8a2640f7e92a68dd616ce8236147af1a0ae438bb48857b3bb7d94460aaf8c706

Remaining Performance Obligations for Product (USD millions)

Remaining Performance Obligations for Services (USD millions)

Total Remaining Performance Obligations (USD millions)

Short-term RPO (USD millions)

Long-term RPO (USD millions)

Inventory Purchase Commitments with Contract Manufacturers and Suppliers (Less than 1 year) (USD millions)

Inventory Purchase Commitments with Contract Manufacturers and Suppliers (1 to 3 years) (USD millions)

Inventory Purchase Commitments with Contract Manufacturers and Suppliers (3 to 5 years) (USD millions)

Total Inventory Purchase Commitments with Contract Manufacturers and Suppliers (USD millions)

52b987f67c3f5d20a5a02917b762c129834d4c0846f1705478cd5436bc191710

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (CapEx) [USD, Millions]

Proceeds from / Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

9efe24a1a83021485ebb30c998dcb008a29ecbf8191901d0ace28881e457b4ac

13cf21124822e1ae8e87c6bb651f5dc2614be704d98bb63ce8a5c6a9c74ceed9

Americas

- United States

EMEA

APJC

Total Revenue

f92c20f11fd547fccb171ba6e55ad15df093b7a163c6b9492a62ebde6daddb6b

154a23074f98b87e0e03fbc1cb306741ee45319900f85f9fd97e6fd1d33a05ac

Net income (USD, millions)

Depreciation, amortization, and other (USD, millions)

Share-based compensation expense (USD, millions)

Provision (benefit) for receivables (USD, millions)

(Gains) losses on divestitures, investments and other, net (USD, millions)

Income taxes, net (USD, millions)

Net cash provided by operating activities (USD, millions)

Purchases of investments (USD, millions)

Proceeds from sales of investments (USD, millions)

Proceeds from maturities of investments (USD, millions)

Acquisitions, net of cash and cash equivalents acquired and divestitures (USD, millions)

Purchases of investments in privately held companies (USD, millions)

Return of investments in privately held companies (USD, millions)

Acquisition of property and equipment (USD, millions)

Other investing activities (USD, millions)

Net cash provided by (used in) investing activities (USD, millions)

Repurchases of common stock — repurchase program (USD, millions)

Shares repurchased for tax withholdings on vesting of restricted stock units (USD, millions)

Repayments of debt (USD, millions)

Dividends paid (USD, millions)

Other financing activities (USD, millions)

Net cash used in financing activities (USD, millions)

Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents (USD, millions)

Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents (USD, millions)

Cash paid for interest (USD, millions)

Cash paid for income taxes, net (USD, millions)

Deferred income taxes (USD, millions)

Accounts receivable (USD, millions)

Inventories (USD, millions)

Financing receivables (USD, millions)

Other assets (USD, millions)

Accounts payable (USD, millions)

Accrued compensation (USD, millions)

Deferred revenue (USD, millions)

Other liabilities (USD, millions)

Short-term borrowings, original maturities of 90 days or less, net (USD, millions)

Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of period (USD, millions)

Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period (USD, millions)

e188b2d0a8ed7af25ea6be478f03c9e600773c59edce30a09f198d174a370b33

f84a5e1b7b8915bb9ae5c568ee0bc1fd134667b6193e5010867e85160c0cbe96

Revenue Product (USD, millions)

Revenue Service (USD, millions)

Total Revenue (USD, millions)

Cost of Sales Product (USD, millions)

Cost of Sales Service (USD, millions)

Total Cost of Sales (USD, millions)

Gross Margin (USD, millions)

Research and Development Expenses (USD, millions)

Sales and Marketing Expenses (USD, millions)

General and Administrative Expenses (USD, millions)

Amortization of Purchased Intangible Assets (USD, millions)

Restructuring and Other Charges (USD, millions)

Total Operating Expenses (USD, millions)

Operating Income (USD, millions)

Interest Income (USD, millions)

Interest Expense (USD, millions)

Other Income (Loss), Net (USD, millions)

