Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
Debt Ratios
Coverage Ratios
Cisco Systems Inc., solvency ratios (quarterly data)
Based on: 10-K (reporting date: 2026-07-25), 10-Q (reporting date: 2026-04-25), 10-Q (reporting date: 2026-01-24), 10-Q (reporting date: 2025-10-25), 10-K (reporting date: 2025-07-26), 10-Q (reporting date: 2025-04-26), 10-Q (reporting date: 2025-01-25), 10-Q (reporting date: 2024-10-26), 10-K (reporting date: 2024-07-27), 10-Q (reporting date: 2024-04-27), 10-Q (reporting date: 2024-01-27), 10-Q (reporting date: 2023-10-28), 10-K (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-Q (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-K (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30).
The solvency profile exhibits two distinct phases: a period of low leverage and high interest coverage from October 2021 through January 2024, followed by a significant increase in debt obligations beginning in April 2024. This structural shift indicates a substantial change in the capital structure, characterized by a sharp increase in borrowing and a corresponding decrease in the margin of safety for interest payments.
- Debt-to-Equity, Capital, and Asset Ratios
- Between October 2021 and January 2024, debt ratios remained consistently low, with Debt to Equity fluctuating between 0.17 and 0.29. A sharp upward shift occurred on April 27, 2024, where Debt to Equity rose to 0.70 and Debt to Assets increased from 0.11 to 0.26. These ratios remained elevated through July 2026, although a gradual reduction is observed in the later quarters, with Debt to Equity declining to 0.59 and Debt to Assets settling at 0.23.
- Financial Leverage
- Financial leverage remained stable within a range of 2.18 to 2.39 during the initial phase of the analysis. Following the April 2024 shift, leverage increased to 2.69, peaking at 2.74 in July 2024. Since that peak, the leverage ratio has trended slightly downward, ending at 2.58 by July 2026, suggesting a period of stabilization following the increase in debt.
- Interest Coverage
- Interest coverage reflects the most dramatic volatility, dropping from a peak of 41.54 in April 2022 to 21.47 in April 2024, eventually reaching a low of 7.13 by January 2025. This decline points to a significant increase in interest expenses relative to operating earnings. A gradual recovery trend is evident from early 2025 onward, with the ratio improving to 11.89 by July 2026, indicating a slow strengthening of the ability to service debt.
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Debt to Equity
Cisco Systems Inc., debt to equity calculation (quarterly data)
| Jul 25, 2026 | Apr 25, 2026 | Jan 24, 2026 | Oct 25, 2025 | Jul 26, 2025 | Apr 26, 2025 | Jan 25, 2025 | Oct 26, 2024 | Jul 27, 2024 | Apr 27, 2024 | Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Short-term debt | 10,161) | 11,932) | 8,719) | 6,725) | 5,232) | 6,422) | 11,413) | 12,364) | 11,341) | 11,891) | 4,936) | 990) | 1,733) | 1,731) | 1,250) | 1,249) | 1,099) | 1,000) | 2,502) | 506) | ||||||
| Long-term debt, excluding current portion | 19,372) | 19,371) | 21,367) | 21,364) | 22,861) | 22,857) | 19,625) | 19,623) | 19,621) | 20,102) | 6,669) | 6,660) | 6,658) | 6,663) | 7,637) | 7,629) | 8,416) | 8,418) | 8,969) | 8,996) | ||||||
| Total debt | 29,533) | 31,303) | 30,086) | 28,089) | 28,093) | 29,279) | 31,038) | 31,987) | 30,962) | 31,993) | 11,605) | 7,650) | 8,391) | 8,394) | 8,887) | 8,878) | 9,515) | 9,418) | 11,471) | 9,502) | ||||||
