Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Cisco Systems Inc. (NASDAQ:CSCO)

Analysis of Property, Plant and Equipment

Advanced level

Property, Plant and Equipment Disclosure

Cisco Systems Inc., balance sheet: property, plant and equipment

US$ in millions

Microsoft Excel LibreOffice Calc
Jul 25, 2020 Jul 27, 2019 Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015
Land, buildings, and building and leasehold improvements 4,252  4,545  4,710  4,926  4,778  4,495 
Computer equipment and related software 875  922  1,085  1,258  1,288  1,310 
Production, engineering, and other equipment 5,163  5,711  5,734  5,707  5,658  5,753 
Operating lease assets 337  485  356  356  296  372 
Furniture, fixtures and other 387  376  358  572  543  497 
Gross property and equipment 11,014  12,039  12,243  12,819  12,563  12,427 
Accumulated depreciation and amortization (8,561) (9,250) (9,237) (9,497) (9,057) (9,095)
Property and equipment, net 2,453  2,789  3,006  3,322  3,506  3,332 

Based on: 10-K (filing date: 2020-09-03), 10-K (filing date: 2019-09-05), 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08).

Item Description The company
Gross property and equipment Amount before accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. Cisco Systems Inc.’s gross property and equipment decreased from 2018 to 2019 and from 2019 to 2020.
Property and equipment, net Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. Cisco Systems Inc.’s property and equipment, net decreased from 2018 to 2019 and from 2019 to 2020.

Asset Age Ratios (Summary)

Cisco Systems Inc., asset age ratios

Microsoft Excel LibreOffice Calc
Jul 25, 2020 Jul 27, 2019 Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015
Average age ratio 77.73% 76.83% 75.45% 74.09% 72.09% 73.19%
Estimated total useful life (years) 12 12 11 12 13 11
Estimated age, time elapsed since purchase (years) 10 9 8 9 9 8
Estimated remaining life (years) 3 3 3 3 4 3

Based on: 10-K (filing date: 2020-09-03), 10-K (filing date: 2019-09-05), 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08).

Asset age ratio Description The company
Average age ratio As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company’s fixed asset base is old or new. Newer assets are likely to be more efficient. Cisco Systems Inc.’s average age ratio of depreciable property, plant and equipment deteriorated from 2018 to 2019 and from 2019 to 2020.
Estimated total useful life Over longer time periods, this ratio is a useful measure of company’s depreciation policy and can be used for comparisons with competitors. Cisco Systems Inc.’s estimated total useful life of depreciable property, plant and equipment increased from 2018 to 2019 and from 2019 to 2020.
Estimated time elapsed since purchase The approximate age in years of a company’s fixed assets. Useful for comparison purposes. Cisco Systems Inc.’s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2018 to 2019 and from 2019 to 2020.
Estimated remaining life Cisco Systems Inc.’s estimated remaining life of depreciable property, plant and equipment increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.

Average Age

Microsoft Excel LibreOffice Calc
Jul 25, 2020 Jul 27, 2019 Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015
Selected Financial Data (US$ in millions)
Accumulated depreciation and amortization 8,561  9,250  9,237  9,497  9,057  9,095 
Gross property and equipment 11,014  12,039  12,243  12,819  12,563  12,427 
Asset Age Ratio
Average age1 77.73% 76.83% 75.45% 74.09% 72.09% 73.19%

Based on: 10-K (filing date: 2020-09-03), 10-K (filing date: 2019-09-05), 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08).

2020 Calculations

1 Average age = 100 × Accumulated depreciation and amortization ÷ Gross property and equipment
= 100 × 8,561 ÷ 11,014 = 77.73%

Asset age ratio Description The company
Average age As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company’s fixed asset base is old or new. Newer assets are likely to be more efficient. Cisco Systems Inc.’s average age ratio of depreciable property, plant and equipment deteriorated from 2018 to 2019 and from 2019 to 2020.

Estimated Total Useful Life

Microsoft Excel LibreOffice Calc
Jul 25, 2020 Jul 27, 2019 Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015
Selected Financial Data (US$ in millions)
Gross property and equipment 11,014  12,039  12,243  12,819  12,563  12,427 
Depreciation and amortization expenses for property and equipment 900  1,000  1,100  1,100  1,000  1,100 
Asset Age Ratio (Years)
Estimated total useful life1 12 12 11 12 13 11

Based on: 10-K (filing date: 2020-09-03), 10-K (filing date: 2019-09-05), 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08).

2020 Calculations

1 Estimated total useful life = Gross property and equipment ÷ Depreciation and amortization expenses for property and equipment
= 11,014 ÷ 900 = 12

Asset age ratio Description The company
Estimated total useful life Over longer time periods, this ratio is a useful measure of company’s depreciation policy and can be used for comparisons with competitors. Cisco Systems Inc.’s estimated total useful life of depreciable property, plant and equipment increased from 2018 to 2019 and from 2019 to 2020.

Estimated Age, Time Elapsed since Purchase

Microsoft Excel LibreOffice Calc
Jul 25, 2020 Jul 27, 2019 Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015
Selected Financial Data (US$ in millions)
Accumulated depreciation and amortization 8,561  9,250  9,237  9,497  9,057  9,095 
Depreciation and amortization expenses for property and equipment 900  1,000  1,100  1,100  1,000  1,100 
Asset Age Ratio (Years)
Time elapsed since purchase1 10 9 8 9 9 8

Based on: 10-K (filing date: 2020-09-03), 10-K (filing date: 2019-09-05), 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08).

2020 Calculations

1 Time elapsed since purchase = Accumulated depreciation and amortization ÷ Depreciation and amortization expenses for property and equipment
= 8,561 ÷ 900 = 10

Asset age ratio Description The company
Estimated time elapsed since purchase The approximate age in years of a company’s fixed assets. Useful for comparison purposes. Cisco Systems Inc.’s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2018 to 2019 and from 2019 to 2020.

Estimated Remaining Life

Microsoft Excel LibreOffice Calc
Jul 25, 2020 Jul 27, 2019 Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015
Selected Financial Data (US$ in millions)
Property and equipment, net 2,453  2,789  3,006  3,322  3,506  3,332 
Depreciation and amortization expenses for property and equipment 900  1,000  1,100  1,100  1,000  1,100 
Asset Age Ratio (Years)
Estimated remaining life1 3 3 3 3 4 3

Based on: 10-K (filing date: 2020-09-03), 10-K (filing date: 2019-09-05), 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08).

2020 Calculations

1 Estimated remaining life = Property and equipment, net ÷ Depreciation and amortization expenses for property and equipment
= 2,453 ÷ 900 = 3

Asset age ratio Description The company
Estimated remaining life Cisco Systems Inc.’s estimated remaining life of depreciable property, plant and equipment increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.