
From Gods To Code: A Brief History Of Human Meaning
Fantasy Moon over ocean and mountain ridge, Far-side of the moon,Darkside of the Moon
Human beings are wired to seek meaning — a subjective sense that life is coherent, purposeful, and significant (even though, in objective terms, it is none of that). From early cognitive psychologists like Jerome Bruner, who argued that we create meaning through narrative, to modern neuroscientists studying the brain's default mode network, the consensus is clear: Meaning isn't a luxury, but a psychological necessity. Indeed, meaning helps us tolerate uncertainty, make sense of chaos, and stay motivated through suffering. It also helps us make sense of ourselves and develop a sense of identity.
Viktor Frankl compellingly illustrated that people can endure almost anything if they believe it has meaning. Referencing his own experiences in a Nazi concentration camp he noted 'Those who have a 'why' to live, can bear with almost any 'how'. Neurologically, meaning activates areas tied to reward, self-reflection, and emotion, integrating experiences into coherent stories. It's not given to us — we construct it, and often defend it, especially during crises. Cognitive and emotional systems work together to build and sustain these frameworks — through memory, identity, and perceived agency.
Empirical studies show people find meaning most often in relationships, purposeful work, personal growth, and even suffering — particularly when it's reframed. While past societies imported meaning from religion, tradition, or social roles, modern individuals must manufacture their own. This makes meaning deeply personal, but also vulnerable to fragmentation and disillusionment.
In the age of AI, where work, creativity, and cognition can be outsourced, we risk losing traditional sources of meaning without obvious replacements. With its impressive repertoire of synthetic knowledge, creativity, and intelligence, AI is forcing us to rethink what truly makes us human (in the sense of our unique capabilities and skills), and what it means to be human in an age in which we outsource even our thinking to machines. If machines can perform the tasks that once made us feel useful, valuable, and unique, what's left for us to build a life around? Furthermore, what does it mean to be human if we can be without thinking?
In every era, humans have asked some version of the same question: Why am I here, and what is this all for? It's the same existential riddle posed by philosophers and pop culture alike — from Nietzsche to Tony Montana, who, after climbing the capitalist mountain in Scarface, asks what's left beyond the pile of cocaine and paranoia. Or Citizen Kane's dying whisper of 'Rosebud,' a child's sled standing in for a lost, possibly meaningless life.
While the human quest of meaning is perennial, the answers have changed as dramatically as our technology, politics, and hairstyles — from gods and rituals to careers and personal brands. As AI begins to take over not just our labor, but our thinking, our creativity, and our productivity, we're left asking whether meaning itself can be outsourced, and found just one click or prompt away.
To understand the scale of this moment, it helps to zoom out — way out — and trace the evolution of meaning across time. Below is a brief intellectual history of what humans have lived for, and how those sources of purpose have shifted with each transformation in how we live and work.
1. Mythic & Tribal Meaning (Prehistory – 600 BCE)
Slogan: We are one with the gods.
In humanity's earliest chapters, meaning was not something you found — it was something you were born into. Life was interpreted through the lens of nature, spirits, and ancestors. The world was enchanted, alive with gods, totems, and unseen forces. Purpose was communal and ritualistic. You belonged to a tribe, you played your part, and the question of individual meaning rarely emerged. The collective mattered more than the self. You knew who you were by knowing where you belonged. Think of it as the original operating system for meaning — closed-source, pre-installed, and immune to customization. Opting out wasn't a philosophical stance; it was a death sentence or, worse, exile. Today, we call it "community." Back then, it was life.
2. Religious & Divine Order (600 BCE – 1500 CE)
Slogan: My purpose is God's plan.
With the rise of the Axial Age came organized religions that framed human life as a moral journey, guided by divine command. Judaism, Christianity, Islam, and Hinduism all offered grand narratives in which human beings had cosmic significance. Meaning was found in obedience, sacrifice, and spiritual striving. The purpose of life wasn't invented by the individual — it was discovered in scripture. To live meaningfully was to live rightly, according to sacred law. Fulfillment came in service to a higher power. This was the theological equivalent of a franchise model: the rules came from headquarters, your job was to follow the manual, and if things went wrong, it was your fault for not having enough faith — not a flaw in the system. Think less personal startup, more divine bureaucracy: your life had a mission, but the job description was carved in stone.
3. Rationalism & Humanism (1500 – 1800)
Slogan: I think, therefore I am.The Enlightenment changed everything. Reason replaced revelation, and individuals became the new arbiters of truth. Thinkers like Descartes, Locke, and Kant argued that humans could construct meaning through intellect, ethics, and personal autonomy. The Renaissance celebrated the dignity of man; science opened new frontiers. Meaning began to shift from divine will to human capability. Life became a quest not to obey, but to understand — and to act morally out of reason, not just faith. Meaning was no longer handed down from the heavens; it was drafted, debated, and footnoted by men in powdered wigs. Humanity became its own mythmaker — the sole author, editor, and sometimes unreliable narrator of significance. It was as if the universe outsourced meaning to us, trusting we'd be rational (or at least confident) enough not to mess it up.
4. Scientific & Industrial Progress (1800 – 1945)
Slogan: To work is to live.
As revolutions roared and factories rose, human worth became increasingly tied to productivity. The industrial age recast people as workers — gears in the great machine of economic progress. Purpose was found in contribution: building, inventing, conquering, producing. Even philosophies of meaning (Marxism, nationalism, utilitarianism) took on a mechanistic bent. Labor was no longer just a necessity; it became an identity. Your job wasn't just what you did — it was who you were. It was the age when the soul clocked in. Humans became their CVs, and meaning punched a timecard. Fulfillment was measured not in prayers or principles, but in output per hour — a kind of existential capitalism where your worth was your work ethic, and vacation was moral suspicion. In a way, this was the analogue version of the digital revolution or data-driven capitalism.
Meaning through the ages
5. Existentialism & Absurdism (1945 – 1980s)
Slogan: Life is meaningless — now make it count.
The aftermath of two world wars shattered many of the old certainties. God seemed silent, progress suspect. Philosophers like Camus and Sartre embraced the absurd: life has no inherent meaning, so we must create our own. This was the era of freedom and anxiety, where responsibility became the burden of the individual. Meaning was no longer handed down from on high — it was something you assembled from scratch. You were condemned to be free, and what you made of your life was entirely on you. It was as if the universe had ghosted you — no guidance, no purpose, just infinite autonomy and a vague sense that whatever you did next better be meaningful... or at least look good in a memoir.
