Cover Page
Cover Page - shares | 6 Months Ended | |
Jan. 25, 2020 | Feb. 13, 2020 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jan. 25, 2020 | |
Document Transition Report | false | |
Entity File Number | 0-18225 | |
Entity Registrant Name | CISCO SYSTEMS, INC. | |
Entity Incorporation, State or Country Code | CA | |
Entity Tax Identification Number | 77-0059951 | |
Entity Address, Address Line One | 170 West Tasman Drive | |
Entity Address, City or Town | San Jose | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 95134 | |
City Area Code | 408 | |
Local Phone Number | 526-4000 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | CSCO | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 4,240,880,161 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 | |
Entity Central Index Key | 0000858877 | |
Current Fiscal Year End Date | --07-25 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 8,475 | $ 11,750 |
Investments | 18,587 | 21,663 |
Accounts receivable, net of allowance for doubtful accounts of $112 at January 25, 2020 and $136 at July 27, 2019 | 4,330 | 5,491 |
Inventories | 1,353 | 1,383 |
Financing receivables, net | 4,827 | 5,095 |
Other current assets | 2,481 | 2,373 |
Total current assets | 40,053 | 47,755 |
Property and equipment, net | 2,621 | 2,789 |
Financing receivables, net | 4,757 | 4,958 |
Goodwill | 33,612 | 33,529 |
Purchased intangible assets, net | 1,906 | 2,201 |
Deferred tax assets | 3,896 | 4,065 |
Other assets | 3,581 | 2,496 |
TOTAL ASSETS | 90,426 | 97,793 |
Current liabilities: | ||
Short-term debt | 1,499 | 10,191 |
Accounts payable | 1,935 | 2,059 |
Income taxes payable | 819 | 1,149 |
Accrued compensation | 2,690 | 3,221 |
Deferred revenue | 10,638 | 10,668 |
Other current liabilities | 4,507 | 4,424 |
Total current liabilities | 22,088 | 31,712 |
Long-term debt | 14,494 | 14,475 |
Income taxes payable | 8,227 | 8,927 |
Deferred revenue | 8,048 | 7,799 |
Other long-term liabilities | 2,036 | 1,309 |
Total liabilities | 54,893 | 64,222 |
Commitments and contingencies (Note 14) | ||
Cisco shareholders’ equity: | ||
Preferred stock, no par value: 5 shares authorized; none issued and outstanding | 0 | 0 |
Common stock and additional paid-in capital, $0.001 par value: 20,000 shares authorized; 4,241 and 4,250 shares issued and outstanding at January 25, 2020 and July 27, 2019, respectively | 40,617 | 40,266 |
Accumulated deficit | (4,384) | (5,903) |
Accumulated other comprehensive loss | (700) | (792) |
Total equity | 35,533 | 33,571 |
TOTAL LIABILITIES AND EQUITY | $ 90,426 | $ 97,793 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 112 | $ 136 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 20,000,000,000 | 20,000,000,000 |
Common stock, shares issued (in shares) | 4,241,000,000 | 4,250,000,000 |
Common stock, shares outstanding (in shares) | 4,241,000,000 | 4,250,000,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
REVENUE: | ||||
Revenue | $ 12,005 | $ 12,446 | $ 25,164 | $ 25,518 |
COST OF SALES: | ||||
Total cost of sales | 4,241 | 4,673 | 8,936 | 9,599 |
GROSS MARGIN | 7,764 | 7,773 | 16,228 | 15,919 |
OPERATING EXPENSES: | ||||
Research and development | 1,570 | 1,557 | 3,236 | 3,165 |
Sales and marketing | 2,279 | 2,271 | 4,759 | 4,681 |
General and administrative | 455 | 509 | 974 | 720 |
Amortization of purchased intangible assets | 38 | 39 | 74 | 73 |
Restructuring and other charges | 42 | 186 | 226 | 264 |
Total operating expenses | 4,384 | 4,562 | 9,269 | 8,903 |
OPERATING INCOME | 3,380 | 3,211 | 6,959 | 7,016 |
Interest income | 242 | 328 | 515 | 672 |
Interest expense | (158) | (223) | (336) | (444) |
Other income (loss), net | 70 | 27 | 82 | 8 |
Interest and other income (loss), net | 154 | 132 | 261 | 236 |
INCOME BEFORE PROVISION FOR INCOME TAXES | 3,534 | 3,343 | 7,220 | 7,252 |
Provision for income taxes | 656 | 521 | 1,416 | 881 |
NET INCOME | $ 2,878 | $ 2,822 | $ 5,804 | $ 6,371 |
Net income per share: | ||||
Basic (in dollars per share) | $ 0.68 | $ 0.63 | $ 1.37 | $ 1.41 |
Diluted (in dollars per share) | $ 0.68 | $ 0.63 | $ 1.36 | $ 1.40 |
Shares used in per-share calculation: | ||||
Basic (in shares) | 4,242 | 4,470 | 4,244 | 4,517 |
Diluted (in shares) | 4,260 | 4,505 | 4,265 | 4,557 |
Product | ||||
REVENUE: | ||||
Revenue | $ 8,671 | $ 9,273 | $ 18,549 | $ 19,163 |
COST OF SALES: | ||||
Total cost of sales | 3,126 | 3,614 | 6,650 | 7,413 |
Service | ||||
REVENUE: | ||||
Revenue | 3,334 | 3,173 | 6,615 | 6,355 |
COST OF SALES: | ||||
Total cost of sales | $ 1,115 | $ 1,059 | $ 2,286 | $ 2,186 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 2,878 | $ 2,822 | $ 5,804 | $ 6,371 |
Available-for-sale investments: | ||||
Change in net unrealized gains and losses, net of tax benefit (expense) of $(15) and $(29) for the second quarter and first six months of fiscal 2020, respectively, and $(12) and $1 for the corresponding periods of fiscal 2019, respectively | 66 | 82 | 139 | 87 |
Net (gains) losses reclassified into earnings, net of tax (benefit) expense of $7 and $12 for the second quarter and first six months of fiscal 2020, respectively, and $(1) for each of the corresponding periods of fiscal 2019, respectively | (4) | 4 | (9) | 10 |
Total- Available-for-sale investments | 62 | 86 | 130 | 97 |
Cash flow hedging instruments: | ||||
Change in unrealized gains and losses, net of tax benefit (expense) of $0 and $1 for the second quarter and first six months of fiscal 2020, respectively, and $1 and $2 for the corresponding periods of fiscal 2019, respectively | 1 | 1 | ||
Change in unrealized gains and losses, net of tax benefit (expense) of $0 and $1 for the second quarter and first six months of fiscal 2020, respectively, and $1 and $2 for the corresponding periods of fiscal 2019, respectively | (4) | (7) | ||
Net (gains) losses reclassified into earnings, net of tax (benefit) expense of $0 for each of the respective periods | 2 | 2 | ||
Net (gains) losses reclassified into earnings, net of tax (benefit) expense of $0 for each of the respective periods | (1) | (1) | ||
Total- Cash flow hedging instruments | 3 | 3 | ||
Total- Cash flow hedging instruments | (5) | (8) | ||
Net change in cumulative translation adjustment and actuarial gains and losses net of tax benefit (expense) of $(1) for each of the second quarter and first six months of fiscal 2020, respectively, and $0 and $(1) for the corresponding periods of fiscal 2019, respectively | 50 | 27 | (41) | (182) |
Other comprehensive income (loss) | 115 | 108 | 92 | (93) |
Comprehensive income | $ 2,993 | $ 2,930 | $ 5,896 | $ 6,278 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Change in net unrealized gains, tax benefit (expense) | $ (15) | $ (12) | $ (29) | $ 1 |
Net (gains) losses reclassified into earnings, tax expense (benefit) | 7 | (1) | 12 | (1) |
Change in unrealized gains and losses, tax benefit (expense) | 0 | 1 | ||
Change in unrealized gains and losses, tax benefit (expense) | 1 | 2 | ||
Net (gains) losses reclassified into earnings, tax expense (benefit) | 0 | 0 | ||
Net (gains) losses reclassified into earnings, tax expense (benefit) | 0 | 0 | ||
Net change in cumulative translation adjustment and actuarial gains and losses, tax benefit (expense) | $ (1) | $ 0 | $ (1) | $ (1) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Jan. 25, 2020 | Jan. 26, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 5,804 | $ 6,371 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, amortization, and other | 918 | 952 |
Share-based compensation expense | 779 | 792 |
Provision for receivables | 46 | 30 |
Deferred income taxes | 128 | (257) |
(Gains) losses on divestitures, investments and other, net | (162) | (77) |
Change in operating assets and liabilities, net of effects of acquisitions and divestitures: | ||
Accounts receivable | 1,084 | 1,613 |
Inventories | 25 | (203) |
Financing receivables | 408 | 161 |
Other assets | 130 | (652) |
Accounts payable | (126) | (296) |
Income taxes, net | (1,007) | (830) |
Accrued compensation | (521) | (339) |
Deferred revenue | 236 | 207 |
Other liabilities | (355) | 88 |
Net cash provided by operating activities | 7,387 | 7,560 |
Cash flows from investing activities: | ||
Purchases of investments | (4,250) | (677) |
Proceeds from sales of investments | 3,410 | 3,055 |
Proceeds from maturities of investments | 4,044 | 6,263 |
Acquisitions and divestitures | (163) | (1,599) |
Purchases of investments in privately held companies | (97) | (68) |
Return of investments in privately held companies | 91 | 43 |
Acquisition of property and equipment | (391) | (473) |
Proceeds from sales of property and equipment | 131 | 10 |
Other | (10) | (12) |
Net cash provided by investing activities | 2,765 | 6,542 |
Cash flows from financing activities: | ||
Issuances of common stock | 334 | 312 |
Repurchases of common stock—repurchase program | (1,648) | (10,062) |
Shares repurchased for tax withholdings on vesting of restricted stock units | (437) | (514) |
Short-term borrowings, original maturities of 90 days or less, net | (3,470) | 0 |
Repayments of debt | (5,220) | 0 |
Dividends paid | (2,972) | (2,970) |
Other | (12) | 18 |
Net cash used in financing activities | (13,425) | (13,216) |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (3,273) | 886 |
Cash, cash equivalents, and restricted cash, beginning of period | 11,772 | 8,993 |
Cash, cash equivalents, and restricted cash, end of period | 8,499 | 9,879 |
Supplemental cash flow information: | ||
Cash paid for interest | 349 | 425 |
Cash paid for income taxes, net | $ 2,295 | $ 1,968 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) shares in Millions, $ in Millions | Total | Total Equity | Shares of Common Stock | Common Stock and Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Jul. 28, 2018 | 4,614 | |||||
Beginning balance at Jul. 28, 2018 | $ 43,204 | $ 42,820 | $ 1,233 | $ (849) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Repurchase of common stock (in shares) | (109) | |||||
Ending balance (in shares) at Oct. 27, 2018 | 4,517 | |||||
Ending balance at Oct. 27, 2018 | 43,848 | 41,897 | 3,169 | (1,218) | ||
Beginning balance (in shares) at Jul. 28, 2018 | 4,614 | |||||
Beginning balance at Jul. 28, 2018 | 43,204 | 42,820 | 1,233 | (849) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | $ 6,371 | 6,371 | 6,371 | |||
Other comprehensive income (loss) | (93) | (93) | (93) | |||
Issuance of common stock (in shares) | 41 | |||||
Issuance of common stock | 312 | 312 | ||||
Repurchase of common stock (in shares) | (220) | |||||
Repurchase of common stock | (10,042) | (2,049) | (7,993) | |||
Shares repurchased for tax withholdings on vesting of restricted stock units (in shares) | (11) | |||||
Shares repurchased for tax withholdings on vesting of restricted stock units | (514) | (514) | ||||
Cash dividends declared | (2,970) | (2,970) | ||||
Share-based compensation | 792 | 792 | ||||
Ending balance (in shares) at Jan. 26, 2019 | 4,424 | |||||
Ending balance at Jan. 26, 2019 | 40,789 | 41,361 | 538 | (1,110) | ||
Beginning balance (in shares) at Oct. 27, 2018 | 4,517 | |||||
Beginning balance at Oct. 27, 2018 | 43,848 | 41,897 | 3,169 | (1,218) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 2,822 | 2,822 | 2,822 | |||
Other comprehensive income (loss) | $ 108 | 108 | 108 | |||
Issuance of common stock (in shares) | 22 | |||||
Issuance of common stock | 304 | 304 | ||||
Repurchase of common stock (in shares) | (111) | (111) | ||||
Repurchase of common stock | (5,016) | (1,033) | (3,983) | |||
Shares repurchased for tax withholdings on vesting of restricted stock units (in shares) | (4) | |||||
Shares repurchased for tax withholdings on vesting of restricted stock units | (196) | (196) | ||||
Cash dividends declared | (1,470) | (1,470) | ||||
Share-based compensation | 389 | 389 | ||||
Ending balance (in shares) at Jan. 26, 2019 | 4,424 | |||||
Ending balance at Jan. 26, 2019 | 40,789 | 41,361 | 538 | (1,110) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Effect of adoption of accounting standards | (168) | |||||
Beginning balance (in shares) at Jul. 27, 2019 | 4,250 | |||||
Beginning balance at Jul. 27, 2019 | 33,571 | 40,266 | (5,903) | (792) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Repurchase of common stock (in shares) | (16) | |||||
Ending balance (in shares) at Oct. 26, 2019 | 4,241 | |||||
Ending balance at Oct. 26, 2019 | 34,423 | 40,321 | (5,083) | (815) | ||
Beginning balance (in shares) at Jul. 27, 2019 | 4,250 | |||||
Beginning balance at Jul. 27, 2019 | 33,571 | 40,266 | (5,903) | (792) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | $ 5,804 | 5,804 | 5,804 | |||
Other comprehensive income (loss) | 92 | 92 | 92 | |||
Issuance of common stock (in shares) | 34 | |||||
Issuance of common stock | 334 | 334 | ||||
Repurchase of common stock (in shares) | (34) | |||||
Repurchase of common stock | (1,638) | (325) | (1,313) | |||
Shares repurchased for tax withholdings on vesting of restricted stock units (in shares) | (9) | |||||
Shares repurchased for tax withholdings on vesting of restricted stock units | (437) | (437) | ||||
Cash dividends declared | (2,972) | (2,972) | ||||
Share-based compensation | 779 | 779 | ||||
Ending balance (in shares) at Jan. 25, 2020 | 4,241 | |||||
Ending balance at Jan. 25, 2020 | 35,533 | 40,617 | (4,384) | (700) | ||
Beginning balance (in shares) at Oct. 26, 2019 | 4,241 | |||||
Beginning balance at Oct. 26, 2019 | 34,423 | 40,321 | (5,083) | (815) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 2,878 | 2,878 | 2,878 | |||
Other comprehensive income (loss) | $ 115 | 115 | 115 | |||
Issuance of common stock (in shares) | 23 | |||||
Issuance of common stock | 332 | 332 | ||||
Repurchase of common stock (in shares) | (18) | (18) | ||||
Repurchase of common stock | (870) | (177) | (693) | |||
Shares repurchased for tax withholdings on vesting of restricted stock units (in shares) | (5) | |||||
Shares repurchased for tax withholdings on vesting of restricted stock units | (243) | (243) | ||||
Cash dividends declared | (1,486) | (1,486) | ||||
Share-based compensation | 384 | 384 | ||||
Ending balance (in shares) at Jan. 25, 2020 | 4,241 | |||||
Ending balance at Jan. 25, 2020 | 35,533 | $ 40,617 | (4,384) | (700) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Effect of adoption of accounting standards | $ 3,729 | $ 3,897 | $ (168) |
Consolidated Statements of Eq_2
Consolidated Statements of Equity (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||||
Cash dividends declared (in dollars per share) | $ 0.35 | $ 0.33 | $ 0.70 | $ 0.66 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jan. 25, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The fiscal year for Cisco Systems, Inc. (the “Company,” “Cisco,” “we,” “us,” or “our”) is the 52 or 53 weeks ending on the last Saturday in July. Fiscal 2020 and fiscal 2019 are each 52-week fiscal years. The Consolidated Financial Statements include our accounts and those of our subsidiaries. All intercompany accounts and transactions have been eliminated. We conduct business globally and are primarily managed on a geographic basis in the following three geographic segments: the Americas; Europe, Middle East, and Africa (EMEA); and Asia Pacific, Japan, and China (APJC). We have prepared the accompanying financial data as of January 25, 2020 and for the second quarter and first six months of fiscal 2020 and 2019 , without audit, pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The July 27, 2019 Consolidated Balance Sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. However, we believe that the disclosures are adequate to make the information presented not misleading. These Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended July 27, 2019 . Our consolidated financial statements include our accounts and entities consolidated under the variable interest and voting models. The noncontrolling interests attributed to these investments, if any, are presented as a separate component from our equity in the equity section of the Consolidated Balance Sheets. The share of earnings attributable to the noncontrolling interests are not presented separately in the Consolidated Statements of Operations as these amounts are not material for any of the fiscal periods presented. In the opinion of management, all normal recurring adjustments necessary to present fairly the consolidated balance sheet as of January 25, 2020 , the results of operations, the statements of comprehensive income (loss) and the statements of equity for the second quarter and first six months of fiscal 2020 and 2019 ; and the statements of cash flows for the first six months of fiscal 2020 and 2019 , as applicable, have been made. The results of operations for the second quarter and first six months of fiscal 2020 are not necessarily indicative of the operating results for the full fiscal year or any future periods. Certain reclassifications have been made to the amounts in prior periods in order to conform to the current period’s presentation. We have evaluated subsequent events through the date that the financial statements were issued. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jan. 25, 2020 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements (a) New Accounting Updates Recently Adopted Leases In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Codification (ASC) 842, Leases , a new standard requiring lessees to recognize operating and finance lease liabilities on the balance sheet, as well as corresponding right-of-use (ROU) assets. This standard also made some changes to lessor accounting and aligns key aspects of the lessor accounting model with the revenue recognition standard. In addition, new disclosures are required to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. ASC 842 requires adoption using the modified retrospective approach, with the option of applying the requirements of the standard either i) retrospectively to each prior comparative reporting period presented, or ii) retrospectively at the beginning of the period of adoption. We adopted this standard at the beginning of our first quarter of fiscal 2020 and applied it at the beginning of the period of adoption and did not restate prior periods. We adopted ASC 842 on July 28, 2019 which resulted in the recognition of $1.2 billion of operating lease ROU assets included in other assets and $1.2 billion of operating lease liabilities included in other current liabilities and other long-term liabilities. There were no transition adjustments recorded from the adoption of ASC 842 as a lessor. We have elected to apply the package of practical expedients permitted under the transition guidance within ASC 842 which does not require reassessment of initial direct costs, classification of a lease and definition of a lease. We also elected additional practical expedients which resulted in: i) allowing us not to reassess the accounting treatment for existing or expired land easements in transition; ii) combining lease and non-lease components and iii) not recording leases with an initial term of less than 12 months on our Consolidated Balance Sheet. As a lessee, we determine if an arrangement is a lease at commencement. Our ROU lease assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments related to the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. We use incremental borrowing rates based on information available at the commencement date to determine the present value of our lease payments. As a lessor, we determine if an arrangement is a lease at inception. We provide leasing arrangements for our equipment to certain qualified customers. Our lease portfolio primarily consists of sales-type leases. We allocate the consideration in a bundled contract with our customers based on relative standalone selling prices of our lease and non-lease components. The residual value on our leased equipment is determined at the inception of the lease based on an analysis of estimates of the value of equipment, market factors and historical customer behavior. Residual value estimates are reviewed on a periodic basis and other-than-temporary declines are expensed in the period they occur. Our leases generally provide an end-of-term option for the customer to extend the lease under mutually-agreed terms, return the leased equipment, or purchase the equipment for either the then-market value of the equipment or a pre-determined purchase price. If a customer chooses to terminate their lease prior to the original end of term date, the customer is required to pay all remaining lease payments in full. For additional information, see Note 8. (b) Recent Accounting Standards or Updates Not Yet Effective Credit Losses of Financial Instruments In June 2016, the FASB issued an accounting standard update that requires measurement and recognition of expected credit losses for financial assets held based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. The accounting standard update will be effective for us beginning in the first quarter of fiscal 2021 on a modified retrospective basis. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements. |
Revenue
Revenue | 6 Months Ended |
Jan. 25, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue We enter into contracts with customers that can include various combinations of products and services which are generally distinct and accounted for as separate performance obligations. As a result, our contracts may contain multiple performance obligations. We determine whether arrangements are distinct based on whether the customer can benefit from the product or service on its own or together with other resources that are readily available and whether our commitment to transfer the product or service to the customer is separately identifiable from other obligations in the contract. We classify our hardware, perpetual software licenses, and software-as-a-service (SaaS) as distinct performance obligations. Term software licenses represent multiple obligations, which include software licenses and software maintenance. In transactions where we deliver hardware or software, we are typically the principal and we record revenue and costs of goods sold on a gross basis. We refer to our term software licenses, security software licenses, SaaS, and associated service arrangements as subscription offers. We recognize revenue upon transfer of control of promised goods or services in a contract with a customer in an amount that reflects the consideration we expect to receive in exchange for those products or services. Transfer of control occurs once the customer has the contractual right to use the product, generally upon shipment or once title and risk of loss has transferred to the customer. Transfer of control can also occur over time for software maintenance and services as the customer receives the benefit over the contract term. Our hardware and perpetual software licenses are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses include multiple performance obligations where the term licenses are recognized upfront upon transfer of control, with the associated software maintenance revenue recognized ratably over the contract term as services and software updates are provided. SaaS arrangements do not include the right for the customer to take possession of the software during the term, and therefore have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term as the customer consumes the services. On our product sales, we record consideration from shipping and handling on a gross basis within net product sales. We record our revenue net of any associated sales taxes. Significant Judgments Revenue is allocated among these performance obligations in a manner that reflects the consideration that we expect to be entitled to for the promised goods or services based on standalone selling prices (SSP). SSP is estimated for each distinct performance obligation and judgment may be required in their determination. The best evidence of SSP is the observable price of a product or service when we sell the goods separately in similar circumstances and to similar customers. In instances where SSP is not directly observable, we determine SSP using information that may include market conditions and other observable inputs. We apply judgment in determining the transaction price as we may be required to estimate variable consideration when determining the amount of revenue to recognize. Variable consideration includes contractual potential penalties and various rebate, cooperative marketing and other incentive programs that we offer to our distributors, partners and customers. When determining the amount of revenue to recognize, we estimate the expected usage of these programs, applying the expected value or most likely estimate and update the estimate at each reporting period as actual utilization becomes available. We also consider the customers' right of return in determining the transaction price, where applicable. We assess certain software licenses, such as for security software, that contain critical updates or upgrades which customers can download throughout the contract term. Without these updates or upgrades, the functionality of the software would diminish over a relatively short time period. These updates or upgrades provide the customer the full functionality of the purchased security software licenses and are required to maintain the security license's utility as the risks and threats in the environment are rapidly changing. In these circumstances, the revenue from these software arrangements is recognized as a single performance obligation satisfied over the contract term. (a) Disaggregation of Revenue We disaggregate our revenue into groups of similar products and services that depict the nature, amount, and timing of revenue and cash flows for our various offerings. The sales cycle, contractual obligations, customer requirements, and go-to-market strategies differ for each of our product categories, resulting in different economic risk profiles for each category. The following table presents this disaggregation of revenue (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Infrastructure Platforms $ 6,528 $ 7,102 $ 14,067 $ 14,724 Applications 1,349 1,465 2,847 2,884 Security 748 684 1,563 1,354 Other Products 46 22 72 200 Total Product 8,671 9,273 18,549 19,163 Services 3,334 3,173 6,615 6,355 Total (1) $ 12,005 $ 12,446 $ 25,164 $ 25,518 Amounts may not sum due to rounding. (1) During the second quarter of fiscal 2019, we completed the divestiture of the Service Provider Video Software Solutions (“SPVSS”) business. Total revenue includes SPVSS business revenue of $168 million for the first six months of fiscal 2019. Infrastructure Platforms consist of our core networking technologies of switching, routing, wireless, and data center products that are designed to work together to deliver networking capabilities and transport and/or store data. These technologies consist of both hardware and software offerings, including software licenses and SaaS, that help our customers build networks, automate, orchestrate, integrate, and digitize data. We are shifting and expanding more of our business to software and subscriptions across our core networking portfolio. Our hardware and perpetual software in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses are multiple performance obligations where the term license is recognized upfront upon transfer of control with the associated software maintenance revenue recognized ratably over the contract term. SaaS arrangements in this category have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term. Applications consists of offerings that utilize the core networking and data center platforms to provide their functions. The products consist primarily of software offerings, including software licenses and SaaS, as well as hardware. Our perpetual software and hardware in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses are multiple performance obligations where the term license is recognized upfront upon transfer of control with the associated software maintenance revenue recognized ratably over the contract term. SaaS arrangements in this category have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term. Security primarily includes our network security, cloud and email security, identity and access management, advanced threat protection, and unified threat management products. These products consist of both hardware and software offerings, including software licenses and SaaS. Updates and upgrades for the term software licenses are critical for our software to perform its intended commercial purpose because of the continuous need for our software to secure our customers' network environments against frequent threats. Therefore, security software licenses are generally represented by a single distinct performance obligation with revenue recognized ratably over the contract term. Our hardware and perpetual software in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. SaaS arrangements in this category have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term. Other Products primarily includes our cloud and system management products. These products include both hardware and software licenses. Our offerings in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. In addition to our product offerings, we provide a broad range of service and support options for our customers, including technical support services and advanced services. Technical support services represent the majority of these offerings which are distinct performance obligations that are satisfied over time with revenue recognized ratably over the contract term. Advanced services are distinct performance obligations that are satisfied over time with revenue recognized as services are delivered. The sales arrangements as discussed above are typically made pursuant to customer purchase orders based on master purchase or partner agreements. Cash is received based on our standard payment terms which is typically 30 days . We provide financing arrangements to customers for all of our hardware, software and service offerings. Refer to Note 9 for additional information. For these arrangements, cash is typically received over time. (b) Contract Balances Accounts receivable, net was $4.3 billion as of January 25, 2020 compared to $5.5 billion as of July 27, 2019 , as reported on the Consolidated Balance Sheet. Contract assets consist of unbilled receivables and are recorded when revenue is recognized in advance of scheduled billings to our customers. These amounts are primarily related to software and service arrangements where transfer of control has occurred but we have not yet invoiced. As of January 25, 2020 and July 27, 2019 , our contract assets for these unbilled receivables were $966 million and $860 million , respectively, and were included in other current assets and other assets. Contract liabilities consist of deferred revenue. Deferred revenue was $18.7 billion as of January 25, 2020 compared to $18.5 billion as of July 27, 2019 . We recognized approximately $2.9 billion and $6.6 billion of revenue during the second quarter and first six months of fiscal 2020 , respectively, that was included in the deferred revenue balance at July 27, 2019 . (c) Remaining Performance Obligations Remaining Performance Obligations (RPO) are comprised of deferred revenue plus unbilled contract revenue. As of January 25, 2020 , the aggregate amount of RPO was $24.9 billion , comprised of $18.7 billion of deferred revenue and $6.2 billion of unbilled contract revenue. We expect approximately 55% of this amount to be recognized as revenue over the next year. As of July 27, 2019 , the aggregate amount of RPO was $25.3 billion , comprised of $18.5 billion of deferred revenue and $6.8 billion of unbilled contract revenue. Unbilled contract revenue represents noncancelable contracts for which we have not invoiced, have an obligation to perform, and revenue has not yet been recognized in the financial statements. (d) Capitalized Contract Acquisition Costs We capitalize direct and incremental costs incurred to acquire contracts, primarily sales commissions, for which the associated revenue is expected to be recognized in future periods. We incur these costs in connection with both initial contracts and renewals. These costs are initially deferred and typically amortized over the term of the customer contract which corresponds to the period of benefit. Deferred sales commissions were $708 million and $750 million as of January 25, 2020 and July 27, 2019 , respectively, and were included in other current assets and other assets. The amortization expense associated with these costs was $122 million and $238 million for the second quarter and first six months of fiscal 2020 , respectively, and $100 million and $212 million for the corresponding periods of fiscal 2019 |
