CISCO REPORTS SECOND QUARTER EARNINGS

Rhea-AI Summary

Cisco (NASDAQ: CSCO) reported Q2 FY2026 revenue of $15.3B (+10% YoY) and GAAP EPS of $0.80 (+31% YoY). Non-GAAP EPS was $1.04 (+11%). Product revenue rose 14% and Networking grew 21%. Product orders were up 18% and AI infrastructure orders totaled $2.1B. Cisco raised the quarterly dividend to $0.42 and returned $3.0B to shareholders in the quarter. Q3 revenue guidance is $15.4B–$15.6B and FY2026 revenue guidance is $61.2B–$61.7B.

Positive

• GAAP EPS +31% year‑over‑year to $0.80
• Product revenue +14% year‑over‑year
• Networking revenue +21% year‑over‑year
• Product orders +18% year‑over‑year; AI infrastructure orders $2.1B
• Returned $3.0B to shareholders via buybacks and dividends; dividend raised to $0.42

Negative

• Cash flow from operations down 19% year‑over‑year to $1.8B
• Inventories increased ~24% to $3.92B, raising working capital needs
• Short‑term debt increased from $5.23B to $8.72B, a ~67% rise

Key Figures

Q2 FY2026 revenue: $15.3 billion Q2 GAAP EPS: $0.80 Q2 Non-GAAP EPS: $1.04 +5 more

8 metrics

Q2 FY2026 revenue $15.3 billion Up 10% year over year; record quarterly revenue

Q2 GAAP EPS $0.80 Up 31% year over year; exceeded guidance high end

Q2 Non-GAAP EPS $1.04 Up 11% year over year; above guidance range

AI infrastructure orders $2.1 billion Orders from hyperscalers in Q2 FY2026

Product orders growth 18% year over year Total product orders in Q2 FY2026

Quarterly dividend $0.42 per share Increased 2% from prior $0.41; payable Apr 22, 2026

FY2026 revenue guidance $61.2–$61.7 billion Company guidance for fiscal 2026 revenue

FY2026 Non-GAAP EPS guide $4.13–$4.17 Company guidance for fiscal 2026 non-GAAP EPS

Market Reality Check

Price: $85.50 Vol: Volume 31,327,782 shares ...

normal vol

$85.50 Last Close

Volume Volume 31,327,782 shares is above the 20-day average of 22,965,024 shares (about 1.36x). normal

Technical Price at 86.27 is trading above its 200-day MA of 70.28 and 65.54% above the 52-week low, sitting 2.18% below the 52-week high.

Peers on Argus

CSCO slipped 0.56% with peers also down modestly (e.g., MSI -0.32%, HPE -0.17%, ...

CSCO slipped 0.56% with peers also down modestly (e.g., MSI -0.32%, HPE -0.17%, NOK -1.12%, ERIC -1.28%, UI -0.20%), indicating a mild sector-wide downdraft rather than a stock-specific move.

Previous Earnings Reports

5 past events · Latest: Nov 12 (Positive)

Same Type Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Nov 12	Q1 FY2026 earnings	Positive	+3.1%	Q1 FY2026 revenue and EPS growth with strong AI infrastructure demand.
Aug 13	Q4 & FY2025 earnings	Positive	-1.6%	Q4 and FY2025 growth and upbeat FY2026 outlook, but shares fell modestly.
May 14	Q3 FY2025 earnings	Positive	+4.8%	Q3 FY2025 beat with strong product orders and accelerating AI orders.
Feb 12	Q2 FY2025 earnings	Positive	+2.1%	Q2 FY2025 revenue beat, higher product orders, dividend increase, buyback auth.
Nov 13	Q1 FY2025 earnings	Negative	-2.1%	Q1 FY2025 revenue and EPS declines despite strong orders and margins.

Pattern Detected

Earnings releases have typically led to modestly positive reactions, with 4 of the last 5 tagged earnings events seeing price moves aligned with generally positive fundamentals.

Recent Company History

Over the last five earnings releases, Cisco has generally delivered year-over-year revenue and EPS growth, often exceeding guidance and highlighting expanding AI infrastructure orders and consistent capital returns via dividends and buybacks. Price reactions were usually positive, though one strong quarter with higher FY2026 guidance saw a mild negative move, showing that upbeat results do not always translate into immediate upside. Today’s Q2 FY2026 report continues the narrative of growth in networking and AI-focused demand.

Historical Comparison

earnings

+1.3 %

Average Historical Move

Historical Analysis

In the past five earnings releases, CSCO’s average move was about 1.28%. Today’s Q2 FY2026 results continue themes of revenue/EPS growth and expanding AI infrastructure demand.

Typical Pattern

Recent earnings show FY2026 revenue and EPS building from Q1 to Q2, with AI infrastructure orders rising from $1.3B in Q1 FY2026 to $2.1B this quarter and guidance for FY2026 raised versus prior outlooks.

Market Pulse Summary

This announcement details a robust Q2 FY2026, with record revenue of $15.3B, GAAP EPS of $0.80, and ...

Analysis

This announcement details a robust Q2 FY2026, with record revenue of $15.3B, GAAP EPS of $0.80, and non-GAAP EPS of $1.04, all growing double digits year over year. Product orders rose 18%, AI infrastructure orders reached $2.1B, and the quarterly dividend increased to $0.42. Historically, earnings releases have usually led to modestly positive moves. Investors may watch how FY2026 guidance of $61.2–$61.7B revenue and $4.13–$4.17 non-GAAP EPS evolves alongside AI demand and margin trends.