6. Consumer Identity (1980s – 2000s)
Slogan: I shop, therefore I am.
As neoliberalism took hold, the market moved into the space once occupied by the sacred and the social. Identity became a product, and meaning was increasingly expressed through what you bought, wore, posted, and owned. Careers replaced work. Brands filled in for belief systems. You didn't just work a job — you crafted a meaningful lifestyle and aspired to becoming a brand. The rise of advertising, credit, and Facebook made meaning feel personal but hollow. Influencers emerged as human brands and sources of meaning. Consumption became performance, and success was measured in likes, logos, and LinkedIn endorsements. Our digital selves begun to subsume our real selves.
7. Wellbeing & Inner Growth (2000s – 2020s)
Slogan: Find your truth.
As burnout and disillusionment with materialism set in, a new quest began: inward. Meaning shifted from status to self-awareness, from hustle to healing. Mindfulness apps replaced religious rituals. Therapy-speak became a second language. Self-actualization became the new salvation. You were expected not only to work and consume, but to grow, evolve, and become your "authentic self." This era promised meaning through alignment — between who you are, what you do, and how you feel. This era of existential freedom—where meaning must be handcrafted from the raw materials of one's own psyche—was not without cost. As the contemporary philosopher Byung-Chul Han observes, we have transitioned from a society of repression to one of depression. No longer oppressed by external authority, we are instead crushed by the weight of limitless possibility. 'If you can be anything,' Han warns, 'then you must be everything'— a pressure that turns potential into paralysis. In the absence of fixed roles or inherited purpose, freedom becomes a tyrannical demand for self-creation. The individual is now CEO, brand, therapist, and motivational speaker all in one — like a one-person startup permanently pitching to an invisible investor called 'self-worth,' with exhaustion as the only guaranteed return on investment.
8. AI & Automation (2020s – → )
Slogan: I prompt, therefore I am.
And now, we arrive at the present moment — a time in which AI, which had been in the making since the 1960s, finally woke up, going mainstream and beginning to absorb not just our labor, but our cognitive and creative functions. AI can now write, draw, analyze, strategize, and even empathize (or at least simulate it well enough to fool us). The very domains where humans once found purpose — problem-solving, innovation, self-expression — are increasingly shared with, or surrendered to, machines.
We are no longer just workers or thinkers; we are prompters — directing generative systems that do the work for us. Meaning becomes mediated through interface. If AI can perform our jobs, generate our ideas, write our stories, even express our feelings — where does that leave us? Are we curators of meaning, or passive consumers of it? Can we still find fulfillment in being the prompt engineers of our own existence? Expertise is no longer about knowing the answer to many questions, but asking the right questions; and creativity, well, it is the human leftover to what AI can't do (or doesn't want to). The optimistic account is that our lives will be more fulfilling because all the boring and predictable tasks can be outsourced to AI; the pessimistic account sees us as the digital version of assembly line workers, training large language models on how to automate us, in the huge virtual factory called AI.
'Ctrl + Alt + Purpose: Rebooting Meaning in the Age of AI'
Throughout history, every era has rewritten the script of human meaning — from divine decree to industrial purpose, from moral codes to personal brands. We once searched the skies, then the self; now, we consult the algorithm. Each answer reflected the technologies, fears, and fantasies of its time.
But today, meaning has become strangely urgent. When machines can paint, write, and diagnose — even simulate empathy — what's left for us to be? If productivity no longer depends on us, why should purpose?
Maybe this is the moment meaning finally stops being about output. Maybe our value isn't in what we produce, but in what we notice, nurture, or choose to care about — in the deliberate, non-automatable act of consciousness. Or maybe we'll just scroll past it, distracted by another synthetic dopamine hit.
Either way, in a world where everything can be faked — intelligence, emotion, even purpose — the real danger isn't that AI will outthink us. It's that we'll forget the value of meaning altogether.
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For more information, please visit us at Contact: Paul SilversteinSenior VP, Investor 2 Coherent Corp. and Subsidiaries Condensed Consolidated Statements of Earnings (Loss)* THREE MONTHS ENDED June 30, March 31, June 30, $ Millions, except per share amounts (unaudited) 2025 2025 2024 Revenues $ 1,529.4 $ 1,497.9 $ 1,314.4 Costs, Expenses & Other Expense (Income) Cost of goods sold 983.3 970.2 882.4 Research and development 155.7 150.7 126.7 Selling, general and administrative 245.4 231.4 228.0 Restructuring charges 53.9 73.8 14.1 Impairment of assets held-for-sale 85.0 — — Interest expense 55.0 57.3 67.8 Other expense (income), net 14.4 4.6 (14.5 ) Total Costs, Expenses, & Other Expense 1,592.9 1,488.0 1,304.5 Earnings (Loss) Before Income Taxes (63.4 ) 9.9 9.9 Income Taxes 34.7 8.1 56.9 Net Earnings (Loss) (98.1 ) 