Industry Updates

Cisco has reported first quarter results for the period ended October 25, 2025. Cisco reported first quarter revenue of $14.9 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.9 billion or $0.72 per share, and non-GAAP net income of $4.0 billion or $1.00 per share.

"We had a solid start to fiscal 2026, and Cisco is on track to deliver our strongest year yet," said Chuck Robbins, chair and CEO of Cisco. "The widespread demand for our technologies highlights the critical role of secure networking and the value of our portfolio as customers move quickly to unlock the potential of AI."

"We delivered a strong quarter, with top and bottom-line performance exceeding our guidance, as well as solid margins and operating cash flow," said Mark Patterson, CFO of Cisco. "Our relevance in AI continues to build and we have a multi-year, multi-billion-dollar campus refresh opportunity starting to ramp, with strong demand for our refreshed networking products. Looking ahead, you can expect a continued focus on profitable growth, capital returns, and strategic investments to capture the significant opportunities ahead."

Reconciliations between net income, EPS, and other measures on a GAAP and non-GAAP basis are provided in the tables located in the section entitled "Reconciliations of GAAP to non-GAAP Measures."

Cisco Declares Quarterly Dividend

Cisco has declared a quarterly dividend of $0.41 per common share to be paid on January 21, 2026, to all stockholders of record as of the close of business on January 2, 2026. Future dividends will be subject to Board approval.

Financial Summary

All comparative percentages are on a year-over-year basis unless otherwise noted.

Q1 FY 2026 Highlights

Revenue -- Total revenue was $14.9 billion, up 8%, with product revenue up 10% and services revenue up 2%.

Revenue by geographic segment was: Americas up 9%, EMEA up 5%, and APJC up 5%. Product revenue performance reflected growth in Networking up 15% and Observability up 6%. Security was down 2% and Collaboration was down 3%.

Gross Margin -- On a GAAP basis, total gross margin, product gross margin, and services gross margin were 65.5%, 64.5%, and 68.4%, respectively, as compared with 65.9%, 65.1%, and 68.0%, respectively, in the first quarter of fiscal 2025.

On a non-GAAP basis, total gross margin, product gross margin, and services gross margin were 68.1%, 67.2%, and 70.7%, respectively, as compared with 69.3%, 68.9%, and 70.3%, respectively, in the first quarter of fiscal 2025.

Total gross margins by geographic segment were: 66.8% for the Americas, 71.9% for EMEA and 66.9% for APJC.

Operating Expenses -- On a GAAP basis, operating expenses were $6.4 billion, down 6% year over year, and were 42.9% of revenue. Non-GAAP operating expenses were $5.0 billion, up 3%, and were 33.7% of revenue.

Operating Income -- GAAP operating income was $3.4 billion, up 43%, with GAAP operating margin of 22.6%. Non-GAAP operating income was $5.1 billion, up 8%, with non-GAAP operating margin at 34.4%.

Provision for Income Taxes -- The GAAP tax provision rate was 15.7%. The non-GAAP tax provision rate was 19.0%.

Net Income and EPS -- On a GAAP basis, net income was $2.9 billion, an increase of 5%, and EPS was $0.72, an increase of 6%. On a non-GAAP basis, net income was $4.0 billion, an increase of 9%, and EPS was $1.00, an increase of 10%.

Cash Flow from Operating Activities -- $3.2 billion for the first quarter of fiscal 2026, a decrease of 12%, compared with $3.7 billion for the first quarter of fiscal 2025.

Balance Sheet and Other Financial Highlights

Cash and Cash Equivalents and Investments -- $15.7 billion at the end of the first quarter of fiscal 2026, compared with $16.1 billion at the end of fiscal 2025.

Remaining Performance Obligations (RPO) -- $42.9 billion, up 7% in total. Product RPO was up 10%, of which long-term RPO was $11.8 billion, up 13%. Services RPO was up 4%.

Deferred Revenue -- $28.0 billion, up 2% in total, with deferred product revenue up 2% and deferred services revenue up 1%.

Capital Allocation -- In the first quarter of fiscal 2026, we returned $3.6 billion to stockholders through share buybacks and dividends. We declared and paid a cash dividend of $0.41 per common share, or $1.6 billion, and repurchased approximately 29 million shares of common stock under our stock repurchase program at an average price of $68.28 per share for an aggregate purchase price of $2.0 billion. The remaining authorized amount for stock repurchases under the program is $12.2 billion with no termination date.

Acquisitions

In the first quarter of fiscal 2026, we closed the acquisition of Aura Asset Intelligence, an asset and risk intelligence (ARI) solution created by Discovered Intelligence, a privately held company based in Toronto, Canada.

Guidance

Cisco estimates the following results for the second quarter of fiscal 2026:

Margin and EPS guidance includes the estimated impact of tariffs based on current trade policy.

Cisco estimates that GAAP EPS will be $0.69 to $0.74 for the second quarter of fiscal 2026.

Cisco estimates the following results for fiscal 2026:

Margin and EPS guidance includes the estimated impact of tariffs based on current trade policy.

Cisco estimates that GAAP EPS will be $2.87 to $2.98 for fiscal 2026.

Our Q2 FY 2026 guidance assumes an effective tax provision rate of approximately 16% for GAAP and approximately 19% for non-GAAP results. Our FY 2026 guidance assumes an effective tax provision rate of approximately 17% for GAAP and approximately 19% for non-GAAP results.

A reconciliation between the guidance on a GAAP and non-GAAP basis is provided in the tables entitled "GAAP to non-GAAP Guidance" located in the section entitled "Reconciliations of GAAP to non-GAAP Measures."

Editor's Notes:

• Q1 fiscal year 2026 conference call to discuss Cisco's results along with its guidance will be held on Wednesday, November 12, 2025 at 1:30 p.m. Pacific Time. Conference call number is 1-888-848-6507 (United States) or 1-212-519-0847 (international).
• Conference call replay will be available from 4:00 p.m. Pacific Time, November 12, 2025 to 10:00 p.m. Pacific Time, November 18, 2025 at 1-800-839-2232 (United States) or 1-203-369-3662 (international). The replay will also be available via webcast on the Cisco Investor Relations website at https://investor.cisco.com.
• Additional information regarding Cisco's financials, as well as a webcast of the conference call with visuals designed to guide participants through the call, will be available at 1:30 p.m. Pacific Time, November 12, 2025. Text of the conference call's prepared remarks will be available within 24 hours of completion of the call. The webcast will include both the prepared remarks and the question-and-answer session. This information, along with the GAAP to non-GAAP reconciliation information, will be available on the Cisco Investor Relations website at https://investor.cisco.com.

Source: https://newsroom.cisco.com/c/r/newsroom/en/us/a/y2025/m11/cisco-reports-first-quarter-earnings.html