including technical assistance, advanced professional services, and advisory consulting. The company serves a broad clientele, from small and large businesses to public institutions, governmental agencies, and service providers. Products and services are distributed directly by Cisco, as well as through a diverse network of system integrators, service providers, other resellers, and distributors. Cisco Systems, Inc. also engages in strategic collaborations with other industry players. Founded in 1984, the company is headquartered in San Jose, California.
Business History
Generated: Jun 23, 2026 3:03amPrice Overview
Last updated: Jun 23, 2026 3:00am (4d ago)Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 2.56
Total Equity: $46.84B
Shares: 3,998,000,000
Total Debt: $28.09B
Cash: $8.35B
EBITDA: $15.38B
Total Debt: $28.09B
Cash: $8.35B
Revenue: $56.65B
Revenue: $56.65B
Revenue: $56.65B
Total Equity: $46.84B
Tax Rate: 8.3%
Equity: $46.84B
Total Debt: $28.09B
Cash: $8.35B
Current Liabilities: $35.06B
Long-Term Debt: $22.86B
Total Debt: $28.09B
Total Equity: $46.84B
Shares: 3,998,000,000
Shares: 3,998,000,000
CapEx: -$905.00M
Shares: 3,998,000,000
Stock Price: $121.53
Net Income: $10.18B
Industry Benchmarks
Advanced Analysis Forensic deep-dive · three lenses
Cisco prints serious cash: FCF of 13.29B in 2025 on 56.65B revenue, with OCF/NI of 1.32x, accruals at -3.5% of assets, Beneish M at -2.65 and Altman Z at 4.59. Earnings integrity looks genuine, not engineered. Capital return is disciplined: diluted share count fell from 4.24B (2021) to 4.00B (2025), a -1.4% CAGR, and buybacks ran 242% of SBC despite SBC at 6.4% of revenue. The balance sheet shows net debt of ~12B against 16.1B liquid cash - a constraint, not a fortress, but trivially serviceable given FCF. The blemish is the operating trajectory. Revenue is only modestly higher than 2021 (56.65B vs 49.82B, ~3% CAGR), and operating margin has eroded materially: 27.1% (2022) to 26.4% (2023) to 22.6% (2024) to 20.8% (2025) - roughly 630bps of compression in two years - even as gross margin actually improved to 64.9%. That gap (GM up, OpM down) implies opex growth (likely Splunk integration, R&D, headcount) is outrunning revenue. Net income has gone backward from 12.61B (2023) to 10.18B (2025). Net: a durable, well-run incumbent with clean books and shareholder-friendly capital allocation, but growth is sluggish and operating leverage is currently negative. Solid quality, not elite.
Verify before trusting this (5)
- Splunk acquisition impact on opex and whether margin compression is integration-related and reversible
- Recurring/subscription revenue mix and ARR growth vs hardware - durability of GM expansion
- Customer concentration with hyperscalers and service-provider segments
- Debt maturity ladder and refinancing needs given net debt position
- Whether insider sales are 10b5-1 programmatic or discretionary
Cisco at $121.53 carries a ~$479B market cap on a business that has essentially not grown revenue in four years and has lost ~630bps of operating margin since the Splunk deal. On consensus, that is roughly 17-18x forward earnings and ~6x sales for a low-single-digit grower - in line with or above the broader market multiple despite slower growth and compressing op margins. The e2e synthesis flag of 'Disconnected from Fundamentals' is a yellow card I take seriously: deserved value for a Strong-but-not-elite incumbent growing 3-5% with eroding op margins is closer to a high-teens P/E on clean EPS, i.e. somewhere in the $95-110 zone, not $121+.