Interest and Other Income (Loss), Net (USD, millions)

Income Before Provision for Income Taxes (USD, millions)

Provision for Income Taxes (USD, millions)

Net Income (USD, millions)

Net Income per Share Basic (USD)

Net Income per Share Diluted (USD)

Shares Used in Per-Share Calculation Basic (millions)

Shares Used in Per-Share Calculation Diluted (millions)

50b6a4b4b3b1f8bac1d7bfaf5e53943be26ccc2a976dcb8a48c5d5f01d81a76f

Cisco's cash and cash equivalents increased notably in Q2 2024 primarily because of a series of positive cash flow activities. These included a strong net cash provision from operating activities, which was bolstered by a significant deferred fiscal tax payment and a U.S. transition tax payment. Additionally, the company raised extra cash by issuing commercial paper notes. Although Cisco also returned cash to stockholders through dividends and repurchase of common stock—and made payments for acquisitions and capital expenditures, as well as reduced debt—these activities were part of the overall mix that contributed to the jump in cash and cash equivalents during this period.  **[0000858877-24-000003_csco-20240127.htm:57]** 

Why did cash and cash equivalents jump so high in Q2 2024?

The surge in **total assets** in Q3 2024 was primarily driven by the **acquisition of Splunk**, which significantly increased both **goodwill** (from **$38,535 million** to **$58,633 million**) and **purchased intangible assets, net** (from **$1,818 million** to **$11,819 million**).  **[0001193125-24-139371_d826117dex991.htm:7]** **[CSCO_3389288_6]**  Additionally, despite decreases in **cash and cash equivalents** and **investments**—reflecting cash outflows for the acquisition—the rise in **other current assets** and the impact of financing activities, such as issuing **senior notes** and increasing **short-term and long-term debt**, further contributed to the substantial change in total assets.  **[0001193125-24-139371_d826117dex991.htm:7]** **[0000858877-24-000007_csco-20240427.htm:63]** 

What drove the surge in total assets in Q3 2024?

Cisco’s **short-term debt spike in Q3 2024** was primarily driven by its financing activities related to the **acquisition of Splunk**. To complete the deal—which involved a **net outflow of $27.4 billion**—Cisco issued a substantial amount of **commercial paper notes** (netting **$11.8 billion**) and **senior notes** (netting **$13.4 billion**), thereby significantly increasing their overall short-term debt.  **[0001193125-24-139371_d826117dex991.htm:7]** **[0000858877-24-000007_csco-20240427.htm:63]** **[CSCO_3389288_6]** 

What caused the short-term debt spike in Q3 2024?

Cisco's dramatic rise in long-term debt in **Q3 2024** was primarily driven by the financing required for its **Splunk acquisition**. The company significantly increased its debt through multiple financing activities, including the issuance of **senior notes** worth **$13.5 billion** and the utilization of its **commercial paper program**. These steps were taken to fund the **$27.4 billion net outflow** associated with the acquisition, leading to an overall debt increase from **$8.4 billion** to **$31.993 billion** during that period.  **[0000858877-24-000007_csco-20240427.htm:43]** **[CSCO_3389288_6]** **[CSCO_3389288_2]** **[0000858877-24-000007_csco-20240427.htm:25]** 

What led to the dramatic rise in long-term debt in Q3 2024?

00302aafcf9bfb7d90051987c381deb6527be471b156427bd53171386f1eba6f

The sharp drop in operating cash flow in Q1 2024 was primarily driven by a **$2.8 billion federal tax payment** related to prior quarters, which was deferred by the IRS due to the California floods. This tax payment significantly impacted the net cash provided by operating activities during that period.  **[0000858877-23-000031_csco-20231028.htm:55]** **[0000858877-23-000031_csco-20231028.htm:3]** 

What caused the operating cash flow to drop so sharply in Q1 2024?

