Summary
Cisco Systems, Inc. (CSCO) reported solid performance for the third quarter of fiscal year 2025, with total revenue increasing by 11% year-over-year to $14.15 billion. This growth was driven by a 15% increase in product revenue, notably bolstered by the full quarter inclusion of Splunk's results, and a 3% increase in services revenue. Gross margin improved by 0.5 percentage points to 65.6%, reflecting productivity gains and the contribution of Splunk, partially offset by pricing erosion. Net income saw a significant jump of 32% to $2.49 billion, leading to diluted earnings per share of $0.62, a 35% increase. The company's operational efficiency improved, with operating income as a percentage of revenue rising to 22.6%. Cisco continues to invest in AI integration across its portfolio and remains focused on its strategic priorities, demonstrating resilience amidst a challenging macroeconomic environment. The company maintained a strong liquidity position with $15.64 billion in cash and investments.
Financial Highlights
56 data points| Revenue | $14.15B |
| Cost of Revenue | $4.87B |
| Gross Profit | $9.28B |
| R&D Expenses | $2.33B |
| Operating Expenses | $6.08B |
| Operating Income | $3.20B |
| Net Income | $2.49B |
| EPS (Basic) | $0.63 |
| EPS (Diluted) | $0.62 |
| Shares Outstanding (Basic) | 3.97B |
| Shares Outstanding (Diluted) | 4.00B |
Key Highlights
- 1Total revenue increased 11% year-over-year to $14.15 billion.
- 2Product revenue surged by 15%, driven by the full quarter inclusion of Splunk, while services revenue grew by 3%.
- 3Gross margin improved to 65.6% from 65.1% in the prior year's quarter.
- 4Net income rose 32% to $2.49 billion, and diluted EPS increased 35% to $0.62.
- 5Operating income margin expanded to 22.6% from 17.2% in the prior year's quarter.
- 6Security and Observability product categories saw significant revenue increases, largely due to Splunk.
- 7The company returned $3.13 billion to stockholders through dividends and share repurchases in the quarter.