Cisco Systems (CSCO) AI Stock Analysis

• Market Cap: $285.90B
• Dividend Yield: 2.26%
• Average Volume (3M): 17.78M
• Price to Earnings (P/E): 28.4
• Beta (1Y): 0.84
• Revenue Growth: 5.30%
• EPS Growth: 3.07%
• Country: US
• Employees: 90,400
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): 0.99
• Shares Outstanding: 3,953,197,000
• 10 Day Avg. Volume: 17,599,593
• 30 Day Avg. Volume: 17,777,830
• PEG Ratio: 8.33
• Price to Book (P/B): 5.83
• Price to Sales (P/S): 4.82
• P/FCF Ratio: 20.55
• Enterprise Value/Market Cap: 1.00
• Enterprise Value/Revenue: 5.06
• Enterprise Value/Gross Profit: 7.77
• Enterprise Value/Ebitda: 18.07
• 1Y Price Target: $78.55
• Price Target Upside: 8.95% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: $79.00 ▲(9.57% Upside)

Cisco's overall stock score is driven by its solid financial performance and positive earnings call sentiment, highlighting strong growth in AI infrastructure and strategic innovation. Technical analysis supports a stable outlook, while valuation concerns are mitigated by a reasonable dividend yield. The company's strategic focus on AI and innovation positions it well for future growth, despite challenges in certain segments.

Positive Factors

AI Infrastructure Growth

The significant increase in AI infrastructure orders indicates Cisco's strategic positioning in a rapidly growing market, enhancing its competitive edge and potential for future revenue growth.

Strong Cash Flow

Robust cash flow allows Cisco to return significant capital to shareholders, indicating strong financial health and the ability to reinvest in growth opportunities.

Innovation and AI Integration

Continued innovation and AI integration demonstrate Cisco's commitment to staying at the forefront of technology, which is crucial for maintaining its market leadership.

Negative Factors

Operating Margin Pressure

Declining operating margins may indicate cost pressures or inefficiencies, potentially impacting Cisco's profitability and ability to sustain competitive pricing.

Flat Services Revenue

Flat services revenue suggests challenges in expanding this segment, which could limit growth potential in a market increasingly focused on service-based solutions.

Security Growth Challenges

Challenges in growing the security segment may hinder Cisco's ability to capitalize on increasing cybersecurity demands, affecting long-term revenue diversification.

Cisco Systems Business Overview & Revenue Model

Company Description

Cisco Systems, Inc. is a global leader in networking and cybersecurity solutions, primarily serving enterprise and service provider markets. The company is headquartered in San Jose, California, and operates in various sectors including cloud computing, the Internet of Things (IoT), collaboration, and data center technologies. Cisco's core products and services encompass routing and switching hardware, security software, collaboration tools such as Webex, and comprehensive networking solutions designed to enhance connectivity and improve operational efficiency for businesses worldwide.

How the Company Makes Money

Cisco generates revenue primarily through the sale of hardware, software, and services. Key revenue streams include the sale of networking equipment such as routers and switches, which are essential for data traffic management. Additionally, the company earns substantial income from its software solutions, particularly in areas like cybersecurity and cloud services, as enterprises increasingly move towards digital transformation. Subscription-based services, particularly for collaboration tools and security solutions, represent a growing segment of Cisco's revenue model. Furthermore, Cisco often enters into strategic partnerships with other technology providers and enterprises, enhancing its product offerings and market reach, which contributes significantly to its overall earnings. This multi-faceted approach allows Cisco to maintain a strong presence in the tech industry and adapt to changing market demands.

Cisco Systems Financial Statement Overview

Summary

Cisco Systems exhibits solid financial performance with steady revenue growth, strong profitability, and efficient cash flow management. Minor concerns include operating margin pressures and moderate leverage, but overall financial health remains robust.

Income Statement

Cisco Systems has demonstrated consistent revenue growth with a 1.85% increase in the latest year. The company maintains strong profitability with a gross profit margin of 63.87% and a net profit margin of 18.45%. However, there is a slight decline in EBIT and EBITDA margins compared to previous years, indicating potential pressure on operating efficiency.

Balance Sheet

The balance sheet reflects a stable financial position with a manageable debt-to-equity ratio of 0.60, indicating moderate leverage. Return on equity remains robust at 22.19%, showcasing effective utilization of shareholder funds. However, the equity ratio suggests a moderate reliance on debt financing.