Key Terms

gaap, non-gaap, eps, gross margin, +4 more

8 terms

gaap financial

"net income on a generally accepted accounting principles (GAAP) basis of $3.2 billion"

GAAP, or Generally Accepted Accounting Principles, are a set of standardized rules and guidelines that companies follow when preparing their financial statements. They ensure consistency, transparency, and comparability across different companies, making it easier for investors to understand and compare financial information accurately. This helps investors make informed decisions based on trustworthy and uniform financial reports.

non-gaap financial

"and non-GAAP net income of $4.1 billion or $1.04 per share"

Non-GAAP refers to financial measures that companies use to show their earnings or performance without including certain expenses or income that are often added back to give a different picture. It matters because it can make a company's results look better or more favorable, but it may also hide important costs, so investors need to look at both GAAP (official rules) and non-GAAP numbers to get a full understanding.

eps financial

"GAAP EPS of $0.80, up 31% year over year; and Non-GAAP EPS of $1.04"

Earnings per share (EPS) measures how much profit a company makes for each outstanding share of its stock by dividing the company’s profit after expenses by the number of shares. It matters to investors because it shows how much of the company’s “pie” each share represents—higher EPS usually signals greater profitability per share, helps compare companies of different sizes, and influences stock valuations and investor decisions.

gross margin financial

"GAAP gross margin of 65.0% and Non-GAAP gross margin of 67.5%"

Gross margin is the difference between how much money a company makes from selling its products and how much it costs to produce them, expressed as a percentage of sales. It shows how efficiently a company is turning sales into profit before other expenses like marketing or salaries. Higher gross margin means the company keeps more money from each sale, which is a good sign of financial health.

operating margin financial

"GAAP operating margin of 24.6% and Non-GAAP operating margin of 34.6%"

Operating margin shows how much profit a company makes from its core business activities after paying for costs like wages and materials. It’s useful because it tells you how efficiently a company is running—higher margins mean it keeps more money from each dollar of sales, which can indicate better management or stronger products.

remaining performance obligations financial

"Remaining Performance Obligations (RPO)-- $43.4 billion, up 5% in total."

Remaining performance obligations are the work a company still needs to complete for its customers, like finishing a service or delivering a product. It’s important because it shows how much future income the company has coming in from current agreements, giving a clearer picture of its ongoing business.

deferred revenue financial

"Deferred Revenue -- $28.4 billion, up 2% in total"

Cash a company has already received for goods or services it has promised but not yet delivered; it's recorded as a liability because the company still owes that product, service, or future revenue recognition. For investors, deferred revenue signals upcoming work or deliveries that will convert into reported sales over time and affects short-term obligations, cash flow quality, and how quickly a firm can grow recognized revenue—think of it like prepaid subscriptions or gift cards a business must honor later.

stock repurchase program financial

"repurchased approximately 18 million shares of common stock under our stock repurchase program"

A stock repurchase program is when a company buys back its own shares from the market. This can make each remaining share more valuable and shows that the company believes its stock is a good investment. It’s like a business treating its shares like a limited resource, hoping to boost confidence and share prices.

AI-generated analysis. Not financial advice.

SAN JOSE, Calif., Feb. 11, 2026 /PRNewswire/ -- 

News Summary:

• • Double-digit top and bottom-line growth exceeding our guidance, with EPS growing faster than revenue
    • Record revenue of $15.3 billion, up 10% year over year; GAAP EPS of $0.80, up 31% year over year; and Non-GAAP EPS of $1.04, up 11% year over year
    • GAAP gross margin of 65.0% and Non-GAAP gross margin of 67.5%; GAAP operating margin of 24.6% and Non-GAAP operating margin of 34.6%, both above the high end of our guidance range
  • Accelerating, double-digit growth in product orders across all geographies and robust growth across all customer markets
    • Product orders up 18% year over year with networking product orders accelerating to more than 20% year over year
  • AI Infrastructure orders taken from hyperscalers totaled $2.1 billion, reflecting a significant acceleration in growth
  • Major multi-year, multi-billion-dollar campus networking refresh cycle underway
  • Dividend increased by 2% to $0.42 per share
• Q2 FY 2026 Results:
  • Revenue: $15.3 billion
    • Increase of 10% year over year
  • Earnings per Share: GAAP: $0.80; Non-GAAP: $1.04
    • GAAP EPS increased 31% year over year
    • Non-GAAP EPS increased 11% year over year
• Q3 FY 2026 Guidance ⁽¹⁾:   
  • Revenue: $15.4 billion to $15.6 billion
  • Earnings per Share: GAAP: $0.73 to $0.77; Non-GAAP: $1.02 to $1.04
• FY 2026 Guidance ⁽¹⁾:
  • Revenue: $61.2 billion to $61.7 billion
  • Earnings per Share: GAAP: $3.00 to $3.08; Non-GAAP: $4.13 to $4.17

(1)	EPS guidance includes the estimated impact of tariffs based on current trade policy.