Acquisitions and Divestitures
Acquisitions and Divestitures | 6 Months Ended |
Jan. 25, 2020 | |
Business Combinations [Abstract] | |
Acquisitions and Divestitures | Acquisitions and Divestitures We completed four acquisitions during the first six months of fiscal 2020 . A summary of the allocation of the total purchase consideration is presented as follows (in millions): Purchase Consideration Net Tangible Assets Acquired (Liabilities Assumed) Purchased Intangible Assets Goodwill Total acquisitions (four in total) $ 182 $ (9 ) $ 108 $ 83 The total purchase consideration related to acquisitions completed during the first six months of fiscal 2020 consisted of cash consideration. The total cash and cash equivalents acquired from these acquisitions was approximately $10 million . Total transaction costs related to acquisition and divestiture activities were $9 million and $11 million for the first six months of fiscal 2020 and 2019 , respectively. These transaction costs were expensed as incurred in general and administrative expenses (“G&A”) in the Consolidated Statements of Operations. The goodwill generated from acquisitions completed during the first six months of fiscal 2020 is primarily related to expected synergies. The goodwill is generally no t deductible for income tax purposes. The Consolidated Financial Statements include the operating results of each acquisition from the date of acquisition. Pro forma results of operations and the revenue and net income subsequent to the acquisition date for the acquisitions completed during the first six months of fiscal 2020 have not been presented because the effects of the acquisitions, individually and in the aggregate, were not material to our financial results. Divestiture of Service Provider Video Software Solutions Business On October 28, 2018, we completed the sale of the Service Provider Video Software Solutions business. We recognized an immaterial gain from this transaction in fiscal 2019. Pending Acquisition of Acacia Communications On July 9, 2019, we announced our intent to acquire Acacia Communications, Inc. (“Acacia”), a public fabless semiconductor company that develops, manufactures and sells high-speed coherent optical interconnect products that are designed to transform communications networks through improvements in performance, capacity and cost. Under the terms of the agreement, we have agreed to pay total consideration of approximately $2.6 billion , net of cash and marketable securities, to acquire Acacia. The acquisition is expected to close during the second half of fiscal 2020, subject to customary closing conditions and regulatory approvals. Upon close of the acquisition, revenue from Acacia will be included in our Infrastructure Platforms product category. |
Goodwill and Purchased Intangib
Goodwill and Purchased Intangible Assets | 6 Months Ended |
Jan. 25, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Purchased Intangible Assets | Goodwill and Purchased Intangible Assets (a) Goodwill The following table presents the goodwill allocated to our reportable segments as of January 25, 2020 and during the first six months of fiscal 2020 (in millions): Balance at July 27, 2019 Acquisitions Other Balance at January 25, 2020 Americas $ 21,120 $ 62 $ 1 $ 21,183 EMEA 7,977 17 — 7,994 APJC 4,432 4 (1 ) 4,435 Total $ 33,529 $ 83 $ — $ 33,612 “Other” in the table above primarily consists of foreign currency translation as well as immaterial purchase accounting adjustments. (b) Purchased Intangible Assets The following table presents details of our intangible assets acquired through acquisitions completed during the first six months of fiscal 2020 (in millions, except years): FINITE LIVES INDEFINITE LIVES TOTAL TECHNOLOGY CUSTOMER RELATIONSHIPS OTHER IPR&D Weighted- Average Useful Life (in Years) Amount Weighted- Average Useful Life (in Years) Amount Weighted- Average Useful Life (in Years) Amount Amount Amount Total acquisitions (four in total) 5.0 $ 108 — $ — — $ — — $ 108 The following tables present details of our purchased intangible assets (in millions): January 25, 2020 Gross Accumulated Amortization Net Purchased intangible assets with finite lives: Technology $ 3,245 $ (2,103 ) $ 1,142 Customer relationships 749 (304 ) 445 Other 34 (23 ) 11 Total purchased intangible assets with finite lives 4,028 (2,430 ) 1,598 In-process research and development, with indefinite lives 308 — 308 Total $ 4,336 $ (2,430 ) $ 1,906 July 27, 2019 Gross Accumulated Amortization Net Purchased intangible assets with finite lives: Technology $ 3,270 $ (1,933 ) $ 1,337 Customer relationships 840 (331 ) 509 Other 41 (22 ) 19 Total purchased intangible assets with finite lives 4,151 (2,286 ) 1,865 In-process research and development, with indefinite lives 336 — 336 Total $ 4,487 $ (2,286 ) $ 2,201 Purchased intangible assets include intangible assets acquired through acquisitions as well as through direct purchases or licenses. The following table presents the amortization of purchased intangible assets, including impairment charges (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Amortization of purchased intangible assets: Cost of sales $ 165 $ 156 $ 331 $ 307 Operating expenses 38 39 74 73 Total $ 203 $ 195 $ 405 $ 380 The estimated future amortization expense of purchased intangible assets with finite lives as of January 25, 2020 is as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 383 2021 $ 591 2022 $ 333 2023 $ 191 2024 $ 93 Thereafter $ 7 |
Restructuring and Other Charges
Restructuring and Other Charges | 6 Months Ended |
Jan. 25, 2020 | |
Restructuring Charges [Abstract] | |
Restructuring and Other Charges | Restructuring and Other Charges We initiated a restructuring plan during fiscal 2018 (the “Fiscal 2018 Plan”) in order to realign the organization and enable further investment in key priority areas. The aggregate pretax charges related to the Fiscal 2018 Plan were primarily cash-based and consisted of employee severance and other one-time termination benefits, and other associated costs. In connection with the Fiscal 2018 Plan, we incurred charges of $42 million and $226 million for the second quarter and first six months of fiscal 2020 , respectively, and have incurred cumulative charges of $656 million . We completed the Fiscal 2018 Plan in the second quarter of fiscal 2020. The following tables summarize the activities related to the restructuring and other charges (in millions): FISCAL 2017 AND PRIOR PLANS FISCAL 2018 PLAN Employee Severance Other Employee Severance Other Total Liability as of July 27, 2019 $ — $ 5 $ 22 $ 6 $ 33 Charges — — 209 17 226 Cash payments — — (202 ) (1 ) (203 ) Non-cash items — (2 ) — (21 ) (23 ) Liability as of January 25, 2020 $ — $ 3 $ 29 $ 1 $ 33 FISCAL 2017 AND PRIOR PLANS FISCAL 2018 PLAN Employee Severance Other Employee Severance Other Total Liability as of July 28, 2018 $ 41 $ 13 $ 19 $ — $ 73 Charges — (1 ) 222 43 264 Cash payments (31 ) (3 ) (202 ) (1 ) (237 ) Non-cash items — — — (42 ) (42 ) Liability as of January 26, 2019 $ 10 $ 9 $ 39 $ — $ 58 Fiscal 2020 Plan We initiated a restructuring plan in the third quarter of fiscal 2020 (the “Fiscal 2020 Plan”) in order to realign the organization and enable further investment in key priority areas. The total pretax charges are estimated to be approximately $300 million |
Balance Sheet Details
Balance Sheet Details | 6 Months Ended |
Jan. 25, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Details | Balance Sheet Details The following tables provide details of selected balance sheet items (in millions): January 25, July 27, Cash and cash equivalents $ 8,475 $ 11,750 Restricted cash included in other current assets 21 21 Restricted cash included in other assets 3 1 Total cash, cash equivalents, and restricted cash $ 8,499 $ 11,772 Inventories: Raw materials $ 384 $ 374 Work in process 12 10 Finished goods: Deferred cost of sales 59 109 Manufactured finished goods 667 643 Total finished goods 726 752 Service-related spares 212 225 Demonstration systems 19 22 Total $ 1,353 $ 1,383 Property and equipment, net: Gross property and equipment: Land, buildings, and building and leasehold improvements $ 4,438 $ 4,545 Computer equipment and related software 900 922 Production, engineering, and other equipment 5,196 5,711 Operating lease assets 411 485 Furniture, fixtures and other 392 376 Total gross property and equipment 11,337 12,039 Less: accumulated depreciation and amortization (8,716 ) (9,250 ) Total $ 2,621 $ 2,789 Deferred revenue: Service $ 11,526 $ 11,709 Product 7,160 6,758 Total $ 18,686 $ 18,467 Reported as: Current $ 10,638 $ 10,668 Noncurrent 8,048 7,799 Total $ 18,686 $ 18,467 |
Leases
Leases | 6 Months Ended |
Jan. 25, 2020 | |
Leases [Abstract] | |
Leases | Leases (a) Lessee Arrangements We lease real estate, information technology (IT) and other equipment and vehicles. We also have arrangements with certain suppliers and contract manufacturers which includes the leasing of dedicated space and equipment costs. Our leases have the option to extend or terminate the lease when it is reasonably certain that we will exercise that option. Certain of our lease agreements contain variable lease payments. Our variable lease payments can fluctuate depending on the level of activity or the cost of certain services where we have elected to combine lease and non-lease components. While these payments are not included as part of our lease liabilities, they are recognized as variable lease expense in the period they are incurred. As of January 25, 2020 , our operating lease right-of-use assets were $1.0 billion and were recorded in other assets, and our operating lease liabilities were $1.1 billion , of which $380 million was included in other current liabilities and $698 million was included in other long-term liabilities. The weighted-average lease term was 4.1 years and the weighted-average discount rate was 1.8% as of January 25, 2020 . The components of our lease expenses were as follows (in millions): January 25, 2020 Three Months Ended Six Months Ended Operating lease expense $ 101 $ 214 Short-term lease expense 16 33 Variable lease expense 39 79 Total lease expense $ 156 $ 326 Supplemental information related to our operating leases is as follows: Six Months Ended In millions: January 25, 2020 Cash paid for amounts included in the measurement of lease liabilities — operating cash flows $ 206 Right-of-use assets obtained in exchange for operating leases liabilities $ 77 The maturities of our operating leases (undiscounted) as of January 25, 2020 are as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 204 2021 316 2022 216 2023 166 2024 104 Thereafter 111 Total lease payments 1,117 Less interest (39 ) Total $ 1,078 Prior to the adoption of the new leasing standard, future minimum lease payments under all noncancelable operating leases with an initial term in excess of one year as of July 27, 2019 were as follows (in millions): Fiscal Year Amount 2020 $ 441 2021 299 2022 195 2023 120 2024 70 Thereafter 54 Total $ 1,179 (b) Lessor Arrangements Our leases primarily represent sales-type leases with terms of four years on average. We provide leasing of our equipment and complementary third-party products primarily through our channel partners and distributors, for which the income arising from these leases is recognized through interest income. Interest income for the second quarter and first six months of fiscal 2020 was $23 million and $49 million , respectively, and was included in interest income in the Consolidated Statement of Operations. The net investment of our lease receivables is measured at the commencement date as the gross lease receivable, residual value less unearned income and allowance for credit loss. For additional information, see Note 9. Future minimum lease payments on our lease receivables as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 438 2021 882 2022 479 2023 267 2024 123 Thereafter 58 Total 2,247 Less: Present value of lease payments 2,117 Difference between undiscounted cash flows and discounted cash flows $ 130 Actual cash collections may differ from the contractual maturities due to early customer buyouts, refinancings, or defaults. Prior to the adoption of the new leasing standard, future minimum lease payments on our lease receivables as of July 27, 2019 were summarized as follows (in millions): Fiscal Year Amount 2020 $ 1,028 2021 702 2022 399 2023 185 2024 53 Total $ 2,367 We provide financing of certain equipment through operating leases, and the amounts are included in property and equipment in the Consolidated Balance Sheets. Amounts relating to equipment on operating lease assets held by Cisco and the associated accumulated depreciation are summarized as follows (in millions): January 25, 2020 July 27, 2019 Operating lease assets $ 411 $ 485 Accumulated depreciation (247 ) (306 ) Operating lease assets, net $ 164 $ 179 Our lease income for the second quarter and first six months of fiscal 2020 was $50 million and $94 million , respectively, and was included in product revenue in the Consolidated Statement of Operations. Minimum future rentals on noncancelable operating leases as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 61 2021 70 2022 24 2023 4 Total $ 159 |
Leases | Leases (a) Lessee Arrangements We lease real estate, information technology (IT) and other equipment and vehicles. We also have arrangements with certain suppliers and contract manufacturers which includes the leasing of dedicated space and equipment costs. Our leases have the option to extend or terminate the lease when it is reasonably certain that we will exercise that option. Certain of our lease agreements contain variable lease payments. Our variable lease payments can fluctuate depending on the level of activity or the cost of certain services where we have elected to combine lease and non-lease components. While these payments are not included as part of our lease liabilities, they are recognized as variable lease expense in the period they are incurred. As of January 25, 2020 , our operating lease right-of-use assets were $1.0 billion and were recorded in other assets, and our operating lease liabilities were $1.1 billion , of which $380 million was included in other current liabilities and $698 million was included in other long-term liabilities. The weighted-average lease term was 4.1 years and the weighted-average discount rate was 1.8% as of January 25, 2020 . The components of our lease expenses were as follows (in millions): January 25, 2020 Three Months Ended Six Months Ended Operating lease expense $ 101 $ 214 Short-term lease expense 16 33 Variable lease expense 39 79 Total lease expense $ 156 $ 326 Supplemental information related to our operating leases is as follows: Six Months Ended In millions: January 25, 2020 Cash paid for amounts included in the measurement of lease liabilities — operating cash flows $ 206 Right-of-use assets obtained in exchange for operating leases liabilities $ 77 The maturities of our operating leases (undiscounted) as of January 25, 2020 are as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 204 2021 316 2022 216 2023 166 2024 104 Thereafter 111 Total lease payments 1,117 Less interest (39 ) Total $ 1,078 Prior to the adoption of the new leasing standard, future minimum lease payments under all noncancelable operating leases with an initial term in excess of one year as of July 27, 2019 were as follows (in millions): Fiscal Year Amount 2020 $ 441 2021 299 2022 195 2023 120 2024 70 Thereafter 54 Total $ 1,179 (b) Lessor Arrangements Our leases primarily represent sales-type leases with terms of four years on average. We provide leasing of our equipment and complementary third-party products primarily through our channel partners and distributors, for which the income arising from these leases is recognized through interest income. Interest income for the second quarter and first six months of fiscal 2020 was $23 million and $49 million , respectively, and was included in interest income in the Consolidated Statement of Operations. The net investment of our lease receivables is measured at the commencement date as the gross lease receivable, residual value less unearned income and allowance for credit loss. For additional information, see Note 9. Future minimum lease payments on our lease receivables as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 438 2021 882 2022 479 2023 267 2024 123 Thereafter 58 Total 2,247 Less: Present value of lease payments 2,117 Difference between undiscounted cash flows and discounted cash flows $ 130 Actual cash collections may differ from the contractual maturities due to early customer buyouts, refinancings, or defaults. Prior to the adoption of the new leasing standard, future minimum lease payments on our lease receivables as of July 27, 2019 were summarized as follows (in millions): Fiscal Year Amount 2020 $ 1,028 2021 702 2022 399 2023 185 2024 53 Total $ 2,367 We provide financing of certain equipment through operating leases, and the amounts are included in property and equipment in the Consolidated Balance Sheets. Amounts relating to equipment on operating lease assets held by Cisco and the associated accumulated depreciation are summarized as follows (in millions): January 25, 2020 July 27, 2019 Operating lease assets $ 411 $ 485 Accumulated depreciation (247 ) (306 ) Operating lease assets, net $ 164 $ 179 Our lease income for the second quarter and first six months of fiscal 2020 was $50 million and $94 million , respectively, and was included in product revenue in the Consolidated Statement of Operations. Minimum future rentals on noncancelable operating leases as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 61 2021 70 2022 24 2023 4 Total $ 159 |
Leases | Leases (a) Lessee Arrangements We lease real estate, information technology (IT) and other equipment and vehicles. We also have arrangements with certain suppliers and contract manufacturers which includes the leasing of dedicated space and equipment costs. Our leases have the option to extend or terminate the lease when it is reasonably certain that we will exercise that option. Certain of our lease agreements contain variable lease payments. Our variable lease payments can fluctuate depending on the level of activity or the cost of certain services where we have elected to combine lease and non-lease components. While these payments are not included as part of our lease liabilities, they are recognized as variable lease expense in the period they are incurred. As of January 25, 2020 , our operating lease right-of-use assets were $1.0 billion and were recorded in other assets, and our operating lease liabilities were $1.1 billion , of which $380 million was included in other current liabilities and $698 million was included in other long-term liabilities. The weighted-average lease term was 4.1 years and the weighted-average discount rate was 1.8% as of January 25, 2020 . The components of our lease expenses were as follows (in millions): January 25, 2020 Three Months Ended Six Months Ended Operating lease expense $ 101 $ 214 Short-term lease expense 16 33 Variable lease expense 39 79 Total lease expense $ 156 $ 326 Supplemental information related to our operating leases is as follows: Six Months Ended In millions: January 25, 2020 Cash paid for amounts included in the measurement of lease liabilities — operating cash flows $ 206 Right-of-use assets obtained in exchange for operating leases liabilities $ 77 The maturities of our operating leases (undiscounted) as of January 25, 2020 are as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 204 2021 316 2022 216 2023 166 2024 104 Thereafter 111 Total lease payments 1,117 Less interest (39 ) Total $ 1,078 Prior to the adoption of the new leasing standard, future minimum lease payments under all noncancelable operating leases with an initial term in excess of one year as of July 27, 2019 were as follows (in millions): Fiscal Year Amount 2020 $ 441 2021 299 2022 195 2023 120 2024 70 Thereafter 54 Total $ 1,179 (b) Lessor Arrangements Our leases primarily represent sales-type leases with terms of four years on average. We provide leasing of our equipment and complementary third-party products primarily through our channel partners and distributors, for which the income arising from these leases is recognized through interest income. Interest income for the second quarter and first six months of fiscal 2020 was $23 million and $49 million , respectively, and was included in interest income in the Consolidated Statement of Operations. The net investment of our lease receivables is measured at the commencement date as the gross lease receivable, residual value less unearned income and allowance for credit loss. For additional information, see Note 9. Future minimum lease payments on our lease receivables as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 438 2021 882 2022 479 2023 267 2024 123 Thereafter 58 Total 2,247 Less: Present value of lease payments 2,117 Difference between undiscounted cash flows and discounted cash flows $ 130 Actual cash collections may differ from the contractual maturities due to early customer buyouts, refinancings, or defaults. Prior to the adoption of the new leasing standard, future minimum lease payments on our lease receivables as of July 27, 2019 were summarized as follows (in millions): Fiscal Year Amount 2020 $ 1,028 2021 702 2022 399 2023 185 2024 53 Total $ 2,367 We provide financing of certain equipment through operating leases, and the amounts are included in property and equipment in the Consolidated Balance Sheets. Amounts relating to equipment on operating lease assets held by Cisco and the associated accumulated depreciation are summarized as follows (in millions): January 25, 2020 July 27, 2019 Operating lease assets $ 411 $ 485 Accumulated depreciation (247 ) (306 ) Operating lease assets, net $ 164 $ 179 Our lease income for the second quarter and first six months of fiscal 2020 was $50 million and $94 million , respectively, and was included in product revenue in the Consolidated Statement of Operations. Minimum future rentals on noncancelable operating leases as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 61 2021 70 2022 24 2023 4 Total $ 159 |
Financing Receivables
Financing Receivables | 6 Months Ended |
Jan. 25, 2020 | |
Receivables [Abstract] | |
Financing Receivables | Financing Receivables (a) Financing Receivables Financing receivables primarily consist of lease receivables, loan receivables, and financed service contracts. Lease receivables represent sales-type leases resulting from the sale of Cisco’s and complementary third-party products and are typically collateralized by a security interest in the underlying assets. Lease receivables consist of arrangements with terms of four years on average. Loan receivables represent financing arrangements related to the sale of our hardware, software, and services, which may include additional funding for other costs associated with network installation and integration of our products and services. Loan receivables have terms of three years on average. Financed service contracts include financing receivables related to technical support and advanced services. Revenue related to the technical support services is typically deferred and included in deferred service revenue and is recognized ratably over the period during which the related services are to be performed, which typically ranges from one to three years . A summary of our financing receivables is presented as follows (in millions): January 25, 2020 Lease Receivables Loan Receivables Financed Service Contracts Total Gross $ 2,247 $ 5,297 $ 2,182 $ 9,726 Residual value 133 — — 133 Unearned income (130 ) — — (130 ) Allowance for credit loss (42 ) (95 ) (8 ) (145 ) Total, net $ 2,208 $ 5,202 $ 2,174 $ 9,584 Reported as: Current $ 999 $ 2,496 $ 1,332 $ 4,827 Noncurrent 1,209 2,706 842 4,757 Total, net $ 2,208 $ 5,202 $ 2,174 $ 9,584 July 27, 2019 Lease Receivables Loan Receivables Financed Service Contracts Total Gross $ 2,367 $ 5,438 $ 2,369 $ 10,174 Residual value 142 — — 142 Unearned income (137 ) — — (137 ) Allowance for credit loss (46 ) (71 ) (9 ) (126 ) Total, net $ 2,326 $ 5,367 $ 2,360 $ 10,053 Reported as: Current $ 1,029 $ 2,653 $ 1,413 $ 5,095 Noncurrent 1,297 2,714 947 4,958 Total, net $ 2,326 $ 5,367 $ 2,360 $ 10,053 (b) Credit Quality of Financing Receivables Gross receivables, excluding residual value, less unearned income categorized by our internal credit risk rating as of January 25, 2020 and July 27, 2019 are summarized as follows (in millions): INTERNAL CREDIT RISK RATING January 25, 2020 1 to 4 5 to 6 7 and Higher Total Lease receivables $ 1,133 $ 936 $ 48 $ 2,117 Loan receivables 3,262 1,855 180 5,297 Financed service contracts 1,256 900 26 2,182 Total $ 5,651 $ 3,691 $ 254 $ 9,596 INTERNAL CREDIT RISK RATING July 27, 2019 1 to 4 5 to 6 7 and Higher Total Lease receivables $ 1,204 $ 991 $ 35 $ 2,230 Loan receivables 3,367 1,920 151 5,438 Financed service contracts 1,413 939 17 2,369 Total $ 5,984 $ 3,850 $ 203 $ 10,037 We determine the adequacy of our allowance for credit loss by assessing the risks and losses inherent in our financing receivables by portfolio segment. The portfolio segment is based on the types of financing offered by us to our customers, which consist of the following: lease receivables, loan receivables, and financed service contracts. Our internal credit risk ratings of 1 through 4 correspond to investment-grade ratings, while credit risk ratings of 5 and 6 correspond to non-investment grade ratings. Credit risk ratings of 7 and higher correspond to substandard ratings. The following tables present the aging analysis of gross receivables, excluding residual value and less unearned income as of January 25, 2020 and July 27, 2019 (in millions): DAYS PAST DUE (INCLUDES BILLED AND UNBILLED) January 25, 2020 31-60 61-90 91+ Total Past Due Current Total Nonaccrual Financing Receivables Impaired Financing Receivables Lease receivables $ 58 $ 34 $ 172 $ 264 $ 1,853 $ 2,117 $ 22 $ 22 Loan receivables 129 31 219 379 4,918 5,297 78 78 Financed service contracts 82 45 309 436 1,746 2,182 2 2 Total $ 269 $ 110 $ 700 $ 1,079 $ 8,517 $ 9,596 $ 102 $ 102 DAYS PAST DUE (INCLUDES BILLED AND UNBILLED) July 27, 2019 31-60 61-90 91+ Total Past Due Current Total Nonaccrual Financing Receivables Impaired Financing Receivables Lease receivables $ 101 $ 42 $ 291 $ 434 $ 1,796 $ 2,230 $ 13 $ 13 Loan receivables 257 67 338 662 4,776 5,438 31 31 Financed service contracts 145 131 271 547 1,822 2,369 3 3 Total $ 503 $ 240 $ 900 $ 1,643 $ 8,394 $ 10,037 $ 47 $ 47 Past due financing receivables are those that are 31 days or more past due according to their contractual payment terms. The data in the preceding tables is presented by contract, and the aging classification of each contract is based on the oldest outstanding receivable, and therefore past due amounts also include unbilled and current receivables within the same contract. As of January 25, 2020 , we had financing receivables of $201 million , net of unbilled or current receivables, that were greater than 120 days plus past due but remained on accrual status as they are well secured and in the process of collection. Such balance was $215 million as of July 27, 2019 . (c) Allowance for Credit Loss Rollforward The allowances for credit loss and the related financing receivables are summarized as follows (in millions): Three months ended January 25, 2020 CREDIT LOSS ALLOWANCES Lease Loan Financed Service Total Allowance for credit loss as of October 26, 2019 $ 43 $ 81 $ 9 $ 133 Provisions (benefits) (1 ) 15 — 14 Recoveries (write-offs), net (1 ) (1 ) — (2 ) Foreign exchange and other 1 — (1 ) — Allowance for credit loss as of January 25, 2020 $ 42 $ 95 $ 8 $ 145 Six months ended January 25, 2020 CREDIT LOSS ALLOWANCES Lease Receivables Loan Receivables Financed Service Contracts Total Allowance for credit loss as of July 27, 2019 $ 46 $ 71 $ 9 $ 126 Provisions (benefits) (4 ) 42 — 38 Recoveries (write-offs), net (1 ) (17 ) — (18 ) Foreign exchange and other 1 (1 ) (1 ) (1 ) Allowance for credit loss as of January 25, 2020 $ 42 $ 95 $ 8 $ 145 Three months ended January 26, 2019 CREDIT LOSS ALLOWANCES Lease Receivables Loan Receivables Financed Service Contracts Total Allowance for credit loss as of October 27, 2018 $ 131 $ 60 $ 8 $ 199 Provisions (benefits) (4 ) 4 1 1 Allowance for credit loss as of January 26, 2019 $ 127 $ 64 $ 9 $ 200 Six months ended January 26, 2019 CREDIT LOSS ALLOWANCES Lease Receivables Loan Receivables Financed Service Contracts Total Allowance for credit loss as of July 28, 2018 $ 135 $ 60 $ 10 $ 205 Provisions (benefits) (7 ) 4 (1 ) (4 ) Foreign exchange and other (1 ) — — (1 ) Allowance for credit loss as of January 26, 2019 $ 127 $ 64 $ 9 $ 200 We assess the allowance for credit loss related to financing receivables on either an individual or a collective basis. We consider various factors in evaluating lease and loan receivables and the earned portion of financed service contracts for possible impairment on an individual basis. These factors include our historical experience, credit quality and age of the receivable balances, and economic conditions that may affect a customer’s ability to pay. When the evaluation indicates that it is probable that all amounts due pursuant to the contractual terms of the financing agreement, including scheduled interest payments, are unable to be collected, the financing receivable is considered impaired. All such outstanding amounts, including any accrued interest, will be assessed and fully reserved at the customer level. Our internal credit risk ratings are categorized as 1 through 10 , with the lowest credit risk rating representing the highest quality financing receivables. Typically, we also consider receivables with a risk rating of 8 or higher to be impaired and will include them in the individual assessment for allowance. These balances, as of January 25, 2020 and July 27, 2019 , are presented under “(b) Credit Quality of Financing Receivables” above. We evaluate the remainder of our financing receivables portfolio for impairment on a collective basis and record an allowance for credit loss at the portfolio segment level. When evaluating the financing receivables on a collective basis, we use expected default frequency rates published by a major third-party credit-rating agency as well as our own historical loss rate in the event of default, while also systematically giving effect to economic conditions, concentration of risk, and correlation. |
