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CISCO REPORTS FIRST QUARTER EARNINGS

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SAN JOSE, Calif., Nov. 13, 2024 /PRNewswire/ — 

News Summary:

Broad-based acceleration in product orders reflecting normalizing demandProduct orders up 20% year over year; up 9% year over year excluding SplunkRevenue of $13.8 billion in Q1, at the high end of our guidance rangeStrong profitability:GAAP gross margin of 65.9% and non-GAAP gross margin of 69.3%, above our guidance rangeGAAP EPS of $0.68 and non-GAAP EPS of $0.91, above our guidance rangeQ1 FY 2025 Results:Revenue: $13.8 billionDecrease of 6% year over yearEarnings per Share: GAAP: $0.68; Non-GAAP: $0.91GAAP EPS decreased 24% year over yearNon-GAAP EPS decreased 18% year over yearQ2 FY 2025 Guidance:   Revenue: $13.75 billion to $13.95 billionEarnings per Share: GAAP: $0.51 to $0.56; Non-GAAP: $0.89 to $0.91FY 2025 Guidance:Revenue: $55.3 billion to $56.3 billionEarnings per Share: GAAP: $2.26 to $2.38; Non-GAAP: $3.60 to $3.66

Cisco today reported first quarter results for the period ended October 26, 2024. Cisco reported first quarter revenue of $13.8 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.7 billion or $0.68 per share, and non-GAAP net income of $3.7 billion or $0.91 per share.

“Cisco is off to a strong start to fiscal 2025,” said Chuck Robbins, chair and CEO of Cisco. “Our customers are investing in critical infrastructure to prepare for AI, and with the breadth of our portfolio, we are uniquely positioned to capitalize on this opportunity.”

“Revenue, gross margin and EPS in Q1 were at the high end or above our guidance range, generating strong operating leverage,” said Scott Herren, CFO of Cisco. “We are focused on solid execution and operating discipline while making strategic investments to drive innovation and growth.”

GAAP Results

Q1 FY 2025

Q1 FY 2024

Vs. Q1 FY 2024

Revenue

$              13.8 billion

$              14.7 billion

(6) %

Net Income

$               2.7  billion

$               3.6  billion

(25) %

Diluted Earnings per Share (EPS)

$                     0.68

$                     0.89

(24) %

Q1 FY 2025 GAAP results include a tax benefit of $720 million due to a recent U.S. Tax Court decision regarding the U.S. taxation of deemed foreign dividends in the transition year of the Tax Cuts and Jobs Act.

Non-GAAP Results

Q1 FY 2025

Q1 FY 2024

Vs. Q1 FY 2024

Net Income

$               3.7   billion

$               4.5   billion

(19) %

EPS

$                      0.91

$                      1.11

(18) %

Reconciliations between net income, EPS, and other measures on a GAAP and non-GAAP basis are provided in the tables located in the section entitled “Reconciliations of GAAP to non-GAAP Measures.”

Cisco Declares Quarterly Dividend

Cisco has declared a quarterly dividend of $0.40 per common share to be paid on January 22, 2025, to all stockholders of record as of the close of business on January 3, 2025. Future dividends will be subject to Board approval.

Financial Summary

All comparative percentages are on a year-over-year basis unless otherwise noted.

Q1 FY 2025 Highlights

Revenue — Total revenue was $13.8 billion, down 6%, with product revenue down 9% and services revenue up 6%. Excluding the contribution from Splunk, total revenue was down 14%.

Revenue by geographic segment was: Americas down 9%, EMEA down 2%, and APJC up 1%. Product revenue performance reflected growth in Security up 100% and Observability up 36%. Networking was down 23% and Collaboration was down 3%. Excluding Splunk, Security and Observability grew 2% and 1%, respectively, in the first quarter of fiscal 2025.

Gross Margin — On a GAAP basis, total gross margin, product gross margin, and services gross margin were 65.9%, 65.1%, and 68.0%, respectively, as compared with 65.2%, 64.5%, and 67.3%, respectively, in the first quarter of fiscal 2024.

On a non-GAAP basis, total gross margin, product gross margin, and services gross margin were 69.3%, 68.9%, and 70.3%, respectively, as compared with 67.1%, 66.5%, and 69.0%, respectively, in the first quarter of fiscal 2024.

Total gross margins by geographic segment were: 69.6% for the Americas, 70.3% for EMEA and 66.4% for APJC.

Operating Expenses — On a GAAP basis, operating expenses were $6.8 billion, up 28%, and were 48.9% of revenue. Non-GAAP operating expenses were $4.9 billion, up 9%, and were 35.2% of revenue.

Operating Income — GAAP operating income was $2.4 billion, down 45%, with GAAP operating margin of 17.0%. Non-GAAP operating income was $4.7 billion, down 12%, with non-GAAP operating margin at 34.1%.

Provision for (benefit from) Income Taxes — The GAAP tax provision rate was a benefit of 19.6%, which includes the $720 million benefit on deemed foreign dividends as discussed above. The non-GAAP tax provision rate was 19.0%.

Net Income and EPS — On a GAAP basis, net income was $2.7 billion, a decrease of 25%, and EPS was $0.68, a decrease of 24%. On a non-GAAP basis, net income was $3.7 billion, a decrease of 19%, and EPS was $0.91, a decrease of 18%.

Cash Flow from Operating Activities — $3.7 billion for the first quarter of fiscal 2025, an increase of 54%, compared with $2.4 billion for the first quarter of fiscal 2024.