| Total equity | 50,285) | 48,861) | 47,723) | 46,873) | 46,843) | 45,935) | 45,530) | 45,277) | 45,457) | 45,768) | 46,251) | 45,210) | 44,353) | 42,295) | 41,474) | 40,272) | 39,773) | 40,400) | 39,496) | 42,701) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to equity1 | 0.59 | 0.64 | 0.63 | 0.60 | 0.60 | 0.64 | 0.68 | 0.71 | 0.68 | 0.70 | 0.25 | 0.17 | 0.19 | 0.20 | 0.21 | 0.22 | 0.24 | 0.23 | 0.29 | 0.22 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||||
| Apple Inc. | — | 0.78 | 0.80 | 1.03 | 1.34 | 1.54 | 1.47 | 1.45 | 1.87 | 1.52 | 1.41 | 1.46 | 1.79 | 1.81 | 1.76 | 1.96 | 2.37 | 2.06 | 1.78 | 1.71 | ||||||
| Arista Networks Inc. | — | — | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Dell Technologies Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 5.36 | 9.04 | 13.39 | ||||||
| Lumentum Holdings Inc. | 0.35 | 1.10 | 3.88 | 4.15 | 2.27 | 2.93 | 2.95 | 2.88 | 2.61 | 2.13 | 2.21 | 2.15 | 2.07 | 1.51 | 1.50 | 1.52 | 1.00 | 0.97 | 0.60 | 0.61 | ||||||
| Super Micro Computer Inc. | 0.60 | 1.16 | 0.70 | 0.73 | 0.75 | 0.39 | 0.31 | 0.38 | 0.40 | 0.37 | 0.12 | 0.07 | 0.15 | 0.11 | 0.09 | 0.15 | 0.42 | 0.43 | 0.27 | 0.25 | ||||||
Based on: 10-K (reporting date: 2026-07-25), 10-Q (reporting date: 2026-04-25), 10-Q (reporting date: 2026-01-24), 10-Q (reporting date: 2025-10-25), 10-K (reporting date: 2025-07-26), 10-Q (reporting date: 2025-04-26), 10-Q (reporting date: 2025-01-25), 10-Q (reporting date: 2024-10-26), 10-K (reporting date: 2024-07-27), 10-Q (reporting date: 2024-04-27), 10-Q (reporting date: 2024-01-27), 10-Q (reporting date: 2023-10-28), 10-K (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-Q (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-K (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30).
1 Q4 2026 Calculation
Debt to equity = Total debt ÷ Total equity
= 29,533 ÷ 50,285 = 0.59
2 Click competitor name to see calculations.
The financial solvency profile of the organization underwent a fundamental shift between 2021 and 2026, transitioning from a low-leverage position to a more moderate debt-financed structure. While equity growth remained consistent throughout the period, a substantial increase in total debt occurred in early 2024, permanently altering the debt-to-equity ratio.
- Total Debt Trends
- From October 2021 through October 2023, total debt remained relatively stable, fluctuating between 7.65 billion and 11.47 billion US dollars. However, a sharp inflection point is observed between January 2024 and April 2024, where debt levels surged from 11.61 billion to 31.99 billion US dollars. Following this spike, debt levels plateaued, maintaining a range between 28.09 billion and 31.30 billion US dollars through July 2026.
- Total Equity Growth
- Total equity demonstrated a steady and consistent upward trajectory over the observed period. Starting at 42.70 billion US dollars in October 2021, equity grew incrementally to reach 50.29 billion US dollars by July 2026. This organic growth in the equity base provided a stabilizing effect against the significant increase in liabilities observed in 2024.
- Debt to Equity Ratio Analysis
- The debt-to-equity ratio remained conservative and generally declined during the first two years, reaching a low of 0.17 in October 2023. The rapid accumulation of debt in the second quarter of 2024 caused the ratio to spike to 0.70. In the subsequent quarters, the ratio exhibited a gradual decline, ending at 0.59 in July 2026, driven by the combination of slight debt reductions and the continuous expansion of total equity.
Overall, the solvency position shifted from a highly conservative posture to one with increased financial leverage. Despite the tripling of debt in 2024, the consistent growth in equity has prevented the debt-to-equity ratio from escalating beyond 0.71, suggesting a managed approach to the increased debt load.