Available-for-Sale Debt Investm
Available-for-Sale Debt Investments and Equity Investments | 6 Months Ended |
Jan. 25, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-Sale Debt Investments and Equity Investments | Available-for-Sale Debt Investments and Equity Investments The following table summarizes our available-for-sale debt investments and equity investments (in millions): January 25, 2020 July 27, 2019 Available-for-sale debt investments $ 18,587 $ 21,660 Marketable equity securities — 3 Total investments 18,587 21,663 Non-marketable equity securities included in other assets 1,155 1,113 Equity method investments included in other assets 61 87 Total $ 19,803 $ 22,863 (a) Summary of Available-for-Sale Debt Investments The following tables summarize our available-for-sale debt investments (in millions): January 25, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government securities $ 2,218 $ 13 $ — $ 2,231 U.S. government agency securities 20 — — 20 Corporate debt securities 13,405 196 (4 ) 13,597 U.S. agency mortgage-backed securities 1,612 14 (3 ) 1,623 Commercial paper 1,052 — — 1,052 Certificates of deposit 64 — — 64 Total (1) $ 18,371 $ 223 $ (7 ) $ 18,587 July 27, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government securities $ 808 $ 1 $ (1 ) $ 808 U.S. government agency securities 169 — — 169 Corporate debt securities 19,188 103 (29 ) 19,262 U.S. agency mortgage-backed securities 1,425 7 (11 ) 1,421 Total $ 21,590 $ 111 $ (41 ) $ 21,660 (1) Net unsettled investment sales were $13 million as of January 25, 2020 and were included in other current assets. The following table presents the gross realized gains and gross realized losses related to available-for-sale debt investments (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Gross realized gains $ 13 $ 1 $ 25 $ 3 Gross realized losses (2 ) (6 ) (4 ) (14 ) Total $ 11 $ (5 ) $ 21 $ (11 ) The following tables present the breakdown of the available-for-sale debt investments with gross unrealized losses and the duration that those losses had been unrealized at January 25, 2020 and July 27, 2019 (in millions): UNREALIZED LOSSES LESS THAN 12 MONTHS UNREALIZED LOSSES 12 MONTHS OR GREATER TOTAL January 25, 2020 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses U.S. government securities $ 44 $ — $ 20 $ — $ 64 $ — U.S. government agency securities — — 3 — 3 — Corporate debt securities 260 (1 ) 439 (3 ) 699 (4 ) U.S. agency mortgage-backed securities 56 — 374 (3 ) 430 (3 ) Commercial paper 51 — — — 51 — Certificates of deposit 36 — — — 36 — Total $ 447 $ (1 ) $ 836 $ (6 ) $ 1,283 $ (7 ) UNREALIZED LOSSES LESS THAN 12 MONTHS UNREALIZED LOSSES 12 MONTHS OR GREATER TOTAL July 27, 2019 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses U.S. government securities $ 204 $ — $ 488 $ (1 ) $ 692 $ (1 ) U.S. government agency securities — — 169 — 169 — Corporate debt securities 2,362 (4 ) 5,271 (25 ) 7,633 (29 ) U.S. agency mortgage-backed securities 123 — 847 (11 ) 970 (11 ) Total $ 2,689 $ (4 ) $ 6,775 $ (37 ) $ 9,464 $ (41 ) For available-for-sale debt investments that were in an unrealized loss position as of January 25, 2020 , we have determined that no other-than-temporary impairments were required to be recognized. The following table summarizes the maturities of our available-for-sale debt investments as of January 25, 2020 (in millions): Amortized Cost Fair Value Within 1 year $ 5,704 $ 5,717 After 1 year through 5 years 8,898 8,995 After 5 years through 10 years 2,150 2,245 After 10 years 7 7 Mortgage-backed securities with no single maturity 1,612 1,623 Total $ 18,371 $ 18,587 Actual maturities may differ from the contractual maturities because borrowers may have the right to call or prepay certain obligations. (b) Summary of Equity Investments Gains and losses recognized on our marketable and non-marketable equity securities are summarized below (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Net gains and losses recognized during the period on equity investments $ 71 $ 67 $ 78 $ 75 Less: Net gains and losses recognized on equity investments sold (68 ) 5 (75 ) (7 ) Net unrealized gains and losses recognized during reporting period on equity securities still held at the reporting date $ 3 $ 72 $ 3 $ 68 We recorded adjustments to the carrying value of our non-marketable equity securities measured using the measurement alternative as follows (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Adjustments to non-marketable equity securities measured using the measurement alternative: Upward adjustments $ 11 $ 14 $ 12 $ 24 Downward adjustments, including impairments (8 ) (2 ) (9 ) (18 ) Net adjustments $ 3 $ 12 $ 3 $ 6 As of January 25, 2020 and July 27, 2019 , we held equity interests in certain private equity funds of $0.7 billion and $0.6 billion , respectively, which are accounted for under the NAV practical expedient. (c) Variable Interest Entities In the ordinary course of business, we have investments in privately held companies and provide financing to certain customers. These privately held companies and customers are evaluated for consolidation under the variable interest or voting interest entity models. We evaluate on an ongoing basis our investments in these privately held companies and our customer financings, and have determined that as of January 25, 2020 , except as disclosed herein, there were no significant variable interest or voting interest entities required to be consolidated in our Consolidated Financial Statements. As of January 25, 2020 , the carrying value of investments in privately held companies was $1.2 billion . $669 million of such investments are considered to be in variable interest entities which are unconsolidated. We have total funding commitments of $291 million related to these privately held investments, some of which are based on the achievement of certain agreed-upon milestones, and some of which are required to be funded on demand. The carrying value of these investments and the additional funding commitments collectively represent our maximum exposure related to these privately held investments. |
Fair Value
Fair Value | 6 Months Ended |
Jan. 25, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be either recorded or disclosed at fair value, we consider the principal or most advantageous market in which we would transact, and we also consider assumptions that market participants would use when pricing the asset or liability. (a) Fair Value Hierarchy The accounting guidance for fair value measurement requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is as follows: Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. (b) Assets and Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities measured at fair value on a recurring basis were as follows (in millions): JANUARY 25, 2020 JULY 27, 2019 Level 1 Level 2 Total Balance Level 1 Level 2 Total Balance Assets: Cash equivalents: Money market funds $ 6,556 $ — $ 6,556 $ 10,083 $ — $ 10,083 Commercial paper — 216 216 — — — Certificates of deposit — 18 18 — — — Available-for-sale debt investments: U.S. government securities — 2,231 2,231 — 808 808 U.S. government agency securities — 20 20 — 169 169 Corporate debt securities — 13,597 13,597 — 19,262 19,262 U.S. agency mortgage-backed securities — 1,623 1,623 — 1,421 1,421 Commercial paper — 1,052 1,052 — — — Certificates of deposit — 64 64 — — — Equity investments: Marketable equity securities — — — 3 — 3 Derivative assets — 103 103 — 89 89 Total $ 6,556 $ 18,924 $ 25,480 $ 10,086 $ 21,749 $ 31,835 Liabilities: Derivative liabilities $ — $ 15 $ 15 $ — $ 15 $ 15 Total $ — $ 15 $ 15 $ — $ 15 $ 15 Level 1 marketable equity securities are determined by using quoted prices in active markets for identical assets. Level 2 available-for-sale debt investments are priced using quoted market prices for similar instruments or nonbinding market prices that are corroborated by observable market data. We use inputs such as actual trade data, benchmark yields, broker/dealer quotes, and other similar data, which are obtained from quoted market prices, independent pricing vendors, or other sources, to determine the ultimate fair value of these assets and liabilities. We use such pricing data as the primary input to make our assessments and determinations as to the ultimate valuation of our investment portfolio and have not made, during the periods presented, any material adjustments to such inputs. We are ultimately responsible for the financial statements and underlying estimates. Our derivative instruments are primarily classified as Level 2, as they are not actively traded and are valued using pricing models that use observable market inputs. We did not have any transfers between Level 1 and Level 2 fair value measurements during the periods presented. (c) Assets Measured at Fair Value on a Nonrecurring Basis The following table presents gains and losses on assets that were measured at fair value on a nonrecurring basis (in millions): TOTAL GAINS (LOSSES) FOR THE THREE MONTHS ENDED TOTAL GAINS (LOSSES) FOR THE SIX MONTHS ENDED January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Non-marketable equity securities and equity method investments $ (11 ) $ 12 $ (32 ) $ 6 Purchased intangible assets (impaired) (3 ) — (3 ) — Total gains (losses) for nonrecurring measurements $ (14 ) $ 12 $ (35 ) $ 6 These assets were measured at fair value due to events or circumstances we identified as having significant impact on their fair value during the respective periods. The carrying value of our non-marketable equity securities recorded to fair value on a non-recurring basis is adjusted for observable transactions for identical or similar investments of the same issuer or impairment. These securities are classified as Level 3 in the fair value hierarchy because we estimate the value based on valuation methods using the observable transaction price at the transaction date and other unobservable inputs such as volatility, rights, and obligations of the securities we hold. The fair value for purchased intangible assets measured at fair value on a nonrecurring basis was categorized as Level 3 due to the use of significant unobservable inputs in the valuation. Significant unobservable inputs that were used included expected revenues and net income related to the assets and the expected life of the assets. The difference between the estimated fair value and the carrying value of the assets was recorded as an impairment charge, which was included in product cost of sales and operating expenses as applicable. See Note 5. The remaining carrying value of the specific purchased intangible assets that were impaired was zero as of January 25, 2020 . (d) Other Fair Value Disclosures The fair value of short-term loan receivables and financed service contracts approximates their carrying value due to their short duration. The aggregate carrying value of long-term loan receivables and financed service contracts as of January 25, 2020 and July 27, 2019 was $3.5 billion and $3.7 billion , respectively. The estimated fair value of long-term loan receivables and financed service contracts approximates their carrying value. We use significant unobservable inputs in determining discounted cash flows to estimate the fair value of our long-term loan receivables and financed service contracts, and therefore they are categorized as Level 3. As of January 25, 2020 , the estimated fair value of our short-term debt approximates its carrying value due to the short maturities. As of January 25, 2020 , the fair value of our senior notes and other long-term debt was $18.0 billion with a carrying amount of $16.0 billion . This compares to a fair value of $22.1 billion and a carrying amount of $20.5 billion as of July 27, 2019 |
Borrowings
Borrowings | 6 Months Ended |
Jan. 25, 2020 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings (a) Short-Term Debt The following table summarizes our short-term debt (in millions, except percentages): January 25, 2020 July 27, 2019 Amount Effective Rate Amount Effective Rate Current portion of long-term debt $ 1,499 2.54 % $ 5,998 3.20 % Commercial paper — — 4,193 2.34 % Total short-term debt $ 1,499 $ 10,191 We have a short-term debt financing program of up to $10.0 billion through the issuance of commercial paper notes. We use the proceeds from the issuance of commercial paper notes for general corporate purposes. The effective rates for the short- and long-term debt include the interest on the notes, the accretion of the discount, the issuance costs, and, if applicable, adjustments related to hedging. (b) Long-Term Debt The following table summarizes our long-term debt (in millions, except percentages): January 25, 2020 July 27, 2019 Maturity Date Amount Effective Rate Amount Effective Rate Senior notes: Floating-rate notes: Three-month LIBOR plus 0.34% September 20, 2019 $ — — $ 500 2.77% Fixed-rate notes: 1.40% September 20, 2019 — — 1,500 1.48% 4.45% January 15, 2020 — — 2,500 4.72% 2.45% June 15, 2020 1,500 2.54% 1,500 2.54% 2.20% February 28, 2021 2,500 2.30% 2,500 2.30% 2.90% March 4, 2021 500 2.51% 500 3.14% 1.85% September 20, 2021 2,000 1.90% 2,000 1.90% 3.00% June 15, 2022 500 2.71% 500 3.36% 2.60% February 28, 2023 500 2.68% 500 2.68% 2.20% September 20, 2023 750 2.27% 750 2.27% 3.625% March 4, 2024 1,000 2.63% 1,000 3.25% 3.50% June 15, 2025 500 2.88% 500 3.52% 2.95% February 28, 2026 750 3.01% 750 3.01% 2.50% September 20, 2026 1,500 2.55% 1,500 2.55% 5.90% February 15, 2039 2,000 6.11% 2,000 6.11% 5.50% January 15, 2040 2,000 5.67% 2,000 5.67% Total 16,000 20,500 Unaccreted discount/issuance costs (94 ) (100 ) Hedge accounting fair value adjustments 87 73 Total $ 15,993 $ 20,473 Reported as: Current portion of long-term debt $ 1,499 $ 5,998 Long-term debt 14,494 14,475 Total $ 15,993 $ 20,473 We entered into interest rate swaps in prior periods with an aggregate notional amount of $2.5 billion designated as fair value hedges of certain of our fixed-rate senior notes. These swaps convert the fixed interest rates of the fixed-rate notes to floating interest rates based on the London InterBank Offered Rate (“LIBOR”). The gains and losses related to changes in the fair value of the interest rate swaps substantially offset changes in the fair value of the hedged portion of the underlying debt that are attributable to the changes in market interest rates. For additional information, see Note 13. Interest is payable semiannually on each class of the senior fixed-rate notes. Each of the senior fixed-rate notes is redeemable by us at any time, subject to a make-whole premium. The senior notes rank at par with the commercial paper notes that may be issued in the future pursuant to our short-term debt financing program, as discussed above under “(a) Short-Term Debt.” As of January 25, 2020 , we were in compliance with all debt covenants. As of January 25, 2020 , future principal payments for long-term debt, including the current portion, are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 1,500 2021 3,000 2022 2,500 2023 500 2024 1,750 Thereafter 6,750 Total $ 16,000 (c) Credit Facility On May 15, 2015, we entered into a credit agreement with certain institutional lenders that provides for a $3.0 billion unsecured revolving credit facility that is scheduled to expire on May 15, 2020 . Any advances under the credit agreement will accrue interest at rates that are equal to, based on certain conditions, either (i) the highest of (a) the Federal Funds rate plus 0.50% , (b) Bank of America’s “prime rate” as announced from time to time, or (c) LIBOR, or a comparable or successor rate that is approved by the Administrative Agent (“Eurocurrency Rate”), for an interest period of one-month plus 1.00% , or (ii) the Eurocurrency Rate, plus a margin that is based on our senior debt credit ratings as published by Standard & Poor’s Financial Services, LLC and Moody’s Investors Service, Inc., provided that in no event will the Eurocurrency Rate be less than zero . We may also, upon the agreement of either the then-existing lenders or additional lenders not currently parties to the agreement, increase the commitments under the credit facility by up to an additional $2.0 billion and/or extend the expiration date of the credit facility up to May 15, 2022 . This credit agreement requires that we comply with certain covenants, including that we maintain an interest coverage ratio as defined in the agreement. As of January 25, 2020 , we were in compliance with the required interest coverage ratio and the other covenants, and we had no t borrowed any funds under this credit facility. |
Derivative Instruments
Derivative Instruments | 6 Months Ended |
Jan. 25, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments (a) Summary of Derivative Instruments We use derivative instruments primarily to manage exposures to foreign currency exchange rate, interest rate, and equity price risks. Our primary objective in holding derivatives is to reduce the volatility of earnings and cash flows associated with changes in foreign currency exchange rates, interest rates, and equity prices. Our derivatives expose us to credit risk to the extent that the counterparties may be unable to meet the terms of the agreement. We do, however, seek to mitigate such risks by limiting our counterparties to major financial institutions. In addition, the potential risk of loss with any one counterparty resulting from this type of credit risk is monitored. Management does not expect material losses as a result of defaults by counterparties. The fair values of our derivative instruments and the line items on the Consolidated Balance Sheets to which they were recorded are summarized as follows (in millions): DERIVATIVE ASSETS DERIVATIVE LIABILITIES Balance Sheet Line Item January 25, July 27, Balance Sheet Line Item January 25, July 27, Derivatives designated as hedging instruments: Foreign currency derivatives Other current assets $ 8 $ 5 Other current liabilities $ 7 $ 8 Interest rate derivatives Other current assets — — Other current liabilities — 1 Interest rate derivatives Other assets 89 75 Other long-term liabilities — — Total 97 80 7 9 Derivatives not designated as hedging instruments: Foreign currency derivatives Other current assets 6 9 Other current liabilities 8 6 Total 6 9 8 6 Total $ 103 $ 89 $ 15 $ 15 The following amounts were recorded on the Consolidated Balance Sheets related to cumulative basis adjustments for our fair value hedges (in millions): CARRYING AMOUNT OF THE HEDGED ASSETS/(LIABILITIES) CUMULATIVE AMOUNT OF FAIR VALUE HEDGING ADJUSTMENT INCLUDED IN THE CARRYING AMOUNT OF THE HEDGED ASSETS/LIABILITIES Balance Sheet Line Item of Hedged Item January 25, July 27, January 25, July 27, Short-term debt $ — $ (2,000 ) $ — $ — Long-term debt $ (2,580 ) $ (2,565 ) $ (87 ) $ (73 ) See Note 17 for the effects of our cash flow hedging instruments on other comprehensive income (OCI) and the Consolidated Statements of Operations. The effect on the Consolidated Statements of Operations of derivative instruments designated as fair value and cash flow hedges is summarized as follows (in millions): January 25, 2020 Three Months Ended Six Months Ended Revenue Cost of sales Operating expenses Interest and other income (loss), net Revenue Cost of sales Operating expenses Interest and other income (loss), net Total amounts presented in the Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 12,005 $ 4,241 $ 4,384 $ 154 $ 25,164 $ 8,936 $ 9,269 $ 261 The effects of fair value and cash flow hedging: Gains (losses) on fair value hedging relationships: Interest rate derivatives Hedged items — — — 7 — — — (14 ) Derivatives designated as hedging instruments — — — (6 ) — — — 16 Gains (losses) on cash flow hedging relationships: Foreign currency derivatives Amount of gains (losses) reclassified from AOCI to income (2 ) — — — (5 ) 1 2 — Total gains (losses) $ (2 ) $ — $ — $ 1 $ (5 ) $ 1 $ 2 $ 2 January 26, 2019 Three Months Ended Six Months Ended Revenue Cost of sales Operating expenses Interest and other income (loss), net Revenue Cost of sales Operating expenses Interest and other income (loss), net Total amounts presented in the Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 12,446 $ 4,673 $ 4,562 $ 132 $ 25,518 $ 9,599 $ 8,903 $ 236 The effects of fair value and cash flow hedging: Gains (losses) on fair value hedging relationships: Interest rate derivatives Hedged items — — — (61 ) — — — (52 ) Derivatives designated as hedging instruments — — — 64 — — — 55 Gains (losses) on cash flow hedging relationships: Foreign currency derivatives Amount of gains (losses) reclassified from AOCI to income 2 (1 ) — — 3 (1 ) (1 ) — Total gains (losses) $ 2 $ (1 ) $ — $ 3 $ 3 $ (1 ) $ (1 ) $ 3 The effect on the Consolidated Statements of Operations of derivative instruments not designated as hedges is summarized as follows (in millions): GAINS (LOSSES) FOR THE THREE MONTHS ENDED GAINS (LOSSES) FOR THE SIX MONTHS ENDED Derivatives Not Designated as Hedging Instruments Line Item in Statements of Operations January 25, January 26, January 25, January 26, Foreign currency derivatives Other income (loss), net $ (2 ) $ (1 ) $ (9 ) $ (28 ) Total return swaps—deferred compensation Operating expenses 40 (9 ) 44 (33 ) Cost of sales 4 (1 ) 4 (3 ) Other income (loss), net (3 ) (4 ) (7 ) (8 ) Equity derivatives Other income (loss), net 3 — 5 1 Total $ 42 $ (15 ) $ 37 $ (71 ) The notional amounts of our outstanding derivatives are summarized as follows (in millions): January 25, July 27, Derivatives designated as hedging instruments: Foreign currency derivatives—cash flow hedges $ 595 $ 663 Interest rate derivatives 2,500 4,500 Net investment hedging instruments 272 309 Derivatives not designated as hedging instruments: Foreign currency derivatives 2,798 2,708 Total return swaps—deferred compensation 630 574 Total $ 6,795 $ 8,754 (b) Offsetting of Derivative Instruments We present our derivative instruments at gross fair values in the Consolidated Balance Sheets. However, our master netting and other similar arrangements with the respective counterparties allow for net settlement under certain conditions, which are designed to reduce credit risk by permitting net settlement with the same counterparty. As of January 25, 2020 and July 27, 2019 , the potential effects of these rights of set-off associated with the derivative contracts would be a reduction to both derivative assets and derivative liabilities of $14 million and $13 million , respectively. To further limit credit risk, we also enter into collateral security arrangements related to certain derivative instruments whereby cash is posted as collateral between the counterparties based on the fair market value of the derivative instrument. Under these collateral security arrangements, the net cash collateral received as of January 25, 2020 and July 27, 2019 was $86 million and $76 million , respectively. Including the effects of collateral, this results in a net derivative asset of $2 million and a net derivative liability of $2 million as of January 25, 2020 and July 27, 2019 , respectively. (c) Foreign Currency Exchange Risk We conduct business globally in numerous currencies. Therefore, we are exposed to adverse movements in foreign currency exchange rates. To limit the exposure related to foreign currency changes, we enter into foreign currency contracts. We do not enter into such contracts for speculative purposes. We hedge forecasted foreign currency transactions related to certain revenues, operating expenses and service cost of sales with currency options and forward contracts. These currency options and forward contracts, designated as cash flow hedges, generally have maturities of less than 24 months . The derivative instrument’s gain or loss is initially reported as a component of accumulated other comprehensive income (AOCI) and subsequently reclassified into earnings when the hedged exposure affects earnings. During the periods presented, we did not discontinue any cash flow hedges for which it was probable that a forecasted transaction would not occur. We enter into foreign exchange forward and option contracts to reduce the short-term effects of foreign currency fluctuations on assets and liabilities such as foreign currency receivables, including long-term customer financings, investments, and payables. These derivatives are not designated as hedging instruments. Gains and losses on the contracts are included in other income (loss), net, and substantially offset foreign exchange gains and losses from the remeasurement of intercompany balances or other current assets, investments, or liabilities denominated in currencies other than the functional currency of the reporting entity. We hedge certain net investments in our foreign operations with forward contracts to reduce the effects of foreign currency fluctuations on our net investment in those foreign subsidiaries. These derivative instruments generally have maturities of up to six months. (d) Interest Rate Risk Interest Rate Derivatives Designated as Fair Value Hedges, Long-Term Debt We hold interest rate swaps designated as fair value hedges related to fixed-rate senior notes that are due in fiscal 2021 through 2025. Under these interest rate swaps, we receive fixed-rate interest payments and make interest payments based on LIBOR plus a fixed number of basis points. The effect of such swaps is to convert the fixed interest rates of the senior fixed-rate notes to floating interest rates based on LIBOR. The gains and losses related to changes in the fair value of the interest rate swaps are included in interest expense and substantially offset changes in the fair value of the hedged portion of the underlying debt that are attributable to the changes in market interest rates. (e) Equity Price Risk We may hold marketable equity securities in our portfolio that are subject to price risk. To diversify our overall portfolio, we also hold equity derivatives that are not designated as accounting hedges. The change in the fair value of each of these investment types are included in other income (loss), net. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jan. 25, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies (a) Purchase Commitments with Contract Manufacturers and Suppliers We purchase components from a variety of suppliers and use several contract manufacturers to provide manufacturing services for our products. During the normal course of business, in order to manage manufacturing lead times and help ensure adequate component supply, we enter into agreements with contract manufacturers and suppliers that either allow them to procure inventory based upon criteria as defined by us or establish the parameters defining our requirements. A significant portion of our reported purchase commitments arising from these agreements consists of firm, noncancelable, and unconditional commitments. Certain of these purchase commitments with contract manufacturers and suppliers relate to arrangements to secure long-term pricing for certain product components for multi-year periods. In certain instances, these agreements allow us the option to cancel, reschedule, and adjust our requirements based on our business needs prior to firm orders being placed. As of January 25, 2020 and July 27, 2019 , we had total purchase commitments for inventory of $4.5 billion and $5.0 billion , respectively. We record a liability for firm, noncancelable, and unconditional purchase commitments for quantities in excess of our future demand forecasts consistent with the valuation of our excess and obsolete inventory. As of January 25, 2020 and July 27, 2019 , the liability for these purchase commitments was $126 million and $129 million , respectively, and was included in other current liabilities. (b) Other Commitments In connection with our acquisitions, we have agreed to pay certain additional amounts contingent upon the achievement of certain agreed-upon technology, development, product, or other milestones or upon the continued employment with Cisco of certain employees of the acquired entities. The following table summarizes the compensation expense related to acquisitions (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Compensation expense related to acquisitions $ 50 $ 66 $ 111 $ 175 As of January 25, 2020 , we estimated that future cash compensation expense of up to $370 million may be required to be recognized pursuant to the applicable business combination agreements. We also have certain funding commitments, primarily related to our non-marketable equity and other investments, some of which are based on the achievement of certain agreed-upon milestones, and some of which are required to be funded on demand. The funding commitments were $291 million and $326 million as of January 25, 2020 and July 27, 2019 , respectively. (c) Product Warranties The following table summarizes the activity related to the product warranty liability (in millions): Six Months Ended January 25, January 26, Balance at beginning of period $ 342 $ 359 Provisions for warranties issued 283 297 Adjustments for pre-existing warranties (3 ) (5 ) Settlements (291 ) (300 ) Acquisitions and divestitures — (2 ) Balance at end of period $ 331 $ 349 We accrue for warranty costs as part of our cost of sales based on associated material product costs, labor costs for technical support staff, and associated overhead. Our products are generally covered by a warranty for periods ranging from 90 days to five years , and for some products we provide a limited lifetime warranty. (d) Financing and Other Guarantees In the ordinary course of business, we provide financing guarantees for various third-party financing arrangements extended to channel partners and end-user customers. Payments under these financing guarantee arrangements were not material for the periods presented. Channel Partner Financing Guarantees We facilitate arrangements for third-party financing extended to channel partners, consisting of revolving short-term financing, generally with payment terms ranging from 60 to 90 days . These financing arrangements facilitate the working capital requirements of the channel partners, and, in some cases, we guarantee a portion of these arrangements. The volume of channel partner financing was $6.6 billion and $7.3 billion for the second quarter of fiscal 2020 and 2019 , respectively, and was $14.2 billion and $14.5 billion for the first six months of fiscal 2020 and 2019 , respectively. The balance of the channel partner financing subject to guarantees was $1.3 billion and $1.4 billion as of January 25, 2020 and July 27, 2019 , respectively. End-User Financing Guarantees We also provide financing guarantees for third-party financing arrangements extended to end-user customers related to leases and loans, which typically have terms of up to three years . The volume of financing provided by third parties for leases and loans as to which we had provided guarantees was $1 million and $6 million for the second quarter of fiscal 2020 and 2019 , respectively, and was $6 million and $9 million for the first six months of fiscal 2020 and 2019 , respectively. Financing Guarantee Summary The aggregate amounts of financing guarantees outstanding at January 25, 2020 and July 27, 2019 , representing the total maximum potential future payments under financing arrangements with third parties along with the related deferred revenue, are summarized in the following table (in millions): January 25, July 27, Maximum potential future payments relating to financing guarantees: Channel partner $ 258 $ 197 End user 13 21 Total $ 271 $ 218 Deferred revenue associated with financing guarantees: Channel partner $ (69 ) $ (62 ) End user (13 ) (15 ) Total $ (82 ) $ (77 ) Maximum