Balance Sheet and Other Financial Highlights

Cash and Cash Equivalents and Investments — $18.7 billion at the end of the first quarter of fiscal 2025, compared with $17.9 billion at the end of fiscal 2024.

Remaining Performance Obligations (RPO) — $40.0 billion, up 15% in total, with 51% of this amount to be recognized as revenue over the next 12 months. Product RPO were up 24% and services RPO were up 7%.

Deferred Revenue — $27.5 billion, up 7% in total, with deferred product revenue up 11%. Deferred services revenue was up 4%.

Capital Allocation — In the first quarter of fiscal 2025, we returned $3.6 billion to stockholders through share buybacks and dividends. We declared and paid a cash dividend of $0.40 per common share, or $1.6 billion, and repurchased approximately 40 million shares of common stock under our stock repurchase program at an average price of $49.56 per share for an aggregate purchase price of $2.0 billion. The remaining authorized amount for stock repurchases under the program is $3.2 billion with no termination date.

Acquisitions

In the first quarter of fiscal 2025, we closed the following acquisitions:

DeepFactor, Inc., a privately held cloud-native application security companyRobust Intelligence, Inc., a privately held AI security solutions company

Guidance

Cisco estimates the following results for the second quarter of fiscal 2025:

Q2 FY 2025

Revenue

$13.75 billion – $13.95 billion

Non-GAAP gross margin

68% – 69%

Non-GAAP operating margin

33.5% – 34.5%

Non-GAAP EPS

$0.89 – $0.91

Cisco estimates that GAAP EPS will be $0.51 to $0.56 for the second quarter of fiscal 2025.

Cisco estimates the following results for fiscal 2025:

FY 2025

Revenue

$55.3 billion – $56.3 billion

Non-GAAP EPS

$3.60 – $3.66

Cisco estimates that GAAP EPS will be $2.26 to $2.38 for fiscal 2025.

Our Q2 FY 2025 guidance assumes an effective tax provision rate of approximately 17% for GAAP and approximately 19% for non-GAAP results. Our FY 2025 guidance assumes an effective tax provision rate of approximately 9% for GAAP and approximately 19% for non-GAAP results.

A reconciliation between the guidance on a GAAP and non-GAAP basis is provided in the tables entitled “GAAP to non-GAAP Guidance” located in the section entitled “Reconciliations of GAAP to non-GAAP Measures.”

Editor’s Notes:

Q1 fiscal year 2025 conference call to discuss Cisco’s results along with its guidance will be held on Wednesday, November 13, 2024 at 1:30 p.m. Pacific Time. Conference call number is 1-888-848-6507 (United States) or 1-212-519-0847 (international).Conference call replay will be available from 4:00 p.m. Pacific Time, November 13, 2024 to 4:00 p.m. Pacific Time, November 19, 2024 at 1-866-360-7722 (United States) or 1-203-369-0174 (international). The replay will also be available via webcast on the Cisco Investor Relations website at https://investor.cisco.com.Additional information regarding Cisco’s financials, as well as a webcast of the conference call with visuals designed to guide participants through the call, will be available at 1:30 p.m. Pacific Time, November 13, 2024. Text of the conference call’s prepared remarks will be available within 24 hours of completion of the call. The webcast will include both the prepared remarks and the question-and-answer session. This information, along with the GAAP to non-GAAP reconciliation information, will be available on the Cisco Investor Relations website at https://investor.cisco.com.

 

CISCO SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per-share amounts)

(Unaudited) 

Three Months Ended

October 26, 2024

October 28, 2023

REVENUE:

Product

$       10,114

$       11,139

Services

3,727

3,529

Total revenue

13,841

14,668

COST OF SALES:

Product

3,526

3,957

Services

1,194

1,154

Total cost of sales

4,720

5,111

GROSS MARGIN

9,121

9,557

OPERATING EXPENSES:

Research and development

2,286

1,913

Sales and marketing

2,752

2,506

General and administrative

795

672

Amortization of purchased intangible assets

265

67

Restructuring and other charges

665

123

Total operating expenses

6,763

5,281

OPERATING INCOME

2,358

4,276

Interest income

286

360

Interest expense

(418)

(111)

Other income (loss), net

41

(83)

Interest and other income (loss), net

(91)

166

INCOME BEFORE PROVISION FOR INCOME TAXES

2,267

4,442

Provision for (benefit from) income taxes

(444)

804

NET INCOME

$         2,711

$         3,638

Net income per share:

Basic

$           0.68

$           0.90

Diluted

$           0.68

$           0.89

Shares used in per-share calculation:

Basic

3,990

4,057

Diluted

4,013

4,087

 

CISCO SYSTEMS, INC.

REVENUE BY SEGMENT

(In millions, except percentages)

Three Months Ended

October 26, 2024

Amount

Y/Y %

Revenue:

Americas

$           8,252

(9) %

EMEA

3,588

(2) %

APJC

2,001

1 %

Total

$         13,841

(6) %

Amounts may not sum and percentages may not recalculate due to rounding.

 

CISCO SYSTEMS, INC.

GROSS MARGIN PERCENTAGE BY SEGMENT

(In percentages)

Three Months Ended

October 26, 2024

Gross Margin Percentage:

Americas

69.6 %

EMEA

70.3 %

APJC

66.4 %

 

CISCO SYSTEMS, INC.

REVENUE FOR GROUPS OF SIMILAR PRODUCTS AND SERVICES

(In millions, except percentages)

Three Months Ended

October 26, 2024

Amount

Y/Y %

Revenue:

Networking

$           6,753

(23) %

Security

2,017

100 %

Collaboration

1,085

(3) %

Observability

258

36 %

Total Product

10,114

(9) %

Services

3,727

6 %

Total

$         13,841

(6) %

Excluding Splunk, Security and Observability grew 2% and 1%, respectively, in the first quarter of fiscal 2025.