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Debt to Capital
Cisco Systems Inc., debt to capital calculation (quarterly data)
| Jul 25, 2026 | Apr 25, 2026 | Jan 24, 2026 | Oct 25, 2025 | Jul 26, 2025 | Apr 26, 2025 | Jan 25, 2025 | Oct 26, 2024 | Jul 27, 2024 | Apr 27, 2024 | Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Short-term debt | 10,161) | 11,932) | 8,719) | 6,725) | 5,232) | 6,422) | 11,413) | 12,364) | 11,341) | 11,891) | 4,936) | 990) | 1,733) | 1,731) | 1,250) | 1,249) | 1,099) | 1,000) | 2,502) | 506) | ||||||
| Long-term debt, excluding current portion | 19,372) | 19,371) | 21,367) | 21,364) | 22,861) | 22,857) | 19,625) | 19,623) | 19,621) | 20,102) | 6,669) | 6,660) | 6,658) | 6,663) | 7,637) | 7,629) | 8,416) | 8,418) | 8,969) | 8,996) | ||||||
| Total debt | 29,533) | 31,303) | 30,086) | 28,089) | 28,093) | 29,279) | 31,038) | 31,987) | 30,962) | 31,993) | 11,605) | 7,650) | 8,391) | 8,394) | 8,887) | 8,878) | 9,515) | 9,418) | 11,471) | 9,502) | ||||||
| Total equity | 50,285) | 48,861) | 47,723) | 46,873) | 46,843) | 45,935) | 45,530) | 45,277) | 45,457) | 45,768) | 46,251) | 45,210) | 44,353) | 42,295) | 41,474) | 40,272) | 39,773) | 40,400) | 39,496) | 42,701) | ||||||
| Total capital | 79,818) | 80,164) | 77,809) | 74,962) | 74,936) | 75,214) | 76,568) | 77,264) | 76,419) | 77,761) | 57,856) | 52,860) | 52,744) | 50,689) | 50,361) | 49,150) | 49,288) | 49,818) | 50,967) | 52,203) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to capital1 | 0.37 | 0.39 | 0.39 | 0.37 | 0.37 | 0.39 | 0.41 | 0.41 | 0.41 | 0.41 | 0.20 | 0.14 | 0.16 | 0.17 | 0.18 | 0.18 | 0.19 | 0.19 | 0.23 | 0.18 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||||
| Apple Inc. | — | 0.44 | 0.44 | 0.51 | 0.57 | 0.61 | 0.60 | 0.59 | 0.65 | 0.60 | 0.59 | 0.59 | 0.64 | 0.64 | 0.64 | 0.66 | 0.70 | 0.67 | 0.64 | 0.63 | ||||||
| Arista Networks Inc. | — | — | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Dell Technologies Inc. | 1.09 | 1.09 | 1.11 | 1.12 | 1.06 | 1.10 | 1.13 | 1.12 | 1.10 | 1.11 | 1.11 | 1.12 | 1.12 | 1.15 | 1.12 | 1.10 | 1.07 | 0.84 | 0.90 | 0.93 | ||||||
| Lumentum Holdings Inc. | 0.26 | 0.52 | 0.80 | 0.81 | 0.69 | 0.75 | 0.75 | 0.74 | 0.72 | 0.68 | 0.69 | 0.68 | 0.67 | 0.60 | 0.60 | 0.60 | 0.50 | 0.49 | 0.37 | 0.38 | ||||||
| Super Micro Computer Inc. | 0.38 | 0.54 | 0.41 | 0.42 | 0.43 | 0.28 | 0.23 | 0.28 | 0.29 | 0.27 | 0.11 | 0.06 | 0.13 | 0.10 | 0.09 | 0.13 | 0.30 | 0.30 | 0.21 | 0.20 | ||||||
Based on: 10-K (reporting date: 2026-07-25), 10-Q (reporting date: 2026-04-25), 10-Q (reporting date: 2026-01-24), 10-Q (reporting date: 2025-10-25), 10-K (reporting date: 2025-07-26), 10-Q (reporting date: 2025-04-26), 10-Q (reporting date: 2025-01-25), 10-Q (reporting date: 2024-10-26), 10-K (reporting date: 2024-07-27), 10-Q (reporting date: 2024-04-27), 10-Q (reporting date: 2024-01-27), 10-Q (reporting date: 2023-10-28), 10-K (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-Q (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-K (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30).
1 Q4 2026 Calculation
Debt to capital = Total debt ÷ Total capital
= 29,533 ÷ 79,818 = 0.37
2 Click competitor name to see calculations.
The solvency profile of the entity exhibits a distinct structural shift in leverage starting in early 2024. For the first two years of the observed period, the capital structure remained conservative with low debt levels relative to total capital. However, a significant increase in borrowing occurred in the second quarter of 2024, leading to a sustained higher leverage ratio throughout the remainder of the period.
- Total Debt Trends
- Between October 2021 and October 2023, total debt remained relatively stable, fluctuating between 7,650 million and 11,471 million US dollars, with a general downward trend toward the end of 2023. A sharp escalation is observed starting in January 2024, peaking at 31,993 million US dollars by April 2024. Following this surge, debt levels plateaued, maintaining a range between approximately 28,000 million and 32,000 million US dollars through July 2026.