1.8 (47.0 ) Net Earnings (Loss) Attributable to Noncontrolling Interests (2.5 ) (13.9 ) 1.4 Net Earnings (Loss) Attributable to Coherent Corp. $ (95.6 ) $ 15.7 $ (48.4 ) Less: Dividends on Preferred Stock 33.1 32.7 31.4 Net Loss Available to the Common Shareholders $ (128.8 ) $ (17.0 ) $ (79.9 ) Basic Loss Per Share $ (0.83 ) $ (0.11 ) $ (0.52 ) Diluted Loss Per Share $ (0.83 ) $ (0.11 ) $ (0.52 ) Average Shares Outstanding – Basic 155.5 155.2 152.6 Average Shares Outstanding – Diluted 155.5 155.2 152.6 *Amounts may not recalculate due to rounding. Table 2 Coherent Corp. and Subsidiaries Condensed Consolidated Statements of Earnings (Loss)* (Continued) YEAR ENDED June 30, June 30, $ Millions, except per share amounts (unaudited) 2025 2024 Revenues $ 5,810.1 $ 4,707.7 Costs, Expenses & Other Expense (Income) Cost of goods sold 3,766.8 3,251.7 Research and development 581.9 478.8 Selling, general and administrative 926.5 854.0 Restructuring charges 160.1 27.1 Impairment of assets held-for-sale 85.0 — Interest expense 243.3 288.5 Other expense (income), net (47.6 ) (44.7 ) Total Costs, Expenses, & Other Expense 5,715.9 4,855.3 Earnings (Loss) Before Income Taxes 94.2 (147.6 ) Income Taxes 64.1 11.1 Net Earnings (Loss) 30.1 (158.8 ) Net Loss Attributable to Noncontrolling Interests (19.3 ) (2.6 ) Net Earnings (Loss) Attributable to Coherent Corp. $ 49.4 $ (156.2 ) Less: Dividends on Preferred Stock 129.9 123.4 Net Loss Available to the Common Shareholders $ (80.6 ) $ (279.5 ) Basic Loss Per Share $ (0.52 ) $ (1.84 ) Diluted Loss Per Share $ (0.52 ) $ (1.84 ) Average Shares Outstanding - Basic 154.8 151.6 Average Shares Outstanding - Diluted 154.8 151.6 *Amounts may not recalculate due to rounding. Table 3 Coherent Corp. and Subsidiaries Condensed Consolidated Balance Sheets* June 30, June 30, $ Millions (unaudited) 2025 2024 Assets Current Assets Cash and cash equivalents $ 909.2 $ 926.0 Restricted cash, current 8.9 174.0 Accounts receivable 964.1 848.5 Inventories 1,437.6 1,286.4 Prepaid and refundable income taxes 55.8 26.9 Prepaid and other current assets 551.6 398.2 Total Current Assets 3,927.2 3,660.1 Property, plant & equipment, net 1,877.5 1,817.3 Goodwill 4,471.1 4,464.3 Other intangible assets, net 3,204.7 3,503.2 Deferred income taxes 53.4 41.0 Restricted cash, non-current 714.8 689.6 Other assets 662.2 313.1 Total Assets $ 14,910.9 $ 14,488.6 Liabilities, Mezzanine Equity and Equity Current Liabilities Current portion of long-term debt $ 188.3 $ 73.8 Accounts payable 847.0 631.5 Operating lease current liabilities 41.6 40.6 Accruals and other current liabilities 718.0 597.9 Total Current Liabilities 1,794.8 1,343.8 Long-term debt 3,498.6 4,026.4 Deferred income taxes 711.7 784.4 Operating lease liabilities 165.2 162.4 Other liabilities 259.3 225.4 Total Liabilities 6,429.7 6,542.4 Total Mezzanine Equity 2,483.3 2,364.8 Total Coherent Corp. Shareholders' Equity 5,644.5 5,210.1 Noncontrolling interests 353.5 371.4 Total Equity 5,998.0 5,581.5 Total Liabilities, Mezzanine Equity and Equity $ 14,910.9 $ 14,488.6 *Amounts may not recalculate due to rounding. Table 4 Coherent Corp. and Subsidiaries Condensed Consolidated Statements of Cash Flows* YEAR ENDED June 30, June 30, $ Millions (unaudited) 2025 2024 Cash Flows from Operating Activities Net cash provided by operating activities $ 633.6 $ 545.7 Cash Flows from Investing Activities Additions to property, plant & equipment (440.8 ) (346.8 ) Proceeds from sale of business 27.0 — Other investing activities (0.4 ) (3.9 ) Net cash used in investing activities (414.2 ) (350.7 ) Cash Flows from Financing Activities Contributions from noncontrolling interest holders — 1,000.0 Proceeds from borrowings of revolving credit facilities 53.7 19.0 Payments on existing debt (437.0 ) (228.8 ) Payments on borrowings under revolving credit facilities (51.7 ) (19.0 ) Equity issuance costs — (31.8 ) Proceeds from exercises of stock options and purchases under employee stock purchase plan 49.6 42.3 Payments in satisfaction of employees' minimum tax obligations (54.0 ) (22.3 ) Payment of dividends (11.4 ) — Other financing activities (0.9 ) (1.1 ) Net cash provided by (used in) financing activities (451.7 ) 758.3 Effect of exchange rate changes on cash and cash equivalents 75.6 (1.2 ) Net increase (decrease) in cash and cash equivalents (156.8 ) 952.1 Cash, Cash Equivalents, and Restricted Cash at Beginning of Period 1,789.7 837.6 Cash, Cash Equivalents, and Restricted Cash at End of Period $ 1,632.9 $ 1,789.7 *Amounts may not recalculate due to rounding. Table 5 Segment Revenues* THREE MONTHS ENDED YEAR ENDED $ Millions (unaudited) June 30, March 31, June 30, June 30, June 30, 2025 2025 2024 2025 2024 Revenues: Networking $ 945.2 $ 897.3 $ 679.8 $ 3,421.3 $ 2,295.7 Materials 236.2 236.7 279.3 953.8 1,016.6 Lasers 348.0 363.9 355.3 1,435.0 1,395.4 Consolidated $ 1,529.4 $ 1,497.9 $ 1,314.4 $ 5,810.1 $ 4,707.7 *Amounts may not recalculate due to rounding. Table 6 Reconciliation of GAAP Measures to Non-GAAP Measures* THREE MONTHS ENDED YEAR ENDED June 30, March 31, June 30, June 30, June 30, $ Millions, except per share amounts (unaudited) 2025 2025 2024(1) 2025(1) 2024(1) Gross margin on GAAP basis $ 546.1 $ 527.7 $ 432.0 $ 2,043.3 $ 1,456.0 Share-based compensation 5.8 5.4 5.0 22.5 22.9 Amortization of acquired intangibles(2) 30.6 43.7 30.4 135.1 122.0 Integration, site consolidation and other(3) (0.4 ) — 4.0 1.3 14.8 Gross margin on non-GAAP basis $ 582.2 $ 576.7 $ 471.4 $ 2,202.3 $ 1,615.7 Research and development on