potential future payments relating to financing guarantees, net of associated deferred revenue $ 189 $ 141 (e) Indemnifications In the normal course of business, we indemnify other parties, including customers, lessors, and parties to other transactions with us, with respect to certain matters. We have agreed to indemnify against losses arising from a breach of representations or covenants or out of intellectual property infringement or other claims made against certain parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. Charter Communications, Inc. (“Charter”), which acquired Time Warner Cable (“TWC”) in May 2016, is seeking indemnification from us for a final judgment obtained by Sprint Communications Company, L.P. (“Sprint”) against TWC in federal court in Kansas. Sprint sought monetary damages, alleging that TWC infringed certain Sprint patents by offering VoIP telephone services utilizing products provided by us generally in combination with those of other manufacturers. Following a trial on March 3, 2017 , a jury in Kansas found that TWC willfully infringed five Sprint patents and awarded Sprint $139.8 million in damages. The Court awarded Sprint pre and post judgment interest of approximately $10 million and denied TWC's post-trial motions and appeals. Charter reported that it paid the judgment in full. At this time, we are working with Charter to calculate the correct amount of indemnification. We do not believe that our indemnity obligations under our agreement will be material. In addition, we have entered into indemnification agreements with our officers and directors, and our Amended and Restated Bylaws contain similar indemnification obligations to our agents. It is not possible to determine the maximum potential amount under these indemnification agreements due to our limited history with prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made by us under these agreements have not had a material effect on our operating results, financial position, or cash flows. (f) Legal Proceedings Brazil Brazilian authorities have investigated our Brazilian subsidiary and certain of its former employees, as well as a Brazilian importer of our products, and its affiliates and employees, relating to alleged evasion of import taxes and alleged improper transactions involving the subsidiary and the importer. Brazilian tax authorities have assessed claims against our Brazilian subsidiary based on a theory of joint liability with the Brazilian importer for import taxes, interest, and penalties. In addition to claims asserted by the Brazilian federal tax authorities in prior fiscal years, tax authorities from the Brazilian state of Sao Paulo have asserted similar claims on the same legal basis in prior fiscal years. During the second quarter of fiscal 2020, $0.8 billion of penalty and interest asserted by the Brazilian federal tax authorities against our Brazilian subsidiary on the theory of joint liability was dismissed on its merits. The asserted claims by Brazilian federal tax authorities that remain are for calendar years 2003 through 2007, and the asserted claims by the tax authorities from the state of Sao Paulo are for calendar years 2005 through 2007. The total remaining asserted claims by Brazilian state and federal tax authorities aggregate to $0.2 billion for the alleged evasion of import and other taxes, $0.9 billion for interest, and $0.5 billion for various penalties, all determined using an exchange rate as of January 25, 2020 . We have completed a thorough review of the matters and believe the remaining asserted claims against our Brazilian subsidiary are without merit, and we are defending the claims vigorously. While we believe there is no legal basis for the alleged liability, due to the complexities and uncertainty surrounding the judicial process in Brazil and the nature of the claims asserting joint liability with the importer, we are unable to determine the likelihood of an unfavorable outcome against our Brazilian subsidiary and are unable to reasonably estimate a range of loss, if any. We do not expect a final judicial determination for several years. SRI International On September 4, 2013 , SRI International, Inc. (“SRI”) asserted patent infringement claims against us in the U.S. District Court for the District of Delaware, accusing our products and services in the area of network intrusion detection of infringing two U.S. patents. SRI sought monetary damages of at least a reasonable royalty and enhanced damages. The trial on these claims began on May 2, 2016 and, on May 12, 2016 , the jury returned a verdict finding willful infringement of the asserted patents. The jury awarded SRI damages of $23.7 million . On May 25, 2017 , the Court awarded SRI enhanced damages and attorneys’ fees, entered judgment in the new amount of $57.0 million , and ordered an ongoing royalty of 3.5% through the expiration of the patents in 2018. We appealed to the United States Court of Appeals for the Federal Circuit on various grounds, a panel of which, after various proceedings, on July 12, 2019, issued an opinion vacating the enhanced damages award; vacating and remanding in part the willful infringement finding; vacating and remanding the attorneys’ fees award for further proceedings; and affirming the district court's other findings. Cisco paid SRI $28.1 million , representing the portion of the judgment that the Federal Circuit affirmed, plus interest and royalties on post-verdict sales. This payment is subject to a refund if any portion of the affirmed judgment is reversed or vacated by the U.S. Supreme Court. On November 8, 2019, Cisco filed a petition for a writ of certiorari with the U.S. Supreme Court, seeking review of the judgment on the grounds that the asserted patents describe patent-ineligible subject matter. While the remanded proceedings may result in an additional loss, we do not expect it to be material. Centripetal On February 13, 2018 , Centripetal Networks, Inc. (“Centripetal”) asserted patent infringement claims against us in the U.S. District Court for the Eastern District of Virginia, seeking injunctive relief and damages, including enhanced damages for allegations of willful infringement. Centripetal alleges that several Cisco products and services (including Cisco’s Catalyst switches, ASR and ISR series routers, ASAs with FirePOWER services, and Stealthwatch products) infringe eleven Centripetal patents. Cisco thereafter petitioned the Patent Trial and Appeal Board (“PTAB”) of the United States Patent and Trademark Office to review the validity of nine of the asserted patents. The PTAB instituted inter partes review proceedings (“IPR Proceedings”) on six asserted patents and certain claims of another asserted patent. The PTAB has thus far issued Final Written Decisions for four patents in the instituted IPR Proceedings, and all claims of three patents have been found unpatentable and a portion of the claims of a fourth patent have been found unpatentable. The court set a trial for April 7, 2020 , on the claims in the five patents not subject to the IPR Proceedings, including claims in three for which the PTAB declined to institute Inter Partes Review. While we believe that we have strong non-infringement arguments and that the patents are invalid, as well as other defenses, if we do not prevail in the District Court, we believe that Centripetal will not be able to meet its burden required for injunctive relief and that any damages ultimately assessed would not be material. Due to uncertainty surrounding patent litigation processes, however, we are unable to reasonably estimate the ultimate monetary outcome of this litigation at this time. Straight Path On September 24, 2014 , Straight Path IP Group, Inc. (“Straight Path”) asserted patent infringement claims against us in the U.S. District Court for the Northern District of California, accusing our 9971 IP Phone, Unified Communications Manager working in conjunction with 9971 IP Phones, and Video Communication Server products of infringement. All of the asserted patents have expired and Straight Path was therefore limited to seeking monetary damages for the alleged past infringement. On November 13, 2017 , the Court granted our motion for summary judgment of non-infringement, thereby dismissing Straight Path's claims against us and cancelling a trial which had been set for March 12, 2018 . Straight Path appealed to the U.S. Court of Appeal for the Federal Circuit, and, on January 23, 2019 , the court summarily affirmed the finding of non-infringement. On August 23, 2019 , Straight Path filed a petition with the United States Supreme Court challenging the constitutionality of the Federal Circuit’s rule allowing summary affirmance, which was denied on November 18, 2019 . Oyster Optics On November 24, 2016 , Oyster Optics, LLC (“Oyster”) asserted patent infringement claims against us in the U.S. District Court for the Eastern District of Texas. Oyster alleges that certain Cisco ONS 15454 and NCS 2000 line cards infringe U.S. Patent No. 7,620,327 (“the ‘327 Patent”). Oyster seeks monetary damages. Oyster filed infringement claims based on the ‘327 Patent against other defendants, including ZTE, Nokia, NEC, Infinera, Huawei, Ciena, Alcatel-Lucent, and Fujitsu, and the court consolidated the cases alleging infringement of the ‘327 Patent. Oyster's cases against some of the defendants were resolved. The court vacated the November 4, 2018 trial date set for Oyster's claims against Cisco and one other remaining defendant, pending resolution of Oyster's appeal of the court's summary judgment ruling dismissing certain of Oyster's claims. Oyster appealed the summary judgment ruling on December 6, 2018 . While we believe that we have strong non-infringement arguments and that the patent is invalid, if Oyster prevails in its appeal of the summary judgment ruling, and if we do not prevail in the District Court in a subsequent trial, we believe damages ultimately assessed would not be material. Due to uncertainty surrounding patent litigation processes, we are unable to reasonably estimate the ultimate outcome of this litigation at this time. However, we do not anticipate that any final outcome of the dispute would be material. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jan. 25, 2020 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity (a) Cash Dividends on Shares of Common Stock We declared and paid cash dividends of $0.35 and $0.33 per common share, or $1.5 billion on our outstanding common stock for each of the second quarter s of fiscal 2020 and 2019 . We declared and paid cash dividends of $0.70 and $0.66 per common share, or $3.0 billion , on our outstanding common stock for each of the first six months of fiscal 2020 and 2019 . On February 12, 2020 , our Board of Directors declared a quarterly dividend of $0.36 per common share to be paid on April 22, 2020 to all shareholders of record as of the close of business on April 3, 2020 . Any future dividends will be subject to the approval of our Board of Directors. (b) Stock Repurchase Program In September 2001, our Board of Directors authorized a stock repurchase program. As of January 25, 2020 , the remaining authorized amount for stock repurchases under this program, including the additional authorization, was approximately $11.8 billion with no termination date. A summary of the stock repurchase activity for fiscal 2020 and 2019 under the stock repurchase program, reported based on the trade date, is summarized as follows (in millions, except per-share amounts): Quarter Ended Shares Weighted-Average Price per Share Amount Fiscal 2020 January 25, 2020 18 $ 46.71 $ 870 October 26, 2019 16 $ 48.91 $ 768 Fiscal 2019 July 27, 2019 82 $ 54.99 $ 4,515 April 27, 2019 116 $ 52.14 $ 6,020 January 26, 2019 111 $ 45.09 $ 5,016 October 27, 2018 109 $ 46.01 $ 5,026 There were $30 million and $40 million of stock repurchases that were pending settlement as of January 25, 2020 and July 27, 2019 , respectively. The purchase price for the shares of our stock repurchased is reflected as a reduction to shareholders’ equity. We are required to allocate the purchase price of the repurchased shares as (i) a reduction to retained earnings and (ii) a reduction of common stock and additional paid-in capital. (c) Preferred Stock Under the terms of our Articles of Incorporation, the Board of Directors may determine the rights, preferences, and terms of our authorized but unissued shares of preferred stock. |
Employee Benefit Plans
Employee Benefit Plans | 6 Months Ended |
Jan. 25, 2020 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans (a) Employee Stock Incentive Plans Stock Incentive Plan Program Description As of January 25, 2020 , we had one stock incentive plan: the 2005 Stock Incentive Plan (the “2005 Plan”). In addition, we have, in connection with our acquisitions of various companies, assumed the share-based awards granted under stock incentive plans of the acquired companies or issued share-based awards in replacement thereof. Share-based awards are designed to reward employees for their long-term contributions to us and provide incentives for them to remain with Cisco. The number and frequency of share-based awards are based on competitive practices, operating results of Cisco, government regulations, and other factors. Our primary stock incentive plan is summarized as follows: 2005 Plan The 2005 Plan provides for the granting of stock options, stock grants, stock units and stock appreciation rights (SARs), the vesting of which may be time-based or upon satisfaction of performance goals, or both, and/or other conditions. Employees (including employee directors and executive officers) and consultants of Cisco and its subsidiaries and affiliates and non-employee directors of Cisco are eligible to participate in the 2005 Plan. As of January 25, 2020 , the maximum number of shares issuable under the 2005 Plan over its term was 694 million shares. The 2005 Plan may be terminated by the Board of Directors at any time and for any reason, and is currently set to terminate at the 2021 Annual Meeting unless re-adopted or extended by the shareholders prior to or on such date. Under the 2005 Plan’s share reserve feature, a distinction is made between the number of shares in the reserve attributable to (i) stock options and SARs and (ii) “full value” awards (i.e., stock grants and stock units). Shares issued as stock grants, pursuant to stock units or pursuant to the settlement of dividend equivalents are counted against shares available for issuance under the 2005 Plan on a 1.5 -to-1 ratio. For each share awarded as restricted stock or a restricted stock unit award under the 2005 Plan, 1.5 shares was deducted from the available share-based award balance. For restricted stock units that were awarded with vesting contingent upon the achievement of future financial performance or market-based metrics, the maximum awards that can be achieved upon full vesting of such awards. If awards issued under the 2005 Plan are forfeited or terminated for any reason before being exercised or settled, then the shares underlying such awards, plus the number of additional shares, if any, that counted against shares available for issuance under the 2005 Plan at the time of grant as a result of the application of the share ratio described above, will become available again for issuance under the 2005 Plan. As of January 25, 2020 , 197 million shares were authorized for future grant under the 2005 Plan. (b) Employee Stock Purchase Plan We have an Employee Stock Purchase Plan under which 721.4 million shares of our common stock have been reserved for issuance as of January 25, 2020 . Eligible employees are offered shares through a 24-month offering period, which consists of four consecutive 6-month purchase periods. Employees may purchase a limited amount of shares of our stock at a discount of up to 15% of the lesser of the fair market value at the beginning of the offering period or the end of each 6-month purchase period. The Employee Stock Purchase Plan is scheduled to terminate on the earlier of (i) January 3, 2030 and (ii) the date on which all shares available for issuance under the Employee Stock Purchase Plan are sold pursuant to exercised purchase rights. Under the Employee Stock Purchase Plan, we issued 9 million shares during the second quarter and first six months of fiscal 2020 and 9 million shares during the second quarter and first six months of fiscal 2019 . As of January 25, 2020 , 150 million shares were available for issuance under the Employee Stock Purchase Plan. (c) Summary of Share-Based Compensation Expense Share-based compensation expense consists primarily of expenses for stock options, stock purchase rights, restricted stock, and RSUs granted to employees. The following table summarizes share-based compensation expense (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Cost of sales—product $ 23 $ 22 $ 46 $ 45 Cost of sales—service 36 31 70 64 Share-based compensation expense in cost of sales 59 53 116 109 Research and development 146 133 292 263 Sales and marketing 119 125 246 262 General and administrative 55 65 115 127 Restructuring and other charges 5 19 13 42 Share-based compensation expense in operating expenses 325 342 666 694 Total share-based compensation expense $ 384 $ 395 $ 782 $ 803 Income tax benefit for share-based compensation $ 109 $ 126 $ 240 $ 291 As of January 25, 2020 , the total compensation cost related to unvested share-based awards not yet recognized was $3.9 billion which is expected to be recognized over approximately 2.8 years on a weighted-average basis. (d) Restricted Stock and Stock Unit Awards A summary of the restricted stock and stock unit activity, which includes time-based and performance-based or market-based RSUs, is as follows (in millions, except per-share amounts): Restricted Stock/ Stock Units Weighted-Average Grant Date Fair Value per Share Aggregate Fair Value UNVESTED BALANCE AT JULY 28, 2018 119 $ 30.56 Granted 45 47.71 Vested (50 ) 29.25 $ 2,446 Canceled/forfeited/other (14 ) 32.01 UNVESTED BALANCE AT JULY 27, 2019 100 38.66 Granted 28 42.09 Vested (25 ) 33.28 $ 1,207 Canceled/forfeited/other (5 ) 39.29 UNVESTED BALANCE AT JANUARY 25, 2020 98 $ 40.94 |
Comprehensive Income
Comprehensive Income | 6 Months Ended |
Jan. 25, 2020 | |
Equity [Abstract] | |
Comprehensive Income | Comprehensive Income The components of AOCI, net of tax, and the other comprehensive income (loss), for the first six months of fiscal 2020 and 2019 are summarized as follows (in millions): Net Unrealized Gains (Losses) on Available-for-Sale Investments Net Unrealized Gains (Losses) Cash Flow Hedging Instruments Cumulative Translation Adjustment and Actuarial Gains (Losses) Accumulated Other Comprehensive Income (Loss) BALANCE AT JULY 27, 2019 $ — $ (14 ) $ (778 ) $ (792 ) Other comprehensive income (loss) before reclassifications 168 — (42 ) 126 (Gains) losses reclassified out of AOCI (21 ) 2 2 (17 ) Tax benefit (expense) (17 ) 1 (1 ) (17 ) BALANCE AT JANUARY 25, 2020 $ 130 $ (11 ) $ (819 ) $ (700 ) Net Unrealized Gains (Losses) on Available-for-Sale Investments Net Unrealized Gains (Losses) Cash Flow Hedging Instruments Cumulative Translation Adjustment and Actuarial Gains (Losses) Accumulated Other Comprehensive Income (Loss) BALANCE AT JULY 28, 2018 $ (310 ) $ (11 ) $ (528 ) $ (849 ) Other comprehensive income (loss) before reclassifications 86 (9 ) (184 ) (107 ) (Gains) losses reclassified out of AOCI 11 (1 ) 3 13 Tax benefit (expense) — 2 (1 ) 1 Total change for the period 97 (8 ) (182 ) (93 ) Effect of adoption of accounting standard (168 ) — — (168 ) BALANCE AT JANUARY 26, 2019 $ (381 ) $ (19 ) $ (710 ) $ (1,110 ) The net gains (losses) reclassified out of AOCI into the Consolidated Statements of Operations, with line item location, during each period were as follows (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Comprehensive Income Components Income Before Taxes Income Before Taxes Line Item in Statements of Operations Net unrealized gains and losses on available-for-sale investments $ 11 $ (5 ) $ 21 $ (11 ) Other income (loss), net Net unrealized gains and losses on cash flow hedging instruments Foreign currency derivatives (2 ) 2 (5 ) 3 Revenue Foreign currency derivatives — (1 ) 1 (1 ) Cost of sales Foreign currency derivatives — — 2 (1 ) Operating expenses (2 ) 1 (2 ) 1 Cumulative translation adjustment and actuarial gains and losses (1 ) (4 ) (2 ) $ (3 ) Other income (loss), net Total amounts reclassified out of AOCI $ 8 $ (8 ) $ 17 $ (13 ) |
Income Taxes
Income Taxes | 6 Months Ended |
Jan. 25, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table provides details of income taxes (in millions, except percentages): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Income before provision for income taxes $ 3,534 $ 3,343 $ 7,220 $ 7,252 Provision for income taxes $ 656 $ 521 $ 1,416 $ 881 Effective tax rate 18.6 % 15.6 % 19.6 % 12.1 % The effective tax rate for the first six months of fiscal 2019 includes a $152 million tax benefit relating to indirect effects from adoption of ASC 606 at the beginning of fiscal 2019. In the first quarter of fiscal 2020, the Internal Revenue Service (IRS) and Cisco settled all outstanding items related to the audit of our federal income tax returns for the fiscal year ended July 30, 2011 through July 27, 2013. As a result of the settlement, we recognized a net benefit to the provision for income taxes of $102 million , which included a reduction in interest expense of $4 million . We are no longer subject to U.S. federal tax audit through fiscal 2013. As of January 25, 2020 , we had $2.0 billion of unrecognized tax benefits, of which $1.7 billion , if recognized, would favorably impact the effective tax rate. We regularly engage in discussions and negotiations with tax authorities regarding tax matters in various jurisdictions. We believe it is reasonably possible that certain federal, foreign and state tax matters may be concluded in the next 12 months. Specific positions that may be resolved include issues involving transfer pricing and various other matters. We estimate that the unrecognized tax benefits at January 25, 2020 could be reduced by approximately $50 million |
Segment Information and Major C
Segment Information and Major Customers | 6 Months Ended |
Jan. 25, 2020 | |
Segment Reporting [Abstract] | |
Segment Information and Major Customers | Segment Information and Major Customers (a) Revenue and Gross Margin by Segment We conduct business globally and are primarily managed on a geographic basis consisting of three segments: the Americas, EMEA, and APJC. Our management makes financial decisions and allocates resources based on the information it receives from our internal management system. Sales are attributed to a segment based on the ordering location of the customer. We do not allocate research and development, sales and marketing, or general and administrative expenses to our segments in this internal management system because management does not include the information in our measurement of the performance of the operating segments. In addition, we do not allocate amortization and impairment of acquisition-related intangible assets, share-based compensation expense, significant litigation settlements and other contingencies, charges related to asset impairments and restructurings, and certain other charges to the gross margin for each segment because management does not include this information in our measurement of the performance of the operating segments. Summarized financial information by segment for the second quarter and the first six months of fiscal 2020 and 2019 , based on our internal management system and as utilized by our Chief Operating Decision Maker (“CODM”), is as follows (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Americas $ 7,013 $ 7,352 $ 14,990 $ 15,103 EMEA 3,134 3,223 6,417 6,447 APJC 1,859 1,872 3,758 3,968 Total $ 12,005 $ 12,446 $ 25,164 $ 25,518 Gross margin: Americas $ 4,692 $ 4,796 $ 10,008 $ 9,866 EMEA 2,062 2,070 4,229 4,141 APJC 1,219 1,109 2,413 2,309 Segment total 7,974 7,975 16,650 16,316 Unallocated corporate items (210 ) (202 ) (422 ) (397 ) Total $ 7,764 $ 7,773 $ 16,228 $ 15,919 Amounts may not sum and percentages may not recalculate due to rounding. Revenue in the United States was $6.2 billion and $6.4 billion for the second quarter of fiscal 2020 and 2019 , respectively, and $13.3 billion for each of the first six months of fiscal 2020 and 2019 . (b) Revenue for Groups of Similar Products and Services We design, manufacture, and sell Internet Protocol (IP)-based networking and other products related to the communications and IT industry and provide services associated with these products and their use. The following table presents revenue for groups of similar products and services (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Infrastructure Platforms $ 6,528 $ 7,102 $ 14,067 $ 14,724 Applications 1,349 1,465 2,847 2,884 Security 748 684 1,563 1,354 Other Products 46 22 72 200 Total Product 8,671 9,273 18,549 19,163 Services 3,334 3,173 6,615 6,355 Total (1) $ 12,005 $ 12,446 $ 25,164 $ 25,518 Amounts may not sum due to rounding. (1) Includes SPVSS business revenue of $168 million for the first six months of fiscal 2019 . |
Net Income per Share
Net Income per Share | 6 Months Ended |
Jan. 25, 2020 | |
Earnings Per Share [Abstract] | |
Net Income per Share | Net Income per Share The following table presents the calculation of basic and diluted net income per share (in millions, except per-share amounts): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Net income $ 2,878 $ 2,822 $ 5,804 $ 6,371 Weighted-average shares—basic 4,242 4,470 4,244 4,517 Effect of dilutive potential common shares 18 35 21 40 Weighted-average shares—diluted 4,260 4,505 4,265 4,557 Net income per share—basic $ 0.68 $ 0.63 $ 1.37 $ 1.41 Net income per share—diluted $ 0.68 $ 0.63 $ 1.36 $ 1.40 Antidilutive employee share-based awards, excluded 29 27 32 28 Employee equity share options, unvested shares, and similar equity instruments granted and assumed by Cisco are treated as potential common shares outstanding in computing diluted earnings per share. Diluted shares outstanding include the dilutive effect of in-the-money options, unvested restricted stock, and restricted stock units. The dilutive effect of such equity awards is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock options and the amount of compensation cost for future service that has not yet been recognized are collectively assumed to be used to repurchase shares. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 6 Months Ended |
Jan. 25, 2020 | |
Accounting Policies [Abstract] | |
Fiscal Period | The fiscal year for Cisco Systems, Inc. (the “Company,” “Cisco,” “we,” “us,” or “our”) is the 52 or 53 weeks ending on the last Saturday in July. Fiscal 2020 and fiscal 2019 |
Basis of Presentation | The Consolidated Financial Statements include our accounts and those of our subsidiaries. All intercompany accounts and transactions have been eliminated. We conduct business globally and are primarily managed on a geographic basis in the following three geographic segments: the Americas; Europe, Middle East, and Africa (EMEA); and Asia Pacific, Japan, and China (APJC). We have prepared the accompanying financial data as of January 25, 2020 and for the second quarter and first six months of fiscal 2020 and 2019 , without audit, pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The July 27, 2019 Consolidated Balance Sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. However, we believe that the disclosures are adequate to make the information presented not misleading. These Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended July 27, 2019 . Our consolidated financial statements include our accounts and entities consolidated under the variable interest and voting models. The noncontrolling interests attributed to these investments, if any, are presented as a separate component from our equity in the equity section of the Consolidated Balance Sheets. The share of earnings attributable to the noncontrolling interests are not presented separately in the Consolidated Statements of Operations as these amounts are not material for any of the fiscal periods presented. In the opinion of management, all normal recurring adjustments necessary to present fairly the consolidated balance sheet as of January 25, 2020 , the results of operations, the statements of comprehensive income (loss) and the statements of equity for the second quarter and first six months of fiscal 2020 and 2019 ; and the statements of cash flows for the first six months of fiscal 2020 and 2019 , as applicable, have been made. The results of operations for the second quarter and first six months of fiscal 2020 are not necessarily indicative of the operating results for the full fiscal year or any future periods. |
Reclassification | Certain reclassifications have been made to the amounts in prior periods in order to conform to the current period’s presentation. We have evaluated subsequent events through the date that the financial statements were issued. |
New Accounting Updates Recently Adopted and Recent Accounting Standards or Updates Not Yet Effective | New Accounting Updates Recently Adopted Leases In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Codification (ASC) 842, Leases , a new standard requiring lessees to recognize operating and finance lease liabilities on the balance sheet, as well as corresponding right-of-use (ROU) assets. This standard also made some changes to lessor accounting and aligns key aspects of the lessor accounting model with the revenue recognition standard. In addition, new disclosures are required to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. ASC 842 requires adoption using the modified retrospective approach, with the option of applying the requirements of the standard either i) retrospectively to each prior comparative reporting period presented, or ii) retrospectively at the beginning of the period of adoption. We adopted this standard at the beginning of our first quarter of fiscal 2020 and applied it at the beginning of the period of adoption and did not restate prior periods. We adopted ASC 842 on July 28, 2019 which resulted in the recognition of $1.2 billion of operating lease ROU assets included in other assets and $1.2 billion of operating lease liabilities included in other current liabilities and other long-term liabilities. There were no transition adjustments recorded from the adoption of ASC 842 as a lessor. We have elected to apply the package of practical expedients permitted under the transition guidance within ASC 842 which does not require reassessment of initial direct costs, classification of a lease and definition of a lease. We also elected additional practical expedients which resulted in: i) allowing us not to reassess the accounting treatment for existing or expired land easements in transition; ii) combining lease and non-lease components and iii) not recording leases with an initial term of less than 12 months on our Consolidated Balance Sheet. As a lessee, we determine if an arrangement is a lease at commencement. Our ROU lease assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments related to the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. We use incremental borrowing rates based on information available at the commencement date to determine the present value of our lease payments. As a lessor, we determine if an arrangement is a lease at inception. We provide leasing arrangements for our equipment to certain qualified customers. Our lease portfolio primarily consists of sales-type leases. We allocate the consideration in a bundled contract with our customers based on relative standalone selling prices of our lease and non-lease components. The residual value on our leased equipment is determined at the inception of the lease based on an analysis of estimates of the value of equipment, market factors and historical customer behavior. Residual value estimates are reviewed on a periodic basis and other-than-temporary declines are expensed in the period they occur. Our leases generally provide an end-of-term option for the customer to extend the lease under mutually-agreed terms, return the leased equipment, or purchase the equipment for either the then-market value of the equipment or a pre-determined purchase price. If a customer chooses to terminate their lease prior to the original end of term date, the customer is required to pay all remaining lease payments in full. For additional information, see Note 8. (b) Recent Accounting Standards or Updates Not Yet Effective Credit Losses of Financial Instruments In June 2016, the FASB issued an accounting standard update that requires measurement and recognition of expected credit losses for financial assets held based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. The accounting standard update will be effective for us beginning in the first quarter of fiscal 2021 on a modified retrospective basis. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements. |
