Q1 Fiscal Year 2010

C o n f eren ce C all

November 4, 2009
GAAP RECONCILIATION
During this presentation references to financial measures of Cisco will include
references to non-GG A A P financial measures. Cisco prov ides a reconciliation
b etween G A A P and non-GG A A P financial information on our web site at
www. cisco. com under “ A b out Cisco” in the “ I nv estor R elations” section.
http: / / inv estor. cisco. com/ results. cfm

F ORW ARD -LOOK ING S TATEM ENTS

T his presentation contains proj ections and other forward-look look ing statements
regarding future ev ents or the future financial performance of Cisco, including
future operating results. T hese proj ections and statements are only predictions.
A ctual ev ents or results may differ materially from those in the proj ections or
other forward-look
look ing statements. P lease see Cisco’ s filings with the S E C,
including its most recent filing on F orm 1 0 -KK , for a discussion of important risk
factors that could cause actual ev ents or results to differ materially from those in
the proj ections or other forward-look ing statements.

2 2
 Opening Remarks
F inanc ial Ov erv iew
B u siness Ov erv iew and
S t rat egy
G u id anc e
S u mmary C o mment s

3 3
Q1 FY’10 Highlights
Financial Summary

Revenue of $9.0B (-1 3% vs -11 5 % t o -1 7 % g ui d a nc e)

N on-G A A P E P S of $0.36

S ol i d ex p ens e m a na g em ent , non-G
non A A P O p E x -1 0% y /y

N on-GG A A P p r od uc t g r os s m a r g i n ex t r em el y s t r ong a t 6 6 .3%

C a s h g ener a t ed fr om op er a t i ons of a p p r ox . $1 .5 B

N on-G A A P op er a t i ng i nc om e ver y s t r ong a t 2 9% of r evenue

P r od uc t b ook t o b i l l w a s a b ove 1

S er vi c es r evenue up 7 % y /y

4
Q1 FY’10 O b se r v a tio n s

A l m os t a l l of t h e fi na nc i a l s eq uent i a l m ea s ur em ent s fr om
Q 4 F Y ’ 09 t o Q 1 F Y ’ 1 0 were at the high end or above
Q 4 to Q 1 i n p r evi ous fi ve ‘ nor m a l ’ y ea r s , F Y ’ 04 t o F Y ’ 08

W e a r e s t a r t i ng t o s ee s ol id indic ations of ec onom ic
rec overy i n m os t g eog r a p h i es a r ound t h e w or l d

S ol i d ex ec ut i on ena b l i ng C i s c o t o m ove i nt o 30+ m a r k et
a d j a c enc i es w h i l e r ed uc i ng non-G
non A A P op er a t i ng
ex p ens es b y 1 0% y / y a nd r ed uc i ng h ea d c ount

M os t m a r k et s s t a r t i ng t o s h ow s igns of im p rovem ent,
es p ec i a l l y p l ea s ed w i t h t h e U .S ., w h er e y / y or d er s w er e
a p p r ox i m a t el y fl a t

5
Q1 FY’10 O b se r v a tio n s

Q 3 F Y ’ 09 a p p ea r s t o h a ve b een t h e b ot t om w i t h nor m a l
m ont h l y l i nea r i t y ; Q 4 F Y ’ 09 w a s c l ea r l y t h e “ t i p p i ng p oi nt ”
w h i l e Q 1 F Y ’ 1 0 res u l ts indic ate rec overy is wel l
u nderway , bas ed on ou r order m om entu m

G i ven our vi ew s of t h e ec onom y , ex p r es s ed over t h e l a s t
t h r ee q ua r t er s , w e a r e p r oud of our abil ity to retu rn to
ou r p rior f inanc ial op erating m odel s o q ui c k l y a ft er t h e
g l ob a l ec onom i c s l ow d ow n

N ew or g a ni z a t i ona l s t r uc t ur e i s op erating very ef f ec tivel y
- a l l ow s p eed , s c a l e, fl ex i b i l i t y a nd r a p i d r ep l i c a t i on

W e ex i t Q 1 F Y ’ 1 0 w i t h a c om p el l i ng fi na nc i a l p os i t i on
a nd i nnova t i on eng i ne