Verify before trusting this (4)
- Forward revenue guidance and product orders trajectory (AI infra order book disclosures)
- Operating margin recovery path post-Splunk integration
- Software/subscription ARR growth and Splunk attach rates
- Any one-time integration costs being adjusted out of non-GAAP EPS
The tape is neutral with a slight tailwind (VIX mid-teens, S&P just off highs) and CSCO's beta of 1 means macro pressure lands averagely - not amplified. More importantly, the live narrative has quietly upgraded: Cisco is being pulled into the AI-infrastructure trade via AI networking orders and hybrid data center security, layered on top of its durable steady-compounder identity. News flow over the past 72h is overwhelmingly constructive - record revenue, surging AI orders, an 87% run, inclusion in quality-dividend ETFs, and even startup competitors framing themselves as 'the next Cisco' (a tell that CSCO owns the category mindshare). Momentum confirms: recent 5.3% pace well above long-term trend. The only crack is an analyst tone that has not caught up - consensus target ($123) is essentially at spot, suggesting the sell side is lagging the story, though one fresh revision at $130 hints they are starting to chase. That divergence (price and narrative ahead of stale targets) is itself a mild tailwind as upgrades typically follow. Net: non-fundamental forces are pushing this name gently but persistently up.
Verify before trusting this (4)
- Whether sell-side targets get revised toward $135-140 in the next earnings cycle (would confirm catch-up tailwind)
- Any crack in the AI-orders narrative - a single soft AI bookings print would deflate the re-rating
- Sector rotation out of networking/AI infrastructure into laggards
- VIX move above 22 which would pressure beta-1 names harder than the current calm tape suggests
Deep Analysis
Pre-flight intelligence scans the company first, then routes to the right analytical methods.
Income Statement (Annual)
Last updated: Jun 23, 2026 3:04am (4d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $49.8B | $51.6B | $57.0B | $53.8B | $56.7B |
| Cost of Revenue | $17.9B | $19.3B | $21.2B | $19.0B | $19.9B |
| Gross Profit | $31.9B | $32.2B | $35.8B | $34.8B | $36.8B |
| Operating Expenses | $19.1B | $18.3B | $20.7B | $22.6B | $25.0B |
| Operating Income | $12.8B | $14.0B | $15.0B | $12.2B | $11.8B |
| Net Income | $10.6B | $11.8B | $12.6B | $10.3B | $10.2B |
| EBITDA | $15.6B | $16.8B | $17.5B | $15.7B | $15.4B |
| EPS | $2.51 | $2.83 | $3.08 | $2.55 | $2.56 |
| EPS (Diluted) | — | — | — | — | — |
Balance Sheet (Annual)
Last updated: Jun 23, 2026 3:00am (4d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $9.2B | $7.1B | $10.1B | $7.5B | $8.3B |
| Total Current Assets | $39.1B | $36.7B | $43.3B | $36.9B | $35.0B |
| Total Assets | $97.5B | $94.0B | $101.9B | $124.4B | $122.3B |
| Current Liabilities | $26.3B | $25.6B | $31.3B | $40.6B | $35.1B |
| Long-Term Debt | $9.0B | $8.4B | $6.7B | $19.6B | $22.9B |
| Total Liabilities | $56.2B | $54.2B | $57.5B | $79.0B | $75.4B |
| Total Equity | $41.3B | $39.8B | $44.4B | $45.5B | $46.8B |
| Retained Earnings | -$654.0M | -$1.3B | $1.6B | $1.1B | $50.0M |
Cash Flow (Annual)
Last updated: Jun 22, 2026 3:04am (5d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $15.5B | $13.2B | $19.9B | $10.9B | $14.2B |
| Capital Expenditure | -$692.0M | -$477.0M | -$849.0M | -$670.0M | -$905.0M |
| Free Cash Flow | $14.8B | $12.7B | $19.0B | $10.2B | $13.3B |
| Acquisitions (net) | -$7.0B | -$373.0M | -$301.0M | -$26.0B | -$291.0M |
| Debt Repayment | — | — | — | — | — |
| Dividends Paid | — | — | — | — | — |
| Stock Buybacks | -$3.5B | -$8.4B | -$4.9B | -$6.8B | -$7.2B |
| Net Change in Cash | -$1.9B | -$1.4B | $3.0B | -$2.8B | -$677.0M |
Analyst Estimates (Annual)
Last updated: Jun 23, 2026 3:00am (4d ago)| Metric | 2025 | 2026 | 2027 | 2028 |
|---|---|---|---|---|
| Revenue |
$56.6B $56.5B – $56.7B
|
$62.9B $62.8B – $63.0B
|
$68.7B $63.3B – $70.6B
|
$73.4B $73.3B – $73.5B
|
| EBITDA |
$17.1B $17.1B – $17.1B
|
$19.0B $19.0B – $19.0B
|
$20.7B $19.1B – $21.3B
|
$22.1B $22.1B – $22.2B
|
| Net Income |
$15.1B $15.1B – $15.2B
|
$17.2B $17.0B – $17.3B
|
$18.9B $17.6B – $20.2B
|
$20.8B $18.9B – $22.7B
|
| EPS | — | — | — | — |
Growth Trends (YoY %)
Last updated: Jun 23, 2026 3:04am (4d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +3.5% | +10.6% | -5.6% | +5.3% |
| Gross Profit Growth | +1.1% | +10.9% | -2.6% | +5.6% |
| Operating Income Growth | +8.9% | +7.6% | -19.0% | -3.5% |
| Net Income Growth | +11.5% | +6.8% | -18.2% | -1.4% |
| EBITDA Growth | +7.9% | +4.0% | -9.9% | -2.3% |
Insider Trading (Recent)
Last updated: Jun 23, 2026 3:04am (4d ago)All SEC Form 4 codes
- P Purchase
- Open-market or private purchase of shares.