Revenue | Infrastructure Platforms consist of our core networking technologies of switching, routing, wireless, and data center products that are designed to work together to deliver networking capabilities and transport and/or store data. These technologies consist of both hardware and software offerings, including software licenses and SaaS, that help our customers build networks, automate, orchestrate, integrate, and digitize data. We are shifting and expanding more of our business to software and subscriptions across our core networking portfolio. Our hardware and perpetual software in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses are multiple performance obligations where the term license is recognized upfront upon transfer of control with the associated software maintenance revenue recognized ratably over the contract term. SaaS arrangements in this category have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term. Applications consists of offerings that utilize the core networking and data center platforms to provide their functions. The products consist primarily of software offerings, including software licenses and SaaS, as well as hardware. Our perpetual software and hardware in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses are multiple performance obligations where the term license is recognized upfront upon transfer of control with the associated software maintenance revenue recognized ratably over the contract term. SaaS arrangements in this category have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term. Security primarily includes our network security, cloud and email security, identity and access management, advanced threat protection, and unified threat management products. These products consist of both hardware and software offerings, including software licenses and SaaS. Updates and upgrades for the term software licenses are critical for our software to perform its intended commercial purpose because of the continuous need for our software to secure our customers' network environments against frequent threats. Therefore, security software licenses are generally represented by a single distinct performance obligation with revenue recognized ratably over the contract term. Our hardware and perpetual software in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. SaaS arrangements in this category have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term. Other Products primarily includes our cloud and system management products. These products include both hardware and software licenses. Our offerings in this category are distinct performance obligations where revenue is recognized upfront upon transfer of control. In addition to our product offerings, we provide a broad range of service and support options for our customers, including technical support services and advanced services. Technical support services represent the majority of these offerings which are distinct performance obligations that are satisfied over time with revenue recognized ratably over the contract term. Advanced services are distinct performance obligations that are satisfied over time with revenue recognized as services are delivered. The sales arrangements as discussed above are typically made pursuant to customer purchase orders based on master purchase or partner agreements. Cash is received based on our standard payment terms which is typically 30 days . We provide financing arrangements to customers for all of our hardware, software and service offerings. Refer to Note 9 for additional information. For these arrangements, cash is typically received over time. We enter into contracts with customers that can include various combinations of products and services which are generally distinct and accounted for as separate performance obligations. As a result, our contracts may contain multiple performance obligations. We determine whether arrangements are distinct based on whether the customer can benefit from the product or service on its own or together with other resources that are readily available and whether our commitment to transfer the product or service to the customer is separately identifiable from other obligations in the contract. We classify our hardware, perpetual software licenses, and software-as-a-service (SaaS) as distinct performance obligations. Term software licenses represent multiple obligations, which include software licenses and software maintenance. In transactions where we deliver hardware or software, we are typically the principal and we record revenue and costs of goods sold on a gross basis. We refer to our term software licenses, security software licenses, SaaS, and associated service arrangements as subscription offers. We recognize revenue upon transfer of control of promised goods or services in a contract with a customer in an amount that reflects the consideration we expect to receive in exchange for those products or services. Transfer of control occurs once the customer has the contractual right to use the product, generally upon shipment or once title and risk of loss has transferred to the customer. Transfer of control can also occur over time for software maintenance and services as the customer receives the benefit over the contract term. Our hardware and perpetual software licenses are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses include multiple performance obligations where the term licenses are recognized upfront upon transfer of control, with the associated software maintenance revenue recognized ratably over the contract term as services and software updates are provided. SaaS arrangements do not include the right for the customer to take possession of the software during the term, and therefore have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term as the customer consumes the services. On our product sales, we record consideration from shipping and handling on a gross basis within net product sales. We record our revenue net of any associated sales taxes. Significant Judgments Revenue is allocated among these performance obligations in a manner that reflects the consideration that we expect to be entitled to for the promised goods or services based on standalone selling prices (SSP). SSP is estimated for each distinct performance obligation and judgment may be required in their determination. The best evidence of SSP is the observable price of a product or service when we sell the goods separately in similar circumstances and to similar customers. In instances where SSP is not directly observable, we determine SSP using information that may include market conditions and other observable inputs. We apply judgment in determining the transaction price as we may be required to estimate variable consideration when determining the amount of revenue to recognize. Variable consideration includes contractual potential penalties and various rebate, cooperative marketing and other incentive programs that we offer to our distributors, partners and customers. When determining the amount of revenue to recognize, we estimate the expected usage of these programs, applying the expected value or most likely estimate and update the estimate at each reporting period as actual utilization becomes available. We also consider the customers' right of return in determining the transaction price, where applicable. We assess certain software licenses, such as for security software, that contain critical updates or upgrades which customers can download throughout the contract term. Without these updates or upgrades, the functionality of the software would diminish over a relatively short time period. These updates or upgrades provide the customer the full functionality of the purchased security software licenses and are required to maintain the security license's utility as the risks and threats in the environment are rapidly changing. In these circumstances, the revenue from these software arrangements is recognized as a single performance obligation satisfied over the contract term. |
Financing Receivables and Operating Leases | Financing receivables primarily consist of lease receivables, loan receivables, and financed service contracts. Lease receivables represent sales-type leases resulting from the sale of Cisco’s and complementary third-party products and are typically collateralized by a security interest in the underlying assets. Lease receivables consist of arrangements with terms of four years on average. Loan receivables represent financing arrangements related to the sale of our hardware, software, and services, which may include additional funding for other costs associated with network installation and integration of our products and services. Loan receivables have terms of three years on average. Financed service contracts include financing receivables related to technical support and advanced services. Revenue related to the technical support services is typically deferred and included in deferred service revenue and is recognized ratably over the period during which the related services are to be performed, which typically ranges from one to three years . |
Impairment of Financing Receivable | We assess the allowance for credit loss related to financing receivables on either an individual or a collective basis. We consider various factors in evaluating lease and loan receivables and the earned portion of financed service contracts for possible impairment on an individual basis. These factors include our historical experience, credit quality and age of the receivable balances, and economic conditions that may affect a customer’s ability to pay. When the evaluation indicates that it is probable that all amounts due pursuant to the contractual terms of the financing agreement, including scheduled interest payments, are unable to be collected, the financing receivable is considered impaired. All such outstanding amounts, including any accrued interest, will be assessed and fully reserved at the customer level. Our internal credit risk ratings are categorized as 1 through 10 , with the lowest credit risk rating representing the highest quality financing receivables. Typically, we also consider receivables with a risk rating of 8 or higher to be impaired and will include them in the individual assessment for allowance. These balances, as of January 25, 2020 and July 27, 2019 , are presented under “(b) Credit Quality of Financing Receivables” above. We evaluate the remainder of our financing receivables portfolio for impairment on a collective basis and record an allowance for credit loss at the portfolio segment level. When evaluating the financing receivables on a collective basis, we use expected default frequency rates published by a major third-party credit-rating agency as well as our own historical loss rate in the event of default, while also systematically giving effect to economic conditions, concentration of risk, and correlation. |
Fair Value Measurement | Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be either recorded or disclosed at fair value, we consider the principal or most advantageous market in which we would transact, and we also consider assumptions that market participants would use when pricing the asset or liability. (a) Fair Value Hierarchy The accounting guidance for fair value measurement requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is as follows: Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. |
Fair Value of Financial Instruments | These assets were measured at fair value due to events or circumstances we identified as having significant impact on their fair value during the respective periods. The carrying value of our non-marketable equity securities recorded to fair value on a non-recurring basis is adjusted for observable transactions for identical or similar investments of the same issuer or impairment. These securities are classified as Level 3 in the fair value hierarchy because we estimate the value based on valuation methods using the observable transaction price at the transaction date and other unobservable inputs such as volatility, rights, and obligations of the securities we hold. Level 1 marketable equity securities are determined by using quoted prices in active markets for identical assets. Level 2 available-for-sale debt investments are priced using quoted market prices for similar instruments or nonbinding market prices that are corroborated by observable market data. We use inputs such as actual trade data, benchmark yields, broker/dealer quotes, and other similar data, which are obtained from quoted market prices, independent pricing vendors, or other sources, to determine the ultimate fair value of these assets and liabilities. We use such pricing data as the primary input to make our assessments and determinations as to the ultimate valuation of our investment portfolio and have not made, during the periods presented, any material adjustments to such inputs. We are ultimately responsible for the financial statements and underlying estimates. Our derivative instruments are primarily classified as Level 2, as they are not actively traded and are valued using pricing models that use observable market inputs. We did not have any transfers between Level 1 and Level 2 fair value measurements during the periods presented. |
Derivatives | We use derivative instruments primarily to manage exposures to foreign currency exchange rate, interest rate, and equity price risks. Our primary objective in holding derivatives is to reduce the volatility of earnings and cash flows associated with changes in foreign currency exchange rates, interest rates, and equity prices. Our derivatives expose us to credit risk to the extent that the counterparties may be unable to meet the terms of the agreement. We do, however, seek to mitigate such risks by limiting our counterparties to major financial institutions. In addition, the potential risk of loss with any one counterparty resulting from this type of credit risk is monitored. Management does not expect material losses as a result of defaults by counterparties. |
Offsetting of Derivative Instruments | We present our derivative instruments at gross fair values in the Consolidated Balance Sheets. However, our master netting and other similar arrangements with the respective counterparties allow for net settlement under certain conditions, which are designed to reduce credit risk by permitting net settlement with the same counterparty. As of January 25, 2020 and July 27, 2019 , the potential effects of these rights of set-off associated with the derivative contracts would be a reduction to both derivative assets and derivative liabilities of $14 million and $13 million , respectively. |
Hedging Derivatives | We conduct business globally in numerous currencies. Therefore, we are exposed to adverse movements in foreign currency exchange rates. To limit the exposure related to foreign currency changes, we enter into foreign currency contracts. We do not enter into such contracts for speculative purposes. We hedge forecasted foreign currency transactions related to certain revenues, operating expenses and service cost of sales with currency options and forward contracts. These currency options and forward contracts, designated as cash flow hedges, generally have maturities of less than 24 months . The derivative instrument’s gain or loss is initially reported as a component of accumulated other comprehensive income (AOCI) and subsequently reclassified into earnings when the hedged exposure affects earnings. During the periods presented, we did not discontinue any cash flow hedges for which it was probable that a forecasted transaction would not occur. We enter into foreign exchange forward and option contracts to reduce the short-term effects of foreign currency fluctuations on assets and liabilities such as foreign currency receivables, including long-term customer financings, investments, and payables. These derivatives are not designated as hedging instruments. Gains and losses on the contracts are included in other income (loss), net, and substantially offset foreign exchange gains and losses from the remeasurement of intercompany balances or other current assets, investments, or liabilities denominated in currencies other than the functional currency of the reporting entity. We hedge certain net investments in our foreign operations with forward contracts to reduce the effects of foreign currency fluctuations on our net investment in those foreign subsidiaries. These derivative instruments generally have maturities of up to six months. (d) Interest Rate Risk Interest Rate Derivatives Designated as Fair Value Hedges, Long-Term Debt We hold interest rate swaps designated as fair value hedges related to fixed-rate senior notes that are due in fiscal 2021 through 2025. Under these interest rate swaps, we receive fixed-rate interest payments and make interest payments based on LIBOR plus a fixed number of basis points. The effect of such swaps is to convert the fixed interest rates of the senior fixed-rate notes to floating interest rates based on LIBOR. The gains and losses related to changes in the fair value of the interest rate swaps are included in interest expense and substantially offset changes in the fair value of the hedged portion of the underlying debt that are attributable to the changes in market interest rates. (e) Equity Price Risk |
Derivatives Not Designated as Hedges | We are also exposed to variability in compensation charges related to certain deferred compensation obligations to employees. Although not designated as accounting hedges, we utilize derivatives such as total return swaps to economically hedge this exposure and offset the related compensation expense. |
Commitments and Contingencies | We record a liability for firm, noncancelable, and unconditional purchase commitments for quantities in excess of our future demand forecasts consistent with the valuation of our excess and obsolete inventory. We purchase components from a variety of suppliers and use several contract manufacturers to provide manufacturing services for our products. During the normal course of business, in order to manage manufacturing lead times and help ensure adequate component supply, we enter into agreements with contract manufacturers and suppliers that either allow them to procure inventory |
Indemnifications | In the normal course of business, we indemnify other parties, including customers, lessors, and parties to other transactions with us, with respect to certain matters. We have agreed to indemnify against losses arising from a breach of representations or covenants or out of intellectual property infringement or other claims made against certain parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. |
Segment Information | We conduct business globally and are primarily managed on a geographic basis consisting of three |
Net Income per Share | Employee equity share options, unvested shares, and similar equity instruments granted and assumed by Cisco are treated as potential common shares outstanding in computing diluted earnings per share. Diluted shares outstanding include the dilutive effect of in-the-money options, unvested restricted stock, and restricted stock units. The dilutive effect of such equity awards is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock options and the amount of compensation cost for future service that has not yet been recognized are collectively assumed to be used to repurchase shares. |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents this disaggregation of revenue (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Infrastructure Platforms $ 6,528 $ 7,102 $ 14,067 $ 14,724 Applications 1,349 1,465 2,847 2,884 Security 748 684 1,563 1,354 Other Products 46 22 72 200 Total Product 8,671 9,273 18,549 19,163 Services 3,334 3,173 6,615 6,355 Total (1) $ 12,005 $ 12,446 $ 25,164 $ 25,518 Amounts may not sum due to rounding. (1) During the second quarter of fiscal 2019, we completed the divestiture of the Service Provider Video Software Solutions (“SPVSS”) business. Total revenue includes SPVSS business revenue of $168 million for the first six months of fiscal 2019. The following table presents revenue for groups of similar products and services (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Infrastructure Platforms $ 6,528 $ 7,102 $ 14,067 $ 14,724 Applications 1,349 1,465 2,847 2,884 Security 748 684 1,563 1,354 Other Products 46 22 72 200 Total Product 8,671 9,273 18,549 19,163 Services 3,334 3,173 6,615 6,355 Total (1) $ 12,005 $ 12,446 $ 25,164 $ 25,518 Amounts may not sum due to rounding. (1) Includes SPVSS business revenue of $168 million for the first six months of fiscal 2019 . |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Business Combinations [Abstract] | |
Summary of Allocation of Total Purchase Consideration | A summary of the allocation of the total purchase consideration is presented as follows (in millions): Purchase Consideration Net Tangible Assets Acquired (Liabilities Assumed) Purchased Intangible Assets Goodwill Total acquisitions (four in total) $ 182 $ (9 ) $ 108 $ 83 |
Goodwill and Purchased Intang_2
Goodwill and Purchased Intangible Assets (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill by Reportable Segment | The following table presents the goodwill allocated to our reportable segments as of January 25, 2020 and during the first six months of fiscal 2020 (in millions): Balance at July 27, 2019 Acquisitions Other Balance at January 25, 2020 Americas $ 21,120 $ 62 $ 1 $ 21,183 EMEA 7,977 17 — 7,994 APJC 4,432 4 (1 ) 4,435 Total $ 33,529 $ 83 $ — $ 33,612 “Other” in the table above primarily consists of foreign currency translation as well as immaterial purchase accounting adjustments. |
Schedule of Intangible Assets Acquired Through Business Combinations | The following table presents details of our intangible assets acquired through acquisitions completed during the first six months of fiscal 2020 (in millions, except years): FINITE LIVES INDEFINITE LIVES TOTAL TECHNOLOGY CUSTOMER RELATIONSHIPS OTHER IPR&D Weighted- Average Useful Life (in Years) Amount Weighted- Average Useful Life (in Years) Amount Weighted- Average Useful Life (in Years) Amount Amount Amount Total acquisitions (four in total) 5.0 $ 108 — $ — — $ — — $ 108 |
Schedule of Intangible Assets Acquired Through Business Combinations | The following table presents details of our intangible assets acquired through acquisitions completed during the first six months of fiscal 2020 (in millions, except years): FINITE LIVES INDEFINITE LIVES TOTAL TECHNOLOGY CUSTOMER RELATIONSHIPS OTHER IPR&D Weighted- Average Useful Life (in Years) Amount Weighted- Average Useful Life (in Years) Amount Weighted- Average Useful Life (in Years) Amount Amount Amount Total acquisitions (four in total) 5.0 $ 108 — $ — — $ — — $ 108 |
Schedule of Purchased Intangible Assets | The following tables present details of our purchased intangible assets (in millions): January 25, 2020 Gross Accumulated Amortization Net Purchased intangible assets with finite lives: Technology $ 3,245 $ (2,103 ) $ 1,142 Customer relationships 749 (304 ) 445 Other 34 (23 ) 11 Total purchased intangible assets with finite lives 4,028 (2,430 ) 1,598 In-process research and development, with indefinite lives 308 — 308 Total $ 4,336 $ (2,430 ) $ 1,906 July 27, 2019 Gross Accumulated Amortization Net Purchased intangible assets with finite lives: Technology $ 3,270 $ (1,933 ) $ 1,337 Customer relationships 840 (331 ) 509 Other 41 (22 ) 19 Total purchased intangible assets with finite lives 4,151 (2,286 ) 1,865 In-process research and development, with indefinite lives 336 — 336 Total $ 4,487 $ (2,286 ) $ 2,201 |
Schedule of Purchased Intangible Assets | The following tables present details of our purchased intangible assets (in millions): January 25, 2020 Gross Accumulated Amortization Net Purchased intangible assets with finite lives: Technology $ 3,245 $ (2,103 ) $ 1,142 Customer relationships 749 (304 ) 445 Other 34 (23 ) 11 Total purchased intangible assets with finite lives 4,028 (2,430 ) 1,598 In-process research and development, with indefinite lives 308 — 308 Total $ 4,336 $ (2,430 ) $ 1,906 July 27, 2019 Gross Accumulated Amortization Net Purchased intangible assets with finite lives: Technology $ 3,270 $ (1,933 ) $ 1,337 Customer relationships 840 (331 ) 509 Other 41 (22 ) 19 Total purchased intangible assets with finite lives 4,151 (2,286 ) 1,865 In-process research and development, with indefinite lives 336 — 336 Total $ 4,487 $ (2,286 ) $ 2,201 |
Schedule of Amortization of Purchased Intangible Assets | The following table presents the amortization of purchased intangible assets, including impairment charges (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Amortization of purchased intangible assets: Cost of sales $ 165 $ 156 $ 331 $ 307 Operating expenses 38 39 74 73 Total $ 203 $ 195 $ 405 $ 380 |
Schedule of Estimated Future Amortization Expense of Purchased Intangible Assets | The estimated future amortization expense of purchased intangible assets with finite lives as of January 25, 2020 is as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 383 2021 $ 591 2022 $ 333 2023 $ 191 2024 $ 93 Thereafter $ 7 |
Restructuring and Other Charg_2
Restructuring and Other Charges (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Restructuring Charges [Abstract] | |
Liabilities Related to Restructuring and Other Charges | The following tables summarize the activities related to the restructuring and other charges (in millions): FISCAL 2017 AND PRIOR PLANS FISCAL 2018 PLAN Employee Severance Other Employee Severance Other Total Liability as of July 27, 2019 $ — $ 5 $ 22 $ 6 $ 33 Charges — — 209 17 226 Cash payments — — (202 ) (1 ) (203 ) Non-cash items — (2 ) — (21 ) (23 ) Liability as of January 25, 2020 $ — $ 3 $ 29 $ 1 $ 33 FISCAL 2017 AND PRIOR PLANS FISCAL 2018 PLAN Employee Severance Other Employee Severance Other Total Liability as of July 28, 2018 $ 41 $ 13 $ 19 $ — $ 73 Charges — (1 ) 222 43 264 Cash payments (31 ) (3 ) (202 ) (1 ) (237 ) Non-cash items — — — (42 ) (42 ) Liability as of January 26, 2019 $ 10 $ 9 $ 39 $ — $ 58 |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Cash, Cash Equivalents, and Restricted Cash | The following tables provide details of selected balance sheet items (in millions): January 25, July 27, Cash and cash equivalents $ 8,475 $ 11,750 Restricted cash included in other current assets 21 21 Restricted cash included in other assets 3 1 Total cash, cash equivalents, and restricted cash $ 8,499 $ 11,772 |
Cash, Cash Equivalents, and Restricted Cash | The following tables provide details of selected balance sheet items (in millions): January 25, July 27, Cash and cash equivalents $ 8,475 $ 11,750 Restricted cash included in other current assets 21 21 Restricted cash included in other assets 3 1 Total cash, cash equivalents, and restricted cash $ 8,499 $ 11,772 |
Inventories | Inventories: Raw materials $ 384 $ 374 Work in process 12 10 Finished goods: Deferred cost of sales 59 109 Manufactured finished goods 667 643 Total finished goods 726 752 Service-related spares 212 225 Demonstration systems 19 22 Total $ 1,353 $ 1,383 |
Property and Equipment, Net | Property and equipment, net: Gross property and equipment: Land, buildings, and building and leasehold improvements $ 4,438 $ 4,545 Computer equipment and related software 900 922 Production, engineering, and other equipment 5,196 5,711 Operating lease assets 411 485 Furniture, fixtures and other 392 376 Total gross property and equipment 11,337 12,039 Less: accumulated depreciation and amortization (8,716 ) (9,250 ) Total $ 2,621 $ 2,789 |
Deferred Revenue | Deferred revenue: Service $ 11,526 $ 11,709 Product 7,160 6,758 Total $ 18,686 $ 18,467 Reported as: Current $ 10,638 $ 10,668 Noncurrent 8,048 7,799 Total $ 18,686 $ 18,467 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Leases [Abstract] | |
Lease Expenses and Supplemental Information | The components of our lease expenses were as follows (in millions): January 25, 2020 Three Months Ended Six Months Ended Operating lease expense $ 101 $ 214 Short-term lease expense 16 33 Variable lease expense 39 79 Total lease expense $ 156 $ 326 Supplemental information related to our operating leases is as follows: Six Months Ended In millions: January 25, 2020 Cash paid for amounts included in the measurement of lease liabilities — operating cash flows $ 206 Right-of-use assets obtained in exchange for operating leases liabilities $ 77 |
Maturities of Operating Leases | The maturities of our operating leases (undiscounted) as of January 25, 2020 are as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 204 2021 316 2022 216 2023 166 2024 104 Thereafter 111 Total lease payments 1,117 Less interest (39 ) Total $ 1,078 |
Future Minimum Lease Payments, Prior to Adoption of New Leasing Standard | Prior to the adoption of the new leasing standard, future minimum lease payments under all noncancelable operating leases with an initial term in excess of one year as of July 27, 2019 were as follows (in millions): Fiscal Year Amount 2020 $ 441 2021 299 2022 195 2023 120 2024 70 Thereafter 54 Total $ 1,179 |
Future Minimum Lease Payments on Lease Receivables | Future minimum lease payments on our lease receivables as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 438 2021 882 2022 479 2023 267 2024 123 Thereafter 58 Total 2,247 Less: Present value of lease payments 2,117 Difference between undiscounted cash flows and discounted cash flows $ 130 |
Future Minimum Lease Payments on Lease Receivables | Prior to the adoption of the new leasing standard, future minimum lease payments on our lease receivables as of July 27, 2019 were summarized as follows (in millions): Fiscal Year Amount 2020 $ 1,028 2021 702 2022 399 2023 185 2024 53 Total $ 2,367 |
Operating Lease Assets | Amounts relating to equipment on operating lease assets held by Cisco and the associated accumulated depreciation are summarized as follows (in millions): January 25, 2020 July 27, 2019 Operating lease assets $ 411 $ 485 Accumulated depreciation (247 ) (306 ) Operating lease assets, net $ 164 $ 179 |