6
Q1 FY’10 O b se r v a tio n s

I nt er na l s t a r t -up
up s , p a r t ner s h i p s a nd our a c q ui s i t i ons
c ont i nue t o fi l l out our a r c h i t ec t ur a l s t r a t eg i es

Bel i eve t h a t video arc hitec tu re is the m os t im p ortant
W eb 2 . 0 nex t generation p l ay a nd i s one of our k ey
c om p et i t i ve a d va nt a g es

V i r t ua l c om p ut i ng envi r onm ent c oa l i t i on b et w een C i s c o,
E M C a nd V M w a r e il l u s trates ou r abil ity to innovate,
p artner and ac q u ire to c atc h k ey m ark et trans itions

K ey m a r k et t r a ns i t i ons , r el a t i ve t o c ol l aboration,
virtu al iz ation and video network ing w i l l d r i ve
p r od uc t i vi t y a nd g r ow t h i n net w or k l oa d s

7
 Opening Remarks
F inanc ial Ov erv iew
B u siness Ov erv iew and
S t rat egy
G u id anc e
S u mmary C o mment s

8 9
 C isc o T o ta l R e v e n u e

Year / Year
G r ow th
Q1 FY’10
Q1 FY’10 Total Revenue
1

$ 9 .0 B (1 3 % )

1 Includes a n a p p r o x i m a t e $ 5 0 m b enef i t r ela t ed t o t h e a do p t i o n o f new r ev enue r eco g ni t i o n a cco unt i ng g ui da nce

9
 Q1 FY’10 R e v e n u e Highlights

Ye a r / Ye a r
Q1 FY’101
G ro w th
R o u te rs $ 1. 6 B ( 17 % )
S w itc h e s $ 2 .9 B ( 2 1% )
A d v a n c e d T e c h n o lo g ie s $ 2 .3 B ( 15 % )
O th e r $ 0. 5 B 9 %
S e r v ic e s $ 1. 8 B 7 %
T o ta l $ 9 . 0B ( 13 % )

1. A s a r e s u lt o f r o u n d in g , fig u r e s m a y n o t to ta l.F o r d e ta ile d r e s u lts , p le a s e s e e C is c o ’s In v e s to r R e la tio n s

W e b s i t e a t h t t p : / / w w w . ci sco . co m / g o / i nv est o r s

1 0
 Q1 FY’10 R e v e n u e b y G e o gr a p hy

Ye a r / Ye a r
Q1 FY’101
G ro w th 2
U .S . & C a n a d a $ 5 . 0B ( 10% )
E u ro p e $ 1. 8 B ( 15 % )
E m e r g in g M a r k e ts $ 0. 9 B ( 3 0% )
A s ia P a c ific $ 1. 0B (6 % )
J a p a n $ 0. 4 B 2 %
T o ta l $ 9 . 0B ( 13 % )

1. A s a r e s u lt o f r o u n d in g , fig u r e s m a y n o t to ta l.F o r d e ta ile d r e s u lts , p le a s e s e e C is c o ’s In v e s to r R e la tio n s

W e b s i t e a t h t t p : / / i nv est o r . ci sco . co m / r esult s. cf m
2 . A s a r e m in d e r , r e v e n u e m a y la g o r d e r s d u e to a n u m b e r o f fa c to r s in c lu d in g s h ip m e n t le v e ls a n d th e
r e q u ir e m e n t to s a tis fy c o m p le x r e v e n u e r e c o g n itio n c r ite r ia .

1 1
Q1 FY’10 N o n -GG A A P G r o ss M a r gin

Q4 FY’09 Q1 FY’10

To t a l n o n -GAAP Gr o s s M a r g i n 6 5 .3 % 6 6 .3 %

Pr o d u c t n o n -GAAP
GAAP Gr o s s M a r g i n 6 4 .7 % 6 6 .3 %

S e r v i c e n o n -GAAP
GAAP Gr o s s M a r g i n 6 7 .5 % 6 6 .3 %

-- Q 1 F Y ’ 1 0 G A A P T o t a l G r o s s M a r g i n o f 6 5 . 3 %
-- Q 1 F Y ’ 1 0 G A A P P r o d u c t G r o s s M a r g i n o f 6 5 . 5 %
-- Q 1 F Y ’ 1 0 G A A P S e r v i c e G r o s s M a r g i n o f 6 4 . 5 %

1 2
 Q1 FY’10 G r o ss M a r gin b y G e o gr a p hy

G r o s s M a r g in % 1

U .S . & C a n a d a 6 6 . 1%
E u ro p e 6 8 .3 %
E m e r g in g M a r k e ts 6 2 .8 %
A s ia P a c ific 6 3 .8 %
J a p a n 7 2 .6 %
T h e a te r T o ta l 6 6 .3 %

1. G r o s s m a r g i n b y g e o g r a p h y m a y f l u c t u a t e f r o m p e r i o d t o p e r i o d . T h e s e f l u c t u a t i o n s
m a y b e d u e to fa c to r s o th e r th a n u n d e r ly in g b u s in e s s tr e n d s .

