Cisco Systems (NAS:CSCO) Interest Coverage

: 33.04 (As of Jan. 2023)

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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Cisco Systems's Operating Income for the three months ended in Jan. 2023 was $3,535 Mil. Cisco Systems's Interest Expense for the three months ended in Jan. 2023 was $-107 Mil. Cisco Systems's interest coverage for the quarter that ended in Jan. 2023 was 33.04. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Cisco Systems's Interest Coverage or its related term are showing as below:

CSCO' s Interest Coverage Range Over the Past 10 Years
Min: 13.43 Med: 19.25 Max: 38.82
Current: 36.19

CSCO's Interest Coverage is ranked better than
64.98% of 1656 companies
in the Hardware industry
Industry Median: 17.51 vs CSCO: 36.19

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Cisco Systems Interest Coverage Historical Data

The historical data trend for Cisco Systems's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Cisco Systems Annual Data

Trend

Jul13

Jul14

Jul15

Jul16

Jul17

Jul18

Jul19

Jul20

Jul21

Jul22

Interest Coverage

13.43

16.93

24.10

31.61

38.82

Cisco Systems Quarterly Data
	Apr18	Jul18	Oct18	Jan19	Apr19	Jul19	Oct19	Jan20	Apr20	Jul20	Oct20	Jan21	Apr21	Jul21	Oct21	Jan22	Apr22	Jul22	Oct22	Jan23
Interest Coverage																39.66	40.11	36.90	35.38	33.04

Competitive Comparison

For the Communication Equipment subindustry, Cisco Systems's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

Cisco Systems Interest Coverage Distribution

For the Hardware industry and Technology sector, Cisco Systems's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Cisco Systems's Interest Coverage falls in comparison to its industry or sector. The grey bar indicates the Interest Coverage's extreme value range as defined by GuruFocus.

Cisco Systems Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Cisco Systems's Interest Coverage for the fiscal year that ended in Jul. 2022 is calculated as

Here, for the fiscal year that ended in Jul. 2022, Cisco Systems's Interest Expense was $-360 Mil. Its Operating Income was $13,975 Mil. And its Long-Term Debt & Capital Lease Obligation was $8,416 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Jul. 2022 )	/	Interest Expense (A: Jul. 2022 )
	=	-1	*	13975	/	-360
	=	38.82

Cisco Systems's Interest Coverage for the quarter that ended in Jan. 2023 is calculated as

Here, for the three months ended in Jan. 2023, Cisco Systems's Interest Expense was $-107 Mil. Its Operating Income was $3,535 Mil. And its Long-Term Debt & Capital Lease Obligation was $7,637 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Jan. 2023 )	/	Interest Expense (Q: Jan. 2023 )
	=	-1	*	3535	/	-107
	=	33.04

The higher the ratio, the stronger the company's Financial Strength is.

Cisco Systems (NAS:CSCO) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

Cisco Systems Interest Coverage Related Terms

Thank you for viewing the detailed overview of Cisco Systems's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Cisco Systems (NAS:CSCO) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » Cisco Systems Inc (NAS:CSCO) » Definitions » Interest Coverage

Traded in Other Exchanges

CSCO:Mexico 0R0K:UK CIS:Germany CSCO:Canada CSCO34:Brazil CIS:Belgium CSCO:Austria CSCO:Argentina

Address

170 West Tasman Drive, San Jose, CA, USA, 95134-1706

Website

https://www.cisco.com

Cisco Systems is the largest provider of networking equipment in the world and one of the largest software companies in the world. Its largest businesses are selling networking hardware and software (where it has leading market shares) and cybersecurity software like firewalls. It also has collaboration products, like its Webex suite, and observability tools. It primarily outsources its manufacturing to third parties and has a large sales and marketing staff—25,000 strong across 90 countries. Overall, Cisco employees 80,000 employees and sells its products globally.

Executives

Sarah Rae Murphy	director	C/O CISCO SYSTEMS, INC., 170 WEST TASMAN DRIVE, SAN JOSE CA 95134
Jeffery S. Sharritts	officer: EVP & Chief Cust & Prtnr Offcr	1200 ABERNATHY RD., NE, STE 1200, ATLANTA GA 30328
Deborah L Stahlkopf	officer: EVP and Chief Legal Officer	C/O CISCO SYSTEMS, INC., 170 WEST TASMAN DRIVE, SAN JOSE CA 95134
Marianna Tessel	director	C/O INTUIT INC., 2700 COAST AVENUE, MOUNTAIN VIEW CA 94043
John D Harris	director	C/O FLEXTRONICS INTERNATIONAL USA, INC., 6201 AMERICA CENTER DRIVE, SAN JOSE CA 95002
Richard Scott Herren	officer: EVP and CFO	851 WEST CYPRESS CREEK ROAD, FORT LAUDERDALE FL 33309
Wesley G Bush	director	333 MAPLE AVENUE EAST, #3080, VIENNA VA 22180
Lisa T Su	director	C/O ADVANCED MICRO DEVICES, INC., 2485 AUGUSTINE DRIVE, SANTA CLARA CA 95054
Carol B Tome	director	55 GLENLAKE PARKWAY, NE, ATLANTA GA 30328
Geraldine Elliott	officer: EVP, Chief Sales & Mktg Offcr	1194 N. MATHILDA AVE., SUNNYVALE CA 94089
Maria Martinez	officer: EVP, Chief Customer Exp Offcr	THE LANDMARK @ 1 MARKET STREET, SUITE 300, SAN FRANCISCO CA 94105
Mark Garrett	director	106 EAST BABCOCK STREET SUITE 3A, BOZEMAN MT 59715
Irving Tan	officer: SVP, Operations and Digital	170 WEST TASMAN DRIVE, SAN JOSE CA 95134
David Goeckeler	officer: EVP, Networking and Security	C/O WESTERN DIGITAL CORPORATION, 5601 GREAT OAKS PARKWAY, SAN JOSE CA 95119
Brent L Saunders	director	2000 GALLOPING HILL ROAD, C/O SCHERING PLOUGH CORP, KENILWORTH NJ 07033