Minimum Future Rentals on Noncancelable Operating Leases | Minimum future rentals on noncancelable operating leases as of January 25, 2020 are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 61 2021 70 2022 24 2023 4 Total $ 159 |
Financing Receivables (Tables)
Financing Receivables (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Receivables [Abstract] | |
Financing Receivables | A summary of our financing receivables is presented as follows (in millions): January 25, 2020 Lease Receivables Loan Receivables Financed Service Contracts Total Gross $ 2,247 $ 5,297 $ 2,182 $ 9,726 Residual value 133 — — 133 Unearned income (130 ) — — (130 ) Allowance for credit loss (42 ) (95 ) (8 ) (145 ) Total, net $ 2,208 $ 5,202 $ 2,174 $ 9,584 Reported as: Current $ 999 $ 2,496 $ 1,332 $ 4,827 Noncurrent 1,209 2,706 842 4,757 Total, net $ 2,208 $ 5,202 $ 2,174 $ 9,584 July 27, 2019 Lease Receivables Loan Receivables Financed Service Contracts Total Gross $ 2,367 $ 5,438 $ 2,369 $ 10,174 Residual value 142 — — 142 Unearned income (137 ) — — (137 ) Allowance for credit loss (46 ) (71 ) (9 ) (126 ) Total, net $ 2,326 $ 5,367 $ 2,360 $ 10,053 Reported as: Current $ 1,029 $ 2,653 $ 1,413 $ 5,095 Noncurrent 1,297 2,714 947 4,958 Total, net $ 2,326 $ 5,367 $ 2,360 $ 10,053 |
Schedule of Internal Credit Risk Rating for Each Portfolio Segment and Class | Gross receivables, excluding residual value, less unearned income categorized by our internal credit risk rating as of January 25, 2020 and July 27, 2019 are summarized as follows (in millions): INTERNAL CREDIT RISK RATING January 25, 2020 1 to 4 5 to 6 7 and Higher Total Lease receivables $ 1,133 $ 936 $ 48 $ 2,117 Loan receivables 3,262 1,855 180 5,297 Financed service contracts 1,256 900 26 2,182 Total $ 5,651 $ 3,691 $ 254 $ 9,596 INTERNAL CREDIT RISK RATING July 27, 2019 1 to 4 5 to 6 7 and Higher Total Lease receivables $ 1,204 $ 991 $ 35 $ 2,230 Loan receivables 3,367 1,920 151 5,438 Financed service contracts 1,413 939 17 2,369 Total $ 5,984 $ 3,850 $ 203 $ 10,037 |
Schedule of Financing Receivables by Portfolio Segment and Class Aging Analysis | The following tables present the aging analysis of gross receivables, excluding residual value and less unearned income as of January 25, 2020 and July 27, 2019 (in millions): DAYS PAST DUE (INCLUDES BILLED AND UNBILLED) January 25, 2020 31-60 61-90 91+ Total Past Due Current Total Nonaccrual Financing Receivables Impaired Financing Receivables Lease receivables $ 58 $ 34 $ 172 $ 264 $ 1,853 $ 2,117 $ 22 $ 22 Loan receivables 129 31 219 379 4,918 5,297 78 78 Financed service contracts 82 45 309 436 1,746 2,182 2 2 Total $ 269 $ 110 $ 700 $ 1,079 $ 8,517 $ 9,596 $ 102 $ 102 DAYS PAST DUE (INCLUDES BILLED AND UNBILLED) July 27, 2019 31-60 61-90 91+ Total Past Due Current Total Nonaccrual Financing Receivables Impaired Financing Receivables Lease receivables $ 101 $ 42 $ 291 $ 434 $ 1,796 $ 2,230 $ 13 $ 13 Loan receivables 257 67 338 662 4,776 5,438 31 31 Financed service contracts 145 131 271 547 1,822 2,369 3 3 Total $ 503 $ 240 $ 900 $ 1,643 $ 8,394 $ 10,037 $ 47 $ 47 |
Allowance for Credit Loss and Related Financing Receivables | The allowances for credit loss and the related financing receivables are summarized as follows (in millions): Three months ended January 25, 2020 CREDIT LOSS ALLOWANCES Lease Loan Financed Service Total Allowance for credit loss as of October 26, 2019 $ 43 $ 81 $ 9 $ 133 Provisions (benefits) (1 ) 15 — 14 Recoveries (write-offs), net (1 ) (1 ) — (2 ) Foreign exchange and other 1 — (1 ) — Allowance for credit loss as of January 25, 2020 $ 42 $ 95 $ 8 $ 145 Six months ended January 25, 2020 CREDIT LOSS ALLOWANCES Lease Receivables Loan Receivables Financed Service Contracts Total Allowance for credit loss as of July 27, 2019 $ 46 $ 71 $ 9 $ 126 Provisions (benefits) (4 ) 42 — 38 Recoveries (write-offs), net (1 ) (17 ) — (18 ) Foreign exchange and other 1 (1 ) (1 ) (1 ) Allowance for credit loss as of January 25, 2020 $ 42 $ 95 $ 8 $ 145 Three months ended January 26, 2019 CREDIT LOSS ALLOWANCES Lease Receivables Loan Receivables Financed Service Contracts Total Allowance for credit loss as of October 27, 2018 $ 131 $ 60 $ 8 $ 199 Provisions (benefits) (4 ) 4 1 1 Allowance for credit loss as of January 26, 2019 $ 127 $ 64 $ 9 $ 200 Six months ended January 26, 2019 CREDIT LOSS ALLOWANCES Lease Receivables Loan Receivables Financed Service Contracts Total Allowance for credit loss as of July 28, 2018 $ 135 $ 60 $ 10 $ 205 Provisions (benefits) (7 ) 4 (1 ) (4 ) Foreign exchange and other (1 ) — — (1 ) Allowance for credit loss as of January 26, 2019 $ 127 $ 64 $ 9 $ 200 |
Available-for-Sale Debt Inves_2
Available-for-Sale Debt Investments and Equity Investments (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Available-for-sale Debt Investments and Equity Investments | The following table summarizes our available-for-sale debt investments and equity investments (in millions): January 25, 2020 July 27, 2019 Available-for-sale debt investments $ 18,587 $ 21,660 Marketable equity securities — 3 Total investments 18,587 21,663 Non-marketable equity securities included in other assets 1,155 1,113 Equity method investments included in other assets 61 87 Total $ 19,803 $ 22,863 |
Summary of Available-for-Sale Investments | The following tables summarize our available-for-sale debt investments (in millions): January 25, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government securities $ 2,218 $ 13 $ — $ 2,231 U.S. government agency securities 20 — — 20 Corporate debt securities 13,405 196 (4 ) 13,597 U.S. agency mortgage-backed securities 1,612 14 (3 ) 1,623 Commercial paper 1,052 — — 1,052 Certificates of deposit 64 — — 64 Total (1) $ 18,371 $ 223 $ (7 ) $ 18,587 July 27, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government securities $ 808 $ 1 $ (1 ) $ 808 U.S. government agency securities 169 — — 169 Corporate debt securities 19,188 103 (29 ) 19,262 U.S. agency mortgage-backed securities 1,425 7 (11 ) 1,421 Total $ 21,590 $ 111 $ (41 ) $ 21,660 (1) Net unsettled investment sales were $13 million as of January 25, 2020 and were included in other current assets. |
Gross Realized Gains and Gross Realized Losses Related to Available-for-Sale Investment | The following table presents the gross realized gains and gross realized losses related to available-for-sale debt investments (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Gross realized gains $ 13 $ 1 $ 25 $ 3 Gross realized losses (2 ) (6 ) (4 ) (14 ) Total $ 11 $ (5 ) $ 21 $ (11 ) |
Available-for-Sale Investments with Gross Unrealized Losses | The following tables present the breakdown of the available-for-sale debt investments with gross unrealized losses and the duration that those losses had been unrealized at January 25, 2020 and July 27, 2019 (in millions): UNREALIZED LOSSES LESS THAN 12 MONTHS UNREALIZED LOSSES 12 MONTHS OR GREATER TOTAL January 25, 2020 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses U.S. government securities $ 44 $ — $ 20 $ — $ 64 $ — U.S. government agency securities — — 3 — 3 — Corporate debt securities 260 (1 ) 439 (3 ) 699 (4 ) U.S. agency mortgage-backed securities 56 — 374 (3 ) 430 (3 ) Commercial paper 51 — — — 51 — Certificates of deposit 36 — — — 36 — Total $ 447 $ (1 ) $ 836 $ (6 ) $ 1,283 $ (7 ) UNREALIZED LOSSES LESS THAN 12 MONTHS UNREALIZED LOSSES 12 MONTHS OR GREATER TOTAL July 27, 2019 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses U.S. government securities $ 204 $ — $ 488 $ (1 ) $ 692 $ (1 ) U.S. government agency securities — — 169 — 169 — Corporate debt securities 2,362 (4 ) 5,271 (25 ) 7,633 (29 ) U.S. agency mortgage-backed securities 123 — 847 (11 ) 970 (11 ) Total $ 2,689 $ (4 ) $ 6,775 $ (37 ) $ 9,464 $ (41 ) |
Maturities of Fixed Income Securities | The following table summarizes the maturities of our available-for-sale debt investments as of January 25, 2020 (in millions): Amortized Cost Fair Value Within 1 year $ 5,704 $ 5,717 After 1 year through 5 years 8,898 8,995 After 5 years through 10 years 2,150 2,245 After 10 years 7 7 Mortgage-backed securities with no single maturity 1,612 1,623 Total $ 18,371 $ 18,587 |
Summary of Adjustments to Carrying Value of Investments | Gains and losses recognized on our marketable and non-marketable equity securities are summarized below (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Net gains and losses recognized during the period on equity investments $ 71 $ 67 $ 78 $ 75 Less: Net gains and losses recognized on equity investments sold (68 ) 5 (75 ) (7 ) Net unrealized gains and losses recognized during reporting period on equity securities still held at the reporting date $ 3 $ 72 $ 3 $ 68 We recorded adjustments to the carrying value of our non-marketable equity securities measured using the measurement alternative as follows (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Adjustments to non-marketable equity securities measured using the measurement alternative: Upward adjustments $ 11 $ 14 $ 12 $ 24 Downward adjustments, including impairments (8 ) (2 ) (9 ) (18 ) Net adjustments $ 3 $ 12 $ 3 $ 6 |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis were as follows (in millions): JANUARY 25, 2020 JULY 27, 2019 Level 1 Level 2 Total Balance Level 1 Level 2 Total Balance Assets: Cash equivalents: Money market funds $ 6,556 $ — $ 6,556 $ 10,083 $ — $ 10,083 Commercial paper — 216 216 — — — Certificates of deposit — 18 18 — — — Available-for-sale debt investments: U.S. government securities — 2,231 2,231 — 808 808 U.S. government agency securities — 20 20 — 169 169 Corporate debt securities — 13,597 13,597 — 19,262 19,262 U.S. agency mortgage-backed securities — 1,623 1,623 — 1,421 1,421 Commercial paper — 1,052 1,052 — — — Certificates of deposit — 64 64 — — — Equity investments: Marketable equity securities — — — 3 — 3 Derivative assets — 103 103 — 89 89 Total $ 6,556 $ 18,924 $ 25,480 $ 10,086 $ 21,749 $ 31,835 Liabilities: Derivative liabilities $ — $ 15 $ 15 $ — $ 15 $ 15 Total $ — $ 15 $ 15 $ — $ 15 $ 15 |
Fair Value Measurements, Nonrecurring | The following table presents gains and losses on assets that were measured at fair value on a nonrecurring basis (in millions): TOTAL GAINS (LOSSES) FOR THE THREE MONTHS ENDED TOTAL GAINS (LOSSES) FOR THE SIX MONTHS ENDED January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Non-marketable equity securities and equity method investments $ (11 ) $ 12 $ (32 ) $ 6 Purchased intangible assets (impaired) (3 ) — (3 ) — Total gains (losses) for nonrecurring measurements $ (14 ) $ 12 $ (35 ) $ 6 |
Borrowings (Tables)
Borrowings (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Short-Term Debt | The following table summarizes our short-term debt (in millions, except percentages): January 25, 2020 July 27, 2019 Amount Effective Rate Amount Effective Rate Current portion of long-term debt $ 1,499 2.54 % $ 5,998 3.20 % Commercial paper — — 4,193 2.34 % Total short-term debt $ 1,499 $ 10,191 |
Schedule of Long-Term Debt | The following table summarizes our long-term debt (in millions, except percentages): January 25, 2020 July 27, 2019 Maturity Date Amount Effective Rate Amount Effective Rate Senior notes: Floating-rate notes: Three-month LIBOR plus 0.34% September 20, 2019 $ — — $ 500 2.77% Fixed-rate notes: 1.40% September 20, 2019 — — 1,500 1.48% 4.45% January 15, 2020 — — 2,500 4.72% 2.45% June 15, 2020 1,500 2.54% 1,500 2.54% 2.20% February 28, 2021 2,500 2.30% 2,500 2.30% 2.90% March 4, 2021 500 2.51% 500 3.14% 1.85% September 20, 2021 2,000 1.90% 2,000 1.90% 3.00% June 15, 2022 500 2.71% 500 3.36% 2.60% February 28, 2023 500 2.68% 500 2.68% 2.20% September 20, 2023 750 2.27% 750 2.27% 3.625% March 4, 2024 1,000 2.63% 1,000 3.25% 3.50% June 15, 2025 500 2.88% 500 3.52% 2.95% February 28, 2026 750 3.01% 750 3.01% 2.50% September 20, 2026 1,500 2.55% 1,500 2.55% 5.90% February 15, 2039 2,000 6.11% 2,000 6.11% 5.50% January 15, 2040 2,000 5.67% 2,000 5.67% Total 16,000 20,500 Unaccreted discount/issuance costs (94 ) (100 ) Hedge accounting fair value adjustments 87 73 Total $ 15,993 $ 20,473 Reported as: Current portion of long-term debt $ 1,499 $ 5,998 Long-term debt 14,494 14,475 Total $ 15,993 $ 20,473 |
Schedule of Principal Payments for Long-Term Debt | As of January 25, 2020 , future principal payments for long-term debt, including the current portion, are summarized as follows (in millions): Fiscal Year Amount 2020 (remaining six months) $ 1,500 2021 3,000 2022 2,500 2023 500 2024 1,750 Thereafter 6,750 Total $ 16,000 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives Recorded at Fair Value | The fair values of our derivative instruments and the line items on the Consolidated Balance Sheets to which they were recorded are summarized as follows (in millions): DERIVATIVE ASSETS DERIVATIVE LIABILITIES Balance Sheet Line Item January 25, July 27, Balance Sheet Line Item January 25, July 27, Derivatives designated as hedging instruments: Foreign currency derivatives Other current assets $ 8 $ 5 Other current liabilities $ 7 $ 8 Interest rate derivatives Other current assets — — Other current liabilities — 1 Interest rate derivatives Other assets 89 75 Other long-term liabilities — — Total 97 80 7 9 Derivatives not designated as hedging instruments: Foreign currency derivatives Other current assets 6 9 Other current liabilities 8 6 Total 6 9 8 6 Total $ 103 $ 89 $ 15 $ 15 |
Cumulative Basis Adjustment For Fair Value Hedges | The following amounts were recorded on the Consolidated Balance Sheets related to cumulative basis adjustments for our fair value hedges (in millions): CARRYING AMOUNT OF THE HEDGED ASSETS/(LIABILITIES) CUMULATIVE AMOUNT OF FAIR VALUE HEDGING ADJUSTMENT INCLUDED IN THE CARRYING AMOUNT OF THE HEDGED ASSETS/LIABILITIES Balance Sheet Line Item of Hedged Item January 25, July 27, January 25, July 27, Short-term debt $ — $ (2,000 ) $ — $ — Long-term debt $ (2,580 ) $ (2,565 ) $ (87 ) $ (73 ) |
Effect on Consolidated Statements of Operations of Derivative Instruments | The effect on the Consolidated Statements of Operations of derivative instruments designated as fair value and cash flow hedges is summarized as follows (in millions): January 25, 2020 Three Months Ended Six Months Ended Revenue Cost of sales Operating expenses Interest and other income (loss), net Revenue Cost of sales Operating expenses Interest and other income (loss), net Total amounts presented in the Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 12,005 $ 4,241 $ 4,384 $ 154 $ 25,164 $ 8,936 $ 9,269 $ 261 The effects of fair value and cash flow hedging: Gains (losses) on fair value hedging relationships: Interest rate derivatives Hedged items — — — 7 — — — (14 ) Derivatives designated as hedging instruments — — — (6 ) — — — 16 Gains (losses) on cash flow hedging relationships: Foreign currency derivatives Amount of gains (losses) reclassified from AOCI to income (2 ) — — — (5 ) 1 2 — Total gains (losses) $ (2 ) $ — $ — $ 1 $ (5 ) $ 1 $ 2 $ 2 January 26, 2019 Three Months Ended Six Months Ended Revenue Cost of sales Operating expenses Interest and other income (loss), net Revenue Cost of sales Operating expenses Interest and other income (loss), net Total amounts presented in the Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 12,446 $ 4,673 $ 4,562 $ 132 $ 25,518 $ 9,599 $ 8,903 $ 236 The effects of fair value and cash flow hedging: Gains (losses) on fair value hedging relationships: Interest rate derivatives Hedged items — — — (61 ) — — — (52 ) Derivatives designated as hedging instruments — — — 64 — — — 55 Gains (losses) on cash flow hedging relationships: Foreign currency derivatives Amount of gains (losses) reclassified from AOCI to income 2 (1 ) — — 3 (1 ) (1 ) — Total gains (losses) $ 2 $ (1 ) $ — $ 3 $ 3 $ (1 ) $ (1 ) $ 3 |
Effect of Derivative Instruments Not Designated as Fair Value Hedges on Consolidated Statement of Operations Summary | The effect on the Consolidated Statements of Operations of derivative instruments not designated as hedges is summarized as follows (in millions): GAINS (LOSSES) FOR THE THREE MONTHS ENDED GAINS (LOSSES) FOR THE SIX MONTHS ENDED Derivatives Not Designated as Hedging Instruments Line Item in Statements of Operations January 25, January 26, January 25, January 26, Foreign currency derivatives Other income (loss), net $ (2 ) $ (1 ) $ (9 ) $ (28 ) Total return swaps—deferred compensation Operating expenses 40 (9 ) 44 (33 ) Cost of sales 4 (1 ) 4 (3 ) Other income (loss), net (3 ) (4 ) (7 ) (8 ) Equity derivatives Other income (loss), net 3 — 5 1 Total $ 42 $ (15 ) $ 37 $ (71 ) |
Schedule of Notional Amounts of Derivatives Outstanding | The notional amounts of our outstanding derivatives are summarized as follows (in millions): January 25, July 27, Derivatives designated as hedging instruments: Foreign currency derivatives—cash flow hedges $ 595 $ 663 Interest rate derivatives 2,500 4,500 Net investment hedging instruments 272 309 Derivatives not designated as hedging instruments: Foreign currency derivatives 2,798 2,708 Total return swaps—deferred compensation 630 574 Total $ 6,795 $ 8,754 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Compensation Expense Related to Business Acquisitions | The following table summarizes the compensation expense related to acquisitions (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Compensation expense related to acquisitions $ 50 $ 66 $ 111 $ 175 |
Schedule of Product Warranty Liability | The following table summarizes the activity related to the product warranty liability (in millions): Six Months Ended January 25, January 26, Balance at beginning of period $ 342 $ 359 Provisions for warranties issued 283 297 Adjustments for pre-existing warranties (3 ) (5 ) Settlements (291 ) (300 ) Acquisitions and divestitures — (2 ) Balance at end of period $ 331 $ 349 |
Schedule of Guarantor Obligations | The aggregate amounts of financing guarantees outstanding at January 25, 2020 and July 27, 2019 , representing the total maximum potential future payments under financing arrangements with third parties along with the related deferred revenue, are summarized in the following table (in millions): January 25, July 27, Maximum potential future payments relating to financing guarantees: Channel partner $ 258 $ 197 End user 13 21 Total $ 271 $ 218 Deferred revenue associated with financing guarantees: Channel partner $ (69 ) $ (62 ) End user (13 ) (15 ) Total $ (82 ) $ (77 ) Maximum potential future payments relating to financing guarantees, net of associated deferred revenue $ 189 $ 141 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stock Repurchase Program | A summary of the stock repurchase activity for fiscal 2020 and 2019 under the stock repurchase program, reported based on the trade date, is summarized as follows (in millions, except per-share amounts): Quarter Ended Shares Weighted-Average Price per Share Amount Fiscal 2020 January 25, 2020 18 $ 46.71 $ 870 October 26, 2019 16 $ 48.91 $ 768 Fiscal 2019 July 27, 2019 82 $ 54.99 $ 4,515 April 27, 2019 116 $ 52.14 $ 6,020 January 26, 2019 111 $ 45.09 $ 5,016 October 27, 2018 109 $ 46.01 $ 5,026 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Retirement Benefits [Abstract] | |
Summary of Share-Based Compensation Expense | The following table summarizes share-based compensation expense (in millions): Three Months Ended Six Months Ended January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Cost of sales—product $ 23 $ 22 $ 46 $ 45 Cost of sales—service 36 31 70 64 Share-based compensation expense in cost of sales 59 53 116 109 Research and development 146 133 292 263 Sales and marketing 119 125 246 262 General and administrative 55 65 115 127 Restructuring and other charges 5 19 13 42 Share-based compensation expense in operating expenses 325 342 666 694 Total share-based compensation expense $ 384 $ 395 $ 782 $ 803 Income tax benefit for share-based compensation $ 109 $ 126 $ 240 $ 291 |
Summary of Restricted Stock and Stock Unit Activity | A summary of the restricted stock and stock unit activity, which includes time-based and performance-based or market-based RSUs, is as follows (in millions, except per-share amounts): Restricted Stock/ Stock Units Weighted-Average Grant Date Fair Value per Share Aggregate Fair Value UNVESTED BALANCE AT JULY 28, 2018 119 $ 30.56 Granted 45 47.71 Vested (50 ) 29.25 $ 2,446 Canceled/forfeited/other (14 ) 32.01 UNVESTED BALANCE AT JULY 27, 2019 100 38.66 Granted 28 42.09 Vested (25 ) 33.28 $ 1,207 Canceled/forfeited/other (5 ) 39.29 UNVESTED BALANCE AT JANUARY 25, 2020 98 $ 40.94 |
Comprehensive Income (Tables)
Comprehensive Income (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Equity [Abstract] | |
Components of AOCI, Net of Tax | The components of AOCI, net of tax, and the other comprehensive income (loss), for the first six months of fiscal 2020 and 2019 are summarized as follows (in millions): Net Unrealized Gains (Losses) on Available-for-Sale Investments Net Unrealized Gains (Losses) Cash Flow Hedging Instruments Cumulative Translation Adjustment and Actuarial Gains (Losses) Accumulated Other Comprehensive Income (Loss) BALANCE AT JULY 27, 2019 $ — $ (14 ) $ (778 ) $ (792 ) Other comprehensive income (loss) before reclassifications 168 — (42 ) 126 (Gains) losses reclassified out of AOCI (21 ) 2 2 (17 ) Tax benefit (expense) (17 ) 1 (1 ) (17 ) BALANCE AT JANUARY 25, 2020 $ 130 $ (11 ) $ (819 ) $ (700 ) Net Unrealized Gains (Losses) on Available-for-Sale Investments Net Unrealized Gains (Losses) Cash Flow Hedging Instruments Cumulative Translation Adjustment and Actuarial Gains (Losses) Accumulated Other Comprehensive Income (Loss) BALANCE AT JULY 28, 2018 $ (310 ) $ (11 ) $ (528 ) $ (849 ) Other comprehensive income (loss) before reclassifications 86 (9 ) (184 ) (107 ) (Gains) losses reclassified out of AOCI 11 (1 ) 3 13 Tax benefit (expense) — 2 (1 ) 1 Total change for the period 97 (8 ) (182 ) (93 ) Effect of adoption of accounting standard (168 ) — — (168 ) BALANCE AT JANUARY 26, 2019 $ (381 ) $ (19 ) $ (710 ) $ (1,110 ) |
Reclassification out of Accumulated Other Comprehensive Income | The net gains (losses) reclassified out of AOCI into the Consolidated Statements of Operations, with line item location, during each period were as follows (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Comprehensive Income Components Income Before Taxes Income Before Taxes Line Item in Statements of Operations Net unrealized gains and losses on available-for-sale investments $ 11 $ (5 ) $ 21 $ (11 ) Other income (loss), net Net unrealized gains and losses on cash flow hedging instruments Foreign currency derivatives (2 ) 2 (5 ) 3 Revenue Foreign currency derivatives — (1 ) 1 (1 ) Cost of sales Foreign currency derivatives — — 2 (1 ) Operating expenses (2 ) 1 (2 ) 1 Cumulative translation adjustment and actuarial gains and losses (1 ) (4 ) (2 ) $ (3 ) Other income (loss), net Total amounts reclassified out of AOCI $ 8 $ (8 ) $ 17 $ (13 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Tax Provision | The following table provides details of income taxes (in millions, except percentages): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Income before provision for income taxes $ 3,534 $ 3,343 $ 7,220 $ 7,252 Provision for income taxes $ 656 $ 521 $ 1,416 $ 881 Effective tax rate 18.6 % 15.6 % 19.6 % 12.1 % |
Segment Information and Major_2
Segment Information and Major Customers (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Segment Reporting [Abstract] | |
Reportable Segments | Summarized financial information by segment for the second quarter and the first six months of fiscal 2020 and 2019 , based on our internal management system and as utilized by our Chief Operating Decision Maker (“CODM”), is as follows (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Americas $ 7,013 $ 7,352 $ 14,990 $ 15,103 EMEA 3,134 3,223 6,417 6,447 APJC 1,859 1,872 3,758 3,968 Total $ 12,005 $ 12,446 $ 25,164 $ 25,518 Gross margin: Americas $ 4,692 $ 4,796 $ 10,008 $ 9,866 EMEA 2,062 2,070 4,229 4,141 APJC 1,219 1,109 2,413 2,309 Segment total 7,974 7,975 16,650 16,316 Unallocated corporate items (210 ) (202 ) (422 ) (397 ) Total $ 7,764 $ 7,773 $ 16,228 $ 15,919 |
Net Sales for Groups of Similar Products and Services | The following table presents this disaggregation of revenue (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Infrastructure Platforms $ 6,528 $ 7,102 $ 14,067 $ 14,724 Applications 1,349 1,465 2,847 2,884 Security 748 684 1,563 1,354 Other Products 46 22 72 200 Total Product 8,671 9,273 18,549 19,163 Services 3,334 3,173 6,615 6,355 Total (1) $ 12,005 $ 12,446 $ 25,164 $ 25,518 Amounts may not sum due to rounding. (1) During the second quarter of fiscal 2019, we completed the divestiture of the Service Provider Video Software Solutions (“SPVSS”) business. Total revenue includes SPVSS business revenue of $168 million for the first six months of fiscal 2019. The following table presents revenue for groups of similar products and services (in millions): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Revenue: Infrastructure Platforms $ 6,528 $ 7,102 $ 14,067 $ 14,724 Applications 1,349 1,465 2,847 2,884 Security 748 684 1,563 1,354 Other Products 46 22 72 200 Total Product 8,671 9,273 18,549 19,163 Services 3,334 3,173 6,615 6,355 Total (1) $ 12,005 $ 12,446 $ 25,164 $ 25,518 Amounts may not sum due to rounding. (1) Includes SPVSS business revenue of $168 million for the first six months of fiscal 2019 . |
Net Income per Share (Tables)
Net Income per Share (Tables) | 6 Months Ended |
Jan. 25, 2020 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Net Income per Share | The following table presents the calculation of basic and diluted net income per share (in millions, except per-share amounts): Three Months Ended Six Months Ended January 25, January 26, January 25, January 26, Net income $ 2,878 $ 2,822 $ 5,804 $ 6,371 Weighted-average shares—basic 4,242 4,470 4,244 4,517 Effect of dilutive potential common shares 18 35 21 40 Weighted-average shares—diluted 4,260 4,505 4,265 4,557 Net income per share—basic $ 0.68 $ 0.63 $ 1.37 $ 1.41 Net income per share—diluted $ 0.68 $ 0.63 $ 1.36 $ 1.40 Antidilutive employee share-based awards, excluded 29 27 32 28 |
Basis of Presentation (Details)
Basis of Presentation (Details) | 6 Months Ended |
Jan. 25, 2020segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of geographic segments | 3 |
Recent Accounting Pronounceme_3
Recent Accounting Pronouncements (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 28, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use asset | $ 1,000 | |
Operating lease liabilities | $ 1,078 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use asset | $ 1,200 | |
Operating lease liabilities | $ 1,200 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 12,005 | $ 12,446 | $ 25,164 | $ 25,518 |
Discontinued operations, held-for-sale | Service Provider Video | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 168 | |||
Product | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 8,671 | 9,273 | 18,549 | 19,163 |
Infrastructure Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 6,528 | 7,102 | 14,067 | 14,724 |
Applications | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 1,349 | 1,465 | 2,847 | 2,884 |
Security | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 748 | 684 | 1,563 | 1,354 |
Other Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 46 | 22 | 72 | 200 |
Other Products | Discontinued operations, held-for-sale | Service Provider Video | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 168 | |||
Service | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 3,334 | $ 3,173 | $ 6,615 | $ 6,355 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | Jul. 27, 2019 | |
Revenue from Contract with Customer [Abstract] | |||||
Payment terms | 30 days | ||||
Accounts receivable, net | $ 4,330 | $ 4,330 | $ 5,491 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Remaining performance obligation | 24,900 | 24,900 | 25,300 | ||
Total deferred revenue | 18,686 | 18,686 | 18,467 | ||
Revenue recognized | 2,900 | 6,600 | |||
Total deferred sales commissions | 708 | 708 | 750 | ||
Amortization of sales commissions, expense | 122 | $ 100 | 238 | $ 212 | |
Unbilled Contract Revenue | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Remaining performance obligation | 6,200 | 6,200 | 6,800 | ||
Software and Service Agreements | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Total contract assets | $ 966 | $ 966 | $ 860 |
Revenue - Performance Obligatio
Revenue - Performance Obligation (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-26 | Jan. 25, 2020 |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, percentage | 55.00% |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Additional Information (Details) | 6 Months Ended | ||
Jul. 25, 2020USD ($) | Jan. 25, 2020USD ($)acquisition | Jan. 26, 2019USD ($) | |
Business Acquisition [Line Items] | |||
Number of acquisitions | acquisition | 4 | ||
Acquired cash and cash equivalents | $ 10,000,000 | ||
Goodwill, expected tax deductible | 0 | ||
Acacia Communications, Inc. | Forecast | |||
Business Acquisition [Line Items] | |||
Payment consideration to acquire business, net of cash and marketable securities | $ 2,600,000,000 | ||
General and administrative | |||
Business Acquisition [Line Items] | |||
Acquisition related costs | $ 9,000,000 | $ 11,000,000 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures - Summary of Allocation of Total Purchase Consideration (Details) $ in Millions | 6 Months Ended |
Jan. 25, 2020USD ($)acquisition | |
Business Combinations [Abstract] | |
Number of acquisitions | acquisition | 4 |
Purchase Consideration | $ 182 |
Net Tangible Assets Acquired (Liabilities Assumed) | (9) |
Purchased Intangible Assets | 108 |
Goodwill | $ 83 |
Goodwill and Purchased Intang_3
Goodwill and Purchased Intangible Assets - Schedule of Goodwill by Reportable Segments (Details) $ in Millions | 6 Months Ended |
Jan. 25, 2020USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 33,529 |
Acquisitions | 83 |
Other | 0 |
Ending Balance | 33,612 |
Americas | |
Goodwill [Roll Forward] | |
Beginning Balance | 21,120 |
Acquisitions | 62 |
Other | 1 |
Ending Balance | 21,183 |
EMEA | |
Goodwill [Roll Forward] | |
Beginning Balance | 7,977 |
Acquisitions | 17 |
Other | 0 |
Ending Balance | 7,994 |
APJC | |
Goodwill [Roll Forward] | |
Beginning Balance | 4,432 |
Acquisitions | 4 |
Other | (1) |
Ending Balance | $ 4,435 |
Goodwill and Purchased Intang_4
Goodwill and Purchased Intangible Assets - Schedule of Intangible Assets Acquired Through Business Combinations (Details) | 6 Months Ended |
Jan. 25, 2020USD ($)acquisition | |
Intangible Assets Acquired Through Business Combinations | |
Total, amount | $ 108,000,000 |
Number of acquisitions | acquisition | 4 |
IPR&D | |
Intangible Assets Acquired Through Business Combinations | |
Indefinite lives, amount | $ 0 |
TECHNOLOGY | |
Intangible Assets Acquired Through Business Combinations | |
Weighted- Average Useful Life (in Years) | 5 years |
Finite lives, amount | $ 108,000,000 |
CUSTOMER RELATIONSHIPS | |
Intangible Assets Acquired Through Business Combinations | |
Weighted- Average Useful Life (in Years) | 0 years |
Finite lives, amount | $ 0 |
OTHER | |
Intangible Assets Acquired Through Business Combinations | |
Weighted- Average Useful Life (in Years) | 0 years |
Finite lives, amount | $ 0 |
Goodwill and Purchased Intang_5
Goodwill and Purchased Intangible Assets - Schedule of Purchased Intangible Assets With Finite and Indefinite Lives (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Purchased intangible assets with finite lives: | ||
Gross | $ 4,028 | $ 4,151 |
Accumulated Amortization | (2,430) | (2,286) |
Total purchased intangible assets with finite lives, net | 1,598 | 1,865 |