Cash Flow

Cisco's cash flow position is strong, with a 3.79% growth in free cash flow, indicating healthy cash generation. The operating cash flow to net income ratio of 0.40 suggests efficient cash conversion, while the free cash flow to net income ratio of 0.94 highlights substantial cash retention relative to earnings.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	56.65B	56.65B	53.80B	57.00B	51.56B	49.82B
Gross Profit	36.90B	36.18B	34.83B	35.75B	32.25B	31.89B
EBITDA	15.86B	15.86B	15.75B	17.47B	16.79B	15.56B
Net Income	10.45B	10.45B	10.32B	12.61B	11.81B	10.59B
Balance Sheet
Total Assets	122.29B	122.29B	124.41B	101.85B	94.00B	97.50B
Cash, Cash Equivalents and Short-Term Investments	17.24B	17.24B	19.37B	26.34B	19.27B	24.52B
Total Debt	29.64B	29.64B	32.23B	9.41B	10.56B	12.69B
Total Liabilities	75.45B	75.45B	78.96B	57.50B	54.23B	56.22B
Stockholders Equity	46.84B	46.84B	45.46B	44.35B	39.77B	41.27B
Cash Flow
Free Cash Flow	13.29B	13.29B	10.21B	19.04B	12.75B	14.76B
Operating Cash Flow	14.19B	14.19B	10.88B	19.89B	13.23B	15.45B
Investing Cash Flow	1.73B	1.73B	-20.48B	-5.11B	1.55B	-5.29B
Financing Cash Flow	-15.81B	-15.81B	6.84B	-11.63B	-15.96B	-12.10B

Cisco Systems Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 72.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSCO, the sentiment is Positive. The current price of 72.1 is above the 20-day moving average (MA) of 70.80, above the 50-day MA of 68.90, and above the 200-day MA of 64.27, indicating a bullish trend. The MACD of 1.20 indicates Negative momentum. The RSI at 57.06 is Neutral, neither overbought nor oversold. The STOCH value of 60.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CSCO.

Cisco Systems Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ANET	83 Outperform	$192.99B	60.38	31.74%	―	27.75%	25.42%
CSCO	79 Outperform	$285.90B	28.40	22.65%	2.26%	5.30%	3.07%
FTNT	78 Outperform	$65.30B	34.32	165.17%	―	14.46%	48.06%
NOK	74 Outperform	$37.74B	38.32	4.03%	2.29%	5.05%	115.92%
HPE	72 Outperform	$31.09B	29.75	5.37%	2.19%	14.39%	-38.96%
FFIV	64 Neutral	$13.87B	20.45	20.60%	―	9.66%	23.87%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Cisco Systems Corporate Events

Cisco Systems Director Wesley G. Bush to Depart

On October 15, 2025, Wesley G. Bush informed Cisco Systems of his decision not to seek re-election at the company’s 2025 annual stockholders meeting. He will continue his role as a director until the meeting, marking a notable change in the board’s composition.

The most recent analyst rating on (CSCO) stock is a Buy with a $79.00 price target. To see the full list of analyst forecasts on Cisco Systems stock, see the CSCO Stock Forecast page.

Cisco’s Earnings Call: AI Growth and Challenges

Cisco’s recent Q4 earnings call highlighted a strong financial performance, marked by significant growth in AI infrastructure orders and robust overall product orders. While the company showcased impressive innovation and strategic partnerships, challenges such as a decline in public sector orders and stagnant services revenue tempered the positive results. Despite these hurdles, Cisco’s strategic positioning and focus on AI integration suggest a promising outlook for future growth.

Cisco Systems Amends Bylaws for Director Nominations

On August 21, 2025, Cisco Systems‘ Board of Directors amended the company’s bylaws to address deficiencies in director nomination notices submitted by stockholders. These amendments, which became effective immediately, include a cure process for such deficiencies and incorporate ministerial changes for clarity and consistency, potentially impacting shareholder engagement and governance processes.

The most recent analyst rating on (CSCO) stock is a Buy with a $73.00 price target. To see the full list of analyst forecasts on Cisco Systems stock, see the CSCO Stock Forecast page.

Cisco Reports Strong Q4 and FY 2025 Earnings

Cisco Systems, Inc., a global leader in networking and cybersecurity solutions, continues to drive innovation in the technology sector, providing cutting-edge AI-powered solutions and services to enhance connectivity and digital resilience worldwide.