The swing to **negative income taxes** in Q1 2024 was primarily driven by a **decrease in net discrete tax expenses**. Although the underlying provision for income taxes was **nearly unchanged**—about **$804 million** compared to **$805 million** from Q1 2023—the increase in income before taxes (from **$3,475 million** to **$4,442 million**) led to a **lower effective tax rate** (decreasing from **23.2%** to **18.1%**). This reduction in the effective rate, influenced by the lower net discrete tax expenses, is the main factor that resulted in the negative figure reported for income taxes in Q1 2024.  **[0000858877-23-000031_csco-20231028.htm:35]** **[0000858877-23-000031_csco-20231028.htm:2]** **[0000858877-23-000031_csco-20231028.htm:53]** 

Why did income taxes swing negative in Q1 2024?

The overall net change in cash turned negative in **Q1 2024** primarily because of a combination of **lower cash provided by operating activities** and **higher cash used in financing activities**. Specifically, the operating cash flow dropped due in large part to a **$1,773 million net outflow for income taxes** (compared to a $20 million inflow in the previous year), along with a larger decrease in accrued compensation. At the same time, financing activities consumed more cash due to **increased repurchases of common stock** (rising from **$556 million** to **$1,300 million**) and the addition of **$750 million in debt repayments**, which further contributed to the negative overall net change in cash.  **[0001193125-23-277891_d850595dex991.htm:6]** **[0000858877-23-000031_csco-20231028.htm:3]** 

Why did the overall net change in cash turn negative in Q1 2024?

dab7fe6f6fe842862a6542962959a8aff2e33e70afe06cad6a15b564ef90b1c3

Cisco’s significant rise in Basic EPS in Q4 2023 was driven by a combination of factors. **Revenue growth** played a major role, with total revenue reaching **$15.2 billion**—boosted by a **20%** increase in product revenue and a **4%** increase in service revenue. In addition, the company’s **net income** jumped to **$4.0 billion**, marking a **41%** year-over-year increase, which further supported the higher EPS. Improved **operating leverage**, evidenced by a **1.8 percentage points** increase in operating income margin, and a reduction in the diluted share count by **44 million shares** also amplified the impact of the earnings, culminating in a **43%** increase in diluted EPS compared to Q4 2022.  **[CSCO_3386186_3]** **[0001193125-23-214316_d511414dex991.htm:0]** **[0000858877-23-000023_csco-20230729.htm:58]** **[0000858877-23-000023_csco-20230729.htm:56]** 

What drove the significant rise in Basic EPS in Q4 2023?

In Q1 2024, while overall year‐over‐year revenue increased, Cisco experienced a **quarter‐over‐quarter decline** compared to Q4 2023. Documents indicate that this was primarily due to a **decline in new product demand**—as customers focused on implementing previously shipped products—which partially offset the benefits of an improved supply chain.  **[0000858877-23-000031_csco-20231028.htm:39]** **[CSCO_3367189_0]**  Additionally, minor revenue declines in regions such as **EMEA** and **APJC** also contributed to the overall decline.  **[0000858877-23-000031_csco-20231028.htm:39]** 

Why did Total Revenue decline in Q1 2024?

Cisco's Q1 2024 results did not show a lower Net Income; rather, its Net Income **increased** from **$2,670 million** in Q1 2023 to **$3,638 million** in Q1 2024. The significant improvement was driven by several factors, including **revenue growth** (an increase of **8%**), **improved gross margins** (boosted by productivity improvements, favorable pricing, and a better product mix), **operating leverage** (with operating income rising by **21%**), **lower costs in certain areas** (including a reduction in the cost of sales despite higher revenue), **higher interest income** (an increase of **$191 million**), and a **lower effective tax rate** (dropping from **23.2%** to **18.1%**).  **[0000858877-23-000031_csco-20231028.htm:2]** **[0000858877-23-000031_csco-20231028.htm:39]** **[0001193125-23-277891_d850595dex991.htm:0]** **[0000858877-23-000031_csco-20231028.htm:53]** 

What factors contributed to the lower Net Income in Q1 2024?

630978384ab848a556adf924af0459552e35819d469ae1cc86ec4a16750f7cb3

Cisco Systems Inc (CSCO)

Financials