In-process research and development, with indefinite lives | 308 | 336 |
Total finite and indefinite lives intangible assets, gross | 4,336 | 4,487 |
Total finite and indefinite lives intangible assets, net | 1,906 | 2,201 |
TECHNOLOGY | ||
Purchased intangible assets with finite lives: | ||
Gross | 3,245 | 3,270 |
Accumulated Amortization | (2,103) | (1,933) |
Total purchased intangible assets with finite lives, net | 1,142 | 1,337 |
CUSTOMER RELATIONSHIPS | ||
Purchased intangible assets with finite lives: | ||
Gross | 749 | 840 |
Accumulated Amortization | (304) | (331) |
Total purchased intangible assets with finite lives, net | 445 | 509 |
OTHER | ||
Purchased intangible assets with finite lives: | ||
Gross | 34 | 41 |
Accumulated Amortization | (23) | (22) |
Total purchased intangible assets with finite lives, net | $ 11 | $ 19 |
Goodwill and Purchased Intang_6
Goodwill and Purchased Intangible Assets - Schedule of Amortization of Purchased Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of purchased intangible assets | $ 38 | $ 39 | $ 74 | $ 73 |
Total | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of purchased intangible assets | 203 | 195 | 405 | 380 |
Cost of sales | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of purchased intangible assets | 165 | 156 | 331 | 307 |
Operating expenses | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of purchased intangible assets | $ 38 | $ 39 | $ 74 | $ 73 |
Goodwill and Purchased Intang_7
Goodwill and Purchased Intangible Assets - Schedule of Estimated Future Amortization Expense of Purchased Intangible Assets (Details) $ in Millions | Jan. 25, 2020USD ($) |
Finite-Lived Intangible Assets, Future Amortization Expense [Abstract] | |
2020 (remaining six months) | $ 383 |
2021 | 591 |
2022 | 333 |
2023 | 191 |
2024 | 93 |
Thereafter | $ 7 |
Restructuring and Other Charg_3
Restructuring and Other Charges - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 25, 2020 | Jan. 26, 2019 | Jul. 28, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 226 | $ 264 | ||
Fiscal 2018 Plan | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 42 | 226 | ||
Cumulative restructuring charges incurred | $ 656 | $ 656 | ||
Fiscal 2020 Plan | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Expected restructuring charges | $ 300 |
Restructuring and Other Charg_4
Restructuring and Other Charges - Schedule of Activities Related to Restructuring and Other Charges (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jan. 25, 2020 | Jan. 25, 2020 | Jan. 26, 2019 | |
Restructuring Reserve [Roll Forward] | |||
Liability as of beginning period | $ 33 | $ 73 | |
Charges | 226 | 264 | |
Cash payments | (203) | (237) | |
Non-cash items | (23) | (42) | |
Liability as of ending period | $ 33 | 33 | 58 |
FISCAL 2017 AND PRIOR PLANS | Employee Severance | |||
Restructuring Reserve [Roll Forward] | |||
Liability as of beginning period | 0 | 41 | |
Charges | 0 | 0 | |
Cash payments | 0 | (31) | |
Non-cash items | 0 | 0 | |
Liability as of ending period | 0 | 0 | 10 |
FISCAL 2017 AND PRIOR PLANS | Other | |||
Restructuring Reserve [Roll Forward] | |||
Liability as of beginning period | 5 | 13 | |
Charges | 0 | (1) | |
Cash payments | 0 | (3) | |
Non-cash items | (2) | 0 | |
Liability as of ending period | 3 | 3 | 9 |
FISCAL 2018 PLAN | |||
Restructuring Reserve [Roll Forward] | |||
Charges | 42 | 226 | |
FISCAL 2018 PLAN | Employee Severance | |||
Restructuring Reserve [Roll Forward] | |||
Liability as of beginning period | 22 | 19 | |
Charges | 209 | 222 | |
Cash payments | (202) | (202) | |
Non-cash items | 0 | 0 | |
Liability as of ending period | 29 | 29 | 39 |
FISCAL 2018 PLAN | Other | |||
Restructuring Reserve [Roll Forward] | |||
Liability as of beginning period | 6 | 0 | |
Charges | 17 | 43 | |
Cash payments | (1) | (1) | |
Non-cash items | (21) | (42) | |
Liability as of ending period | $ 1 | $ 1 | $ 0 |
Balance Sheet Details (Details)
Balance Sheet Details (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 | Jan. 26, 2019 | Jul. 28, 2018 |
Total cash, cash equivalents, and restricted cash | ||||
Cash and cash equivalents | $ 8,475 | $ 11,750 | ||
Restricted cash included in other current assets | 21 | 21 | ||
Restricted cash included in other assets | 3 | 1 | ||
Total cash, cash equivalents, and restricted cash | 8,499 | 11,772 | $ 9,879 | $ 8,993 |
Inventories: | ||||
Raw materials | 384 | 374 | ||
Work in process | 12 | 10 | ||
Finished goods: | ||||
Deferred cost of sales | 59 | 109 | ||
Manufactured finished goods | 667 | 643 | ||
Total finished goods | 726 | 752 | ||
Service-related spares | 212 | 225 | ||
Demonstration systems | 19 | 22 | ||
Total | 1,353 | 1,383 | ||
Property and equipment, net: | ||||
Total gross property and equipment | 11,337 | 12,039 | ||
Less: accumulated depreciation and amortization | (8,716) | (9,250) | ||
Total | 2,621 | 2,789 | ||
Disaggregation of Revenue [Line Items] | ||||
Deferred revenue: | 18,686 | 18,467 | ||
Current | 10,638 | 10,668 | ||
Noncurrent | 8,048 | 7,799 | ||
Land, buildings, and building and leasehold improvements | ||||
Property and equipment, net: | ||||
Total gross property and equipment | 4,438 | 4,545 | ||
Computer equipment and related software | ||||
Property and equipment, net: | ||||
Total gross property and equipment | 900 | 922 | ||
Production, engineering, and other equipment | ||||
Property and equipment, net: | ||||
Total gross property and equipment | 5,196 | 5,711 | ||
Operating lease assets | ||||
Property and equipment, net: | ||||
Total gross property and equipment | 411 | |||
Less: accumulated depreciation and amortization | (247) | |||
Total | 164 | |||
Operating lease assets | ||||
Property and equipment, net: | ||||
Total gross property and equipment | 485 | |||
Furniture, fixtures and other | ||||
Property and equipment, net: | ||||
Total gross property and equipment | 392 | 376 | ||
Service | ||||
Disaggregation of Revenue [Line Items] | ||||
Deferred revenue: | 11,526 | 11,709 | ||
Product | ||||
Disaggregation of Revenue [Line Items] | ||||
Deferred revenue: | $ 7,160 | $ 6,758 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jan. 25, 2020USD ($) | Jan. 25, 2020USD ($) | |
Leases [Abstract] | ||
Operating lease right-of-use asset | $ 1,000 | $ 1,000 |
Operating lease liabilities | 1,078 | 1,078 |
Operating lease liabilities, current | 380 | 380 |
Operating lease liabilities, noncurrent | $ 698 | $ 698 |
Weighted-average remaining lease term (in years) | 4 years 1 month 6 days | 4 years 1 month 6 days |
Weighted-average discount rate | 1.80% | 1.80% |
Sales-type lease terms, on average | 4 years | 4 years |
Interest income, lease receivables | $ 23 | $ 49 |
Operating lease income | $ 50 | $ 94 |
Leases - Lease Expenses (Detail
Leases - Lease Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jan. 25, 2020 | Jan. 25, 2020 | |
Leases [Abstract] | ||
Operating lease expense | $ 101 | $ 214 |
Short-term lease expense | 16 | 33 |
Variable lease expense | 39 | 79 |
Total lease expense | $ 156 | $ 326 |
Leases - Supplemental Informati
Leases - Supplemental Information (Details) $ in Millions | 6 Months Ended |
Jan. 25, 2020USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of lease liabilities — operating cash flows | $ 206 |
Right-of-use assets obtained in exchange for operating leases liabilities | $ 77 |
Leases - Lessee Arrangements, M
Leases - Lessee Arrangements, Maturities of Operating Leases (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2020 (remaining six months) | $ 204 | |
2021 | 316 | |
2022 | 216 | |
2023 | 166 | |
2024 | 104 | |
Thereafter | 111 | |
Total lease payments | 1,117 | |
Less interest | (39) | |
Total | $ 1,078 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2020 | $ 441 | |
2021 | 299 | |
2022 | 195 | |
2023 | 120 | |
2024 | 70 | |
Thereafter | 54 | |
Total | $ 1,179 |
Leases - Lessor Arrangements, F
Leases - Lessor Arrangements, Future Minimum Lease Payments (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Future Minimum Lease Payments, After Topic 842 Adoption [Abstract] | ||
2020 (remaining six months) | $ 438 | |
2021 | 882 | |
2022 | 479 | |
2023 | 267 | |
2024 | 123 | |
Thereafter | 58 | |
Total | 2,247 | |
Less: Present value of lease payments | 2,117 | |
Difference between undiscounted cash flows and discounted cash flows | $ 130 | |
Future Minimum Lease Payments, Prior to Topic 842 Adoption [Abstract] | ||
2020 | $ 1,028 | |
2021 | 702 | |
2022 | 399 | |
2023 | 185 | |
2024 | 53 | |
Total | $ 2,367 |
Leases - Operating Lease Assets
Leases - Operating Lease Assets (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Lessor, Lease, Description [Line Items] | ||
Operating lease assets | $ 11,337 | $ 12,039 |
Accumulated depreciation | (8,716) | (9,250) |
Total | 2,621 | 2,789 |
Property Subject to or Available for Operating Lease, Net [Abstract] | ||
Operating lease assets | 485 | |
Accumulated depreciation | (306) | |
Operating lease assets, net | $ 179 | |
Operating lease assets | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease assets | 411 | |
Accumulated depreciation | (247) | |
Total | $ 164 |
Leases - Minimum Future Rental
Leases - Minimum Future Rental Payments (Details) $ in Millions | Jan. 25, 2020USD ($) |
Minimum Future Rentals on Noncancelable Operating Leases [Abstract] | |
2020 (remaining six months) | $ 61 |
2021 | 70 |
2022 | 24 |
2023 | 4 |
Total | $ 159 |
Financing Receivables - Additio
Financing Receivables - Additional Information (Details) $ in Millions | 6 Months Ended | |
Jan. 25, 2020USD ($)rating | Jul. 27, 2019USD ($) | |
Financing Receivables And Guarantees [Line Items] | ||
Lease receivables terms, on average | 4 years | |
Loan receivables term | 3 years | |
Threshold for past due receivables | 31 days | |
Financing receivable, 91 days past due and still accruing | $ | $ 201 | $ 215 |
Investment credit risk ratings range lowest (rating) | 1 | |
Highest rating when receivables are deemed impaired (rating) | 10 | |
Rating at or higher when receivables deemed impaired (rating) | 8 | |
Minimum | Financed Service Contracts | ||
Financing Receivables And Guarantees [Line Items] | ||
Financed service contracts term | 1 year | |
Maximum | Financed Service Contracts | ||
Financing Receivables And Guarantees [Line Items] | ||
Financed service contracts term | 3 years |
Financing Receivables - Schedul
Financing Receivables - Schedule of Financing Receivables (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Oct. 26, 2019 | Jul. 27, 2019 | Jan. 26, 2019 | Oct. 27, 2018 | Jul. 28, 2018 |
Financing Receivables [Line Items] | ||||||
Gross | $ 9,726 | $ 10,174 | ||||
Residual value | 133 | |||||
Residual value | 142 | |||||
Unearned income | (130) | (137) | ||||
Allowance for credit loss | (145) | $ (133) | (126) | $ (200) | $ (199) | $ (205) |
Total, net | 9,584 | 10,053 | ||||
Current | 4,827 | 5,095 | ||||
Noncurrent | 4,757 | 4,958 | ||||
Lease Receivables | ||||||
Financing Receivables [Line Items] | ||||||
Gross | 2,247 | 2,367 | ||||
Residual value | 133 | |||||
Residual value | 142 | |||||
Unearned income | (130) | (137) | ||||
Allowance for credit loss | (42) | (43) | (46) | (127) | (131) | (135) |
Total, net | 2,208 | 2,326 | ||||
Current | 999 | 1,029 | ||||
Noncurrent | 1,209 | 1,297 | ||||
Loan Receivables | ||||||
Financing Receivables [Line Items] | ||||||
Gross | 5,297 | 5,438 | ||||
Unearned income | 0 | 0 | ||||
Allowance for credit loss | (95) | (81) | (71) | (64) | (60) | (60) |
Total, net | 5,202 | 5,367 | ||||
Current | 2,496 | 2,653 | ||||
Noncurrent | 2,706 | 2,714 | ||||
Financed Service Contracts | ||||||
Financing Receivables [Line Items] | ||||||
Gross | 2,182 | 2,369 | ||||
Unearned income | 0 | 0 | ||||
Allowance for credit loss | (8) | $ (9) | (9) | $ (9) | $ (8) | $ (10) |
Total, net | 2,174 | 2,360 | ||||
Current | 1,332 | 1,413 | ||||
Noncurrent | $ 842 | $ 947 |
Financing Receivables - Sched_2
Financing Receivables - Schedule of Financing Receivables Categorized by Internal Credit Risk Rating (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | $ 9,596 | $ 10,037 |
1 to 4 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 5,651 | 5,984 |
5 to 6 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 3,691 | 3,850 |
7 and Higher | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 254 | 203 |
Lease Receivables | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 2,117 | 2,230 |
Lease Receivables | 1 to 4 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 1,133 | 1,204 |
Lease Receivables | 5 to 6 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 936 | 991 |
Lease Receivables | 7 and Higher | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 48 | 35 |
Loan Receivables | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 5,297 | 5,438 |
Loan Receivables | 1 to 4 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 3,262 | 3,367 |
Loan Receivables | 5 to 6 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 1,855 | 1,920 |
Loan Receivables | 7 and Higher | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 180 | 151 |
Financed Service Contracts | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 2,182 | 2,369 |
Financed Service Contracts | 1 to 4 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 1,256 | 1,413 |
Financed Service Contracts | 5 to 6 | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | 900 | 939 |
Financed Service Contracts | 7 and Higher | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Gross receivables less unearned income | $ 26 | $ 17 |
Financing Receivables - Sched_3
Financing Receivables - Schedule of Aging Analysis of Financing Receivables (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | $ 1,079 | $ 1,643 |
Current | 8,517 | 8,394 |
Total | 9,596 | 10,037 |
Nonaccrual Financing Receivables | 102 | 47 |
Impaired Financing Receivables | 102 | 47 |
Past due 31-60 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 269 | 503 |
Past due 61-90 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 110 | 240 |
Past due 91 or above days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 700 | 900 |
Lease Receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 264 | 434 |
Current | 1,853 | 1,796 |
Total | 2,117 | 2,230 |
Nonaccrual Financing Receivables | 22 | 13 |
Impaired Financing Receivables | 22 | 13 |
Lease Receivables | Past due 31-60 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 58 | 101 |
Lease Receivables | Past due 61-90 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 34 | 42 |
Lease Receivables | Past due 91 or above days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 172 | 291 |
Loan Receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 379 | 662 |
Current | 4,918 | 4,776 |
Total | 5,297 | 5,438 |
Nonaccrual Financing Receivables | 78 | 31 |
Impaired Financing Receivables | 78 | 31 |
Loan Receivables | Past due 31-60 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 129 | 257 |
Loan Receivables | Past due 61-90 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 31 | 67 |
Loan Receivables | Past due 91 or above days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 219 | 338 |
Financed Service Contracts | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 436 | 547 |
Current | 1,746 | 1,822 |
Total | 2,182 | 2,369 |
Nonaccrual Financing Receivables | 2 | 3 |
Impaired Financing Receivables | 2 | 3 |
Financed Service Contracts | Past due 31-60 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 82 | 145 |
Financed Service Contracts | Past due 61-90 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | 45 | 131 |
Financed Service Contracts | Past due 91 or above days | ||
Financing Receivable, Past Due [Line Items] | ||
Total Past Due | $ 309 | $ 271 |
Financing Receivables - Summary
Financing Receivables - Summary of Allowances for Credit Loss and Related Financing Receivables (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Allowance for credit loss as of beginning of period | $ 133 | $ 199 | $ 126 | $ 205 |
Provisions (benefits) | 14 | 1 | 38 | (4) |
Recoveries (write-offs), net | (2) | (18) | ||
Foreign exchange and other | 0 | (1) | (1) | |
Allowance for credit loss as of end of period | 145 | 200 | 145 | 200 |
Lease Receivables | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Allowance for credit loss as of beginning of period | 43 | 131 | 46 | 135 |
Provisions (benefits) | (1) | (4) | (4) | (7) |
Recoveries (write-offs), net | (1) | (1) | ||
Foreign exchange and other | 1 | 1 | (1) | |
Allowance for credit loss as of end of period | 42 | 127 | 42 | 127 |
Loan Receivables | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Allowance for credit loss as of beginning of period | 81 | 60 | 71 | 60 |
Provisions (benefits) | 15 | 4 | 42 | 4 |
Recoveries (write-offs), net | (1) | (17) | ||
Foreign exchange and other | 0 | (1) | 0 | |
Allowance for credit loss as of end of period | 95 | 64 | 95 | 64 |
Financed Service Contracts | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Allowance for credit loss as of beginning of period | 9 | 8 | 9 | 10 |
Provisions (benefits) | 0 | 1 | 0 | (1) |
Recoveries (write-offs), net | 0 | 0 | ||
Foreign exchange and other | (1) | (1) | 0 | |
Allowance for credit loss as of end of period | $ 8 | $ 9 | $ 8 | $ 9 |
Available-for-Sale Debt Inves_3
Available-for-Sale Debt Investments and Equity Investments - Summary of Available-for-sale Debt Investments and Equity Investments (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Investments, Debt and Equity Securities [Abstract] | ||
Available-for-sale debt investments | $ 18,587 | $ 21,660 |
Marketable equity securities | 0 | 3 |
Total investments | 18,587 | 21,663 |
Non-marketable equity securities included in other assets | 1,155 | 1,113 |
Equity method investments included in other assets | 61 | 87 |
Total | $ 19,803 | $ 22,863 |
Available-for-Sale Debt Inves_4
Available-for-Sale Debt Investments and Equity Investments - Summary of Available-for-Sale Investments (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract] | ||
Amortized Cost | $ 18,371 | $ 21,590 |
Gross Unrealized Gains | 223 | 111 |
Gross Unrealized Losses | (7) | (41) |
Fair Value | 18,587 | 21,660 |
Net unsettled investment sales | 13 | |
U.S. government securities | ||
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract] | ||
Amortized Cost | 2,218 | 808 |
Gross Unrealized Gains | 13 | 1 |
Gross Unrealized Losses | 0 | (1) |
Fair Value | 2,231 | 808 |
U.S. government agency securities | ||
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract] | ||
Amortized Cost | 20 | 169 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 20 | 169 |
Corporate debt securities | ||
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract] | ||
Amortized Cost | 13,405 | 19,188 |
Gross Unrealized Gains | 196 | 103 |
Gross Unrealized Losses | (4) | (29) |
Fair Value | 13,597 | 19,262 |
U.S. agency mortgage-backed securities | ||
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract] | ||
Amortized Cost | 1,612 | 1,425 |
Gross Unrealized Gains | 14 | 7 |
Gross Unrealized Losses | (3) | (11) |
Fair Value | 1,623 | $ 1,421 |
Commercial paper | ||
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract] | ||
Amortized Cost | 1,052 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | 1,052 | |
Certificates of deposit | ||
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract] | ||
Amortized Cost | 64 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | $ 64 |
Available-for-Sale Debt Inves_5
Available-for-Sale Debt Investments and Equity Investments - Gross Realized Gains and Gross Realized Losses Related to Available-for-Sale Investment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Investments [Abstract] | ||||
Gross realized gains | $ 13 | $ 1 | $ 25 | $ 3 |
Gross realized losses | (2) | (6) | (4) | (14) |
Total | $ 11 | $ (5) | $ 21 | $ (11) |
Available-for-Sale Debt Inves_6
Available-for-Sale Debt Investments and Equity Investments - Available-for-Sale Investments With Gross Unrealized Losses (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Schedule of Investments [Line Items] | ||
UNREALIZED LOSSES LESS THAN 12 MONTHS, Fair Value | $ 447 | $ 2,689 |
UNREALIZED LOSSES LESS THAN 12 MONTHS, Gross Unrealized Losses | (1) | (4) |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Fair Value | 836 | 6,775 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Gross Unrealized Losses | (6) | (37) |
TOTAL, Fair Value | 1,283 | 9,464 |
TOTAL, Gross Unrealized Losses | (7) | (41) |
U.S. government securities | ||
Schedule of Investments [Line Items] | ||
UNREALIZED LOSSES LESS THAN 12 MONTHS, Fair Value | 44 | 204 |
UNREALIZED LOSSES LESS THAN 12 MONTHS, Gross Unrealized Losses | 0 | 0 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Fair Value | 20 | 488 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Gross Unrealized Losses | 0 | (1) |
TOTAL, Fair Value | 64 | 692 |
TOTAL, Gross Unrealized Losses | 0 | (1) |
U.S. government agency securities | ||
Schedule of Investments [Line Items] | ||
UNREALIZED LOSSES LESS THAN 12 MONTHS, Fair Value | 0 | 0 |
UNREALIZED LOSSES LESS THAN 12 MONTHS, Gross Unrealized Losses | 0 | 0 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Fair Value | 3 | 169 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Gross Unrealized Losses | 0 | 0 |
TOTAL, Fair Value | 3 | 169 |
TOTAL, Gross Unrealized Losses | 0 | 0 |
Corporate debt securities | ||
Schedule of Investments [Line Items] | ||
UNREALIZED LOSSES LESS THAN 12 MONTHS, Fair Value | 260 | 2,362 |
UNREALIZED LOSSES LESS THAN 12 MONTHS, Gross Unrealized Losses | (1) | (4) |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Fair Value | 439 | 5,271 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Gross Unrealized Losses | (3) | (25) |
TOTAL, Fair Value | 699 | 7,633 |
TOTAL, Gross Unrealized Losses | (4) | (29) |
U.S. agency mortgage-backed securities | ||
Schedule of Investments [Line Items] | ||
UNREALIZED LOSSES LESS THAN 12 MONTHS, Fair Value | 56 | 123 |
UNREALIZED LOSSES LESS THAN 12 MONTHS, Gross Unrealized Losses | 0 | 0 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Fair Value | 374 | 847 |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Gross Unrealized Losses | (3) | (11) |
TOTAL, Fair Value | 430 | 970 |
TOTAL, Gross Unrealized Losses | (3) | $ (11) |
Commercial paper | ||
Schedule of Investments [Line Items] | ||
UNREALIZED LOSSES LESS THAN 12 MONTHS, Fair Value | 51 | |
UNREALIZED LOSSES LESS THAN 12 MONTHS, Gross Unrealized Losses | 0 | |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Fair Value | 0 | |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Gross Unrealized Losses | 0 | |
TOTAL, Fair Value | 51 | |
TOTAL, Gross Unrealized Losses | 0 | |
Certificates of deposit | ||
Schedule of Investments [Line Items] | ||
UNREALIZED LOSSES LESS THAN 12 MONTHS, Fair Value | 36 | |
UNREALIZED LOSSES LESS THAN 12 MONTHS, Gross Unrealized Losses | 0 | |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Fair Value | 0 | |
UNREALIZED LOSSES 12 MONTHS OR GREATER, Gross Unrealized Losses | 0 | |
TOTAL, Fair Value | 36 | |
TOTAL, Gross Unrealized Losses | $ 0 |
Available-for-Sale Debt Inves_7
Available-for-Sale Debt Investments and Equity Investments - Additional Information (Details) | 3 Months Ended | |
Jan. 25, 2020USD ($)entity | Jul. 27, 2019USD ($) | |
Schedule of Investments [Line Items] | ||
Impairment charges of available-for-sale investments, in an unrealized loss position | $ 0 | |
Non-marketable equity securities included in other assets | $ 1,155,000,000 | $ 1,113,000,000 |
Number of variable interest entities required to be consolidated (entity) | entity | 0 | |
Investments in privately held companies | $ 1,200,000,000 | |
Funding commitments | 291,000,000 | |
Private equity funds | Fair value measured at NAV per share | ||
Schedule of Investments [Line Items] | ||
Non-marketable equity securities included in other assets | 700,000,000 | $ 600,000,000 |
Variable Interest Entity, Not Primary Beneficiary | ||
Schedule of Investments [Line Items] | ||
Investments in privately held companies | $ 669,000,000 |
Available-for-Sale Debt Inves_8
Available-for-Sale Debt Investments and Equity Investments - Maturities of Fixed Income Securities (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Amortized Cost | ||
Within 1 year | $ 5,704 | |
After 1 year through 5 years | 8,898 | |
After 5 years through 10 years | 2,150 | |
After 10 years | 7 | |
Mortgage-backed securities with no single maturity | 1,612 | |
Amortized Cost | 18,371 | $ 21,590 |
Fair Value | ||
Within 1 year | 5,717 | |
After 1 year through 5 years | 8,995 | |
After 5 years through 10 years | 2,245 | |
After 10 years | 7 | |
Mortgage-backed securities with no single maturity | 1,623 | |
Total | $ 18,587 | $ 21,660 |
Available-for-Sale Debt Inves_9
Available-for-Sale Debt Investments and Equity Investments - Summary of Gains and Losses Recognized on Marketable and Non-marketable Equity Securities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Net gains and losses recognized during the period on equity investments | $ 71 | $ 67 | $ 78 | $ 75 |
Less: Net gains and losses recognized on equity investments sold | (68) | 5 | (75) | (7) |
Net unrealized gains and losses recognized during reporting period on equity securities still held at the reporting date | 3 | 72 | 3 | 68 |
Adjustments to non-marketable equity securities measured using the measurement alternative: | ||||
Upward adjustments | 11 | 14 | 12 | 24 |
Downward adjustments, including impairments | (8) | (2) | (9) | (18) |
Net adjustments | $ 3 | $ 12 | $ 3 | $ 6 |
Fair Value - Assets and Liabili
Fair Value - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Assets: | ||
Available-for-sale debt investments | $ 18,587 | $ 21,660 |
Marketable equity securities | 0 | 3 |
U.S. government securities | ||
Assets: | ||
Available-for-sale debt investments | 2,231 | 808 |
U.S. government agency securities | ||
Assets: | ||
Available-for-sale debt investments | 20 | 169 |
Corporate debt securities | ||
Assets: | ||
Available-for-sale debt investments | 13,597 | 19,262 |
Commercial paper | ||
Assets: | ||
Available-for-sale debt investments | 1,052 | |
Certificates of deposit | ||
Assets: | ||
Available-for-sale debt investments | 64 | |
Fair value, measurements, recurring | ||
Assets: | ||
Marketable equity securities | 0 | 3 |
Derivative assets | 103 | 89 |
Total | 25,480 | 31,835 |
Liabilities: | ||
Derivative liabilities | 15 | 15 |
Total | 15 | 15 |
Fair value, measurements, recurring | U.S. government securities | ||
Assets: | ||
Available-for-sale debt investments | 2,231 | 808 |
Fair value, measurements, recurring | U.S. government agency securities | ||
Assets: | ||
Available-for-sale debt investments | 20 | 169 |
Fair value, measurements, recurring | Corporate debt securities | ||
Assets: | ||
Available-for-sale debt investments | 13,597 | 19,262 |
Fair value, measurements, recurring | U.S. agency mortgage-backed securities | ||
Assets: | ||
Available-for-sale debt investments | 1,623 | 1,421 |
Fair value, measurements, recurring | Commercial paper | ||
Assets: | ||
Available-for-sale debt investments | 1,052 | 0 |
Fair value, measurements, recurring | Certificates of deposit | ||
Assets: | ||
Available-for-sale debt investments | 64 | 0 |
Fair value, measurements, recurring | Money market funds | ||
Assets: | ||
Cash equivalents | 6,556 | 10,083 |
Fair value, measurements, recurring | Commercial paper | ||
Assets: | ||
Cash equivalents | 216 | 0 |
Fair value, measurements, recurring | Certificates of deposit | ||
Assets: | ||
Cash equivalents | 18 | 0 |
Fair value, measurements, recurring | Level 1 | ||
Assets: | ||
Marketable equity securities | 0 | 3 |
Derivative assets | 0 | 0 |
Total | 6,556 | 10,086 |
Liabilities: | ||
Derivative liabilities | 0 | 0 |
Total | 0 | 0 |
Fair value, measurements, recurring | Level 1 | U.S. government securities | ||
Assets: | ||
Available-for-sale debt investments | 0 | 0 |
Fair value, measurements, recurring | Level 1 | U.S. government agency securities | ||
Assets: | ||
Available-for-sale debt investments | 0 | 0 |
Fair value, measurements, recurring | Level 1 | Corporate debt securities | ||
Assets: | ||
Available-for-sale debt investments | 0 | 0 |
Fair value, measurements, recurring | Level 1 | U.S. agency mortgage-backed securities | ||
Assets: | ||
Available-for-sale debt investments | 0 | 0 |
Fair value, measurements, recurring | Level 1 | Commercial paper | ||
Assets: | ||
Available-for-sale debt investments | 0 | 0 |
Fair value, measurements, recurring | Level 1 | Certificates of deposit | ||
Assets: | ||
Available-for-sale debt investments | 0 | 0 |
Fair value, measurements, recurring | Level 1 | Money market funds | ||
Assets: | ||
Cash equivalents | 6,556 | 10,083 |
Fair value, measurements, recurring | Level 1 | Commercial paper | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Fair value, measurements, recurring | Level 1 | Certificates of deposit | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Fair value, measurements, recurring | Level 2 | ||
Assets: | ||
Marketable equity securities | 0 | 0 |
Derivative assets | 103 | 89 |
Total | 18,924 | 21,749 |
Liabilities: | ||
Derivative liabilities | 15 | 15 |
Total | 15 | 15 |
Fair value, measurements, recurring | Level 2 | U.S. government securities | ||
Assets: | ||
Available-for-sale debt investments | 2,231 | 808 |
Fair value, measurements, recurring | Level 2 | U.S. government agency securities | ||
Assets: | ||
Available-for-sale debt investments | 20 | 169 |
Fair value, measurements, recurring | Level 2 | Corporate debt securities | ||
Assets: | ||
Available-for-sale debt investments | 13,597 | 19,262 |
Fair value, measurements, recurring | Level 2 | U.S. agency mortgage-backed securities | ||
Assets: | ||
Available-for-sale debt investments | 1,623 | 1,421 |
Fair value, measurements, recurring | Level 2 | Commercial paper | ||
Assets: | ||
Available-for-sale debt investments | 1,052 | 0 |
Fair value, measurements, recurring | Level 2 | Certificates of deposit | ||
Assets: | ||
Available-for-sale debt investments | 64 | 0 |
Fair value, measurements, recurring | Level 2 | Money market funds | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Fair value, measurements, recurring | Level 2 | Commercial paper | ||
Assets: | ||
Cash equivalents | 216 | 0 |
Fair value, measurements, recurring | Level 2 | Certificates of deposit | ||
Assets: | ||
Cash equivalents | $ 18 | $ 0 |
Fair Value - Fair Value, Nonrec
Fair Value - Fair Value, Nonrecurring Measurement (Details) - Level 3 - Fair value, measurements, nonrecurring - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total gains (losses) for nonrecurring measurements | $ (14) | $ 12 | $ (35) | $ 6 |
Non-marketable equity securities and equity method investments | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total gains (losses) for nonrecurring measurements | (11) | 12 | (32) | 6 |
Purchased intangible assets (impaired) | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total gains (losses) for nonrecurring measurements | $ (3) | $ 0 | $ (3) | $ 0 |
Fair Value - Additional Informa
Fair Value - Additional Information (Details) - USD ($) | 6 Months Ended | |
Jan. 25, 2020 | Jul. 27, 2019 | |
Fair Value Measurements [Line Items] | ||
Borrowings, carrying value | $ 15,993,000,000 | $ 20,473,000,000 |
IPR&D | ||
Fair Value Measurements [Line Items] | ||
Indefinite lives, amount | 0 | |
Level 3 | ||
Fair Value Measurements [Line Items] | ||
Long term loan receivables and financed service contracts and others carrying value | 3,500,000,000 | 3,700,000,000 |
Level 2 | ||
Fair Value Measurements [Line Items] | ||
Borrowings, fair value | $ 18,000,000,000 | $ 22,100,000,000 |
Borrowings - Schedule of Short-