Amounts may not sum and percentages may not recalculate due to rounding.

 

CISCO SYSTEMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)

October 26, 2024

July 27, 2024

ASSETS

Current assets:

Cash and cash equivalents

$                9,065

$                7,508

Investments

9,606

10,346

Accounts receivable, net of allowance of $78 at October 26, 2024 and $87
at July 27, 2024

4,457

6,685

Inventories

3,143

3,373

Financing receivables, net

3,123

3,338

Other current assets

6,358

5,612

Total current assets

35,752

36,862

Property and equipment, net

2,082

2,090

Financing receivables, net

3,411

3,376

Goodwill

58,774

58,660

Purchased intangible assets, net

10,744

11,219

Deferred tax assets

6,514

6,262

Other assets

6,056

5,944

TOTAL ASSETS

$            123,333

$            124,413

LIABILITIES AND EQUITY

Current liabilities:

Short-term debt

$              12,364

$              11,341

Accounts payable

1,996

2,304

Income taxes payable

2,096

1,439

Accrued compensation

2,861

3,608

Deferred revenue

15,615

16,249

Other current liabilities

5,610

5,643

Total current liabilities

40,542

40,584

Long-term debt

19,623

19,621

Income taxes payable

3,367

3,985

Deferred revenue

11,887

12,226

Other long-term liabilities

2,637

2,540

Total liabilities

78,056

78,956

Total equity

45,277

45,457

TOTAL LIABILITIES AND EQUITY

$            123,333

$            124,413

 

CISCO SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

Three Months Ended

October 26,
2024

October 28,
2023

Cash flows from operating activities:

Net income

$              2,711

$              3,638

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation, amortization, and other

789

401

Share-based compensation expense

827

661

Provision (benefit) for receivables

(1)

4

Deferred income taxes

(281)

(513)

(Gains) losses on divestitures, investments and other, net

(60)

89

Change in operating assets and liabilities, net of effects of acquisitions and divestitures:

Accounts receivable

2,227

979

Inventories

229

307

Financing receivables

173

25

Other assets

(190)

(290)

Accounts payable

(269)

(235)

Income taxes, net

(806)

(1,773)

Accrued compensation

(754)

(908)

Deferred revenue

(971)

259

Other liabilities

37

(273)

Net cash provided by operating activities

3,661

2,371

Cash flows from investing activities:

Purchases of investments

(1,775)

(1,850)

Proceeds from sales of investments

1,490

1,280

Proceeds from maturities of investments

1,164

2,497

Acquisitions, net of cash and cash equivalents acquired and divestitures

(217)

(876)

Purchases of investments in privately held companies

(42)

(13)

Return of investments in privately held companies

77

47

Acquisition of property and equipment

(217)

(134)

Other

(1)

1

Net cash provided by investing activities

479

952

Cash flows from financing activities:

Repurchases of common stock – repurchase program

(2,003)

(1,300)

Shares repurchased for tax withholdings on vesting of restricted stock units

(165)

(153)

Short-term borrowings, original maturities of 90 days or less, net

68

Issuances of debt

5,732

Repayments of debt

(4,821)

(750)

Dividends paid

(1,592)

(1,580)

Other

(3)

(17)

Net cash used in financing activities

(2,784)

(3,800)

Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and
restricted cash equivalents

10

(45)

Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents

1,366

(522)

Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of period

8,842

11,627

Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period

$           10,208

$           11,105

Supplemental cash flow information:

Cash paid for interest

$                 545

$                 128

Cash paid for income taxes, net

$                 643

$              3,090

 

CISCO SYSTEMS, INC.

REMAINING PERFORMANCE OBLIGATIONS

(In millions, except percentages)

October 26, 2024

July 27, 2024

October 28, 2023

Amount

Y/Y%

Amount

Y/Y%

Amount

Y/Y%

Product

$    19,882

24 %

$    20,055

27 %

$    16,011

14 %

Services

20,108

7 %

20,993

10 %

18,742

11 %

Total

$    39,990

15 %

$    41,048

18 %

$    34,753

12 %

We expect 51% of total RPO at October 26, 2024 will be recognized as revenue over the next 12 months.

 

CISCO SYSTEMS, INC.

DEFERRED REVENUE

(In millions)

October 26,
2024

July 27,
2024

October 28,

 2023

Deferred revenue:

Product

$       12,941

$       13,219

$       11,689

Services

14,561

15,256

13,970

Total

$       27,502

$       28,475

$       25,659

Reported as:

Current

$       15,615

$       16,249

$       13,812

Noncurrent

11,887

12,226

11,847

Total

$       27,502

$       28,475

$       25,659

 

CISCO SYSTEMS, INC.

DIVIDENDS PAID AND REPURCHASES OF COMMON STOCK

(In millions, except per-share amounts)

DIVIDENDS

STOCK REPURCHASE PROGRAM

TOTAL

Quarter Ended

Per Share

Amount

Shares

Weighted-Average
Price per Share

Amount

Amount

Fiscal 2025

October 26, 2024

$             0.40

$          1,592

40

$          49.56

$          2,003

$          3,595

Fiscal 2024

July 27, 2024

$             0.40

$          1,606

43

$          46.80

$          2,002

$          3,608

April 27, 2024

$             0.40

$          1,615

26

$          49.22

$          1,256

$          2,871

January 27, 2024

$             0.39

$          1,583

25

$          49.54

$          1,254

$          2,837

October 28, 2023

$             0.39

$          1,580

23

$          54.53

$          1,252

$          2,832

 

CISCO SYSTEMS, INC.

RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

 

GAAP TO NON-GAAP NET INCOME

(In millions)

Three Months Ended

October 26,
2024

October 28,
2023

GAAP net income

$           2,711

$           3,638

Adjustments to cost of sales:

Share-based compensation expense

131

103

Amortization of acquisition-related intangible assets

319

181

Acquisition/divestiture-related costs

19

Total adjustments to GAAP cost of sales

469

284

Adjustments to operating expenses:

Share-based compensation expense

679

550

Amortization of acquisition-related intangible assets

265

67

Acquisition/divestiture-related costs

285

75

Russia-Ukraine war costs

(2)

Significant asset impairments and restructurings

665

123

Total adjustments to GAAP operating expenses

1,894

813

Adjustments to interest and other income (loss), net:

(Gains) and losses on investments

(98)

51

Total adjustments to GAAP interest and other income (loss), net

(98)

51

Total adjustments to GAAP income before provision for income taxes

2,265

1,148

Income tax effect of non-GAAP adjustments

(476)

(258)

Significant tax matters (1)

(829)

Total adjustments to GAAP provision for income taxes

(1,305)

(258)

Non-GAAP net income

$           3,671

$           4,528

(1) The three months ended October 26, 2024 include a $720 million benefit due to a recent U.S. Tax Court decision regarding the U.S. taxation of deemed foreign dividends in the transition year of the Tax Cuts and Jobs Act.

 

CISCO SYSTEMS, INC.

RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

 

GAAP TO NON-GAAP EPS

Three Months Ended

October 26,
2024

October 28,
2023

GAAP EPS

$              0.68

$             0.89

Adjustments to GAAP:

Share-based compensation expense

0.20

0.16

Amortization of acquisition-related intangible assets

0.15

0.06

Acquisition/divestiture-related costs

0.08

0.02

Significant asset impairments and restructurings

0.17

0.03

(Gains) and losses on investments

(0.02)

0.01

Income tax effect of non-GAAP adjustments

(0.12)

(0.06)

Significant tax matters

(0.21)

Non-GAAP EPS

$              0.91

$             1.11

Amounts may not sum due to rounding.

 

CISCO SYSTEMS, INC.

RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

 

GROSS MARGINS, OPERATING EXPENSES, OPERATING MARGINS, INTEREST AND OTHER INCOME (LOSS), NET, AND NET INCOME

(In millions, except percentages)

Three Months Ended

October 26, 2024

Product
Gross
Margin

Services

Gross

Margin

Total
Gross

Margin

Operating

Expenses

Y/Y

Operating
Income

Y/Y

Interest and

other income

 (loss), net

Net

Income

Y/Y

GAAP amount

$ 6,588

$ 2,533

$ 9,121

$ 6,763

28 %

$ 2,358

(45) %

$   (91)

$ 2,711

(25) %

% of revenue

65.1 %

68.0 %

65.9 %

48.9 %

17.0 %

(0.7) %

19.6 %

Adjustments to GAAP amounts:

Share-based compensation expense

57

74

131

679

810

810

Amortization of acquisition-related intangible assets

319

319

265

584

584

Acquisition/divestiture-related costs

5

14

19

285

304

304

Significant asset impairments and restructurings

665

665

665

(Gains) and losses on investments

(98)

(98)

Income tax effect/significant tax matters

(1,305)

Non-GAAP amount

$ 6,969

$ 2,621

$ 9,590

$ 4,869

9 %

$ 4,721

(12) %

$ (189)

$ 3,671

(19) %

% of revenue

68.9 %

70.3 %

69.3 %

35.2 %

34.1 %

(1.4) %

26.5 %

               

Three Months Ended

October 28, 2023

Product
Gross
Margin

Services

Gross

Margin

Total

Gross

Margin

Operating

Expenses

Operating

Income

Interest and

other income

 (loss), net

Net

Income

GAAP amount

$   7,182

$   2,375

$   9,557

$   5,281

$   4,276

$      166

$   3,638

% of revenue

64.5 %

67.3 %

65.2 %

36.0 %

29.2 %

1.1 %

24.8 %

Adjustments to GAAP amounts:

Share-based compensation expense

42

61

103

550

653

653

Amortization of acquisition-related intangible assets

181

181

67

248

248

Acquisition/divestiture-related costs

75

75

75

Significant asset impairments and restructurings

123

123

123

Russia-Ukraine war costs

(2)

(2)

(2)

(Gains) and losses on investments

51

51

Income tax effect/significant tax matters

(258)

Non-GAAP amount

$   7,405

$   2,436

$   9,841

$   4,468

$   5,373

$      217

$   4,528

% of revenue

66.5 %

69.0 %

67.1 %

30.5 %

36.6 %

1.5 %

30.9 %

Amounts may not sum and percentages may not recalculate due to rounding.

 

CISCO SYSTEMS, INC.

RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

 

EFFECTIVE TAX RATE

(In percentages)

Three Months Ended

October 26, 2024

October 28, 2023

GAAP effective tax rate

(19.6) %

18.1 %

Total adjustments to GAAP provision for income taxes

38.6 %

0.9 %

Non-GAAP effective tax rate

19.0 %

19.0 %

 

GAAP TO NON-GAAP GUIDANCE

Q2 FY 2025

Gross Margin
Rate

Operating Margin

 Rate

Earnings per
Share (1)

GAAP

64.5% – 65.5%

20% – 21%

$0.51 – $0.56

Estimated adjustments for:

Share-based compensation expense

1.0 %

7.0 %

$0.18 – $0.19

Amortization of acquisition-related intangible assets and acquisition/divestiture-related costs

2.5 %

6.0 %

$0.16 – $0.17

Significant asset impairments and restructurings

0.5 %

$0.01 – $0.02

Non-GAAP

68% – 69%

33.5% – 34.5%

$0.89 – $0.91

 

FY 2025

Earnings per

 Share (1)

GAAP

$2.26 – $2.38

Estimated adjustments for:

Share-based compensation expense

$0.73 – $0.75

Amortization of acquisition-related intangible assets and acquisition/divestiture-related costs                                                          

$0.60 – $0.62

Significant asset impairments and restructurings

$0.18 – $0.20

(Gains) and losses on investments

($0.02)

Significant tax matters

($0.21)

Non-GAAP

$3.60– $3.66

(1) Estimated adjustments to GAAP earnings per share are shown after income tax effects.

Except as noted above, this guidance does not include the effects of any future acquisitions/divestitures, significant asset impairments and restructurings, significant litigation settlements and other contingencies, gains and losses on investments, significant tax matters, or other items, which may or may not be significant.

Forward Looking Statements, Non-GAAP Information and Additional Information

This release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events (such as our customers’ investments in critical infrastructure to prepare for AI, our position to capitalize on that opportunity given the breadth of our portfolio, and our focus on solid execution and operating discipline while making strategic investments to drive innovation and growth) and the future financial performance of Cisco (including the guidance for Q2 FY 2025 and full year FY 2025) that involve risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results due to a variety of factors, including: business and economic conditions and growth trends in the networking industry, our customer markets and various geographic regions; global economic conditions and uncertainties in the geopolitical environment; our development and use of artificial intelligence; overall information technology spending; the growth and evolution of the Internet and levels of capital spending on Internet-based systems; variations in customer demand for products and services, including sales to the service provider market, cloud, enterprise and other customer markets; the return on our investments in certain key priority areas, and in certain geographical locations, as well as maintaining leadership in Networking and services; the timing of orders and manufacturing and customer lead times; supply constraints; changes in customer order patterns or customer mix; insufficient, excess or obsolete inventory; variability of component costs; variations in sales channels, product costs or mix of products sold; our ability to successfully acquire businesses and technologies and to successfully integrate and operate these acquired businesses and technologies; our ability to achieve expected benefits of our partnerships; increased competition in our product and services markets, including the data center market; dependence on the introduction and market acceptance of new product offerings and standards; rapid technological and market change; manufacturing and sourcing risks; product defects and returns; litigation involving patents, other intellectual property, antitrust, stockholder and other matters, and governmental investigations; our ability to achieve the benefits of restructurings and possible changes in the size and timing of related charges; cyber attacks, data breaches or other incidents; vulnerabilities and critical security defects; our ability to protect personal data; evolving regulatory uncertainty; terrorism; natural catastrophic events (including as a result of global climate change); any pandemic or epidemic; our ability to achieve the benefits anticipated from our investments in sales, engineering, service, marketing and manufacturing activities; our ability to recruit and retain key personnel; our ability to manage financial risk, and to manage expenses during economic downturns; risks related to the global nature of our operations, including our operations in emerging markets; currency fluctuations and other international factors; changes in provision for income taxes, including changes in tax laws and regulations or adverse outcomes resulting from examinations of our income tax returns; potential volatility in operating results; and other factors listed in Cisco’s most recent report on Form 10-K filed on September 5, 2024. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes thereto included in Cisco’s most recent report on Form 10-K as it may be amended from time to time. Cisco’s results of operations for the three months ended October 26, 2024 are not necessarily indicative of Cisco’s operating results for any future periods. Any projections in this release are based on limited information currently available to Cisco, which is subject to change. Although any such projections and the factors influencing them will likely change, Cisco will not necessarily update the information, since Cisco will only provide guidance at certain points during the year. Such information speaks only as of the date of this release.

This release includes non-GAAP net income, non-GAAP gross margins, non-GAAP operating expenses, non-GAAP operating income and margin, non-GAAP effective tax rates, non-GAAP interest and other income (loss), net, and non-GAAP net income per share data for the periods presented. It also includes future estimated ranges for gross margin, operating margin, tax provision rate and EPS on a non-GAAP basis.

These non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles (GAAP) and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Cisco believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Cisco’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Cisco’s results of operations in conjunction with the corresponding GAAP measures.

Cisco believes that the presentation of non-GAAP measures when shown in conjunction with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations.

For its internal budgeting process, Cisco’s management uses financial statements that do not include, when applicable, share-based compensation expense, amortization of acquisition-related intangible assets, acquisition/divestiture-related costs, significant asset impairments and restructurings, significant litigation settlements and other contingencies, RussiaUkraine war costs, gains and losses on investments, the income tax effects of the foregoing and significant tax matters. Cisco’s management also uses the foregoing non-GAAP measures, in addition to the corresponding GAAP measures, in reviewing the financial results of Cisco. In prior periods, Cisco has excluded other items that it no longer excludes for purposes of its non-GAAP financial measures. From time to time in the future there may be other items that Cisco may exclude for purposes of its internal budgeting process and in reviewing its financial results. For additional information on the items excluded by Cisco from one or more of its non-GAAP financial measures, refer to the Form 8-K regarding this release furnished today to the Securities and Exchange Commission.

Annualized recurring revenue represents the annualized revenue run-rate of active subscriptions, term licenses, operating leases and maintenance contracts at the end of a reporting period, net of rebates to customers and partners as well as certain other revenue adjustments. Includes both revenue recognized ratably as well as upfront on an annualized basis.