GAAP basis $ 155.7 $ 150.7 $ 126.7 $ 581.9 $ 478.8 Share-based compensation (5.9 ) (5.3 ) (5.2 ) (22.2 ) (23.1 ) Amortization of acquired intangibles(2) (0.2 ) (3.8 ) (0.6 ) (5.3 ) (2.6 ) Integration, site consolidation and other(3) 0.1 (0.4 ) (0.7 ) (0.2 ) (1.7 ) Research and development on non-GAAP basis $ 149.7 $ 141.2 $ 120.2 $ 554.3 $ 451.4 Selling, general and administrative on GAAP basis $ 245.4 $ 231.4 $ 228.0 $ 926.5 $ 854.0 Share-based compensation (32.6 ) (29.5 ) (18.5 ) (116.3 ) (80.9 ) Amortization of acquired intangibles(2) (41.2 ) (39.6 ) (40.7 ) (162.4 ) (163.6 ) Integration, site consolidation and other(3) (14.4 ) (6.0 ) (20.2 ) (36.7 ) (63.3 ) Selling, general and administrative on non-GAAP basis $ 157.3 $ 156.3 $ 148.6 $ 611.0 $ 546.3 Restructuring charges on GAAP basis $ 53.9 $ 73.8 $ 14.1 $ 160.1 $ 27.1 Restructuring charges(4) (53.9 ) (73.8 ) (14.1 ) (160.1 ) (27.1 ) Restructuring charges on non-GAAP basis $ — $ — $ — $ — $ — Impairment of assets held-for-sale on GAAP basis $ 85.0 $ — $ — $ 85.0 $ — Impairment of assets held-for-sale(5) (85.0 ) — — (85.0 ) — Impairment of assets held-for-sale on non-GAAP basis $ — $ — $ — $ — $ — Operating income on GAAP basis $ 6.1 $ 71.8 $ 63.2 $ 289.9 $ 96.1 Share-based compensation 44.3 40.2 28.7 161.0 126.9 Amortization of acquired intangibles(2) 72.0 87.2 71.7 302.8 288.2 Restructuring charges(4) 53.9 73.8 14.1 160.1 27.1 Impairment of assets held-for-sale(5) 85.0 — — 85.0 — Integration, site consolidation and other(3) 13.8 6.4 24.9 38.2 79.8 Operating income on non-GAAP basis $ 275.1 $ 279.3 $ 202.7 $ 1,036.9 $ 618.0 Table 6 Reconciliation of GAAP Measures to Non-GAAP Measures* (Continued) THREE MONTHS ENDED YEAR ENDED June 30, March 31, June 30, June 30, June 30, $ Millions, except per share amounts (unaudited) 2025 2025 2024(1) 2025(1) 2024(1) Interest and other (income) expense, net on GAAP basis $ 69.5 $ 61.9 $ 53.3 $ 195.7 $ 243.8 Foreign currency exchange losses, net (37.0 ) (16.7 ) (0.9 ) (28.4 ) (9.5 ) Transaction fees and financing(6) — — (2.0 ) — (2.0 ) Interest and other (income) expense, net on non-GAAP basis $ 32.5 $ 45.1 $ 50.4 $ 167.3 $ 232.3 Income taxes on GAAP basis $ 34.7 $ 8.1 $ 56.9 $ 64.1 $ 11.1 Tax impact of non-GAAP measures 18.8 47.6 29.1 114.0 112.6 Tax windfall from share-based compensation(7) 1.3 4.2 — 20.5 — Tax impact of valuation allowance for deferred tax assets(8) (2.0 ) (1.4 ) (46.0 ) (14.6 ) (46.0 ) Income taxes on non-GAAP basis $ 52.8 $ 58.5 $ 40.0 $ 184.0 $ 77.7 Net earnings (loss) attributable to Coherent Corp. on GAAP basis $ (95.6 ) $ 15.7 $ (48.4 ) $ 49.4 $ (156.2 ) Share-based compensation 44.3 40.2 28.7 161.0 126.9 Amortization of acquired intangibles(2) 72.0 87.2 71.7 302.8 288.2 Foreign currency exchange losses 37.0 16.7 0.9 28.4 9.5 Restructuring charges(4) 53.9 73.8 14.1 160.1 27.1 Impairment of assets held-for-sale(5) 85.0 — — 85.0 — Integration, site consolidation and other(3) 13.8 6.4 24.9 38.2 79.8 Non-controlling interest impact of non-GAAP items — (12.3 ) — (12.3 ) — Transaction fees and financing(6) — — 2.0 — 2.0 Tax windfall from share-based compensation(7) (1.3 ) (4.2 ) — (20.5 ) — Tax impact of valuation allowance for deferred tax assets(8) 2.0 1.4 46.0 14.6 46.0 Tax impact of non-GAAP measures (18.8 ) (47.6 ) (29.1 ) (114.0 ) (112.6 ) Net earnings attributable to Coherent Corp. on non-GAAP basis $ 192.3 $ 177.2 $ 110.8 $ 692.6 $ 310.7 Per share data: Net loss on GAAP basis Basic Loss Per Share $ (0.83 ) $ (0.11 ) $ (0.52 ) $ (0.52 ) $ (1.84 ) Diluted Loss Per Share $ (0.83 ) $ (0.11 ) $ (0.52 ) $ (0.52 ) $ (1.84 ) Net earnings on non-GAAP basis Basic Earnings Per Share $ 1.02 $ 0.93 $ 0.52 $ 3.64 $ 1.24 Diluted Earnings Per Share $ 1.00 $ 0.91 $ 0.51 $ 3.53 $ 1.21 *Amounts may not recalculate due to rounding. (1) During the second fiscal quarter of 2025, the Company refined its methodology to report non-GAAP measures. The change does not impact the Company's financial position, cash flows, or GAAP consolidated results of operations. Prior period non-GAAP financial measures presented in this press release have been recast to conform to the current presentation.(2) Amortization of acquired intangibles includes the write-off of certain impaired intangible assets in the third quarter of fiscal 2025.(3) Integration, site consolidation and other costs include retention and severance payments and other integration costs related to the acquisition of Coherent, Inc. Refer to table 7 for a more detailed description of these costs on a consolidated basis.(4) Restructuring charges include non-cash impairment charges for production assets and improvements on leased facilities, loss on sale of a facility, severance, contract termination costs and other costs related to the restructuring plans.(5) Impairment of assets held-for-sale relate to several entities classified as held for sale at June 30, 2025.(6)Transaction fees and financing includes debt extinguishment costs and various fees related to closing the Coherent transaction. (6) Windfall tax benefits were recorded on the vesting of share-based compensation.