How does Cisco (CSCO) make money?

Cisco (CSCO) generates revenue primarily from Networking, which accounted for 54% of total revenue in TTM through Q2 2026. The company reported $60.7B in revenue and converted 19.7% of it into net profit, equivalent to roughly $12B in net income — what's left after the cost of revenue, operating expenses, interest, and income taxes.

What is the gross profit margin of Cisco (CSCO)?

Cisco (CSCO) reported a gross profit margin of 64.3% in TTM through Q2 2026, equivalent to $39.1B in gross profit on $60.7B in revenue. Gross margin measures how much of each dollar of revenue remains after the direct cost of producing or delivering the product — a higher figure typically signals pricing power, scale, or a less capital-intensive business model.

What is the operating profit margin of Cisco (CSCO)?

Cisco (CSCO) reported an operating profit margin of 23.4% in TTM through Q2 2026, equivalent to $14.2B in operating income. Operating margin captures profitability after research & development, sales & marketing, and general & administrative expenses — but before interest, taxes, and one-off items — and is the cleanest single read on the underlying business's efficiency.

What is the net profit margin of Cisco (CSCO)?

Cisco (CSCO) reported a net profit margin of 19.7% in TTM through Q2 2026, equivalent to $12B in net income. Net margin is the bottom-line share of revenue that survives every expense — operating costs, interest, and income taxes — and is the figure that flows directly into earnings per share.

Is Cisco (CSCO) profitable?

Yes. Cisco (CSCO) reported $12B in net income for TTM through Q2 2026, with a net profit margin of 19.7%. The company earned more from its operations than it paid out in costs, interest, and income taxes, leaving positive earnings on the bottom line.

How much does Cisco (CSCO) invest in research and development?

Cisco (CSCO) invested $9.51B in research and development during TTM through Q2 2026, roughly 15.7% of total revenue. R&D spending funds the company's future product pipeline and is expensed in full on the income statement rather than capitalised, which makes the operating margin sensitive to how aggressively management chooses to reinvest in innovation.

How much does Cisco (CSCO) spend on capital expenditures?

Cisco (CSCO) spent $409M on capital expenditures (CapEx) during TTM through Q2 2026, roughly 0.7% of total revenue. CapEx represents long-lived investment in property, equipment, data centres, and other physical infrastructure, and is subtracted from operating cash flow to arrive at free cash flow.

How much free cash flow does Cisco (CSCO) generate?

Cisco (CSCO) generated $12.6B in free cash flow during TTM through Q2 2026, a free-cash-flow margin of 20.8%. Free cash flow is the cash left after capital expenditures and represents the discretionary pool the company can use to pay dividends, repurchase shares, repay debt, or fund acquisitions without raising external capital.

What is the effective tax rate of Cisco (CSCO)?

Cisco (CSCO) had an effective tax rate of 15% in TTM through Q2 2026. The effective rate is the actual share of pre-tax income paid as income taxes and can differ materially from the statutory rate due to foreign earnings mix, tax credits (such as R&D), share-based compensation deductions, and one-off discrete items.

What are the main business segments of Cisco (CSCO)?

Cisco (CSCO) reports revenue across 5 reportable product segments, led by Networking at 54% of total revenue in TTM through Q2 2026. See the revenue-by-segment table on this page for the full breakdown and how each segment feeds into the income-statement waterfall above.

How Cisco Makes Money: 2026 Visual Revenue Map

Cisco (CSCO) Income Statement Flow — TTM through Q2 2026

Calculated from the four most recent reported quarters, ending April 25, 2026 (reported May 19, 2026).

Cisco discloses geographic revenue only in annual filings. to view the full breakdown.

Cisco (CSCO) Revenue by Product Segment — TTM through Q2 2026

Aggregated from the four quarterly disclosures behind this TTM. Minor differences vs the company's annual filing can occur if reported segments changed mid-year.

Revenue contribution by product segment for Cisco (CSCO), TTM through Q2 2026.
Segment	Revenue (USD)	% of total
Networking	$32.8B	54%
Service	$14.9B	24.5%
Security	$7.92B	13%
Collaboration	$4.13B	6.8%
Observability	$1.07B	1.8%
Total	$60.7B	100%

Networking$32.8B
Service$14.9B
Security$7.92B
Collaboration$4.13B
Observability$1.07B
Total$60.7B

Revenue Breakdown — TTM through Q2 2026

In TTM through Q2 2026, Cisco (CSCO) reports revenue across 5 reportable product segments; the largest segment was Networking at 54%, followed by Service (24.5%) and Security (13%).

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