- S Sale
- Open-market or private sale of shares.
- A Award / grant
- Grant or award of securities (RSUs, options, etc.) under Rule 16b-3.
- D Return to issuer
- Securities disposed back to the company under Rule 16b-3.
- F In-kind (tax)
- Shares withheld or delivered to pay the option-exercise price or tax — not an open-market sale.
- I Discretionary
- Discretionary transaction under an employee plan — Rule 16b-3(f).
- M Option exercise
- Exercise or conversion of a derivative (option/RSU) into shares — exempt.
- C Conversion
- Conversion of a derivative security into the underlying shares.
- E Short expiration
- Expiration of a short derivative position.
- H Long expiration
- Expiration or cancellation of a long derivative position with value received.
- O OTM exercise
- Exercise of an out-of-the-money derivative.
- X ITM exercise
- Exercise of an in-the-money or at-the-money derivative.
- G Gift
- Bona fide gift of securities.
- L Small acquisition
- Small acquisition under Rule 16a-6.
- W Inheritance
- Acquisition or disposition by will or the laws of descent.
- Z Voting trust
- Deposit into or withdrawal from a voting trust.
- J Other
- Other acquisition or disposition (explained in a Form 4 footnote).
- K Equity swap
- Transaction in an equity swap or similar instrument.
- U Tender / buyout
- Disposition via tender of shares in a change-of-control transaction.
Compensation-plan codes (A, D, F, M) are routine and rarely directional. Open-market P (buy) and S (sale) carry the most signal.
| Date | Insider | Type | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-06-16 | Subaiya Thimaya K. | S-Sale | 5,219.00 | $119.69 | $624,673 |
| 2026-06-16 | Subaiya Thimaya K. | S-Sale | 1,908.00 | $120.51 | $229,926 |
| 2026-06-15 | Weil Kevin | A-Award | 251.00 | $120.17 | $30,163 |
| 2026-06-15 | Tessel Marianna | A-Award | 251.00 | $120.17 | $30,163 |
| 2026-06-15 | JOHNSON KRISTINA M | A-Award | 351.00 | $120.17 | $42,180 |
| 2026-06-10 | Subaiya Thimaya K. | F-InKind | 1,715.47 | $120.36 | $206,474 |
| 2026-06-10 | Tuszik Oliver | F-InKind | 5,542.88 | $120.36 | $667,141 |
| 2026-06-11 | Tuszik Oliver | S-Sale | 400.00 | $119.59 | $47,836 |
| 2026-06-11 | Tuszik Oliver | S-Sale | 700.00 | $120.51 | $84,355 |
| 2026-06-11 | Tuszik Oliver | S-Sale | 1,407.00 | $121.77 | $171,336 |
| 2026-06-11 | Tuszik Oliver | S-Sale | 100.00 | $122.44 | $12,244 |
| 2026-06-10 | Patterson Mark | F-InKind | 6,399.10 | $120.36 | $770,195 |
| 2026-06-11 | Patterson Mark | S-Sale | 1,100.00 | $117.60 | $129,356 |
| 2026-06-11 | Patterson Mark | S-Sale | 1,600.00 | $118.36 | $189,382 |
