Executive Summary
Cisco Systems delivered a solid QQ1 2025 with resilient top-line momentum and a healthy profitability profile. Revenue reached $13.841B, up 8.97% year-over-year, while gross profit rose 10.25% to $9.121B and gross margin held at approximately 65.9%. Operating income was $2.358B (operating margin ~17.0%), supported by disciplined opex management and ongoing benefits from software and security offerings embedded in Cisco’s infrastructure platform strategy.
The company generated robust free cash flow of $3.444B in the quarter, contributing to a strong liquidity position with $18.671B in cash and short-term investments and a net debt position of $22.922B. Cash flow from operations was $3.661B, while capital expenditures remained modest at $217M, underscoring Cisco’s ability to translate earnings into cash. Notable capital allocation included $2.168B spent on share repurchases and $1.592B in dividends, reflecting a shareholder-friendly framework and a disciplined balance sheet.
Looking forward, Cisco faces a favorable long-term growth trajectory driven by software and subscription growth, security, and multi-cloud networking deployments in enterprise IT environments. However, the stock will remain sensitive to macro IT budgets and competitive dynamics in the networking stack. The dataset does not include explicit management guidance; investors should monitor software revenue mix, security adoption, and capital allocation efficiency as key drivers of the next quarters.
Key Performance Indicators
Key Insights
Revenue: 13.841B, YoY +8.97%, QoQ 0.00%
Gross Profit: 9.121B, YoY +10.25%, Margin ~65.90%
Operating Income: 2.359B, YoY +7.62%, Margin ~17.04%
Net Income: 2.711B, YoY +43.74%, Margin ~19.59%
EPS (year-over-year): not disclosed for QQ1 2025; YoY metric for EPS shown as +44.68% in the data
Key profitability ratios: Gross margin 0.659, Operating margin 0.170, Pretax margin 0.164, Net margin 0.196
Delivery efficiency: Operating cash flow 3.661B; Free cash flow 3.444B; Cash from operations to FCF co...
Financial Highlights
Revenue: 13.841B, YoY +8.97%, QoQ 0.00%
Gross Profit: 9.121B, YoY +10.25%, Margin ~65.90%
Operating Income: 2.359B, YoY +7.62%, Margin ~17.04%
Net Income: 2.711B, YoY +43.74%, Margin ~19.59%
EPS (year-over-year): not disclosed for QQ1 2025; YoY metric for EPS shown as +44.68% in the data
Key profitability ratios: Gross margin 0.659, Operating margin 0.170, Pretax margin 0.164, Net margin 0.196
Delivery efficiency: Operating cash flow 3.661B; Free cash flow 3.444B; Cash from operations to FCF conversion strong given capex at 0.217B
Liquidity and leverage: Cash and short-term investments 18.671B; Cash and cash equivalents 9.065B; Total debt 31.987B; Net debt 22.922B; Interest coverage 5.64x
Capital allocation: Dividends paid 1.592B; Common stock repurchased 2.168B; Net cash provided by financing activities -2.784B
Valuation context: Enterprise Value Multiple 6.60x; Dividend yield 0.0% (dataset shows varied dividend metrics); Price-to-book/price-to-sales metrics not provided; Cash flow strength supports deleveraging optionality.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
13.84B |
8.97% |
0.00% |
| Gross Profit |
9.12B |
10.25% |
0.00% |
| Operating Income |
2.36B |
7.62% |
0.00% |
| Net Income |
2.71B |
43.74% |
0.00% |
Key Financial Ratios
operatingProfitMargin
17%
dividendPayoutRatio
58.7%
Management Commentary
No earnings call transcript data were provided in the dataset. As a result, management quotes, themes on strategy, operations, or market conditions could not be extracted or grouped by theme.
Forward Guidance
Explicit management guidance for QQ2 2025 or full-year 2025 is not supplied in the dataset. Inference-based posture suggests continued emphasis on expanding software and subscription revenues, security solutions, and multi-cloud networking to support enterprise IT modernization. Investors should monitor: (1) software/subscription mix trajectory and associated gross margins, (2) AWS/major cloud and data-center partner demand for Cisco’s edge-to-cloud solutions, (3) enterprise IT budget cycles and capex intensity, and (4) currency effects given a global footprint. Achievability hinges on sustained IT spend, successful cross-sell of security and collaboration products, and continued efficiency in operating expenses to protect margins as the software mix grows.