About Cisco

Cisco (Nasdaq: CSCO) is the worldwide technology leader that securely connects everything to make anything possible. Our purpose is to power an inclusive future for all by helping our customers reimagine their applications, power hybrid work, secure their enterprise, transform their infrastructure, and meet their sustainability goals. Discover more at newsroom.cisco.com and follow us on X at @Cisco.

Copyright © 2024 Cisco and/or its affiliates. All rights reserved. Cisco and the Cisco logo are trademarks or registered trademarks of Cisco and/or its affiliates in the U.S. and other countries. To view a list of Cisco trademarks, go to: www.cisco.com/go/trademarks. Third-party trademarks mentioned in this document are the property of their respective owners. The use of the word partner does not imply a partnership relationship between Cisco and any other company. This document is Cisco Public Information.

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/C O R R E C T I O N — Natural Resources Canada/

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In the news release, Canada Invests in Climate Change Adaptation to Keep Communities Safe in British Columbia and Across Canada, issued 14-Nov-2024 by Natural Resources Canada over PR Newswire, we are advised by the company that the 18th paragraph has been added to the release. The complete, corrected release follows:

Canada Invests in Climate Change Adaptation to Keep Communities Safe in British Columbia and Across Canada

COQUITLAM, BC, Nov. 14, 2024 /CNW/ – Working together to reduce risks from the changing climate will help keep Canadians safer and healthier. Acting now will help improve long-term resilience and reduce costs associated with the increasing frequency of extreme weather events in Canada, including higher grocery prices, insurance premiums and local taxes to cover the costs of disaster recovery and damage.

Across the country, the impacts of climate change are becoming more severe and more frequent with extreme events like floods, wildfires and heatwaves on the rise. Gradual changes, like thawing permafrost in the north and rising sea levels in coastal regions, are also affecting the safety of our communities and quality of life. To protect our communities from the worst economic and environmental impacts of climate change, we must continue to prepare for the changes that are coming by investing in community resilience. This will not only support the safety of Canadians but also reinforce the ability of communities to recover from extreme weather events.

Today, the Honourable Jonathan Wilkinson announced over $7 million in funding for 12 projects in British Columbia or with a national reach under Natural Resources Canada’s Climate Change Adaptation Program (CCAP) and the Climate-Resilient Coastal Communities (CRCC) Program. These projects will aim to help regions and sectors in B.C. and across Canada adapt to a changing climate by developing, improving and delivering strategies, tools and resources that address climate change risks and adaptation gaps, and to support the implementation of climate change adaptation and resilience actions.

The funding announced today comes from a total investment of $39.5 million for 53 projects through the CCAP and the the CRCC Program to reduce climate change risks and build more resilient communities across the country in support of the National Adaptation Strategy (NAS). Details on additional projects supported by this investment will be announced in the near future.

The steps we take now will protect our communities, our livelihoods, our environment and our economy. We are actively investing in climate change adaptation to proactively support long-term, community-led resilience and adaptation projects. It is essential, now more than ever, that we come together to help communities stay strong in the face of the current and future impacts of climate change.

Quotes

“The impacts associated with climate change, including atmospheric rivers here in British Columbia, are being felt right now. That is why this federal government is acting now to help our communities and our economy prepare and protect themselves from the threat of climate change. Today’s announcement of 12 projects based in British Columbia under two funding programs supports the vital long-term, community-based work to keep people safe now and into the future.”

The Honourable Jonathan Wilkinson
Minister of Energy and Natural Resources

“Municipalities are on the front lines of climate change, and they know best what local challenges — and solutions — are affecting local neighbourhoods, transportation and businesses. The 12 projects under the CCAP and CRCC program will help build stronger, more livable communities, providing safety and security in the face of a changing climate. With smart investments, forward planning and active collaboration, we can support communities that are already feeling the impacts of climate change and help make them more sustainable and prosperous for generations to come.”

The Honourable Steven Guilbeault
Minister of Environment and Climate Change

“Climate change is impacting communities in British Columbia and across Canada. Now is the time to work together and build climate change responses that address current and future problems. By taking the necessary steps today to adapt and build resiliency, we can make more-informed decisions to prepare for and to respond and adapt to climate change impacts.”

Ron McKinnon
Member of Parliament for Coquitlam–Port Coquitlam

“Coastal flooding and rising seas are not exclusively localized issues. Coordinating between First Nations, municipalities and other authorities in the region can increase the effectiveness of coastal resilience actions and help to pool resources. Thanks to the support from the CRCC Program, our B.C. Southern Coastal Regional Climate Collaborative project will help coordinate approaches to address rising sea levels and coastal flooding and implement key regional actions to build the foundation for long-term coastal resilience outcomes across the Pacific North Shore and Sunshine Coast region.” 

Ewa Jackson
Managing Director, ICLEI Canada 

“Clean energy systems are the future — and this initiative is helping First Nations communities and local governments to push forward on micro-hydro, solar, wind and other renewables that strengthen B.C.’s power grid. Planning infrastructure to withstand severe weather and other impacts of climate change is now a key challenge in building a clean energy future, and we’re happy to help bring together local leaders and experts to meet that challenge.”

David Marshall
Chief Executive Officer, Fraser Basin Council

“Across British Columbia, small, rural and remote communities work every day with extremely limited resources to address the current and anticipated impacts of climate change, often off the side of their desk amidst many competing priorities. As a result of this funding, the CoNext Climate Preparedness Hub will provide direct support to local governments, First Nation governments and their partners to build understanding of the challenges and options for addressing climate impacts and translate this knowledge into action within their organizations and communities.”