| 2026-06-11 | Patterson Mark | S-Sale | 851.00 | $119.44 | $101,645 |
| 2026-06-11 | Patterson Mark | S-Sale | 1,100.00 | $120.44 | $132,481 |
| 2026-06-11 | Patterson Mark | S-Sale | 2,546.00 | $121.75 | $309,978 |
| 2026-06-11 | Patterson Mark | S-Sale | 200.00 | $122.40 | $24,479 |
| 2026-06-03 | Fink Nichlas A | A-Award | 4,501.00 | $0.00 | $0 |
| 2026-05-22 | Robbins Charles | S-Sale | 500.00 | $118.48 | $59,242 |
Dividend History (Last 20)
Last updated: Jun 21, 2026 7:14pm (5d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-07-06 | $0.42 | 2026-05-13 | 2026-07-06 | 2026-07-22 |
| 2026-04-02 | $0.42 | 2026-02-11 | 2026-04-02 | 2026-04-22 |
| 2026-01-02 | $0.41 | 2025-11-12 | 2026-01-02 | 2026-01-21 |
| 2025-10-03 | $0.41 | 2025-08-13 | 2025-10-03 | 2025-10-22 |
| 2025-07-03 | $0.41 | 2025-05-14 | 2025-07-03 | 2025-07-23 |
| 2025-04-03 | $0.41 | 2025-02-12 | 2025-04-03 | 2025-04-23 |
| 2025-01-03 | $0.40 | 2024-11-13 | 2025-01-03 | 2025-01-22 |
| 2024-10-02 | $0.40 | 2024-08-14 | 2024-10-02 | 2024-10-23 |
| 2024-07-05 | $0.40 | 2024-05-15 | 2024-07-05 | 2024-07-24 |
| 2024-04-03 | $0.40 | 2024-02-14 | 2024-04-04 | 2024-04-24 |
| 2024-01-03 | $0.39 | 2023-11-15 | 2024-01-04 | 2024-01-24 |
| 2023-10-03 | $0.39 | 2023-08-16 | 2023-10-04 | 2023-10-25 |
| 2023-07-05 | $0.39 | 2023-05-17 | 2023-07-06 | 2023-07-26 |
| 2023-04-04 | $0.39 | 2023-02-15 | 2023-04-05 | 2023-04-26 |
| 2023-01-04 | $0.38 | 2022-12-07 | 2023-01-05 | 2023-01-25 |
| 2022-10-04 | $0.38 | 2022-08-23 | 2022-10-05 | 2022-10-26 |
| 2022-07-05 | $0.38 | 2022-06-06 | 2022-07-06 | 2022-07-27 |
| 2022-04-05 | $0.38 | 2022-02-16 | 2022-04-06 | 2022-04-27 |
| 2022-01-04 | $0.37 | 2021-12-12 | 2022-01-05 | 2022-01-26 |
| 2021-10-04 | $0.37 | 2021-09-22 | 2021-10-05 | 2021-10-27 |
Narrative Economics
market-narrative step).
Delvantic AI Findings
Looking at the raw quarterly trajectory first: revenue went $13.64B → $13.84B → $13.99B → $14.15B → $14.67B → $14.88B → $15.35B → $15.84B across the last eight quarters. That's not a stagnant mature franchise — that's a clear acceleration, with sequential growth visible every single quarter and YoY in Q3 FY26 of roughly 12% ($15.84B vs $14.15B). Net margins expanded from 15.8% to 21.3% over the same window. The 5-year CAGR figures the momentum model is citing (-0.3% revenue, -10.2% earnings) are backward-looking artifacts of the FY23 peak ($57B/$12.6B NI) and the Splunk-integration trough in FY24. They are misleading about the current run-rate. Annualizing the last two quarters gets you to ~$62B revenue and ~$13B+ NI — above the FY23 peak, with Splunk now contributing.