- Total Capital Trends
- Total capital displayed consistent stability around the 50,000 million US dollar mark from October 2021 through October 2023. Parallel to the increase in debt, total capital rose sharply in April 2024 to 77,761 million US dollars. This expanded capital base remained elevated, oscillating between 74,000 million and 80,000 million US dollars in the subsequent quarters.
- Debt to Capital Ratio Analysis
- The debt to capital ratio remained low and stable for the initial two years, oscillating between 0.14 and 0.23, indicating a low reliance on borrowed funds. A pivotal increase occurred in April 2024, where the ratio jumped to 0.41. From that point forward, the ratio stabilized at a significantly higher level, fluctuating narrowly between 0.37 and 0.41. This shift represents a fundamental change in the company's financing strategy, effectively doubling the proportion of debt within the total capital structure.
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Debt to Assets
Cisco Systems Inc., debt to assets calculation (quarterly data)
| Jul 25, 2026 | Apr 25, 2026 | Jan 24, 2026 | Oct 25, 2025 | Jul 26, 2025 | Apr 26, 2025 | Jan 25, 2025 | Oct 26, 2024 | Jul 27, 2024 | Apr 27, 2024 | Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Short-term debt | 10,161) | 11,932) | 8,719) | 6,725) | 5,232) | 6,422) | 11,413) | 12,364) | 11,341) | 11,891) | 4,936) | 990) | 1,733) | 1,731) | 1,250) | 1,249) | 1,099) | 1,000) | 2,502) | 506) | ||||||
| Long-term debt, excluding current portion | 19,372) | 19,371) | 21,367) | 21,364) | 22,861) | 22,857) | 19,625) | 19,623) | 19,621) | 20,102) | 6,669) | 6,660) | 6,658) | 6,663) | 7,637) | 7,629) | 8,416) | 8,418) | 8,969) | 8,996) | ||||||
| Total debt | 29,533) | 31,303) | 30,086) | 28,089) | 28,093) | 29,279) | 31,038) | 31,987) | 30,962) | 31,993) | 11,605) | 7,650) | 8,391) | 8,394) | 8,887) | 8,878) | 9,515) | 9,418) | 11,471) | 9,502) | ||||||
| Total assets | 129,637) | 125,546) | 123,371) | 121,102) | 122,291) | 119,782) | 121,375) | 123,333) | 124,413) | 122,998) | 101,174) | 98,782) | 101,852) | 97,529) | 95,840) | 93,054) | 94,002) | 92,797) | 94,262) | 95,981) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to assets1 | 0.23 | 0.25 | 0.24 | 0.23 | 0.23 | 0.24 | 0.26 | 0.26 | 0.25 | 0.26 | 0.11 | 0.08 | 0.08 | 0.09 | 0.09 | 0.10 | 0.10 | 0.10 | 0.12 | 0.10 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||||
| Apple Inc. | — | 0.22 | 0.23 | 0.24 | 0.27 | 0.31 | 0.30 | 0.28 | 0.29 | 0.31 | 0.31 | 0.31 | 0.32 | 0.33 | 0.33 | 0.32 | 0.34 | 0.36 | 0.34 | 0.32 | ||||||
| Arista Networks Inc. | — | — | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Dell Technologies Inc. | 0.31 | 0.36 | 0.32 | 0.33 | 0.31 | 0.31 | 0.30 | 0.32 | 0.32 | 0.32 | 0.32 | 0.34 | 0.33 | 0.32 | 0.30 | 0.31 | 0.29 | 0.35 | 0.36 | 0.38 | ||||||
| Lumentum Holdings Inc. | 0.22 | 0.47 | 0.68 | 0.70 | 0.61 | 0.65 | 0.65 | 0.65 | 0.64 | 0.60 | 0.61 | 0.62 | 0.61 | 0.53 | 0.53 | 0.53 | 0.45 | 0.45 | 0.34 | 0.34 | ||||||
| Super Micro Computer Inc. | 0.29 | 0.37 | 0.17 | 0.33 | 0.34 | 0.23 | 0.20 | 0.21 | 0.22 | 0.21 | 0.07 | 0.04 | 0.08 | 0.06 | 0.06 | 0.08 | 0.19 | 0.18 | 0.12 | 0.11 | ||||||
Based on: 10-K (reporting date: 2026-07-25), 10-Q (reporting date: 2026-04-25), 10-Q (reporting date: 2026-01-24), 10-Q (reporting date: 2025-10-25), 10-K (reporting date: 2025-07-26), 10-Q (reporting date: 2025-04-26), 10-Q (reporting date: 2025-01-25), 10-Q (reporting date: 2024-10-26), 10-K (reporting date: 2024-07-27), 10-Q (reporting date: 2024-04-27), 10-Q (reporting date: 2024-01-27), 10-Q (reporting date: 2023-10-28), 10-K (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-Q (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-K (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30).
