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CSCO · Forward model · Collaboration · Bull case

What has to happen in Collaboration

Model as of

This page changes Collaboration inside the complete CSCO model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

CSCO forward model
Horizon
Consolidated fair value $127.01 all other verticals held in this portfolio case
Final-quarter revenue $1.50B 6% of company revenue
Explicit segment contribution $6.11B EBITDA less segment capex, before corporate items

The order book is the leading indicator and it keeps leading. AI infrastructure revenue runs past the guided $7.5bn, Services finally converts its +6% RPO into revenue growth, and Security compounds on Splunk, holding 6x exit sales. What this case does NOT reach is Arista's 23x sales: even a very good Cisco is a $70-100bn revenue business earning a low-30s operating margin, and it keeps a large-cap multiple.

Collaboration

Basis quarter$1.17B
Final quarter$1.50B
Implied CAGR+5%
Final revenue mix6%

Webex meetings, calling, contact centre and collaboration devices. $1,167M in the basis quarter, +12% year over year, $4,300M and +4% for FY2026. A mature category that stopped shrinking against Teams and Zoom. No seats and no ARPU are published, so growth on the reported line is the only defensible driver.

Last four quarters
2026 Q1 $1.05B Reported
2026 Q2 $1.05B Reported
2026 Q3 $1.02B Reported
2026 Q4 $1.17B Reported
Webex meetings, calling and contact centreCollaboration devices and endpoints
Sequential growth +0.5%/qtr decaying toward +0.5% 0.5% a quarter, roughly the 2% a year this line has actually delivered across three fiscal years.
Collaboration

Latest: $1.50B (2031Q4E)

Period Value
2024Q1 $1.12B
2024Q2 $989M
2024Q3 $987M
2024Q4 $1.02B
2025Q1 $1.08B
2025Q2 $996M
2025Q3 $1.03B
2025Q4 $1.04B
2026Q1 $1.05B
2026Q2 $1.05B
2026Q3 $1.02B
2026Q4 $1.17B
2027Q1E $1.18B
2027Q2E $1.20B
2027Q3E $1.21B
2027Q4E $1.23B
2028Q1E $1.24B
2028Q2E $1.26B
2028Q3E $1.27B
2028Q4E $1.29B
2029Q1E $1.31B
2029Q2E $1.32B
2029Q3E $1.34B
2029Q4E $1.36B
2030Q1E $1.37B
2030Q2E $1.39B
2030Q3E $1.41B
2030Q4E $1.42B
2031Q1E $1.44B
2031Q2E $1.46B
2031Q3E $1.48B
2031Q4E $1.50B

Assumptions & reasoning

  • Quarterly revenue has sat between $987M and $1,167M for twelve straight quarters, so a flat sequential path is the honest projection; the Q4 +12% is read as a device quarter rather than as a new trend.
  • Margin 30% is assumed, fading to 28%, on a mature software-and-device mix whose price is capped by competitors that bundle the same functionality into a suite. Cisco discloses no profitability for this category.
  • Every vertical margin here is assumed. Cisco discloses gross margin by geography (Americas 64.5%, EMEA 70.1%, APJC 67.3% in the basis quarter) and product-versus-services gross margin, and never operating profit, capex or headcount by product category.
  • The two July quarters are derived, not printed: FY2024 Q4 and FY2025 Q4 are the fiscal-year column of the 10-K less the nine-month column of that year's Q3 10-Q, and both reconcile to the quarterly totals Cisco printed later, so they carry estimated: true.
  • Capex intensity is the consolidated rate applied to every line: FY2026 property and equipment $1,410M on $63,325M of revenue is 2.2%, and Cisco publishes no capex by product category to split it with.
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