Borrowings - Schedule of Short-Term Debt (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Short-term Debt [Line Items] | ||
Amount | $ 1,499 | $ 10,191 |
Current portion of long-term debt | ||
Short-term Debt [Line Items] | ||
Amount | $ 1,499 | $ 5,998 |
Effective Rate | 2.54% | 3.20% |
Commercial paper | ||
Short-term Debt [Line Items] | ||
Amount | $ 0 | $ 4,193 |
Effective Rate | 0.00% | 2.34% |
Borrowings - Additional Informa
Borrowings - Additional Information (Details) - USD ($) | May 15, 2015 | Jan. 25, 2020 | Jul. 27, 2019 |
Debt Instrument [Line Items] | |||
Derivative, notional amount | $ 6,795,000,000 | $ 8,754,000,000 | |
Line of credit facility, amount outstanding | 0 | ||
Unsecured revolving credit facility | |||
Debt Instrument [Line Items] | |||
Current borrowing capacity | $ 3,000,000,000 | ||
Additional credit facility upon agreement (up to) | $ 2,000,000,000 | ||
Unsecured revolving credit facility | Federal Fund rate | |||
Debt Instrument [Line Items] | |||
Interest rate based on % above pre-defined market rate | 0.50% | ||
Unsecured revolving credit facility | LIBOR | |||
Debt Instrument [Line Items] | |||
Interest rate based on % above pre-defined market rate | 1.00% | ||
Unsecured revolving credit facility | Eurodollar | |||
Debt Instrument [Line Items] | |||
Interest rate based on % above pre-defined market rate | 0.00% | ||
Interest rate swaps | |||
Debt Instrument [Line Items] | |||
Derivative, notional amount | 2,500,000,000 | ||
Commercial paper | |||
Debt Instrument [Line Items] | |||
Commercial paper, maximum borrowing limit (up to) | $ 10,000,000,000 |
Borrowings - Schedule of Long-T
Borrowings - Schedule of Long-Term Debt (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jan. 25, 2020 | Jul. 27, 2019 | |
Debt Instrument [Line Items] | ||
Total | $ 16,000 | $ 20,500 |
Unaccreted discount/issuance costs | (94) | (100) |
Hedge accounting fair value adjustments | 87 | 73 |
Total | 15,993 | 20,473 |
Current portion of long-term debt | 1,499 | 5,998 |
Long-term debt | 14,494 | 14,475 |
Floating Rate Notes 3-month LIBOR Plus 0.34% Due September 20, 2019 | ||
Debt Instrument [Line Items] | ||
Amount | $ 0 | $ 500 |
Effective Rate | 0.00% | 2.77% |
Fixed-Rate Notes, 1.40%, Due September 20, 2019 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 1.40% | |
Amount | $ 0 | $ 1,500 |
Effective Rate | 0.00% | 1.48% |
Fixed-Rate Notes, 4.45%, Due January 15, 2020 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 4.45% | |
Amount | $ 0 | $ 2,500 |
Effective Rate | 0.00% | 4.72% |
Fixed-Rate Notes, 2.45%, Due June 15, 2020 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.45% | |
Amount | $ 1,500 | $ 1,500 |
Effective Rate | 2.54% | 2.54% |
Fixed-Rate Notes, 2.20%, Due February 28, 2021 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.20% | |
Amount | $ 2,500 | $ 2,500 |
Effective Rate | 2.30% | 2.30% |
Fixed-Rate Notes, 2.90%, Due March 4, 2021 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.90% | |
Amount | $ 500 | $ 500 |
Effective Rate | 2.51% | 3.14% |
Fixed-Rate Notes, 1.85%, Due September 20, 2021 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 1.85% | |
Amount | $ 2,000 | $ 2,000 |
Effective Rate | 1.90% | 1.90% |
Fixed-Rate Notes, 3.00 %, Due June 15, 2022 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.00% | |
Amount | $ 500 | $ 500 |
Effective Rate | 2.71% | 3.36% |
Fixed-Rate Notes, 2.60%, Due February 28, 2023 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.60% | |
Amount | $ 500 | $ 500 |
Effective Rate | 2.68% | 2.68% |
Fixed-Rate Notes, 2.20%, Due September 20, 2023 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.20% | |
Amount | $ 750 | $ 750 |
Effective Rate | 2.27% | 2.27% |
Fixed-Rate Notes, 3.625%, Due March 4, 2024 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.625% | |
Amount | $ 1,000 | $ 1,000 |
Effective Rate | 2.63% | 3.25% |
Fixed-Rate Notes, 3.50%, Due June 15, 2025 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.50% | |
Amount | $ 500 | $ 500 |
Effective Rate | 2.88% | 3.52% |
Fixed-Rate Notes, 2.95%, Due February 28, 2026 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.95% | |
Amount | $ 750 | $ 750 |
Effective Rate | 3.01% | 3.01% |
Fixed-Rate Notes, 2.50%, Due September 20, 2026 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.50% | |
Amount | $ 1,500 | $ 1,500 |
Effective Rate | 2.55% | 2.55% |
Fixed-Rate Notes, 5.90%, Due February 15, 2039 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 5.90% | |
Amount | $ 2,000 | $ 2,000 |
Effective Rate | 6.11% | 6.11% |
Fixed-Rate Notes, 5.50%, Due January 15, 2040 | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 5.50% | |
Amount | $ 2,000 | $ 2,000 |
Effective Rate | 5.67% | 5.67% |
LIBOR | Floating Rate Notes 3-month LIBOR Plus 0.34% Due September 20, 2019 | ||
Debt Instrument [Line Items] | ||
Three-month LIBOR plus this percentage | 0.34% |
Borrowings - Schedule of Future
Borrowings - Schedule of Future Principal Payments for Long-Term Debt (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Debt Disclosure [Abstract] | ||
2020 (remaining six months) | $ 1,500 | |
2021 | 3,000 | |
2022 | 2,500 | |
2023 | 500 | |
2024 | 1,750 | |
Thereafter | 6,750 | |
Total | $ 16,000 | $ 20,500 |
Derivative Instruments - Deriva
Derivative Instruments - Derivatives Recorded at Fair Value (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Derivative [Line Items] | ||
DERIVATIVE ASSETS | $ 103 | $ 89 |
DERIVATIVE LIABILITIES | 15 | 15 |
Derivatives designated as hedging instruments: | ||
Derivative [Line Items] | ||
DERIVATIVE ASSETS | 97 | 80 |
DERIVATIVE LIABILITIES | 7 | 9 |
Derivatives designated as hedging instruments: | Foreign currency derivatives | Other current assets | ||
Derivative [Line Items] | ||
DERIVATIVE ASSETS | 8 | 5 |
Derivatives designated as hedging instruments: | Foreign currency derivatives | Other current liabilities | ||
Derivative [Line Items] | ||
DERIVATIVE LIABILITIES | 7 | 8 |
Derivatives designated as hedging instruments: | Interest rate derivatives | Other current assets | ||
Derivative [Line Items] | ||
DERIVATIVE ASSETS | 0 | 0 |
Derivatives designated as hedging instruments: | Interest rate derivatives | Other current liabilities | ||
Derivative [Line Items] | ||
DERIVATIVE LIABILITIES | 0 | 1 |
Derivatives designated as hedging instruments: | Interest rate derivatives | Other assets | ||
Derivative [Line Items] | ||
DERIVATIVE ASSETS | 89 | 75 |
Derivatives designated as hedging instruments: | Interest rate derivatives | Other long-term liabilities | ||
Derivative [Line Items] | ||
DERIVATIVE LIABILITIES | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Derivative [Line Items] | ||
DERIVATIVE ASSETS | 6 | 9 |
DERIVATIVE LIABILITIES | 8 | 6 |
Derivatives not designated as hedging instruments: | Foreign currency derivatives | Other current assets | ||
Derivative [Line Items] | ||
DERIVATIVE ASSETS | 6 | 9 |
Derivatives not designated as hedging instruments: | Foreign currency derivatives | Other current liabilities | ||
Derivative [Line Items] | ||
DERIVATIVE LIABILITIES | $ 8 | $ 6 |
Derivative Instruments - Cumula
Derivative Instruments - Cumulative Basis Adjustments For Fair Value Hedges (Details) - Derivatives designated as hedging instruments: - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Short-term debt | ||
Derivative [Line Items] | ||
CARRYING AMOUNT OF THE HEDGED ASSETS/(LIABILITIES) | $ 0 | $ (2,000) |
CUMULATIVE AMOUNT OF FAIR VALUE HEDGING ADJUSTMENT INCLUDED IN THE CARRYING AMOUNT OF THE HEDGED ASSETS/LIABILITIES | 0 | 0 |
Long-term debt | ||
Derivative [Line Items] | ||
CARRYING AMOUNT OF THE HEDGED ASSETS/(LIABILITIES) | (2,580) | (2,565) |
CUMULATIVE AMOUNT OF FAIR VALUE HEDGING ADJUSTMENT INCLUDED IN THE CARRYING AMOUNT OF THE HEDGED ASSETS/LIABILITIES | $ (87) | $ (73) |
Derivative Instruments - Additi
Derivative Instruments - Additional Information (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jan. 25, 2020 | Jul. 27, 2019 | |
Derivative [Line Items] | ||
Gross derivative amounts | $ 14 | $ 13 |
Cash collateral, assets | 86 | 76 |
Net derivative asset | $ 2 | |
Net derivative liability | $ 2 | |
Derivatives designated as cash flow hedging instruments: | ||
Derivative [Line Items] | ||
Foreign currency cash flow hedges maturity period, maximum, months | 24 months |
Derivative Instruments - Consol
Derivative Instruments - Consolidated Statements of Operations of Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Derivative [Line Items] | ||||
Revenue | $ 12,005 | $ 12,446 | $ 25,164 | $ 25,518 |
Cost of sales | 4,241 | 4,673 | 8,936 | 9,599 |
Operating expenses | 4,384 | 4,562 | 9,269 | 8,903 |
Interest and other income (loss), net | 154 | 132 | 261 | 236 |
Total gains (losses) | 1 | 3 | 2 | 3 |
Interest rate derivatives | ||||
Derivative [Line Items] | ||||
Hedged items | 7 | (61) | (14) | (52) |
Derivatives designated as hedging instruments | (6) | 64 | 16 | 55 |
Foreign currency derivatives | ||||
Derivative [Line Items] | ||||
Amount of gains (losses) reclassified from AOCI to income | 0 | 0 | ||
Amount of gains (losses) reclassified from AOCI to income | 0 | 0 | ||
Revenue | ||||
Derivative [Line Items] | ||||
Total gains (losses) | (2) | 2 | (5) | 3 |
Revenue | Interest rate derivatives | ||||
Derivative [Line Items] | ||||
Hedged items | 0 | 0 | 0 | 0 |
Derivatives designated as hedging instruments | 0 | 0 | 0 | 0 |
Revenue | Foreign currency derivatives | ||||
Derivative [Line Items] | ||||
Amount of gains (losses) reclassified from AOCI to income | (2) | (5) | ||
Amount of gains (losses) reclassified from AOCI to income | 2 | 3 | ||
Cost of sales | ||||
Derivative [Line Items] | ||||
Total gains (losses) | 0 | (1) | 1 | (1) |
Cost of sales | Interest rate derivatives | ||||
Derivative [Line Items] | ||||
Hedged items | 0 | 0 | 0 | 0 |
Derivatives designated as hedging instruments | 0 | 0 | 0 | 0 |
Cost of sales | Foreign currency derivatives | ||||
Derivative [Line Items] | ||||
Amount of gains (losses) reclassified from AOCI to income | 0 | 1 | ||
Amount of gains (losses) reclassified from AOCI to income | (1) | (1) | ||
Operating expenses | ||||
Derivative [Line Items] | ||||
Total gains (losses) | 0 | 0 | 2 | (1) |
Operating expenses | Interest rate derivatives | ||||
Derivative [Line Items] | ||||
Hedged items | 0 | 0 | 0 | 0 |
Derivatives designated as hedging instruments | 0 | 0 | 0 | 0 |
Operating expenses | Foreign currency derivatives | ||||
Derivative [Line Items] | ||||
Amount of gains (losses) reclassified from AOCI to income | $ 0 | $ 2 | ||
Amount of gains (losses) reclassified from AOCI to income | $ 0 | $ (1) |
Derivative Instruments - Effect
Derivative Instruments - Effect of Derivative Instruments Not Designated as Hedges on Consolidated Statement of Operations Summary (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | $ 1 | $ 3 | $ 2 | $ 3 |
Operating expenses | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | 0 | 0 | 2 | (1) |
Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | 0 | (1) | 1 | (1) |
Derivatives not designated as hedging instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | 42 | (15) | 37 | (71) |
Derivatives not designated as hedging instruments: | Foreign currency derivatives | Other income (loss), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | (2) | (1) | (9) | (28) |
Derivatives not designated as hedging instruments: | Total return swaps—deferred compensation | Other income (loss), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | (3) | (4) | (7) | (8) |
Derivatives not designated as hedging instruments: | Total return swaps—deferred compensation | Operating expenses | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | 40 | (9) | 44 | (33) |
Derivatives not designated as hedging instruments: | Total return swaps—deferred compensation | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | 4 | (1) | 4 | (3) |
Derivatives not designated as hedging instruments: | Equity derivatives | Other income (loss), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total gains (losses) | $ 3 | $ 0 | $ 5 | $ 1 |
Derivative Instruments - Schedu
Derivative Instruments - Schedule of Notional Amounts of Derivatives Outstanding (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Derivative [Line Items] | ||
Derivatives | $ 6,795 | $ 8,754 |
Derivatives designated as hedging instruments: | Foreign currency derivatives | ||
Derivative [Line Items] | ||
Derivatives | 595 | 663 |
Derivatives designated as hedging instruments: | Interest rate derivatives | ||
Derivative [Line Items] | ||
Derivatives | 2,500 | 4,500 |
Derivatives designated as hedging instruments: | Net investment hedging instruments | ||
Derivative [Line Items] | ||
Derivatives | 272 | 309 |
Derivatives not designated as hedging instruments: | Foreign currency derivatives | ||
Derivative [Line Items] | ||
Derivatives | 2,798 | 2,708 |
Derivatives not designated as hedging instruments: | Total return swaps—deferred compensation | ||
Derivative [Line Items] | ||
Derivatives | $ 630 | $ 574 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | Nov. 04, 2018defendant | Feb. 13, 2018patent | May 25, 2017USD ($) | Mar. 03, 2017USD ($)patent | May 12, 2016USD ($) | Sep. 04, 2013patent | Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) | Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) | Nov. 08, 2019USD ($) | Jul. 27, 2019USD ($) |
Contingency [Line Items] | ||||||||||||
Liability for purchase commitments | $ 126 | $ 126 | $ 129 | |||||||||
Future compensation expense & contingent consideration (up to) | 370 | 370 | ||||||||||
Commitments and contingencies | ||||||||||||
Volume of channel partner financing | 6,600 | $ 7,300 | 14,200 | $ 14,500 | ||||||||
Balance of the channel partner financing subject to guarantees | 1,300 | 1,300 | 1,400 | |||||||||
Financing provided by third parties for leases and loans on which the Company has provided guarantees | 1 | $ 6 | $ 6 | 9 | ||||||||
SRI International | Pending Litigation | ||||||||||||
Contingency [Line Items] | ||||||||||||
Damages awarded, value | $ 57 | $ 23.7 | ||||||||||
Number of allegedly infringed patents (patent) | patent | 2 | |||||||||||
Percentage of royalty awarded | 3.50% | |||||||||||
Payment | $ 28.1 | |||||||||||
Oyster Optics | Pending Litigation | ||||||||||||
Contingency [Line Items] | ||||||||||||
Number remaining defendants, other than Cisco | defendant | 1 | |||||||||||
Patent Infringement | Sprint Communications Company, L.P. vs. Time Warner Cable, Inc. | Pending Litigation | ||||||||||||
Contingency [Line Items] | ||||||||||||
Number of patents found infringed (patent) | patent | 5 | |||||||||||
Damages awarded, value | $ 139.8 | |||||||||||
Pre-judgment interest requested | $ 10 | |||||||||||
Patent Infringement | Centripetal | Pending Litigation | ||||||||||||
Contingency [Line Items] | ||||||||||||
Number of allegedly infringed patents (patent) | patent | 11 | |||||||||||
Number of allegedly infringed patents, petitioned (patent) | patent | 9 | |||||||||||
Number of allegedly infringed patents, unpatentable (patent) | patent | 3 | |||||||||||
Patent Infringement, IPR Proceedings | Centripetal | Pending Litigation | ||||||||||||
Contingency [Line Items] | ||||||||||||
Number of allegedly infringed patents (patent) | patent | 6 | |||||||||||
Patent Infringement, Patent Trial and Appeal Board | Centripetal | Pending Litigation | ||||||||||||
Contingency [Line Items] | ||||||||||||
Number of allegedly infringed patents (patent) | patent | 4 | |||||||||||
Patent Infringement, Not Subject to IPR Proceedings | Centripetal | Pending Litigation | ||||||||||||
Contingency [Line Items] | ||||||||||||
Number of allegedly infringed patents (patent) | patent | 5 | |||||||||||
Minimum | ||||||||||||
Contingency [Line Items] | ||||||||||||
Warranty period for products | 90 days | |||||||||||
Channel partners revolving short-term financing payment term | 60 days | |||||||||||
Maximum | ||||||||||||
Contingency [Line Items] | ||||||||||||
Warranty period for products | 5 years | |||||||||||
Channel partners revolving short-term financing payment term | 90 days | |||||||||||
End user lease and loan term | 3 years | |||||||||||
Investments in privately held companies (impaired) | ||||||||||||
Contingency [Line Items] | ||||||||||||
Commitments and contingencies | 291 | $ 291 | $ 326 | |||||||||
Inventories | ||||||||||||
Contingency [Line Items] | ||||||||||||
Purchase commitment | 4,500 | $ 5,000 | ||||||||||
Tax Year 2003 - 2007 | Brazilian tax authority | ||||||||||||
Contingency [Line Items] | ||||||||||||
Penalty and interest asserted by the Brazilian federal tax authorities | $ 800 | 800 | ||||||||||
Income tax examination, tax | 200 | |||||||||||
Income tax examination, interest | 900 | |||||||||||
Income tax examination, penalties | $ 500 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Other Commitments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Acquisition | ||||
Contingency [Line Items] | ||||
Compensation expense related to acquisitions | $ 50 | $ 66 | $ 111 | $ 175 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule of Product Warranty Liability (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jan. 25, 2020 | Jan. 26, 2019 | |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ||
Balance at beginning of period | $ 342 | $ 359 |
Provisions for warranties issued | 283 | 297 |
Adjustments for pre-existing warranties | (3) | (5) |
Settlements | (291) | (300) |
Acquisitions and divestitures | 0 | (2) |
Balance at end of period | $ 331 | $ 349 |
Commitments and Contingencies_4
Commitments and Contingencies - Schedule of Financing Guarantees Outstanding (Details) - USD ($) $ in Millions | Jan. 25, 2020 | Jul. 27, 2019 |
Loss Contingencies [Line Items] | ||
Maximum potential future payments relating to financing guarantees: | $ 271 | $ 218 |
Deferred revenue associated with financing guarantees: | (82) | (77) |
Maximum potential future payments relating to financing guarantees, net of associated deferred revenue | 189 | 141 |
Channel partner | ||
Loss Contingencies [Line Items] | ||
Maximum potential future payments relating to financing guarantees: | 258 | 197 |
Deferred revenue associated with financing guarantees: | (69) | (62) |
End user | ||
Loss Contingencies [Line Items] | ||
Maximum potential future payments relating to financing guarantees: | 13 | 21 |
Deferred revenue associated with financing guarantees: | $ (13) | $ (15) |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 12, 2020 | Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | Jul. 27, 2019 |
Class of Stock [Line Items] | ||||||
Cash dividends paid per common share (in dollars per share) | $ 0.35 | $ 0.33 | $ 0.70 | $ 0.66 | ||
Payments of dividends | $ 1,500 | $ 2,972 | $ 2,970 | |||
Cash dividends declared (in dollars per share) | $ 0.35 | $ 0.33 | $ 0.70 | $ 0.66 | ||
Remaining authorized repurchase amount | $ 11,800 | $ 11,800 | ||||
Subsequent event | ||||||
Class of Stock [Line Items] | ||||||
Cash dividends declared (in dollars per share) | $ 0.36 | |||||
Stock repurchase program | ||||||
Class of Stock [Line Items] | ||||||
Stock repurchases pending settlement | $ 30 | $ 30 | $ 40 |
Shareholders' Equity - Stock Re
Shareholders' Equity - Stock Repurchase Program (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |||||
Jan. 25, 2020 | Oct. 26, 2019 | Jul. 27, 2019 | Apr. 27, 2019 | Jan. 26, 2019 | Oct. 27, 2018 | |
Stockholders' Equity Note [Abstract] | ||||||
Shares (in shares) | 18 | 16 | 82 | 116 | 111 | 109 |
Weighted-Average Price per Share (in dollars per share) | $ 46.71 | $ 48.91 | $ 54.99 | $ 52.14 | $ 45.09 | $ 46.01 |
Amount | $ 870 | $ 768 | $ 4,515 | $ 6,020 | $ 5,016 | $ 5,026 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) $ in Billions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020USD ($)stock_incentive_planshares | Jan. 26, 2019shares | Jan. 25, 2020USD ($)periodstock_incentive_planshares | Jan. 26, 2019shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of stock incentive plans (stock incentive plan) | stock_incentive_plan | 1 | 1 | ||
Total compensation cost related to unvested share-based awards | $ | $ 3.9 | $ 3.9 | ||
Expected period of recognition of compensation cost | 2 years 9 months 18 days | |||
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares reserved for issuance (in shares) | 721,400,000 | 721,400,000 | ||
Consecutive offering period | 24 months | |||
Number of purchase periods | period | 4 | |||
Purchase period | 6 months | |||
ESPP discount percentage from market price, beginning of purchase period | 15.00% | |||
Shares issued under employee purchase plan, shares (in shares) | 9,000,000 | 9,000,000 | 9,000,000 | 9,000,000 |
Number of shares reserved for issuance (in shares) | 150,000,000 | 150,000,000 | ||
2005 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares reserved for issuance (in shares) | 694,000,000 | 694,000,000 | ||
2005 Plan | Stock awards subsequent to November 12, 2009 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares reserved for issuance (in shares) | 197,000,000 | 197,000,000 | ||
Reduction in shares available for issuance pursuant to November 12, 2009 amendment (in shares) | 1.5 | 1.5 |
Employee Benefit Plans - Summar
Employee Benefit Plans - Summary of Share-Based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 384 | $ 395 | $ 782 | $ 803 |
Income tax benefit for share-based compensation | 109 | 126 | 240 | 291 |
Share-based compensation expense in cost of sales | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 59 | 53 | 116 | 109 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 146 | 133 | 292 | 263 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 119 | 125 | 246 | 262 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 55 | 65 | 115 | 127 |
Restructuring and other charges | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 5 | 19 | 13 | 42 |
Share-based compensation expense in operating expenses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 325 | 342 | 666 | 694 |
Product | Share-based compensation expense in cost of sales | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 23 | 22 | 46 | 45 |
Service | Share-based compensation expense in cost of sales | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 36 | $ 31 | $ 70 | $ 64 |
Employee Benefit Plans - Summ_2
Employee Benefit Plans - Summary of Restricted Stock and Stock Unit Activity (Details) - Restricted Stock/Stock Units - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 6 Months Ended | 12 Months Ended |
Jan. 25, 2020 | Jul. 27, 2019 | |
Restricted Stock/ Stock Units | ||
Beginning balance (in shares) | 100 | 119 |
Granted (in shares) | 28 | 45 |
Vested (in shares) | (25) | (50) |
Canceled/forfeited/other (in shares) | (5) | (14) |
Ending balance (in shares) | 98 | 100 |
Weighted-Average Grant Date Fair Value per Share | ||
Beginning balance (in dollars per share) | $ 38.66 | $ 30.56 |
Granted (in dollars per share) | 42.09 | 47.71 |
Vested (in dollars per share) | 33.28 | 29.25 |
Canceled/forfeited/other (in dollars per share) | 39.29 | 32.01 |
Ending balance (in dollars per share) | $ 40.94 | $ 38.66 |
Aggregate Fair Value | $ 1,207 | $ 2,446 |
Comprehensive Income - AOCI Com
Comprehensive Income - AOCI Components (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Other comprehensive income (loss) | $ 115 | $ 108 | $ 92 | $ (93) |
Net Unrealized Gains (Losses) on Available-for-Sale Investments | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning balance | 0 | (310) | ||
Other comprehensive income (loss) before reclassifications | 168 | 86 | ||
(Gains) losses reclassified out of AOCI | (21) | 11 | ||
Tax benefit (expense) | (17) | 0 | ||
Other comprehensive income (loss) | 97 | |||
Effect of adoption of accounting standards | (168) | (168) | ||
Ending balance | 130 | (381) | 130 | (381) |
Net Unrealized Gains (Losses) Cash Flow Hedging Instruments | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning balance | (14) | |||
Other comprehensive income (loss) before reclassifications | 0 | |||
(Gains) losses reclassified out of AOCI | 2 | |||
Tax benefit (expense) | 1 | |||
Ending balance | (11) | (11) | ||
Net Unrealized Gains (Losses) Cash Flow Hedging Instruments | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning balance | (11) | |||
Other comprehensive income (loss) before reclassifications | (9) | |||
(Gains) losses reclassified out of AOCI | (1) | |||
Tax benefit (expense) | 2 | |||
Other comprehensive income (loss) | (8) | |||
Effect of adoption of accounting standards | 0 | 0 | ||
Ending balance | (19) | (19) | ||
Cumulative Translation Adjustment and Actuarial Gains (Losses) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning balance | (778) | (528) | ||
Other comprehensive income (loss) before reclassifications | (42) | (184) | ||
(Gains) losses reclassified out of AOCI | 2 | 3 | ||
Tax benefit (expense) | (1) | (1) | ||
Other comprehensive income (loss) | (182) | |||
Effect of adoption of accounting standards | 0 | 0 | ||
Ending balance | (819) | (710) | (819) | (710) |
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning balance | (815) | (1,218) | (792) | (849) |
Other comprehensive income (loss) before reclassifications | 126 | (107) | ||
(Gains) losses reclassified out of AOCI | (17) | 13 | ||
Tax benefit (expense) | (17) | 1 | ||
Other comprehensive income (loss) | 115 | 108 | 92 | (93) |
Effect of adoption of accounting standards | (168) | (168) | (168) | (168) |
Ending balance | $ (700) | $ (1,110) | $ (700) | $ (1,110) |
Comprehensive Income - Reclassi
Comprehensive Income - Reclassification Out of Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Other income (loss), net | $ 70 | $ 27 | $ 82 | $ 8 |
Revenue | 12,005 | 12,446 | 25,164 | 25,518 |
Cost of sales | (4,241) | (4,673) | (8,936) | (9,599) |
Operating expenses | (4,384) | (4,562) | (9,269) | (8,903) |
Net income (loss) | 2,878 | 2,822 | 5,804 | 6,371 |
Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Net income (loss) | 8 | (8) | 17 | (13) |
Reclassification out of Accumulated Other Comprehensive Income | Net unrealized gains and losses on available-for-sale investments | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Other income (loss), net | 11 | (5) | 21 | (11) |
Reclassification out of Accumulated Other Comprehensive Income | Net unrealized gains and losses on cash flow hedging instruments | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Revenue | (2) | (5) | ||
Cost of sales | 0 | 1 | ||
Operating expenses | 0 | 2 | ||
Net income (loss) | (2) | (2) | ||
Reclassification out of Accumulated Other Comprehensive Income | Net unrealized gains and losses on cash flow hedging instruments | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Revenue | 2 | 3 | ||
Cost of sales | (1) | (1) | ||
Operating expenses | 0 | (1) | ||
Net income (loss) | 1 | 1 | ||
Reclassification out of Accumulated Other Comprehensive Income | Cumulative translation adjustment and actuarial gains and losses | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Other income (loss), net | $ (1) | $ (4) | $ (2) | $ (3) |
Income Taxes - Income Before Pr
Income Taxes - Income Before Provision for Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Income before provision for income taxes | $ 3,534 | $ 3,343 | $ 7,220 | $ 7,252 |
Provision for income taxes | $ 656 | $ 521 | $ 1,416 | $ 881 |
Effective tax rate | 18.60% | 15.60% | 19.60% | 12.10% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | Oct. 26, 2019 | |
Income Tax Contingency [Line Items] | |||||
Benefit for provision for income taxes | $ (656) | $ (521) | $ (1,416) | $ (881) | |
Unrecognized tax benefits | 2,000 | 2,000 | |||
Unrecognized tax benefits that would impact effective tax rate | 1,700 | 1,700 | |||
Unrecognized tax benefits approximately reduced in next 12 months | $ 50 | $ 50 | |||
Internal Revenue Service (IRS) | |||||
Income Tax Contingency [Line Items] | |||||
Income tax examination, adjustment from settlement | $ 102 | ||||
Internal Revenue Service (IRS) | Interest expense | |||||
Income Tax Contingency [Line Items] | |||||
Income tax examination, adjustment from settlement | $ 4 | ||||
Accounting Standards Update 2014-09 | |||||
Income Tax Contingency [Line Items] | |||||
Benefit for provision for income taxes | $ 152 |
Segment Information and Major_3
Segment Information and Major Customers - Additional Information (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) | Jan. 25, 2020USD ($)segment | Jan. 26, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of geographic segments | segment | 3 | |||
Revenue | $ 12,005 | $ 12,446 | $ 25,164 | $ 25,518 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 6,200 | $ 6,400 | $ 13,300 |
Segment Information and Major_4
Segment Information and Major Customers - Summary of Reportable Segments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Segment Reporting Information [Line Items] | ||||
Revenue, total | $ 12,005 | $ 12,446 | $ 25,164 | $ 25,518 |
Gross margin | 7,764 | 7,773 | 16,228 | 15,919 |
Americas | ||||
Segment Reporting Information [Line Items] | ||||
Revenue, total | 7,013 | 7,352 | 14,990 | 15,103 |
EMEA | ||||
Segment Reporting Information [Line Items] | ||||
Revenue, total | 3,134 | 3,223 | 6,417 | 6,447 |
APJC | ||||
Segment Reporting Information [Line Items] | ||||
Revenue, total | 1,859 | 1,872 | 3,758 | 3,968 |
Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Gross margin | 7,974 | 7,975 | 16,650 | 16,316 |
Operating segments | Americas | ||||
Segment Reporting Information [Line Items] | ||||
Gross margin | 4,692 | 4,796 | 10,008 | 9,866 |
Operating segments | EMEA | ||||
Segment Reporting Information [Line Items] | ||||
Gross margin | 2,062 | 2,070 | 4,229 | 4,141 |
Operating segments | APJC | ||||
Segment Reporting Information [Line Items] | ||||
Gross margin | 1,219 | 1,109 | 2,413 | 2,309 |
Unallocated corporate items | ||||
Segment Reporting Information [Line Items] | ||||
Gross margin | $ (210) | $ (202) | $ (422) | $ (397) |
Segment Information and Major_5
Segment Information and Major Customers - Summary of Net Revenue for Groups of Similar Products and Services (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | $ 12,005 | $ 12,446 | $ 25,164 | $ 25,518 |
Discontinued operations, held-for-sale | Service Provider Video | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | 168 | |||
Total Product | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | 8,671 | 9,273 | 18,549 | 19,163 |
Infrastructure Platforms | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | 6,528 | 7,102 | 14,067 | 14,724 |
Applications | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | 1,349 | 1,465 | 2,847 | 2,884 |
Security | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | 748 | 684 | 1,563 | 1,354 |
Other Products | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | 46 | 22 | 72 | 200 |
Other Products | Discontinued operations, held-for-sale | Service Provider Video | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | 168 | |||
Service | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenue, total | $ 3,334 | $ 3,173 | $ 6,615 | $ 6,355 |
Net Income per Share - Calculat
Net Income per Share - Calculation of Basic and Diluted Net Income per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 2,878 | $ 2,822 | $ 5,804 | $ 6,371 |
Weighted-average shares—basic (in shares) | 4,242 | 4,470 | 4,244 | 4,517 |
Effect of dilutive potential common shares (in shares) | 18 | 35 | 21 | 40 |
Weighted-average shares—diluted (in shares) | 4,260 | 4,505 | 4,265 | 4,557 |
Net income per share—basic (in dollars per share) | $ 0.68 | $ 0.63 | $ 1.37 | $ 1.41 |
Net income per share—diluted (in dollars per share) | $ 0.68 | $ 0.63 | $ 1.36 | $ 1.40 |
Antidilutive employee share-based awards, excluded (in shares) | 29 | 27 | 32 | 28 |