1 Q4 2026 Calculation
Debt to assets = Total debt ÷ Total assets
= 29,533 ÷ 129,637 = 0.23
2 Click competitor name to see calculations.
The solvency profile of the entity exhibits two distinct phases characterized by a significant shift in leverage strategy beginning in early 2024. For the first several quarters, the organization maintained a conservative debt position, followed by a substantial increase in total debt that resulted in a higher, yet stable, debt-to-assets ratio.
- Debt Accumulation Patterns
- Between October 2021 and October 2023, total debt remained relatively low and stable, fluctuating between 7.65 billion and 11.47 billion US dollars. A sharp inflection point occurred between January 2024 and April 2024, where total debt increased from 11.60 billion to 31.99 billion US dollars. Following this spike, debt levels stabilized in a new range between 28.08 billion and 31.30 billion US dollars through July 2026.
- Asset Base Expansion
- Total assets showed gradual growth from 95.98 billion US dollars in late 2021 to 101.17 billion US dollars by January 2024. Concurrent with the surge in debt in April 2024, assets increased significantly to 122.99 billion US dollars. The asset base continued a steady upward trajectory, reaching 129.63 billion US dollars by July 2026, indicating that the increased borrowing was associated with a substantial expansion of the balance sheet.
- Debt to Assets Ratio Analysis
- The debt-to-assets ratio remained consistently low during the initial period, oscillating between 0.08 and 0.12, which indicates a minimal reliance on borrowed funds relative to total assets. In April 2024, the ratio shifted abruptly to 0.26. Throughout the remainder of the observed period, the ratio plateaued between 0.23 and 0.26. This shift represents a structural change in the capital composition, moving toward a higher leverage model while maintaining a stable ratio over the subsequent two years.
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Financial Leverage
Cisco Systems Inc., financial leverage calculation (quarterly data)
| Jul 25, 2026 | Apr 25, 2026 | Jan 24, 2026 | Oct 25, 2025 | Jul 26, 2025 | Apr 26, 2025 | Jan 25, 2025 | Oct 26, 2024 | Jul 27, 2024 | Apr 27, 2024 | Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Total assets | 129,637) | 125,546) | 123,371) | 121,102) | 122,291) | 119,782) | 121,375) | 123,333) | 124,413) | 122,998) | 101,174) | 98,782) | 101,852) | 97,529) | 95,840) | 93,054) | 94,002) | 92,797) | 94,262) | 95,981) | ||||||
| Total equity | 50,285) | 48,861) | 47,723) | 46,873) | 46,843) | 45,935) | 45,530) | 45,277) | 45,457) | 45,768) | 46,251) | 45,210) | 44,353) | 42,295) | 41,474) | 40,272) | 39,773) | 40,400) | 39,496) | 42,701) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Financial leverage1 | 2.58 | 2.57 | 2.59 | 2.58 | 2.61 | 2.61 | 2.67 | 2.72 | 2.74 | 2.69 | 2.19 | 2.18 | 2.30 | 2.31 | 2.31 | 2.31 | 2.36 | 2.30 | 2.39 | 2.25 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||||
| Apple Inc. | — | 3.56 | 3.48 | 4.30 | 4.87 | 5.04 | 4.96 | 5.15 | 6.41 | 4.97 | 4.55 | 4.77 | 5.67 | 5.56 | 5.34 | 6.11 | 6.96 | 5.79 | 5.20 | 5.30 | ||||||