1 3
Q1 FY’10 N o n -GG A A P
I n c o m e S ta te m e n t Highlights

$ M ( e x c e p t p e r -s h a r e a m o u n t s a n d p e r c e n t a g e s ) Q1 FY’09 Q4 FY’09 Q1 FY’10

N e t S a le s 10, 3 3 1 8 ,5 3 5 9 , 02 1
G r o s s M a r g in 6 5 .6 % 6 5 .3 % 6 6 .3 %
O p e r a tin g E x p e n s e s 3 ,6 9 9 3 ,3 4 9 3 ,3 3 7
O p e x (% of Revenue) 3 5 .8 % 3 9 .2 % 3 7 . 0%
O p e r a t i n g I n c o m e (% of Revenue) 2 9 .8 % 2 6 . 1% 2 9 .3 %
N e t In c o m e 2 ,4 9 7 1, 8 3 9 2 , 116
N e t In c o m e (% of Revenue) 2 4 .2 % 2 1. 5 % 2 3 .5 %
E P S (d i l ut ed ) $ 0. 4 2 $ 0. 3 1 $ 0. 3 6

1 4
 Q1 FY’10 G A A P
I n c o m e S ta te m e n t Highlights

$ M ( e x c e p t p e r -s h a r e a m o u n t s a n d p e r c e n t a g e s ) Q1 FY’09 Q4 FY’09 Q1 FY’10

N e t S a le s 10, 3 3 1 8 ,5 3 5 9 , 02 1
G r o s s M a r g in 6 4 .7 % 6 4 . 0% 6 5 .3 %
O p e r a tin g E x p e n s e s 4 , 19 9 4 , 001 3 ,7 6 4
O p e x (% of Revenue) 4 0. 6 % 4 6 .9 % 4 1. 7 %
O p e r a tin g In c o m e (% of Revenue) 2 4 . 0% 17 . 1% 2 3 .5 %
N e t In c o m e 2 , 2 01 1, 08 1 1, 7 8 7
N e t In c o m e (% of Revenue) 2 1. 3 % 12 . 7 % 19 . 8 %
E P S (d i l ut ed ) $ 0. 3 7 $ 0. 19 $ 0. 3 0

1 5
 Q1 FY’10 K e y Fin a n c ia l M e a su r e s
Q1 FY’09 Q2 FY’09 Q3 FY’09 Q4 FY’09 Q 1 F Y ’1 0

Cash and Cash Equivalents 2 6 ,7 6 3 2 9 ,5 3 1 3 3 ,5 5 1 3 5 ,0 0 1 3 5 ,3 6 5

and I nvestm ents ( $ M )
O p er ating Cash F lo w ($ M ) 2 ,7 1 8 3 ,1 9 8 1 ,9 9 6 1 ,9 8 5 1 ,4 8 8

S h a r e Re p u r c h a s e Pr o g r a m
Amount N umb e r of Av g . P r i c e P e r
P ur c h a s e d ($M) S h a r e s (M) S h a re

Q 1 F Y ’ 1 0 P ur c hases $ 1 ,7 5 3 7 6 $ 2 2 .9 9

Cum ulative P r o g r am P ur c hases* $ 5 8 ,9 3 2 2 ,8 7 8 $ 2 0 .4 7

*Since program inception in FY’02

A p p r o x . $ 1 3 . 1 B r em aining autho r iz ed f unds in r ep ur c hase

p r o g r am , inc luding $ 1 0 B additio nal autho r iz atio n ap p r o ved
o n N o vem b er 4 2 0 0 9 b y Cisc o B o ar d o f D ir ec to r s.