(8) Valuation allowance adjustment was related to an increase (decrease) in valuation allowance related to certain deferred tax assets resulting from the Company's cumulative GAAP net loss that is not recognized for non-GAAP purposes given the historical non-GAAP net earnings. Table 7 Components of Integration, Site Consolidation and Other Costs Excluded from Non-GAAP Operating Income* THREE MONTHS ENDED YEAR ENDED June 30, March 31, June 30, June 30, June 30, $ Millions (unaudited) 2025 2025 2024(1) 2025(1) 2024(1) Integration, site consolidations and other costs Consulting costs related to projects to integrate recent acquisitions into common technology systems and simplify legal entity structure $ 14.3 $ 5.8 $ 6.5 $ 35.3 $ 40.8 Charges for products that are end-of-life, including production equipment to produce those products — — 1.0 — 3.2 Employee severance and retention costs for site consolidations as part of our Synergy and Site Consolidation Plan or other actions (0.5 ) 0.6 4.2 2.3 14.1 Severance costs related to the retirement of our former CEO/CFO/President — — 13.2 0.6 18.7 Direct damages from substation power failure/fire at manufacturing sites — — — — 3.0 Integration, site consolidations and other costs $ 13.8 $ 6.4 $ 24.9 $ 38.2 $ 79.8 *Amounts may not recalculate due to rounding. (1) During the second fiscal quarter of 2025, the Company refined its methodology to report non-GAAP measures. The change does not impact the Company's financial position, cash flows, or GAAP consolidated results of operations. Prior period non-GAAP financial measures presented in this press release have been recast to conform to the current presentation. Table 8 GAAP Earnings (Loss) Per Share Calculation* THREE MONTHS ENDED YEAR ENDED $ Millions, except per share amounts (unaudited June 30, March 31, June 30, June 30, June 30, 2025 2025 2024 2025 2024 Numerator Net earnings (loss) attributable to Coherent Corp. $ (95.6 ) $ 15.7 $ (48.4 ) $ 49.4 $ (156.2 ) Deduct Series B redeemable preferred dividends (33.1 ) (32.7 ) (31.4 ) (129.9 ) (123.4 ) Basic loss available to common shareholders $ (128.8 ) $ (17.0 ) $ (79.9 ) $ (80.6 ) $ (279.5 ) Diluted loss available to common shareholders $ (128.8 ) $ (17.0 ) $ (79.9 ) $ (80.6 ) $ (279.5 ) Denominator Diluted weighted average common shares 155.5 155.2 152.6 154.8 151.6 Basic loss per common share $ (0.83 ) $ (0.11 ) $ (0.52 ) $ (0.52 ) $ (1.84 ) Diluted loss per common share $ (0.83 ) $ (0.11 ) $ (0.52 ) $ (0.52 ) $ (1.84 ) *Amounts may not recalculate due to rounding. Table 9 Non-GAAP Earnings Per Share Calculation* THREE MONTHS ENDED YEAR ENDED $ Millions, except per share amounts (unaudited) June 30, March 31, June 30, June 30, June 30, 2025 2025 2024(1) 2025(1) 2024(1) Numerator Net earnings attributable to Coherent Corp. on non-GAAP basis $ 192.3 $ 177.2 $ 110.8 $ 692.6 $ 310.7 Deduct Series B redeemable preferred dividends (33.1 ) (32.7 ) (31.4 ) (129.9 ) (123.4 ) Basic earnings available to common shareholders $ 159.1 $ 144.6 $ 79.4 $ 562.6 $ 187.3 Diluted earnings available to common shareholders $ 159.1 $ 144.6 $ 79.4 $ 562.6 $ 187.3 Denominator Weighted average shares 155.5 155.2 152.6 154.8 151.6 Effect of dilutive securities: Common stock equivalents 3.7 4.0 3.8 4.5 2.6 Diluted weighted average common shares 159.2 159.1 156.3 159.2 154.3 Basic earnings per common share on non-GAAP basis $ 1.02 $ 0.93 $ 0.52 $ 3.64 $ 1.24 Diluted earnings per common share on non-GAAP basis $ 1.00 $ 0.91 $ 0.51 $ 3.53 $ 1.21 *Amounts may not recalculate due to rounding. (1) During the second fiscal quarter of 2025, the Company refined its methodology to report non-GAAP measures. The change does not impact the Company's financial position, cash flows, or GAAP consolidated results of operations. Prior period non-GAAP financial measures presented in this press release have been recast to conform to the current in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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CISCO REPORTS FOURTH QUARTER AND FISCAL YEAR 2025 EARNINGS
SAN JOSE, Calif., Aug. 13, 2025 /PRNewswire/ -- News Summary: Strong topline performance at the high end of our guidance ranges: Q4 revenue of $14.7 billion, up 8% year over year FY 2025 revenue of $56.7 billion, up 5% year over year Q4 product orders up 7% year over year with growth across all geographies, demonstrating robust demand for Cisco's technologies AI Infrastructure orders taken from webscale customers exceeded $800 million, bringing the FY 2025 total to over $2 billion, more than double the original $1 billion target Strong profitability in Q4: GAAP gross margin of 65.7% and non-GAAP gross margin of 68.4%, at the high end of our guidance range GAAP EPS of $0.71 and non-GAAP EPS of $0.99, above the high end of our guidance range Q4 FY 2025 Results: Revenue: $14.7 billion Increase of 8% year over year Earnings per Share: GAAP: $0.71; Non-GAAP: $0.99 GAAP EPS increased 31% year over year Non-GAAP EPS increased 14% year over year FY 2025 Results: Revenue: $56.7 billion Increase of 5% year over year Earnings per Share: GAAP: $2.61; Non-GAAP: $3.81 GAAP EPS increased 3% year over year Non-GAAP EPS increased 2% year over year Q1 FY 2026 Guidance (1): Revenue: $14.65 billion to $14.85 billion Earnings per Share: GAAP: $0.63 to $0.68; Non-GAAP: $0.97 to $0.99 FY 2026 Guidance (1): Revenue: $59.0 billion to $60.0 billion Earnings per Share: GAAP: $2.79 to $2.91; Non-GAAP: $4.00 to $4.06 (1) Margin and EPS guidance includes the estimated impact of tariffs based on current trade policy. Cisco today reported fourth quarter and fiscal year results for the period ended July 26, 2025. Cisco reported fourth quarter revenue of $14.7 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.8 billion or $0.71 per share, and non-GAAP net income of $4.0 billion or $0.99 per share. "We delivered a strong close to fiscal 2025, driven by our accelerated innovation and solid execution," said Chuck Robbins, chair