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CSCO · Forward model · Collaboration · Supercycle 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 $124.95 all other verticals held in this portfolio case
Final-quarter revenue $1.29B 5% of company revenue
Explicit segment contribution $5.37B EBITDA less segment capex, before corporate items

Chuck Robbins' claim taken at face value: agentic AI drives a multi-year refresh Cisco is 'very early in', so networking holds a low-teens annual growth rate across the whole horizon instead of fading after FY2027. This case invents no AI vertical and no capacity metric — it is the same five disclosed lines with Networking's terminal rate raised from 1.25% to 3.25% a quarter. What it does NOT do is fix the margin: gross margin stays at the guided 65-66% because the mix never normalises, so the extra revenue arrives at today's hardware economics, and it still does not reach the multiple Arista carries.

Collaboration

Basis quarter$1.17B
Final quarter$1.29B
Implied CAGR+2%
Final revenue mix5%

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: $1.29B (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 $1.17B
2027Q2E $1.18B
2027Q3E $1.18B
2027Q4E $1.19B
2028Q1E $1.20B
2028Q2E $1.20B
2028Q3E $1.21B
2028Q4E $1.21B
2029Q1E $1.22B
2029Q2E $1.23B
2029Q3E $1.23B
2029Q4E $1.24B
2030Q1E $1.25B
2030Q2E $1.25B
2030Q3E $1.26B
2030Q4E $1.26B
2031Q1E $1.27B
2031Q2E $1.28B
2031Q3E $1.28B
2031Q4E $1.29B

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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