Cisco Revenue Rises 12% to $15.35 Billion in Q2 FY2026
Cisco Systems posted $15.35 billion in revenue for the three months ending January 24, up from $13.99 billion in the year-ago quarter. Net income climbed 31% to $3.18 billion.
Cisco Systems reported revenue of $15.35 billion for the quarter ending January 24, 2026, a 12% increase from $13.99 billion in the same period a year earlier. The networking equipment maker posted net income of $3.18 billion, up 31% from $2.43 billion in the year-ago quarter. Read more earnings reports.
For the six months ending January 24, 2026, total revenue reached $30.23 billion, up 9% from $27.83 billion in the first half of fiscal 2025. Net income for the half-year period came in at $6.04 billion, compared with $5.14 billion a year earlier.
Diluted earnings per share for the second quarter stood at $0.80, compared with $0.61 in the prior-year quarter. For the six-month period, diluted EPS was $1.51, up from $1.28 a year earlier.
Product Revenue Drives Growth
Product revenue for the quarter totaled $11.64 billion, a 14% jump from $10.23 billion in the year-ago period. Service revenue came in at $3.71 billion, nearly flat compared with $3.76 billion a year earlier.
For the first half of fiscal 2026, product revenue reached $22.72 billion, up 12% from $20.35 billion. Service revenue for the six-month period was $7.51 billion, matching the $7.48 billion recorded in the first half of fiscal 2025.
Gross Margin Expands
Gross profit for the second quarter was $9.97 billion, up from $9.11 billion a year earlier. The gross margin improved to 65.0% from 65.1% in the prior-year quarter. Cost of goods sold rose to $5.38 billion from $4.88 billion.
Operating expenses increased to $6.19 billion in the quarter from $6.00 billion a year earlier. Research and development spending climbed to $2.36 billion from $2.30 billion.
Operating income for the quarter reached $3.78 billion, up 21% from $3.11 billion in the year-ago period. For the six months, operating income totaled $7.14 billion compared with $5.47 billion a year earlier.
Cash Flow and Balance Sheet
Cash from operations for the first half of fiscal 2026 was $5.03 billion, down from $5.90 billion in the same period of fiscal 2025. Cash used in investing activities totaled $1.15 billion, a reversal from the $1.50 billion generated in the prior-year period. Financing activities consumed $5.30 billion, compared with $6.73 billion in the first half of fiscal 2025.
Total assets stood at $123.37 billion as of January 24, 2026, compared with $122.29 billion at the end of fiscal 2025. Cash and cash equivalents decreased to $7.46 billion from $8.35 billion. Inventory rose to $3.92 billion from $3.16 billion.
Long-term debt declined to $21.37 billion from $22.86 billion at the end of the prior fiscal year. Total stockholders' equity increased to $47.72 billion from $46.84 billion.
Common shares outstanding totaled 3.95 billion as of January 24, 2026, down from 3.96 billion at the end of fiscal 2025.
Key Financial Metrics
| Metric | Q2 FY2026 | Q2 FY2025 | Change |
|---|---|---|---|
| Revenue | $15.35 billion | $13.99 billion | +9.7% |
| Net Income | $3.18 billion | $2.43 billion | +30.8% |
| Diluted EPS | $0.80 | $0.61 | +31.1% |
| Gross Margin | 65.0% | 65.1% | -0.1 pts |
| Operating Income | $3.78 billion | $3.11 billion | +21.5% |
The tax provision for the quarter was $471 million, compared with $459 million in the year-ago quarter. For the six-month period, income tax expense totaled $1.00 billion, up sharply from $15 million in the first half of fiscal 2025.