and CEO of Cisco. "The AI infrastructure orders we received from webscale customers in fiscal 2025 were more than double our original target, indicating a massive opportunity ahead as we lead the required architectural shift and build the critical infrastructure needed for the AI era." "In Q4, revenue, gross margin and operating margin were at the high end of our guidance ranges, earnings per share was above the guidance range and we delivered solid operating cash flow," said Mark Patterson, CFO of Cisco. "As we enter fiscal 2026, we remain focused on making strategic investments in innovation, driving durable, profitable growth and delivering shareholder value." Q4 GAAP ResultsQ4 FY 2025Q4 FY 2024Vs. Q4 FY 2024 Revenue$ 14.7 billion$ 13.6 billion8 % Net Income$ 2.8 billion$ 2.2 billion31 % Diluted Earnings per Share (EPS)$ 0.71$ 0.5431 %Q4 Non-GAAP ResultsQ4 FY 2025Q4 FY 2024Vs. Q4 FY 2024 Net Income$ 4.0 billion$ 3.5 billion12 % EPS$ 0.99$ 0.8714 %Fiscal Year GAAP ResultsFY 2025FY 2024Vs. FY 2024 Revenue$ 56.7 billion$ 53.8 billion5 % Net Income$ 10.5 billion$ 10.3 billion1 % EPS$ 2.61$ 2.543 %Fiscal Year Non-GAAP ResultsFY 2025FY 2024Vs. FY 2024 Net Income$ 15.2 billion$ 15.2 billion— % EPS$ 3.81$ 3.732 % Reconciliations between net income, EPS, and other measures on a GAAP and non-GAAP basis are provided in the tables located in the section entitled "Reconciliations of GAAP to non-GAAP Measures." Cisco Declares Quarterly Dividend Cisco has declared a quarterly dividend of $0.41 per common share to be paid on October 22, 2025, to all stockholders of record as of the close of business on October 3, 2025. Future dividends will be subject to Board approval. Financial Summary All comparative percentages are on a year-over-year basis unless otherwise noted. Q4 FY 2025 Highlights Revenue -- Total revenue was $14.7 billion, up 8%, with product revenue up 10% and services revenue flat. Revenue by geographic segment was: Americas up 9%, EMEA up 4%, and APJC up 7%. Product revenue performance reflected growth in Networking up 12%, Security up 9%, Observability up 4%, and Collaboration up 2%. Gross Margin -- On a GAAP basis, total gross margin, product gross margin, and services gross margin were 65.7%, 64.7%, and 68.3%, respectively, as compared with 64.4%, 63.0%, and 67.8%, respectively, in the fourth quarter of fiscal 2024. On a non-GAAP basis, total gross margin, product gross margin, and services gross margin were 68.4%, 67.5%, and 70.8%, respectively, as compared with 67.9%, 67.0%, and 70.3%, respectively, in the fourth quarter of fiscal 2024. Total gross margins by geographic segment were: 68.0% for the Americas, 71.7% for EMEA and 64.2% for APJC. Operating Expenses -- On a GAAP basis, operating expenses were $6.2 billion, flat year over year, and were 42.2% of revenue. Non-GAAP operating expenses were $5.0 billion, up 4%, and were 34.1% of revenue. Operating Income -- GAAP operating income was $3.4 billion, up 32%, with GAAP operating margin of 23.5%. Non-GAAP operating income was $5.0 billion, up 13%, with non-GAAP operating margin at 34.3%. Provision for Income Taxes -- The GAAP tax provision rate was 15.8%. The non-GAAP tax provision rate was 18.1%. Net Income and EPS -- On a GAAP basis, net income was $2.8 billion, an increase of 31%, and EPS was $0.71, an increase of 31%. On a non-GAAP basis, net income was $4.0 billion, an increase of 12%, and EPS was $0.99, an increase of 14%. Cash Flow from Operating Activities -- $4.2 billion for the fourth quarter of fiscal 2025, an increase of 14% compared with $3.7 billion for the fourth quarter of fiscal 2024. FY 2025 Highlights Revenue -- Total revenue was $56.7 billion, an increase of 5%. Net Income and EPS -- On a GAAP basis, net income was $10.5 billion, an increase of 1%, and EPS was $2.61, an increase of 3%. On a non-GAAP basis, net income was $15.2 billion, flat compared to fiscal 2024, and EPS was $3.81, an increase of 2%. Cash Flow from Operating Activities -- $14.2 billion for fiscal 2025, an increase of 30% compared with $10.9 billion for fiscal 2024. Balance Sheet and Other Financial Highlights Cash and Cash Equivalents and Investments -- $16.1 billion at the end of the fourth quarter of fiscal 2025, compared with $15.6 billion at the end of the third quarter of fiscal 2025, and compared with $17.9 billion at the end of fiscal 2024. Remaining Performance Obligations (RPO) -- $43.5 billion, up 6% in total, with 50% of this amount expected to be recognized as revenue over the next 12 months. Product RPO was up 8% and services RPO was up 5%. Deferred Revenue -- $28.8 billion, up 1% in total, with deferred product revenue up 2%. Deferred services revenue was flat. Capital Allocation -- In the fourth quarter of fiscal 2025, we returned $2.9 billion to stockholders through share buybacks and dividends. We declared and paid a cash dividend of $0.41 per common share, or $1.6 billion, and repurchased approximately 19 million shares of common stock under our stock repurchase program at an average price of $64.65 per share for an aggregate purchase price of $1.3 billion. The remaining authorized amount for stock repurchases under the program is $14.2 billion with no termination date. Guidance Cisco estimates the following results for the first quarter of fiscal 2026: Q1 FY 2026 Revenue$14.65 billion - $14.85 billion Non-GAAP gross margin67.5% - 68.5% Non-GAAP operating margin33% - 34% Non-GAAP EPS $0.97 - $0.99 Margin and EPS guidance includes the estimated impact of tariffs based on current trade