1 6
 Q1 FY’10 K e y Fin a n c ia l M e a su r e s

Q1 FY’09 Q2 FY’09 Q3 FY’09 Q4 FY’09 Q1 FY’10

A c c o unts R ec eivab le ( $ M ) 3 ,2 7 8 2 , 8 93 2 , 3 92 3 , 17 7 3 , 15 9

D ay s S ales O utstanding 2 9 2 9 2 7 3 4 3 2

I nvento r y ( $ M ) 1, 2 09 1, 107 1, 02 3 1, 07 4 1, 08 9

N o n
n--G A A P I nvento r y T ur ns 11. 6 11. 3 10. 7 11. 3 11. 3

P ur c hase Co m m itm ents ( $ M ) 2 ,8 5 2 2 ,6 6 9 2 , 196 2 , 15 7 2 , 8 03

D ef er r ed R evenue ( $ M ) 8 ,8 4 4 9, 3 00 8 ,7 7 3 9, 3 93 9, 2 7 1

H eadc o unt 6 7 ,6 4 7 6 7 , 3 18 6 6 ,5 5 8 6 5 ,5 4 5 6 3 ,7 5 6

1 7
N e w a c c o u n tin g sta n d a r d s

I n Q 1 F Y ’ 1 0 a d op t ed t w o new a c c ount i ng s t a nd a r d s w h i c h
i m p a c t r evenue r ec og ni t i on – E I T F 08 -1 a nd 09-3

I m p a c t of t h e new s t a nd a r d s i n Q 1 w a s a n i nc r ea s e t o
r evenue of a p p r ox . $5 0m a nd a h a l f p enny b enefi t t o E P S

D o not ex p ec t t h e new s t a nd a r d s t o h a ve a m a t er i a l i m p a c t
on fi na nc i a l r es ul t s i n Q 2 F Y ’ 1 0

A nt i c i p a t e new a c c ount i ng g ui d a nc e w i l l r es ul t i n i m p r oved
op er a t i ona l a l i g nm ent of t h e a c c ount i ng w i t h new p r od uc t
offer i ng s , i nc l ud i ng p r od uc t s fr om a c q ui s i t i ons , a nd
r el a t ed g o-t o-mm a rk et s t r a t eg i es

1 8
Fin a n c ia l su m m a r y

P l ea s ed w i t h our Q 1 r es ul t s a nd t h e s t r ong found a t i on fr om
w h i c h w e c a n c ont i nue t o f oc u s on growth and c ap tu ring
m ark et trans itions

O ng oi ng effor t s t o i m p r ove effi c i enc y a nd p r od uc t i vi t y h a ve
a l l ow ed us t o d el i ver s t r ong p er for m a nc e; w e w i l l c ontinu e to
m ak e inves tm ents in innovation, op erational ex c el l enc e
and ou r k ey growth op p ortu nities

1 9
 Opening Remarks
F inanc ial Ov erv iew
B u siness Ov erv iew and
S t rat egy
G u id anc e
S u mmary C o mment s

20 21
 S tr a te gy R e v ie w

Q 1 c ont i nued t h e t r end of b a l a nc e b et w een i nnova t i on
a nd op er a t i ona l effec t i venes s

T h e m a j or r es ul t s a nd c om m i t m ent s t o virtu al iz ation,
video a nd c ol l aboration w er e evi d ent i n a l m os t a l l
p h a s es of our foc us on m a r k et a d j a c enc i es a s t h e
net w or k b ec om es t h e p l a t for m for a l l for m s of
c om m uni c a t i ons a nd I T

21
S tr a te gy R e v ie w

V i r t ua l i z a t i on
– S o lid m o m e n tu m d r iv e n b y N e x u s 5 0 0 0 a n d 7 0 0 0 fa m ily
– U C S e x p e r ie n c in g s o lid m a r k e t r e c e p tio n
– V C E C o a litio n a n n o u n c e m e n t w ith E M C a n d V M w a r e
r e p r e s e n ts a n u n p r e c e d e n te d le v e l o f c o lla b o r a tio n

V i d eo
– T e le P r e s e n c e r e v e n u e s g r e w in e x c e s s o f 1 0 0 % y /y
– T A N D B E R G , D V N a n d P u r e D ig ita l a n n o u n c e m e n ts
– M e d ia n e t a r c h ite c tu r a l s o lu tio n