Erica Crawford
CoNext Project Lead and Principal, HeronBridge Consulting

“Climate adaptation is a new but urgent challenge, and leading practices are just beginning to emerge. Our CRCC project funded direct conversations with Canadian practitioners to identify the challenges and opportunities they face today, and this learning will inform similar outreach in Oceania, Europe, the United States, Latin America and the Caribbean, and Asia. We look forward to bringing this snapshot of global adaptation practice today back to Canada to help drive innovation and solutions to this shared threat.” 

Dr. Glynis Lough
Global Director of PEERS and Affiliate at the Aspen Global Change Institute

“The far-reaching impacts of recent wildfires — massive emissions and disrupted communities — demand urgent action. This contribution from Natural Resources Canada will foster collaboration across sectors, First Nations and impacted communities in ways that accelerate wildfire adaptation, create jobs, enhance ecosystem resilience and increase public safety.”

Robin Prest
Program Director, Simon Fraser University’s Morris J. Wosk Centre for Dialogue

“Engineers and Geoscientists BC welcomes this investment that is intended to help protect Canadians from the risks of climate change. In collaboration with the Climate Risk Institute, we are proud to lead the development of a national climate resiliency training program for building sector professionals. Supported by Natural Resources Canada through the CCAP, the training program aims to empower engineers, and other professionals, with the skills and knowledge needed to design and retrofit buildings to help communities become more resilient to the risks associated with a changing climate.” 

Heidi Yang, P.Eng.
Chief Executive Officer, Engineers and Geoscientists BC

“The Regional District of Nanaimo is grateful for this generous grant, which we will use to develop an inclusive and collaborative coastal climate adaptation strategy in our region. This strategy will build on the critical work we are already undertaking to prepare for, and respond to, impacts we are seeing on our coast.”

Vanessa Craig
Chair, Regional District of Nanaimo

“In recent years, climate-related impacts have significantly disrupted supply chains. With this funding to develop a climate adaptation plan for the Port of Vancouver, we will work collaboratively with First Nations and stakeholders to identify key climate risks and priority actions needed to enhance port infrastructure and supply chain resiliency. This will help strengthen our position to facilitate Canada’s trade reliably, now and into the future.”

Jennifer Natland
Vice President, Properties and Environment, Vancouver Fraser Port Authority

“Nature-based solutions, like restoring wetlands and adopting green infrastructure approaches, offer powerful ways for Canadian communities to adapt to climate change while unlocking significant social, economic and environmental co-benefits. Yet a lack of understanding of the monetary benefits of these multi-solving solutions means they remain underutilized by local governments. With the support of Natural Resources Canada and our partners, ESSA and All One Sky Foundation are developing a toolkit with clear economic data and guidance to help communities confidently invest in these sustainable, cost-effective strategies to multiple local problems.”  

Jimena Eyzaguirre
Climate Change Adaptation Practice Lead, ESSA Technologies Ltd.

“In 2022, we brought together leadership and staff from First Nations and local governments and local agriculture sectors as well as federal and provincial representatives to collectively discuss what a Build Back Better, Together process would look like and to explore how we could work together more effectively in our shared landscape. This funding will support subsequent dialogues as we work toward developing a unified plan for how to maximize resilience in the Lower Mainland.” 
  
Tribal Chief Tyrone McNeil 
Chair of the Emergency Planning Secretariat 

Quick Facts

The National Adaptation Strategy (NAS) provides a whole-of-society plan focused on protecting Canadian lives and building more resilient and prosperous communities. Canada released its first NAS on June 27, 2023. Achieving the objectives of the NAS requires whole-of-society action. The Government of Canada is working with provinces, territories, Indigenous partners and the private sector to develop innovative technical, financial and operational solutions that will support adaptation action by communities across the economy.Every $1 spent on climate adaptation measures saves up to $15 in terms of the long-term costs involved in mitigating climate change and extreme weather events.Since 2015, the Government of Canada has invested more than $6.5 billion in adaptation efforts, including $2.1 billion since fall 2022 to implement the NAS and other adaptation-related activities.The CCAP will help Canada’s regions and sectors to adapt to a changing climate. More specifically, the CCAP aims to:support decision-makers in identifying and implementing adaptation actions;enhance adaptation knowledge and skills among Canada’s workforce; andincrease access to climate change adaptation tools and resources.The CRCC Program supports regional-scale pilot projects on Canada’s three marine coasts —Atlantic, Pacific and North — and in the Great Lakes–St. Lawrence region. The program aims to enhance the climate resilience of coastal communities and businesses and to accelerate adaptation to reduce climate change risks and coordinate innovative actions.

Related Product

Backgrounder: Canada Invests in Climate Change to Keep Communities Safe in British Columbia and Across Canada https://www.canada.ca/en/natural-resources-canada/news/2024/11/canada-invests-in-climate-change-adaptation-to-keep-communities-safe-in-british-columbia-and-across-canada.html

Associated Links

Climate Change Adaptation ProgramNatural Resources Canada Announces up to $15 Million to Help Communities and Businesses Adapt to a Changing ClimateClimate-Resilient Coastal Communities ProgramNational Adaptation StrategyGovernment of Canada Adaptation Action Plan

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András Szakonyi named CEO of Ferrovial’s Digital Infrastructure Division

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This division targets the high-growth data center market, building on a decade of successful projects for industry leaders

AMSTERDAM, Nov. 14, 2024 /PRNewswire/ — Ferrovial, a leading global infrastructure company, announces the appointment of András Szakonyi as CEO of Digital Infrastructure. Szakonyi brings deep sector expertise, both in data centers and sustainable AI cloud solutions. As divisional CEO, he will strengthen and expand Ferrovial’s presence in a growing sector where it has been developing projects for multinational leaders for more than 10 years in Europe and the Americas. 