Cisco (NASDAQ: CSCO) today reported second quarter results for the period ended January 24, 2026. Cisco reported second quarter revenue of $15.3 billion, net income on a generally accepted accounting principles (GAAP) basis of $3.2 billion or $0.80 per share, and non-GAAP net income of $4.1 billion or $1.04 per share.

"Cisco's strong second quarter and first half of fiscal 2026 demonstrate both the power of our portfolio and the fundamental role we continue to play in connecting and protecting customers in a rapidly evolving landscape," said Chuck Robbins, chair and CEO of Cisco. "With over 40 years of customer trust, global scale, and a relentless focus on innovation, we believe Cisco is uniquely positioned to deliver the trusted infrastructure needed to securely and confidently power the AI-era."

"In Q2, we delivered double-digit growth on both the top and bottom lines which exceeded the high end of our guidance and puts us on track to deliver our strongest revenue year yet in fiscal 2026," said Mark Patterson, CFO of Cisco. "Operating margin was also above the high end of guidance, as we continue to drive profitability by exercising financial discipline. We see strong, broad-based demand for our technology solutions and remain focused on capturing the significant opportunities we see ahead." 

GAAP Results
		Q2 FY 2026		Q2 FY 2025		vs. Q2 FY 2025
Revenue		$              15.3 billion		$              14.0 billion		10 %
Net Income		$                3.2 billion		$                2.4 billion		31 %
Diluted Earnings per Share (EPS)		$             0.80		$              0.61		31 %
Non-GAAP Results
		Q2 FY 2026		Q2 FY 2025		vs. Q2 FY 2025
Net Income		$              4.1   billion		$              3.8   billion		10 %
EPS		$            1.04		$            0.94		11 %

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 Increases Quarterly Dividend

Cisco has declared a quarterly dividend of $0.42 per common share, a 1-cent increase or up 2% over the previous quarter's dividend, to be paid on April 22, 2026, to all stockholders of record as of the close of business on April 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.

Q2 FY 2026 Highlights

Revenue -- Total revenue was $15.3 billion, up 10%, with product revenue up 14% and services revenue down 1%.

Revenue by geographic segment was: Americas up 8%, EMEA up 15%, and APJC up 8%. Product revenue performance reflected growth in Networking, up 21%, and Collaboration, up 6%. Security was down 4%. Observability was flat.

Gross Margin -- On a GAAP basis, total gross margin, product gross margin, and services gross margin were 65.0%, 63.9%, and 68.4%, respectively, as compared with 65.1%, 63.7%, and 68.9%, respectively, in the second quarter of fiscal 2025.

On a non-GAAP basis, total gross margin, product gross margin, and services gross margin were 67.5%, 66.4%, and 70.9%, respectively, as compared with 68.7%, 67.7%, and 71.6%, respectively, in the second quarter of fiscal 2025.

Total gross margins by geographic segment were: 65.8% for the Americas, 71.7% for EMEA and 65.8% for APJC.

Operating Expenses -- On a GAAP basis, operating expenses were $6.2 billion, up 3% year over year, and were 40.3% of revenue. Non-GAAP operating expenses were $5.0 billion, up 6%, and were 32.9% of revenue.

Operating Income -- GAAP operating income was $3.8 billion, up 21%, with GAAP operating margin of 24.6%. Non-GAAP operating income was $5.3 billion, up 9%, with non-GAAP operating margin at 34.6%.

Provision for Income Taxes -- The GAAP tax provision rate was 12.9%. The non-GAAP tax provision rate was 19.0%.

Net Income and EPS -- On a GAAP basis, net income was $3.2 billion, an increase of 31%, and EPS was $0.80, an increase of 31%. On a non-GAAP basis, net income was $4.1 billion, an increase of 10%, and EPS was $1.04, an increase of 11%.

Cash Flow from Operating Activities -- $1.8 billion for the second quarter of fiscal 2026, a decrease of 19%, compared with $2.2 billion for the second quarter of fiscal 2025.

Balance Sheet and Other Financial Highlights

Cash and Cash Equivalents and Investments -- $15.8 billion at the end of the second quarter of fiscal 2026, compared with $16.1 billion at the end of fiscal 2025.

Remaining Performance Obligations (RPO)-- $43.4 billion, up 5% in total. Product RPO was up 8%, of which long-term RPO was $11.8 billion, up 11%. Services RPO was up 2%.

Deferred Revenue -- $28.4 billion, up 2% in total, with deferred product revenue up 3% and deferred services revenue up 2%.

Capital Allocation -- In the second quarter of fiscal 2026, we returned $3.0 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 18 million shares of common stock under our stock repurchase program at an average price of $76.29 per share for an aggregate purchase price of $1.4 billion. The remaining authorized amount for stock repurchases under the program is $10.8 billion with no termination date.

Acquisitions

In the second quarter of fiscal 2026, we closed the following acquisitions:

• NeuralFabric Corp., a privately held enterprise AI platform company
• EzDubs, Inc., a privately held AI software company

Guidance

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

Q3 FY 2026
Revenue		$15.4 billion - $15.6 billion
Non-GAAP gross margin		65.5% - 66.5%
Non-GAAP operating margin		33.5% - 34.5%
Non-GAAP EPS		$1.02 - $1.04

Cisco estimates that GAAP EPS will be $0.73 to $0.77 for the third quarter of fiscal 2026.