| Arista Networks Inc. | — | — | 1.60 | 1.61 | 1.57 | 1.52 | 1.52 | 1.43 | 1.41 | 1.39 | 1.38 | 1.34 | 1.38 | 1.39 | 1.40 | 1.42 | 1.39 | 1.41 | 1.45 | 1.47 | ||||||
| Dell Technologies Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 15.15 | 25.43 | 34.92 | ||||||
| Lumentum Holdings Inc. | 1.57 | 2.36 | 5.68 | 5.91 | 3.72 | 4.52 | 4.55 | 4.43 | 4.11 | 3.57 | 3.64 | 3.47 | 3.42 | 2.83 | 2.86 | 2.87 | 2.22 | 2.16 | 1.79 | 1.79 | ||||||
| Super Micro Computer Inc. | 2.07 | 3.10 | 4.00 | 2.21 | 2.22 | 1.68 | 1.56 | 1.85 | 1.81 | 1.74 | 1.76 | 1.89 | 1.86 | 1.81 | 1.69 | 2.03 | 2.25 | 2.41 | 2.26 | 2.14 | ||||||
Based on: 10-K (reporting date: 2026-07-25), 10-Q (reporting date: 2026-04-25), 10-Q (reporting date: 2026-01-24), 10-Q (reporting date: 2025-10-25), 10-K (reporting date: 2025-07-26), 10-Q (reporting date: 2025-04-26), 10-Q (reporting date: 2025-01-25), 10-Q (reporting date: 2024-10-26), 10-K (reporting date: 2024-07-27), 10-Q (reporting date: 2024-04-27), 10-Q (reporting date: 2024-01-27), 10-Q (reporting date: 2023-10-28), 10-K (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-Q (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-K (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30).
1 Q4 2026 Calculation
Financial leverage = Total assets ÷ Total equity
= 129,637 ÷ 50,285 = 2.58
2 Click competitor name to see calculations.
The financial leverage trajectory of Cisco Systems Inc. reveals two distinct phases of capital structure management. From October 2021 through January 2024, the company maintained a relatively stable leverage profile. However, a significant structural shift occurred in April 2024, characterized by a sharp increase in total assets that outpaced equity growth, resulting in a sustained higher leverage ratio through July 2026.
- Asset Expansion Trends
- Total assets exhibited moderate fluctuations between $92.8 billion and $101.2 billion during the initial period from October 2021 to January 2024. A substantial increase is observed in April 2024, where assets surged to $122.998 billion. Following this spike, the asset base remained elevated, fluctuating between $119.8 billion and a peak of $129.6 billion by July 2026, indicating a significant expansion of the company's balance sheet.
- Equity Growth Profile
- Total equity demonstrated a consistent and gradual upward trend over the analyzed timeframe. After an initial dip to $39.5 billion in January 2022, equity grew steadily to reach $50.3 billion by July 2026. This organic growth in equity provided a stabilizing counterweight to the increase in assets, although the pace of equity accumulation was slower than the acceleration of asset growth observed in 2024.
- Financial Leverage Analysis
- The financial leverage ratio remained within a tight range of 2.18 to 2.39 between October 2021 and January 2024. A sharp inflection point occurred in April 2024, when the ratio climbed to 2.69, peaking at 2.74 in July 2024. In the subsequent period from October 2024 to July 2026, the ratio entered a phase of gradual normalization, trending downward to settle at 2.58. This suggests a strategic increase in debt or other liabilities to fund asset expansion, followed by a period of incremental deleveraging.