policy. Cisco estimates that GAAP EPS will be $0.63 to $0.68 for the first quarter of fiscal 2026. Cisco estimates the following results for fiscal 2026: FY 2026 Revenue$59.0 billion - $60.0 billion Non-GAAP EPS $4.00 - $4.06 Margin and EPS guidance includes the estimated impact of tariffs based on current trade policy. Cisco estimates that GAAP EPS will be $2.79 to $2.91 for fiscal 2026. Our Q1 FY 2026 and FY 2026 guidance assumes an effective tax provision rate of approximately 18% for GAAP and approximately 19% for non-GAAP results. A reconciliation between the guidance on a GAAP and non-GAAP basis is provided in the tables entitled "GAAP to non-GAAP Guidance" located in the section entitled "Reconciliations of GAAP to non-GAAP Measures." Editor's Notes: Q4 fiscal year 2025 conference call to discuss Cisco's results along with its guidance will be held on Wednesday, August 13, 2025 at 1:30 p.m. Pacific Time. Conference call number is 1-888-848-6507 (United States) or 1-212-519-0847 (international). Conference call replay will be available from 4:00 p.m. Pacific Time, August 13, 2025 to 10:00 p.m. Pacific Time, August 19, 2025 at 1-800-391-9853 (United States) or 1-203-369-3269 (international). The replay will also be available via webcast on the Cisco Investor Relations website at Additional information regarding Cisco's financials, as well as a webcast of the conference call with visuals designed to guide participants through the call, will be available at 1:30 p.m. Pacific Time, August 13, 2025. Text of the conference call's prepared remarks will be available within 24 hours of completion of the call. The webcast will include both the prepared remarks and the question-and-answer session. This information, along with the GAAP to non-GAAP reconciliation information, will be available on the Cisco Investor Relations website at CISCO SYSTEMS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per-share amounts) (Unaudited) Three Months EndedFiscal Year EndedJuly 26,2025July 27,2024July 26,2025July 27,2024 REVENUE:Product $ 10,886$ 9,858$ 41,608$ 39,253 Services 3,7873,78415,04614,550 Total revenue 14,67313,64256,65453,803 COST OF SALES:Product 3,8393,64414,76614,339 Services 1,1991,2174,7434,636 Total cost of sales 5,0384,86119,50918,975 GROSS MARGIN 9,6358,78137,14534,828 OPERATING EXPENSES:Research and development 2,3802,1799,3007,983 Sales and marketing 2,8182,84110,96610,364 General and administrative 7067632,9922,813 Amortization of purchased intangible assets 2542681,028698 Restructuring and other charges 35112744789 Total operating expenses 6,1936,16325,03022,647 OPERATING INCOME 3,4422,61812,11512,181 Interest income 2272701,0011,365 Interest expense (368)(418)(1,593)(1,006) Other income (loss), net 53(74)(68)(306) Interest and other income (loss), net (88)(222)(660)53 INCOME BEFORE PROVISION FOR INCOME TAXES 3,3542,39611,45512,234 Provision for income taxes 5312341,0021,914 NET INCOME $ 2,823$ 2,162$ 10,453$ 10,320 Net income per share:Basic $ 0.71$ 0.54$ 2.63$ 2.55 Diluted $ 0.71$ 0.54$ 2.61$ 2.54 Shares used in per-share calculation:Basic 3,9604,0183,9764,043 Diluted 3,9924,0353,9984,062 CISCO SYSTEMS, INC. REVENUE BY SEGMENT (In millions, except percentages)July 26, 2025 Three Months EndedFiscal Year Ended AmountY/Y%AmountY/Y% Revenue: Americas$ 8,8229 %$ 33,6565 % EMEA3,6454 %14,8245 % APJC2,2067 %8,1746 % Total$ 14,6738 %$ 56,6545 % Amounts may not sum and percentages may not recalculate due to rounding. CISCO SYSTEMS, INC. GROSS MARGIN PERCENTAGE BY SEGMENT (In percentages)July 26, 2025 Three Months EndedFiscal Year Ended Gross Margin Percentage: Americas68.0 %68.2 % EMEA71.7 %71.1 % APJC64.2 %66.4 % CISCO SYSTEMS, INC. REVENUE FOR GROUPS OF SIMILAR PRODUCTS AND SERVICES (In millions, except percentages)July 26, 2025 Three Months EndedFiscal Year Ended AmountY/Y %AmountY/Y % Revenue: Networking$ 7,63312 %$ 28,304(3) % Security1,9529 %8,09459 % Collaboration1,0422 %4,1541 % Observability2594 %1,05526 % Total Product10,88610 %41,6086 % Services3,787— %15,0463 % Total$ 14,6738 %$ 56,6545 % Amounts may not sum and percentages may not recalculate due to rounding. CISCO SYSTEMS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In millions) (Unaudited) July 26,2025July 27,2024 ASSETSCurrent assets:Cash and cash equivalents $ 8,346$ 7,508 Investments 7,76410,346 Accounts receivable, net of allowance of $69 at July 26, 2025 and $87 at July 27, 2024 6,7016,685 Inventories 3,0953,373 Financing receivables, net 3,0613,338 Other current assets 6,3745,612 Total current assets 35,34136,862 Property and equipment, net 2,1132,090 Financing receivables, net 3,4663,376 Goodwill 59,13658,660 Purchased intangible assets, net 9,17511,219 Deferred tax assets 7,2746,262 Other assets 6,0595,944 TOTAL ASSETS $ 122,564$ 124,413 LIABILITIES AND EQUITYCurrent liabilities:Short-term debt $ 5,232$ 11,341 Accounts payable 2,5282,304 Income taxes payable 1,8571,439 Accrued compensation 3,6113,608 Deferred revenue 16,41616,249 Other current liabilities 5,4205,643 Total current liabilities 35,06440,584 Long-term debt 22,86119,621 Income taxes payable 2,1653,985 Deferred revenue 12,36312,226 Other long-term liabilities 2,9952,540 Total liabilities 75,44878,956 Total equity 47,11645,457 TOTAL LIABILITIES AND EQUITY $ 122,564$ 124,413 CISCO SYSTEMS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (Unaudited) Three Months EndedFiscal Year EndedJuly 26,2025July 27,2024July 26,2025July 27,2024 Cash flows from operating activities:Net income $ 2,823$ 2,162$ 10,453$ 10,320 