“Ferrovial brings distinctive expertise in complex data center construction projects. Our proven track record of engineering excellence and value creation positions us well to expand our role as a global investor and developer of digital infrastructure. We welcome András’s leadership in driving our continued success and innovation in this strategic area,” said Ignacio Madridejos, CEO of Ferrovial.

The Digital Infrastructure Division will identify investment opportunities to develop high-value projects in this sector.  

András Szakonyi holds an MBA in Finance and Economics from Corvinus University in Budapest and is a graduate of INSEAD Business School’s LEAP (Leadership Excellence through Awareness and Practice Program).

During his extensive professional experience, he has held various international leadership positions. He started his career as a finance professional at General Electric, where he spent six years leading different finance functions in the United States. 

Afterward, he spent 21 years in multiple senior leadership roles at Iron Mountain (IRM), a global listed B2B service company based in Boston focusing on data centers and information management services. He played a key role in building Iron Mountain’s data center business in his role as global COO. 

Since 2020, he has been a member of the Supervisory Board and Audit Committee of Magyar Telekom (Subsidiary of Deutsche Telekom), a leading Hungarian information and communications technology company.

About Ferrovial

Ferrovial is one of the world’s leading infrastructure companies. The Company operates in more than 15 countries and has a workforce of over 24,000 worldwide. Ferrovial is triple listed on Euronext Amsterdam, the Spanish Stock Exchanges and Nasdaq and is a member of Spain’s blue-chip IBEX 35 index. It is part of the Dow Jones Sustainability Index and FTSE4Good, and all its operations are conducted in compliance with the principles of the UN Global Compact, which the Company adopted in 2002. 

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2025 Fortune Global Forum to be held in Riyadh, Saudi Arabia

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Fortune will also hold a Most Powerful Women gathering in Riyadh next year

NEW YORK, Nov. 14, 2024 /PRNewswire/ — Fortune announced that its 2025 Fortune Global Forum, the premier gathering of CEOs and other leaders of the world’s largest multinational companies, will convene in Riyadh, Saudi Arabia, next December. In the spring, Fortune will also hold in Riyadh its first-ever Fortune Most Powerful Women event in the Middle East, an extension of the annual Most Powerful Women summit in the U.S.

This marks the first time since its inception in 1995 that the Fortune Global Forum has taken place in the Saudi capital. The Forum and the MPW event are being held in partnership with the Saudi Conventions and Exhibitions General Authority.

“For 30 years, Fortune has been proud to bring the Fortune Global Forum to the frontiers of the business world,” Anastasia Nyrkovskaya, CEO of Fortune, said. “Saudi Arabia is one of those important frontiers. We look forward to connecting leaders of companies across industries from the East and West in Riyadh, an ideal location for our 2025 Fortune Global Forum.”

The Forum has historically been held in major cities at the forefront of global business, including Singapore, Barcelona, Guangzhou, New Delhi, Rome, Hong Kong, Paris, Abu Dhabi, Cape Town, and San Francisco. Earlier this week in New York City, the 2024 Fortune Global Forum included speakers such as former U.S. CIA Directors Mike Pompeo and Leon Panetta; Adena Friedman, Chair and CEO, Nasdaq; Gita Gopinath, First Managing Director, International Monetary Fund; Josh Kushner, Founder and CEO, Thrive Capital; Rob Manfred and Adam Silver, the commissioners of Major League Baseball and the National Basketball Association, respectively; John Stankey, CEO, AT&T; Boris Johnson, former Prime Minister of the United Kingdom; Brooke Shields, actor, New York Times bestselling author, and founder of Commence; H.E. Fahd bin Abdulmohsan Al-Rasheed, Advisor, General Secretariat of the Council of Ministers, and Chair, Saudi Conventions and Exhibitions General Authority; Tom Brady, seven-time world champion; and Wynton Marsalis, Pulitzer Prize-winning composer and Managing and Artistic Director of Jazz at Lincoln Center, the site of the Forum, and more.

The Fortune Global Forum fosters impactful discussions among leading executives and other top figures in business, government, and culture and offers valuable insights into international business strategies.

Fortune’s annual Most Powerful Women Summit convenes women leaders from Fortune 500 companies and trailblazers from government, philanthropy, education, sports, and the arts for inspiring conversations, collaboration, and networking. The Riyadh MPW conference will draw women globally who are making significant contributions to business and economic growth.

About Fortune:
Fortune is a global multi-platform media company built on a legacy of trusted, award-winning reporting and information for those who want to make business better. Independently owned, Fortune tells the stories of the world’s biggest companies and their leaders as well as a new generation of innovators who are moving business forward. Digitally and in print, Fortune measures corporate performance through rigorous benchmarks, and holds companies accountable, in regions around the world. Its iconic rankings include Fortune 500, Fortune Global 500Most Powerful Women, and World’s Most Admired Companies. Fortune builds world-class communities by convening industry thought leaders for exclusive summits and conferences, including the Fortune Global Forum, Brainstorm Tech, Fortune Most Powerful Women. For more information, visit fortune.com.

Media Contacts:
Patrick Reilly
Fortune
Patrick.Reilly@fortune.com

Chelsea Hudson
Fortune
Chelsea.Hudson@fortune.com

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