Cisco estimates the following results for fiscal 2026:

FY 2026
Revenue		$61.2 billion - $61.7 billion
Non-GAAP EPS		$4.13 - $4.17

Cisco estimates that GAAP EPS will be $3.00 to $3.08 for fiscal 2026.

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

Our Q3 FY 2026 guidance assumes an effective tax provision rate of approximately 17% for GAAP and approximately 19% for non-GAAP results. Our FY 2026 guidance assumes an effective tax provision rate of approximately 16% 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:

• Q2 fiscal year 2026 conference call to discuss Cisco's results along with its guidance will be held on Wednesday, February 11, 2026 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, February 11, 2026 to 10:00 p.m. Pacific Time, February 17, 2026 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, February 11, 2026. 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. 

CISCO SYSTEMS, INC CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per-share amounts) (Unaudited)
	Three Months Ended				Six Months Ended
	January 24, 2026		January 25, 2025		January 24, 2026		January 25, 2025
REVENUE:
Product	$      11,642		$      10,234		$      22,719		$      20,348
Services	3,707		3,757		7,513		7,484
Total revenue	15,349		13,991		30,232		27,832
COST OF SALES:
Product	4,205		3,713		8,139		7,239
Services	1,172		1,167		2,376		2,361
Total cost of sales	5,377		4,880		10,515		9,600
GROSS MARGIN	9,972		9,111		19,717		18,232
OPERATING EXPENSES:
Research and development	2,355		2,299		4,755		4,585
Sales and marketing	2,881		2,672		5,752		5,424
General and administrative	688		752		1,421		1,547
Amortization of purchased intangible assets	231		265		462		530
Restructuring and other charges	36		10		183		675
Total operating expenses	6,191		5,998		12,573		12,761
OPERATING INCOME	3,781		3,113		7,144		5,471
Interest income	210		238		432		524
Interest expense	(370)		(404)		(720)		(822)
Other income (loss), net	25		(60)		181		(19)
Interest and other income (loss), net	(135)		(226)		(107)		(317)
INCOME BEFORE PROVISION FOR INCOME TAXES	3,646		2,887		7,037		5,154
Provision for income taxes	471		459		1,002		15
NET INCOME	$         3,175		$         2,428		$         6,035		$         5,139
Net income per share:
Basic	$           0.80		$           0.61		$           1.53		$           1.29
Diluted	$           0.80		$           0.61		$           1.51		$           1.28
Shares used in per-share calculation:
Basic	3,955		3,981		3,955		3,986
Diluted	3,984		4,005		3,987		4,008

 

CISCO SYSTEMS, INC REVENUE BY SEGMENT (In millions, except percentages)
		January 24, 2026
		Three Months Ended				Six Months Ended
		Amount		Y/Y %		Amount		Y/Y %
Revenue:
Americas		$         8,845		8 %		$      17,834		8 %
EMEA		4,425		15 %		8,208		10 %
APJC		2,080		8 %		4,191		7 %
Total		$      15,349		10 %		$      30,232		9 %

Amounts may not sum and percentages may not recalculate due to rounding.

 

CISCO SYSTEMS, INC GROSS MARGIN PERCENTAGE BY SEGMENT (In percentages)
		January 24, 2026
		Three Months Ended		Six Months Ended
Gross Margin Percentage:
Americas		65.8 %		66.3 %
EMEA		71.7 %		71.8 %
APJC		65.8 %		66.4 %

 

CISCO SYSTEMS, INC REVENUE FOR GROUPS OF SIMILAR PRODUCTS AND SERVICES (In millions, except percentages)
		January 24, 2026
		Three Months Ended				Six Months Ended
		Amount		Y/Y %		Amount		Y/Y %
Revenue:
Networking		$       8,294		21 %		$      16,061		18 %
Security		2,018		(4) %		3,998		(3) %
Collaboration		1,054		6 %		2,109		1 %
Observability		277		— %		550		3 %
Total Product		11,642		14 %		22,719		12 %
Services		3,707		(1) %		7,513		— %
Total		$     15,349		10 %		$      30,232		9 %

Amounts may not sum and percentages may not recalculate due to rounding.

 

CISCO SYSTEMS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In millions) (Unaudited)
	January 24, 2026		July 26, 2025
ASSETS
Current assets:
Cash and cash equivalents	$                7,458		$                8,346
Investments	8,319		7,764
Accounts receivable, net of allowance of $76 at January 24, 2026 and $69 at July 26, 2025	6,606		6,701
Inventories	3,920		3,164
Financing receivables, net	2,944		3,061
Other current assets	5,884		5,950
Total current assets	35,131		34,986
Property and equipment, net	2,351		2,113
Financing receivables, net	3,698		3,466
Goodwill	59,234		59,136
Purchased intangible assets, net	8,307		9,175
Deferred tax assets	7,399		7,356
Other assets	7,251		6,059
TOTAL ASSETS	$            123,371		$            122,291
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt	$                8,719		$                5,232
Accounts payable	2,762		2,528
Income taxes payable	195		1,857
Accrued compensation	3,494		3,611
Deferred revenue	16,199		16,416
Other current liabilities	5,417		5,420
Total current liabilities	36,786		35,064
Long-term debt	21,367		22,861
Income taxes payable	2,124		2,165
Deferred revenue	12,204		12,363
Other long-term liabilities	3,167		2,995
Total liabilities	75,648		75,448
Total equity	47,723		46,843
TOTAL LIABILITIES AND EQUITY	$            123,371		$            122,291