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Interest Coverage
Cisco Systems Inc., interest coverage calculation (quarterly data)
| Jul 25, 2026 | Apr 25, 2026 | Jan 24, 2026 | Oct 25, 2025 | Jul 26, 2025 | Apr 26, 2025 | Jan 25, 2025 | Oct 26, 2024 | Jul 27, 2024 | Apr 27, 2024 | Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Net income | 3,859) | 3,373) | 3,175) | 2,860) | 2,550) | 2,491) | 2,428) | 2,711) | 2,162) | 1,886) | 2,634) | 3,638) | 3,958) | 3,212) | 2,773) | 2,670) | 2,815) | 3,044) | 2,973) | 2,980) | ||||||
| Add: Income tax expense | 1,074) | 666) | 471) | 531) | 449) | 456) | 459) | (444) | 234) | 349) | 527) | 804) | 513) | 745) | 642) | 805) | 601) | 757) | 630) | 677) | ||||||
| Add: Interest expense | 373) | 377) | 370) | 350) | 368) | 403) | 404) | 418) | 418) | 357) | 120) | 111) | 111) | 109) | 107) | 100) | 93) | 90) | 88) | 89) | ||||||
| Earnings before interest and tax (EBIT) | 5,306) | 4,416) | 4,016) | 3,741) | 3,367) | 3,350) | 3,291) | 2,685) | 2,814) | 2,592) | 3,281) | 4,553) | 4,582) | 4,066) | 3,522) | 3,575) | 3,509) | 3,891) | 3,691) | 3,746) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Interest coverage1 | 11.89 | 10.61 | 9.71 | 9.02 | 7.97 | 7.39 | 7.13 | 8.66 | 13.16 | 21.47 | 36.55 | 38.18 | 36.87 | 35.87 | 37.17 | 39.53 | 41.21 | 41.54 | 38.79 | 35.64 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||||
| Lumentum Holdings Inc. | -328.03 | 12.61 | 3.21 | -2.92 | -6.75 | -11.98 | -12.98 | -13.04 | -11.00 | -7.56 | -6.06 | -4.19 | -1.88 | 0.62 | 1.91 | 3.15 | 3.93 | 4.16 | 7.58 | 8.09 | ||||||
| Super Micro Computer Inc. | 15.32 | 12.18 | 13.06 | 14.63 | 21.24 | 32.93 | 47.86 | 45.14 | 63.83 | 58.83 | 58.89 | 84.71 | 72.55 | 70.87 | 68.85 | 56.79 | 53.71 | 51.73 | 42.94 | 45.86 | ||||||
Based on: 10-K (reporting date: 2026-07-25), 10-Q (reporting date: 2026-04-25), 10-Q (reporting date: 2026-01-24), 10-Q (reporting date: 2025-10-25), 10-K (reporting date: 2025-07-26), 10-Q (reporting date: 2025-04-26), 10-Q (reporting date: 2025-01-25), 10-Q (reporting date: 2024-10-26), 10-K (reporting date: 2024-07-27), 10-Q (reporting date: 2024-04-27), 10-Q (reporting date: 2024-01-27), 10-Q (reporting date: 2023-10-28), 10-K (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-Q (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-K (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30).
1 Q4 2026 Calculation
Interest coverage
= (EBITQ4 2026
+ EBITQ3 2026
+ EBITQ2 2026
+ EBITQ1 2026)
÷ (Interest expenseQ4 2026
+ Interest expenseQ3 2026
+ Interest expenseQ2 2026
+ Interest expenseQ1 2026)
= (5,306 + 4,416 + 4,016 + 3,741)
÷ (373 + 377 + 370 + 350)
= 11.89
2 Click competitor name to see calculations.
The analysis of the solvency data reveals a distinct three-phase trajectory in the company's ability to service its debt obligations. An initial period of high stability was followed by a sharp deterioration in the interest coverage ratio, which has since entered a phase of gradual recovery.
- Earnings Before Interest and Tax (EBIT)
- EBIT remained relatively stable between October 2021 and October 2023, generally fluctuating between US$ 3.5 billion and US$ 4.6 billion. A notable contraction occurred in early 2024, with earnings reaching a low of US$ 2.59 billion in April 2024. However, a consistent upward trend followed this trough, with earnings expanding to a peak of US$ 5.31 billion by July 2026, indicating strong operational recovery and growth in profitability.
- Interest Expense
- Interest costs were maintained at a low and consistent level, ranging from US$ 88 million to US$ 120 million, from October 2021 through January 2024. A significant structural shift occurred in April 2024, where interest expenses spiked to US$ 357 million and peaked at US$ 418 million in mid-2024. While these expenses remained elevated compared to the initial period, they showed a slight downward trend toward the end of the analyzed period, settling at US$ 373 million by July 2026.
- Interest Coverage Ratio
- The interest coverage ratio exhibited extreme strength during the first two years, peaking at 41.54 in April 2022 and maintaining a floor above 35.00 through October 2023. The convergence of declining EBIT and surging interest expenses led to a precipitous decline in the ratio, which fell to 7.13 by January 2025. This represents a significant reduction in the margin of safety for debt servicing. Since that low point, the ratio has steadily improved, reaching 11.89 by July 2026, driven primarily by the growth in EBIT.
The data indicates that while the company's solvency profile has not returned to the exceptional levels observed in 2021 and 2022, the current trend is positive. The recovery in the interest coverage ratio suggests that operational earnings are growing faster than the increased cost of debt, thereby restoring a healthier buffer for financial obligations.
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