C ol l a b or a t i on
– C o lla b o r a tio n d r iv in g th e n e x t w a v e o f b u s in e s s g r o w th ,
in n o v a tio n a n d p r o d u c tiv ity
– T A N D B E R G a ls o a b o u t in te g r a tio n o f v id e o in to th e
b r o a d e r $ 3 0 B + c o lla b o r a tio n m a r k e t
– In te n t to a c q u ir e S ta r e n t fo c u s s e d o n m o b ile s u b s c r ib e r s
22
Q1 FY’10 G e o gr a p hic Highlights

U .S . or d er s fl a t y / y
– E n te r p r is e u p a p p r o x . 1 0 % y /y
– P u b lic s e c to r u p h ig h s in g le d ig its y /y
– S e r v ic e p r o v id e r d o w n h ig h s in g le d ig its y /y
– C o m m e r c ia l d o w n in m id s in g le d ig its y /y

J a p a n or d er s up m i d s i ng l e d i g i t s y / y
– P u b lic s e c to r u p o v e r 4 0 % y /y
– C o m m e r c ia l d o w n in m id te e n s y /y

A s i a P a c or d er s d ow n l ow s i ng l e d i g i t s y / y
– P u b lic s e c to r u p o v e r 3 0 % y /y
– O th e r s e c to r s d o w n b e tw e e n m id s in g le a n d m id te e n s y /y

E m er g i ng M a r k et s or d er s d ow n h i g h t w ent i es y / y

E ur op e or d er s d ow n l ow t eens y / y
23
Q1 FY’10 P r o d u c t Highlights
P rodu c t R evenu e

S w i t c h i ng r evenue d ow n a p p r ox . 2 1 % y /y

Rout i ng r evenue d ow n a p p r ox . 1 7 % y /y

T ot a l A d va nc ed T ec h nol og i es d ow n a p p r ox . 1 5 % y /y
– U n ifie d C o m m u n ic a tio n s d o w n a p p r o x . 1 0 %
– W ir e le s s u p 7 %
– N e tw o rk e d H o m e d o w n 1 8 %
– S e c u r ity d o w n 9 %
– S to ra g e d o w n 1 9 %
– V id e o d o w n 2 9 %
– A N S d o w n 2 5 %
– T e le P r e s e n c e r e v e n u e g r e w o v e r 1 0 0 % y /y

24
V isio n , S tr a te gy a n d E x e c u tio n

V is ion of h ow t h e i nd us t r y evol vi ng a p p ea r s t o b e p l a y i ng out

ver y m uc h a s w e ex p ec t ed

O ur dif f erentiated s trategy i s a c h i evi ng t h e b enefi t s t o b ot h
C i s c o a nd our c us t om er s t h a t w e t h oug h t w er e p os s i b l e

O ur ex ec u tion i s on t a r g et i n t er m s of r es ul t s a s m ea s ur ed b y
a c us t om er p a r t ner s h i p p er s p ec t i ve, m a r k et s h a r e, a nd s h a r e
of our c us t om er s ’ t ot a l c om m uni c a t i ons a nd I T ex p end i t ur es

25
 Opening Remarks
F inanc ial Ov erv iew
B u siness Ov erv iew and
S t rat egy
G u id anc e
S u mmary C o mment s

26 36
S u m m a r y C o m m e n ts

W h i l e no one k now s for s ur e t h e s t r eng t h of t h e
r ec over y , j ob c r ea t i on op p or t uni t i es a nd t h e p os s i b i l i t y
of a not h er d ow nt ur n, we wil l s et ou r s trategy and
ex ec u tion as s u m ing an op tim is tic view

O ur c us t om er s a r e r a p i d l y ex p a nd i ng t h ei r vi ew s h ow
C i s c o c a n h el p t h em a c h i eve t h ei r ow n p rodu c tivity ,
revenu e growth and dif f erentiation ver s us t h ei r
p eer s

I n Q 2 F Y ’ 1 0 w e p l a n t o aggres s ivel y inves t in new
and adj ac ent m ark ets for t h e l ong er t er m

O n a g l ob a l a nd U .S . b a s i s w e s a w i m p r ovem ent s b ut
w e a l s o c ontinu e to s ee s om e c hal l enges and
u nc ertainties fr om a n ec onom i c , p ol i t i c a l a nd c a p i t a l
s p end i ng p er s p ec t i ve