 

CISCO SYSTEMS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (Unaudited)
	Three Months Ended				Six Months Ended
	January 24, 2026		January 25, 2025		January 24, 2026		January 25, 2025
Cash flows from operating activities:
Net income	$          3,175		$          2,428		$          6,035		$          5,139
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, and other	659		761		1,265		1,550
Share-based compensation expense	934		921		1,989		1,748
Provision for receivables	12		8		9		7
Deferred income taxes	(89)		(101)		(64)		(382)
(Gains) losses on divestitures, investments and other, net	(59)		55		(237)		(5)
Change in operating assets and liabilities, net of effects of acquisitions and divestitures:
Accounts receivable	(1,803)		(1,258)		54		969
Inventories	(527)		212		(761)		441
Financing receivables	192		157		(120)		330
Other assets	(50)		(237)		(642)		(427)
Accounts payable	344		(90)		236		(359)
Income taxes, net	(2,375)		(1,479)		(2,503)		(2,285)
Accrued compensation	419		461		(120)		(293)
Deferred revenue	433		416		(290)		(555)
Other liabilities	557		(13)		183		24
Net cash provided by operating activities	1,822		2,241		5,034		5,902
Cash flows from investing activities:
Purchases of investments	(2,244)		(486)		(4,228)		(2,261)
Proceeds from sales of investments	176		301		1,445		1,791
Proceeds from maturities of investments	1,081		1,539		2,303		2,703
Acquisitions, net of cash and cash equivalents acquired and divestitures	(39)		(40)		(46)		(257)
Purchases of investments in privately held companies	(47)		(95)		(65)		(137)
Return of investments in privately held companies	36		17		55		94
Acquisition of property and equipment	(283)		(210)		(606)		(427)
Other	14		(4)		(8)		(5)
Net cash provided by (used in) investing activities	(1,306)		1,022		(1,150)		1,501
Cash flows from financing activities:
Issuances of common stock	354		320		354		320
Repurchases of common stock - repurchase program	(1,363)		(1,240)		(3,355)		(3,243)
Shares repurchased for tax withholdings on vesting of restricted stock units	(784)		(490)		(1,068)		(655)
Short-term borrowings, original maturities of 90 days or less, net	(510)		944		750		1,012
Issuances of debt	2,682		4,674		4,241		10,406
Repayments of debt	(204)		(6,561)		(2,992)		(11,382)
Dividends paid	(1,617)		(1,593)		(3,234)		(3,185)
Other	3		1		2		(2)
Net cash used in financing activities	(1,439)		(3,945)		(5,302)		(6,729)
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents	(19)		(18)		(33)		(8)
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents	(942)		(700)		(1,451)		666
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of period	8,401		10,208		8,910		8,842
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period	$          7,459		$          9,508		$          7,459		$          9,508
Supplemental cash flow information:
Cash paid for interest	$               85		$             224		$             701		$             769
Cash paid for income taxes, net	$          2,935		$          2,039		$          3,569		$          2,682

 

CISCO SYSTEMS, INC. REMAINING PERFORMANCE OBLIGATIONS (In millions, except percentages)
	January 24, 2026				October 25, 2025				January 25, 2025
	Amount		Y/Y%		Amount		Y/Y%		Amount		Y/Y%
Product (1)	$    21,977		8 %		$    21,904		10 %		$    20,321		25 %
Services	21,429		2 %		20,969		4 %		20,947		8 %
Total	$    43,406		5 %		$    42,873		7 %		$    41,268		16 %

(1)	As of the end of the second quarter of fiscal 2026, long-term product RPO was $11.8 billion, up 11% year over year.

 

CISCO SYSTEMS, INC. DEFERRED REVENUE (In millions)
	January 24, 2026		October 25, 2025		January 25, 2025
Deferred revenue:
Product	$      13,371		$      13,252		$      13,033
Services	15,032		14,717		14,762
Total	$      28,403		$      27,969		$      27,795
Reported as:
Current	$      16,199		$      15,801		$      15,999
Noncurrent	12,204		12,168		11,796
Total	$      28,403		$      27,969		$      27,795

 

CISCO SYSTEMS, INC. DIVIDENDS PAID AND REPURCHASES OF COMMON STOCK (In millions, except per-share amounts)
		DIVIDENDS				STOCK REPURCHASE PROGRAM						TOTAL
Quarter Ended		Per Share		Amount		Shares		Weighted- Average Price per Share		Amount		Amount
Fiscal 2026
January 24, 2026		$            0.41		$          1,617		18		$          76.29		$          1,351		$          2,968
October 25, 2025		$            0.41		$          1,617		29		$          68.28		$          2,001		$          3,618
Fiscal 2025
July 26, 2025		$            0.41		$          1,625		19		$          64.65		$          1,252		$          2,877
April 26, 2025		$            0.41		$          1,627		25		$          59.78		$          1,504		$          3,131
January 25, 2025		$            0.40		$          1,593		21		$          58.58		$          1,236		$          2,829
October 26, 2024		$            0.40		$          1,592		40		$          49.56		$          2,003		$          3,595

 

CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES
GAAP TO NON-GAAP NET INCOME (In millions)
	Three Months Ended				Six Months Ended
	January 24, 2026		January 25, 2025		January 24, 2026		January 25, 2025
GAAP net income	$           3,175		$          2,428		$          6,035		$          5,139
Adjustments to cost of sales:
Share-based compensation expense	151		151		301		282
Amortization of acquisition-related intangible assets	228		335		461		654
Acquisition/divestiture-related costs	6		17		14		36
Total adjustments to GAAP cost of sales	385		503		776		972
Adjustments to operating expenses:
Share-based compensation expense	782		765		1,666		1,444
Amortization of acquisition-related intangible assets	231		265		462		530
Acquisition/divestiture-related costs	96		205		199		490
Significant asset impairments and restructurings	36		10		183		675
Total adjustments to GAAP operating expenses	1,145		1,245		2,510		3,139
Adjustments to interest and other income (loss), net:
(Gains) and losses on investments	(61)		7		(256)		(91)
Total adjustments to GAAP interest and other income (loss), net	(61)		7		(256)		(91)
Total adjustments to GAAP income before provision for income taxes	1,469		1,755		3,030		4,020
Income tax effect of non-GAAP adjustments	(442)		(423)		(779)		(899)
Significant tax matters	(59)		—		(132)		(829)
Total adjustments to GAAP provision for income taxes	(501)		(423)		(911)		(1,728)
Non-GAAP net income	$           4,143		$          3,760		$          8,154		$          7,431

 

CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES
GAAP TO NON-GAAP EPS
	Three Months Ended				Six Months Ended
	January 24, 2026		January 25, 2025		January 24, 2026		January 25, 2025
GAAP EPS	$             0.80		$             0.61		$             1.51		$             1.28
Adjustments to GAAP:
Share-based compensation expense	0.23		0.23		0.49		0.43
Amortization of acquisition-related intangible assets	0.12		0.15		0.23		0.30
Acquisition/divestiture-related costs	0.03		0.06		0.05		0.13
Significant asset impairments and restructurings	0.01		—		0.05		0.17
(Gains) and losses on investments	(0.02)		—		(0.06)		(0.02)
Income tax effect of non-GAAP adjustments	(0.11)		(0.11)		(0.20)		(0.22)
Significant tax matters	(0.01)		—		(0.03)		(0.21)
Non-GAAP EPS	$             1.04		$             0.94		$             2.05		$             1.85

Amounts may not sum due to rounding.

 

CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES
GROSS MARGINS, OPERATING EXPENSES, OPERATING MARGINS, INTEREST AND OTHER INCOME (LOSS), NET, AND NET INCOME (In millions, except percentages)
	Three Months Ended
	January 24, 2026
	Product Gross Margin		Services Gross Margin		Total Gross Margin		Operating Expenses		Y/Y		Operating Income		Y/Y		Interest and other income (loss), net		Net Income		Y/Y
GAAP amount	$ 7,437		$ 2,535		$ 9,972		$ 6,191		3 %		$ 3,781		21 %		$ (135)		$ 3,175		31 %
% of revenue	63.9 %		68.4 %		65.0 %		40.3 %				24.6 %				(0.9) %		20.7 %
Adjustments to GAAP amounts:
Share-based compensation expense	63		88		151		782				933				—		933
Amortization of acquisition-related intangible assets	228		—		228		231				459				—		459
Acquisition/divestiture-related costs	2		4		6		96				102				—		102
Significant asset impairments and restructurings	—		—		—		36				36				—		36
(Gains) and losses on investments	—		—		—		—				—				(61)		(61)
Income tax effect/significant tax matters	—		—		—		—				—				—		(501)
Non-GAAP amount	$ 7,730		$ 2,627		$ 10,357		$ 5,046		6 %		$ 5,311		9 %		$ (196)		$ 4,143		10 %
% of revenue	66.4 %		70.9 %		67.5 %		32.9 %				34.6 %				(1.3) %		27.0 %

              

	Three Months Ended
	January 25, 2025
	Product Gross Margin		Services Gross Margin		Total Gross Margin		Operating Expenses		Operating Income		Interest and other income (loss), net		Net Income
GAAP amount	$   6,521		$   2,590		$   9,111		$   5,998		$   3,113		$    (226)		$   2,428
% of revenue	63.7 %		68.9 %		65.1 %		42.9 %		22.3 %		(1.6) %		17.4 %
Adjustments to GAAP amounts:
Share-based compensation expense	65		86		151		765		916		—		916
Amortization of acquisition-related intangible assets	335		—		335		265		600		—		600
Acquisition/divestiture-related costs	3		14		17		205		222		—		222
Significant asset impairments and restructurings	—		—		—		10		10		—		10
(Gains) and losses on investments	—		—		—		—		—		7		7
Income tax effect/significant tax matters	—		—		—		—		—		—		(423)
Non-GAAP amount	$   6,924		$   2,690		$   9,614		$   4,753		$   4,861		$    (219)		$   3,760
% of revenue	67.7 %		71.6 %		68.7 %		34.0 %		34.7 %		(1.6) %		26.9 %

Amounts may not sum and percentages may not recalculate due to rounding.