The synthesis and market-forces models are, I think, fighting the tape. "Deteriorating legacy networking leader losing structural share during an industry boom" doesn't square with 12% YoY revenue growth and 380bps of margin expansion in four quarters. The bear framing was probably right in 2023-2024; it's stale now. The AI infrastructure thesis (Cisco selling Ethernet fabric to hyperscalers, Silicon One traction, security ARR ramp post-Splunk) is showing up in the numbers, not just in management narrative. FCF of $13.29B on a $479B cap is a ~2.8% FCF yield — not cheap, but not the "33% FCF growth priced in" claim from synthesis either. At a TTM P/E of 40x, the rich multiple is real, but TTM earnings are depressed by trailing weak quarters; on forward run-rate NI of ~$13B, you're at ~37x — still rich, but the denominator is moving fast.
The contrarian-to-the-contrarians case: insider activity is net selling (six S-Sales vs awards/in-kinds), which is what you'd expect at $121 after an 85% rally from $65 lows — management ringing the register, not a smoking gun, but not a confidence vote either. Gross margin at 64.9% has held, but operating margin at 20.8% is well below FY23's 26.4% — Splunk dilution and security investment haven't fully normalized. Current ratio of 0.998 is tight for a company this size; the balance sheet has meaningful Splunk debt that the tile omits ("Total debt: —" is a data gap, not zero — Cisco carries ~$30B+ gross debt post-acquisition). EV/EBITDA of 27.9x assumes that debt load. And the hyperscaler AI orders are lumpy — one quarter of digestion and the "acceleration" narrative breaks.
Where I land: the prior models are anchored to a 2023-2024 deterioration story that the last four quarters have falsified. The market isn't "mis-categorizing" Cisco — it's repricing a genuine inflection in AI networking and Splunk-integrated security ARR. That said, 40x trailing / ~37x forward for a business that will likely grow revenue 8-10% and earnings 12-15% off this base is full-to-rich. Fair value on 25x forward NI of $13B = $325B, or roughly $82-85 — meaningful downside from $121. The 47x P/S framing in thesis-eval is wrong (it's ~8.5x P/S, ~5.2x EV/Sales), but the directional conclusion that price has run ahead of fundamentals is correct, just for different reasons. I dissent from "value trap / deteriorating legacy" but agree with "overvalued" — this is a re-rated quality compounder that overshot, not a melting ice cube.
GPT Critique
From my analysis of the raw data, Cisco Systems is experiencing a notable improvement in its financial performance over the past two years. Quarterly revenues have been on an upward trajectory, increasing from $13.64 billion in July 2024 to $15.84 billion in April 2026, marking a growth rate of about 16%. This sequential growth, alongside expanding net margins from 15.8% to 21.3%, contradicts a narrative of stagnation. Annually, while there was a dip in revenue and net income in 2024 ($53.80 billion and $10.32 billion respectively), the figures have rebounded in 2025 with revenues reaching $56.65 billion and net income at $10.18 billion. This suggests the Splunk acquisition is beginning to contribute positively. However, the company’s valuation metrics like a P/E ratio of 40.18 and EV/EBITDA of 27.85 indicate a premium valuation that may not fully align with the existing growth trajectory.
I agree with Opus's assertion that Cisco's recent financial performance does not fit the "deteriorating legacy networking leader" narrative. The reported 12% year-over-year revenue growth and significant margin expansion are tangible indicators of operational improvement and strategic success, particularly in integrating Splunk and focusing on software revenue. However, I disagree with Opus's dismissal of the high valuation concerns. While Opus suggests the market is rightfully repricing Cisco due to genuine growth inflections, the current multiples still seem excessive given the forward growth projections. The $479 billion market cap and a FCF yield of 2.8% imply significant growth expectations that may not be sustainable, especially if hyperscaler demand fluctuates.
Opus also identifies potential risks in the insider selling pattern and the balance sheet's tight current ratio of 0.998, which I concur are red flags warranting caution. Furthermore, Cisco's shift from a hardware to a software-centric model is fraught with execution risks, which are not dismissed by the recent positive performance. Opus notes the misrepresentation of Cisco's P/S ratio in prior models, and I agree that while the directional conclusion of overvaluation is sound, the magnitude of overvaluation may be understated given the market's current pricing of future growth.
A careful skeptic might argue that both Opus and I are underestimating the long-term benefits of Cisco's strategic transition to software and services. They might point out that AI and cloud networking are in early stages of a much larger growth cycle, potentially justifying the premium multiples. Additionally, the skeptic might argue that the insider selling is routine profit-taking, not indicative of fundamental weaknesses.