Is the business good?
How good a business is CSCO?
Cisco earns 21% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
21%
Return on invested capital · cost of capital 9.0% · 12 points above what the capital costs: growth creates value
- Operating margin
- 24%
Operating margin · Communication Equipment median 5.3% · 12 months to Q4 2026
- Cash conversion
- 0.96×
Cash conversion · 1.30× a year ago · some of the reported profit has not turned into cash yet
- R&D as % of revenue
- 15%
R&D as % of revenue
| Year | Operating margin |
|---|---|
| FY2021 | 26% |
| FY2022 | 27% |
| FY2023 | 26% |
| FY2024 | 23% |
| FY2025 | 21% |
| FY2026 | 24% |
Details›
- Gross margin12 months to Q4 2026
- 65%
- Operating margin12 months to Q4 2026
- 24%
- Net margin12 months to Q4 2026
- 21%
- Free cash flow margin
- 20%
- R&D as % of revenue
- 15%
- Revenue, trailing twelve months
- $63.3B
- Free cash flow, trailing twelve months
- $12.8B
- Net income, trailing twelve months
- $13.3B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 21%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.
Communication Equipment
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