27
S u m m a r y C o m m e n ts

C l ea r l y w e s a w a tip p ing p oint in Q 4 F Y ’ 0 9 , and Q 1
was very s trong s eq u ential l y , our ex p ec t a t i ons for Q 2
y / y g r ow t h c onfi r m t h a t t h e m a r k et i s r ec over i ng

S t i l l t oo ea r l y t o k now w h a t t h e rate of rec overy a nd
ex tent of j ob c reation, w h i c h i s r eq ui r ed for
s us t a i na b i l i t y , w i l l l ook l i k e i n 2 01 0

E x p ec t a c ont i nued r ec over y i nt o nex t y ea r , i m p or t a nt t h a t
ex p ec tations do not get ahead of m ark et real ities

P os i t i on C i s c o t o g a i n m om ent um i n m a r k et t r a ns i t i ons
w h et h er t h ey a r e indu s try c ons ol idation, p rodu c t
trans itions , m ark et adj ac enc y op p ortu nities or
ec onom ic

W e b el i eve our vis ion, s trategy , and ex ec u tion
a r e i n g r ea t s h a p e a nd p rodu c ing res u l ts

28
F orward-L ook ing S tatem ents
T h ese p r esent a t i o n sli des a nd t h e r ela t ed co nf er ence ca ll co nt a i n f o r w a r d-lolo o k i ng st a t em ent s, w h i ch a r e
sub j ect t o t h e sa f e h a r b o r p r o v i si o ns o f t h e P r i v a t e S ecur i t i es L i t i g a t i o n R ef o r m A ct o f 19 9 5 . T h ese
f o r w a r d-lolo o k i ng st a t em ent s i nclude, a m o ng o t h er t h i ng s, st a t em ent s r eg a r di ng f ut ur e ev ent s ( such a s t h e
i m p r o v i ng eco no m i c o ut lo o k a nd r ela t ed o p p o r t uni t y , m a r k et t r a nsi t i o ns a cr o ss co lla b o r a t i o n,
v i r t ua li z a t i o n a nd v i deo dr i v i ng p r o duct i v i t y a nd g r o w t h i n net w o r k lo a ds f o r t h e nex t deca de, a nd t h e
em er g ence o f a new m o del o f p r o duct i v i t y b a sed o n co lla b o r a t i o n a nd r ela t ed b usi ness o p p o r t uni t y ) a nd
t h e f ut ur e f i na nci a l p er f o r m a nce o f C i sco t h a t i nv o lv e r i sk s a nd uncer t a i nt i es. R ea der s a r e ca ut i o ned t h a t
t h ese f o r w a r d-lolo o k i ng st a t em ent s a r e o nly p r edi ct i o ns a nd m a y di f f er m a t er i a lly f r o m a ct ua l f ut ur e ev ent s
o r r esult s due t o a v a r i et y o f f a ct o r s, i ncludi ng : b usi ness a nd eco no m i c co ndi t i o ns a nd g r o w t h t r ends i n
t h e net w o r k i ng i ndust r y , o ur cust o m er m a r k et s a nd v a r i o us g eo g r a p h i c r eg i o ns; g lo b a l eco no m i c
co ndi t i o ns a nd uncer t a i nt i es i n t h e g eo p o li t i ca l env i r o nm ent ; o v er a ll i nf o r m a t i o n t ech no lo g y sp endi ng ; t h e
g r o w t h a nd ev o lut i o n o f t h e Int er net a nd lev els o f ca p i t a l sp endi ng o n Int er net -bb a sed sy st em s; v a r i a t i o ns
i n cust o m er dem a nd f o r p r o duct s a nd ser v i ces, i ncludi ng sa les t o t h e ser v i ce p r o v i der m a r k et a nd o t h er
cust o m er m a r k et s; t h e r et ur n o n o ur i nv est m ent s i n cer t a i n m a r k et a dj a cenci es a nd g eo g r a p h i ca l
lo ca t i o ns dur i ng t h e cur r ent eco no m i c do w nt ur n; t h e t i m i ng o f o r der s a nd m a nuf a ct ur i ng a nd cust o m er
lea d t i m es; ch a ng es i n cust o m er o r der p a t t er ns o r cust o m er m i x ; i nsuf f i ci ent , ex cess o r o b so let e