 

CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES
GROSS MARGINS, OPERATING EXPENSES, OPERATING MARGINS, INTEREST AND OTHER INCOME (LOSS), NET, AND NET INCOME (In millions, except percentages)
	Six Months Ended
	January 24, 2026
	Product Gross Margin		Services Gross Margin		Total Gross Margin		Operating Expenses		Y/Y		Operating Income		Y/Y		Interest and other income (loss), net		Net Income		Y/Y
GAAP amount	$ 14,580		$ 5,137		$ 19,717		$ 12,573		(1) %		$ 7,144		31 %		$ (107)		$ 6,035		17 %
% of revenue	64.2 %		68.4 %		65.2 %		41.6 %				23.6 %				(0.4) %		20.0 %
Adjustments to GAAP amounts:
Share-based compensation expense	131		170		301		1,666				1,967				—		1,967
Amortization of acquisition-related intangible assets	461		—		461		462				923				—		923
Acquisition/divestiture-related costs	4		10		14		199				213				—		213
Significant asset impairments and restructurings	—		—		—		183				183				—		183
(Gains) and losses on investments	—		—		—		—				—				(256)		(256)
Income tax effect/significant tax matters	—		—		—		—				—				—		(911)
Non-GAAP amount	$ 15,176		$ 5,317		$ 20,493		$ 10,063		5 %		$ 10,430		9 %		$ (363)		$ 8,154		10 %
% of revenue	66.8 %		70.8 %		67.8 %		33.3 %				34.5 %				(1.2) %		27.0 %

              

	Six Months Ended
	January 25, 2025
	Product Gross Margin		Services Gross Margin		Total Gross Margin		Operating Expenses		Operating Income		Interest and other income (loss), net		Net Income
GAAP amount	$ 13,109		$   5,123		$ 18,232		$ 12,761		$   5,471		$    (317)		$   5,139
% of revenue	64.4 %		68.5 %		65.5 %		45.9 %		19.7 %		(1.1) %		18.5 %
Adjustments to GAAP amounts:
Share-based compensation expense	122		160		282		1,444		1,726		—		1,726
Amortization of acquisition-related intangible assets	654		—		654		530		1,184		—		1,184
Acquisition/divestiture-related costs	8		28		36		490		526		—		526
Significant asset impairments and restructurings	—		—		—		675		675		—		675
(Gains) and losses on investments	—		—		—		—		—		(91)		(91)
Income tax effect/significant tax matters	—		—		—		—		—		—		(1,728)
Non-GAAP amount	$ 13,893		$   5,311		$ 19,204		$   9,622		$   9,582		$    (408)		$   7,431
% of revenue	68.3 %		71.0 %		69.0 %		34.6 %		34.4 %		(1.5) %		26.7 %

Amounts may not sum and percentages may not recalculate due to rounding.

 

CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES
EFFECTIVE TAX RATE (In percentages)
	Three Months Ended				Six Months Ended
	January 24, 2026		January 25, 2025		January 24, 2026		January 25, 2025
GAAP effective tax rate	12.9 %		15.9 %		14.2 %		0.3 %
Total adjustments to GAAP provision for income taxes	6.1 %		3.1 %		4.8 %		18.7 %
Non-GAAP effective tax rate	19.0 %		19.0 %		19.0 %		19.0 %

 

GAAP TO NON-GAAP GUIDANCE
Q3 FY 2026		Gross Margin Rate		Operating Margin Rate		Earnings per Share (1)
GAAP		63% - 64%		24% - 25%		$0.73 - $0.77
Estimated adjustments for:
Share-based compensation expense		1.0 %		6.0 %		$0.17 - $0.18
Amortization of acquisition-related intangible assets and acquisition/divestiture-related costs		1.5 %		3.5 %		$0.10 - $0.11
Non-GAAP		65.5% - 66.5%		33.5% - 34.5%		$1.02 - $1.04
FY 2026						Earnings per Share (1)
GAAP						$3.00 - $3.08
Estimated adjustments for:
Share-based compensation expense						$0.70 - $0.72
Amortization of acquisition-related intangible assets and acquisition/divestiture-related costs						$0.43 - $0.45
Significant asset impairments and restructurings						$0.04
(Gains) and losses on investments						($0.05)
Significant tax matters						($0.03)
Non-GAAP						$4.13 - $4.17

(1)	Estimated adjustments to GAAP earnings per share are shown after income tax effects.

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

Except as noted above, this guidance does not include the effects of any future acquisitions/divestitures, significant asset impairments and restructurings, significant litigation settlements and other contingencies, gains and losses on investments, significant tax matters, or other items, which may or may not be significant.

