Cisco Systems Inc (CSCO)
Return on total capital
| Jul 31, 2025 | Jul 31, 2024 | Jul 27, 2024 | Jul 31, 2023 | Jul 29, 2023 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 13,048,000 | 13,240,000 | 12,181,000 | 15,745,000 | 15,745,000 |
| Long-term debt | US$ in thousands | — | — | 19,621,000 | — | 6,658,000 |
| Total stockholders’ equity | US$ in thousands | 47,116,000 | 45,457,000 | 45,457,000 | 44,353,000 | 44,353,000 |
| Return on total capital | 27.69% | 29.13% | 18.72% | 35.50% | 30.87% |
July 31, 2025 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $13,048,000K ÷ ($—K + $47,116,000K)
= 27.69%
The return on total capital (ROTC) for Cisco Systems Inc. exhibits notable fluctuations over the specified periods, reflecting changes in the company's efficiency in generating earnings from its capital base.
As of July 29, 2023, the ROTC was recorded at 30.87%, indicating a relatively strong capitalization efficiency at that point. However, shortly thereafter, by July 31, 2023, the ROTC increased significantly to 35.50%, suggesting an improvement in the company's ability to utilize its total capital effectively during this period.
Contrasting these figures, the subsequent data for July 27, 2024, shows a substantial decline to 18.72%, which may signal a reduction in profitability or increased capital costs, or possibly a change in the company's operational efficiency. Interestingly, this downward trend appears to stabilize somewhat, as the figure on July 31, 2024, rebounds to 29.13%, indicating a partial recovery in ROTC and suggesting improvements in earnings generation or financial management.
Looking further ahead to July 31, 2025, the ROTC is documented at 27.69%, signifying a slight decrease compared to the previous period but maintaining a level well above the lowest point observed earlier in July 2024. This indicates that while there may have been some erosion in capital efficiency, Cisco Systems Inc. continues to operate with a relatively healthy return on its total capital.
Overall, the data demonstrates variability in Cisco’s ROTC over the analyzed periods, with periods of both growth and decline. The fluctuations could be attributable to operational adjustments, changes in market conditions, or shifts in strategic focus. The company's ability to regain and sustain a relatively high ROTC after periods of decline suggests resilience and the potential for ongoing efficiency in capital utilization.
Peer comparison
Jul 31, 2025