i nv ent o r y ; v a r i a b i li t y o f co m p o nent co st s; v a r i a t i o ns i n sa les ch a nnels, p r o duct co st s o r m i x o f p r o duct s
so ld; o ur a b i li t y t o successf ully a cq ui r e b usi nesses a nd t ech no lo g i es a nd t o successf ully i nt eg r a t e a nd
o p er a t e t h ese a cq ui r ed b usi nesses a nd t ech no lo g i es; i ncr ea sed co m p et i t i o n i n o ur p r o duct a nd ser v i ce
m a r k et s; dep endence o n t h e i nt r o duct i o n a nd m a r k et a ccep t a nce o f new p r o duct o f f er i ng s a nd
st a nda r ds; r a p i d t ech no lo g i ca l a nd m a r k et ch a ng e; m a nuf a ct ur i ng a nd so ur ci ng r i sk s; p r o duct def ect s
a nd r et ur ns; li t i g a t i o n i nv o lv i ng p a t ent s, i nt ellect ua l p r o p er t y , a nt i t r ust , sh a r eh o lder a nd o t h er m a t t er s,
a nd g o v er nm ent a l i nv est i g a t i o ns; na t ur a l ca t a st r o p h i c ev ent s; o ur a b i li t y t o a ch i ev e t h e b enef i t s
a nt i ci p a t ed f r o m o ur i nv est m ent s i n sa les a nd eng i neer i ng a ct i v i t i es; o ur a b i li t y t o r ecr ui t a nd r et a i n k ey
p er so nnel; o ur a b i li t y t o m a na g e f i na nci a l r i sk , a nd t o m a na g e ex p enses dur i ng t h e cur r ent eco no m i c
do w nt ur n; r i sk s r ela t ed t o t h e g lo b a l na t ur e o f o ur o p er a t i o ns, i ncludi ng o ur o p er a t i o ns i n em er g i ng
m a r k et s, cur r ency f luct ua t i o ns a nd o t h er i nt er na t i o na l f a ct o r s, i ncludi ng r ela t i ng t o t r a nsa ct i o ns t o h edg e
f o r ei g n cur r ency co nsi der a t i o n f o r a cq ui si t i o ns; ch a ng es i n p r o v i si o n f o r i nco m e t a x es o r a dv er se
o ut co m es r esult i ng f r o m ex a m i na t i o ns o f o ur i nco m e t a x r et ur ns; p o t ent i a l v o la t i li t y i n o p er a t i ng r esult s;
a nd o t h er f a ct o r s li st ed i n C i sco ’ s m o st r ecent r ep o r t o n F o r m 10 -KK . T h e f i na nci a l i nf o r m a t i o n co nt a i ned
i n t h ese p r esent a t i o n sli des a nd t h e r ela t ed co nf er ence ca ll sh o uld b e r ea d i n co nj unct i o n w i t h t h e
co nso li da t ed f i na nci a l st a t em ent s a nd no t es t h er et o i ncluded i n C i sco ’ s m o st r ecent r ep o r t o n F o r m 10 -K ,
a s such m a y b e a m ended f r o m t i m e t o t i m e. C i sco ’ s r esult s o f o p er a t i o ns f o r t h e t h r ee m o nt h s ended
O ct o b er 2 4 , 2 0 0 9 a r e no t necessa r i ly i ndi ca t i v e o f C i sco ’ s o p er a t i ng r esult s f o r a ny f ut ur e p er i o ds. A ny
p r o j ect i o ns i n t h ese p r esent a t i o n sli des a nd t h e r ela t ed co nf er ence ca ll a r e b a sed o n li m i t ed i nf o r m a t i o n
cur r ent ly a v a i la b le t o C i sco , w h i ch i s sub j ect t o ch a ng e. A lt h o ug h a ny such p r o j ect i o ns a nd t h e f a ct o r s
i nf luenci ng t h em w i ll li k ely ch a ng e, C i sco w i ll no t necessa r i ly up da t e t h e i nf o r m a t i o n, si nce C i sco w i ll o nly
p r o v i de g ui da nce a t cer t a i n p o i nt s dur i ng t h e y ea r . S uch i nf o r m a t i o n sp ea k s o nly a s o f t h e da t e o f t h ese
p r esent a t i o n sli des a nd t h e r ela t ed co nf er ence ca ll.

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