Forward Looking Statements, Non-GAAP Information and Additional Information

This release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events (such as our belief in our unique position to deliver the trusted infrastructure needed to securely and confidently power the AI-era, continuing to drive profitability by exercising financial discipline, and the strong, broad-based demand for our technology solutions as we remain focused on capturing the significant opportunities ahead) and the future financial performance of Cisco (including the guidance for Q3 FY 2026 and full year FY 2026) that involve risks and uncertainties, such as the actual impact of tariffs on our guidance for Q3 FY 2026 and full year FY 2026. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results due to a variety of factors, including: business and economic conditions and growth trends in the networking industry, our customer markets and various geographic regions; global economic conditions and uncertainties in the geopolitical environment; our development and use of artificial intelligence; overall information technology spending; the growth and evolution of the Internet and levels of capital spending on Internet-based systems; variations in customer demand for products and services, including sales to the service provider market, cloud, enterprise and other customer markets; the return on our investments in certain key priority areas, and in certain geographical locations, as well as maintaining leadership in Networking and services; the timing of orders and manufacturing and customer lead times; supply constraints; changes in customer order patterns or customer mix; insufficient, excess or obsolete inventory; variability of component costs; variations in sales channels, product costs or mix of products sold; our ability to successfully acquire businesses and technologies and to successfully integrate and operate these acquired businesses and technologies; our ability to achieve expected benefits of our partnerships; increased competition in our product and services markets, including the data center market; dependence on the introduction and market acceptance of new product offerings and standards; rapid technological and market change; manufacturing and sourcing risks; product defects and returns; litigation involving patents, other intellectual property, antitrust, stockholder and other matters, and governmental investigations; our ability to achieve the benefits of restructurings and possible changes in the size and timing of related charges; cyber attacks, data breaches or other incidents; vulnerabilities and critical security defects; our ability to protect personal data; evolving regulatory uncertainty; terrorism; natural catastrophic events (including as a result of global climate change); any pandemic or epidemic; our ability to achieve the benefits anticipated from our investments in sales, engineering, service, marketing and manufacturing activities; our ability to recruit and retain key personnel; our ability to manage financial risk, and to manage expenses during economic downturns; risks related to the global nature of our operations, including our operations in emerging markets; currency fluctuations and other international factors; changes in provision for income taxes, including changes in tax laws and regulations or adverse outcomes resulting from examinations of our income tax returns; potential volatility in operating results; and other factors listed in Cisco's most recent reports on Forms 10-Q and 10-K filed on November 18, 2025 and September 3, 2025, respectively. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes thereto included in Cisco's most recent reports on Forms 10-Q and 10-K as each may be amended from time to time. Cisco's results of operations for the three and six months ended January 24, 2026 are not necessarily indicative of Cisco's operating results for any future periods. Any projections in this release are based on limited information currently available to Cisco, which is subject to change. Although any such projections and the factors influencing them will likely change, Cisco will not necessarily update the information, since Cisco will only provide guidance at certain points during the year. Such information speaks only as of the date of this release.

This release includes non-GAAP net income, non-GAAP gross margins, non-GAAP operating expenses, non-GAAP operating income and margin, non-GAAP effective tax rates, non-GAAP interest and other income (loss), net, and non-GAAP net income per share data for the periods presented. It also includes future estimated ranges for gross margin, operating margin, tax provision rate and EPS on a non-GAAP basis.

These non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles (GAAP) and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Cisco believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Cisco's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Cisco's results of operations in conjunction with the corresponding GAAP measures.

Cisco believes that the presentation of non-GAAP measures when shown in conjunction with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations.

For its internal budgeting process, Cisco's management uses financial statements that do not include, when applicable, share-based compensation expense, amortization of acquisition-related intangible assets, acquisition/divestiture-related costs, significant asset impairments and restructurings, significant litigation settlements and other contingencies, gains and losses on investments, the income tax effects of the foregoing and significant tax matters. Cisco's management also uses the foregoing non-GAAP measures, in addition to the corresponding GAAP measures, in reviewing the financial results of Cisco. In prior periods, Cisco has excluded other items that it no longer excludes for purposes of its non-GAAP financial measures. From time to time in the future there may be other items that Cisco may exclude for purposes of its internal budgeting process and in reviewing its financial results. For additional information on the items excluded by Cisco from one or more of its non-GAAP financial measures, refer to the Form 8-K regarding this release furnished today to the Securities and Exchange Commission.

About Cisco

Cisco (NASDAQ: CSCO) is the worldwide technology leader that is revolutionizing the way organizations connect and protect in the AI era. For more than 40 years, Cisco has securely connected the world. With its industry leading AI-powered solutions and services, Cisco enables its customers, partners and communities to unlock innovation, enhance productivity and strengthen digital resilience. With purpose at its core, Cisco remains committed to creating a more connected and inclusive future for all. Discover more on The Newsroom and follow us on X at @Cisco.

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FAQ

What were Cisco (CSCO) Q2 FY2026 revenue and EPS results announced on February 11, 2026?

Cisco reported Q2 revenue of $15.3B and GAAP EPS of $0.80. According to the company, revenue grew 10% year‑over‑year and GAAP EPS increased 31% year‑over‑year.

How did Cisco's product and networking revenue perform in Q2 FY2026 (CSCO)?

Product revenue rose 14% and Networking revenue grew 21% year‑over‑year. According to the company, networking strength drove much of the product revenue acceleration.

What guidance did Cisco (CSCO) give for Q3 FY2026 and full fiscal 2026 revenue?

Cisco guided Q3 revenue to $15.4B–$15.6B and FY2026 revenue to $61.2B–$61.7B. According to the company, guidance incorporates estimated tariff impacts under current trade policy.

How much capital did Cisco (CSCO) return to shareholders in Q2 FY2026 and did it change the dividend?

Cisco returned $3.0B via buybacks and dividends and raised the quarterly dividend to $0.42. According to the company, the dividend increase is 2% over the prior quarter.

Were there any cash‑flow or balance sheet concerns for Cisco (CSCO) in Q2 FY2026?

Operating cash flow fell 19% to $1.8B and inventories rose to $3.92B, increasing working capital. According to the company, cash and investments remain about $15.8B despite these shifts.