Adjustments to reconcile net income to net cash provided by operating activities:Depreciation, amortization, and other 6358232,8112,507 Share-based compensation expense 9488003,6413,074 Provision for receivables 7152434 Deferred income taxes (259)(727)(1,051)(972) (Gains) losses on divestitures, investments and other, net (90)(9)(38)215 Change in operating assets and liabilities, net of effects of acquisitions and divestitures:Accounts receivable (1,428)(1,575)(22)(289) Inventories (263)(255)278275 Financing receivables (291)(16)21476 Other assets (407)(289)(923)(671) Accounts payable 267210257(90) Income taxes, net 163684(1,839)(4,539) Accrued compensation 378396(53)(696) Deferred revenue 7721,0092481,220 Other liabilities 979502193416 Net cash provided by operating activities 4,2343,73014,19310,880 Cash flows from investing activities:Purchases of investments (1,523)(1,186)(4,589)(4,230) Proceeds from sales of investments 4152622,6434,136 Proceeds from maturities of investments 9585634,9436,367 Acquisitions, net of cash and cash equivalents acquired and divestitures —(120)(291)(25,994) Purchases of investments in privately held companies (118)(202)(383)(284) Return of investments in privately held companies 19856306202 Acquisition of property and equipment (217)(198)(905)(670) Other 14(3)9(5) Net cash provided by (used in) investing activities (273)(828)1,733(20,478) Cash flows from financing activities:Issuances of common stock 416367736714 Repurchases of common stock - repurchase program (1,252)(2,015)(6,000)(5,787) Shares repurchased for tax withholdings on vesting of restricted stock units (312)(227)(1,222)(992) Short-term borrowings, original maturities of 90 days or less, net 448(1,069)(31)478 Issuances of debt 1,9047,65919,29231,818 Repayments of debt (3,528)(7,631)(22,073)(9,826) Repayments of Splunk convertible debt, net ———(3,140) Dividends paid (1,625)(1,606)(6,437)(6,384) Other —15(80)(37) Net cash provided by (used in) financing activities (3,949)(4,507)(15,815)6,844 Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents (20)8(43)(31) Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents (8)(1,597)68(2,785) Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of period 8,91810,4398,84211,627 Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period $ 8,910$ 8,842$ 8,910$ 8,842 Supplemental cash flow information:Cash paid for interest $ 130$ 233$ 1,500$ 583 Cash paid for income taxes, net $ 627$ 276$ 3,892$ 7,426 CISCO SYSTEMS, INC. REMAINING PERFORMANCE OBLIGATIONS (In millions, except percentages) July 26, 2025April 26, 2025July 27, 2024AmountY/Y %AmountY/Y %AmountY/Y % Product $ 21,5728 %$ 20,75210 %$ 20,05527 % Services 21,9615 %20,9155 %20,99310 % Total $ 43,5336 %$ 41,6677 %$ 41,04818 % We expect 50% of total RPO at July 26, 2025 to be recognized as revenue over the next 12 months. CISCO SYSTEMS, INC. DEFERRED REVENUE (In millions) July 26,2025April 26,2025July 27,2024 Deferred revenue:Product $ 13,490$ 13,170$ 13,219 Services 15,28914,82115,256 Total $ 28,779$ 27,991$ 28,475 Reported as:Current $ 16,416$ 16,081$ 16,249 Noncurrent 12,36311,91012,226 Total $ 28,779$ 27,991$ 28,475 CISCO SYSTEMS, INC. DIVIDENDS PAID AND REPURCHASES OF COMMON STOCK (In millions, except per-share amounts)DIVIDENDSSTOCK REPURCHASE PROGRAMTOTAL Quarter EndedPer ShareAmountSharesWeighted-Average Priceper ShareAmountAmount Fiscal 2025 July 26, 2025$ 0.41$ 1,62519$ 64.65$ 1,252$ 2,877 April 26, 2025$ 0.41$ 1,62725$ 59.78$ 1,504$ 3,131 January 25, 2025$ 0.40$ 1,59321$ 58.58$ 1,236$ 2,829 October 26, 2024$ 0.40$ 1,59240$ 49.56$ 2,003$ 3,595Fiscal 2024 July 27, 2024$ 0.40$ 1,60643$ 46.80$ 2,002$ 3,608 April 27, 2024$ 0.40$ 1,61526$ 49.22$ 1,256$ 2,871 January 27, 2024$ 0.39$ 1,58325$ 49.54$ 1,254$ 2,837 October 28, 2023$ 0.39$ 1,58023$ 54.53$ 1,252$ 2,832 CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES GAAP TO NON-GAAP NET INCOME (In millions) Three Months EndedFiscal Year EndedJuly 26,2025July 27,2024July 26,2025July 27,2024 GAAP net income $ 2,823$ 2,162$ 10,453$ 10,320 Adjustments to cost of sales:Share-based compensation expense 150133584514 Amortization of acquisition-related intangible assets 2333311,150936 Acquisition/divestiture-related costs 13216634 Supplier component remediation charge (adjustment) ——(7)— Total adjustments to GAAP cost of sales 3964851,7931,484 Adjustments to operating expenses:Share-based compensation expense 7976603,0192,537 Amortization of acquisition-related intangible assets 2552681,029698 Acquisition/divestiture-related costs 104297791700 Russia-Ukraine war costs ———(12) Significant asset impairments and restructurings 35112744789 Total adjustments to GAAP operating expenses 1,1911,3375,5834,712 Adjustments to interest and other income (loss), net:Russia-Ukraine war costs —49—49 (Gains) and losses on investments (115)(32)(187)100 Total adjustments to GAAP interest and other income (loss), net (115)17(187)149 Total adjustments to GAAP income before provision for income taxes 1,4721,8397,1896,345 Income tax effect of non-GAAP adjustments (344)(315)(1,600)(1,360) Significant tax matters (1) —(155)(829)(155) Total adjustments to GAAP provision for income taxes (344)(470)(2,429)(1,515) Non-GAAP net income $ 3,951$ 3,531$ 15,213$ 15,150 (1) The fiscal year ended July 26, 2025 includes a $720 million benefit due to an August 2024 U.S. Tax Court decision regarding the U.S. taxation of deemed foreign dividends in the transition year of the Tax Cuts and Jobs Act. CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES GAAP TO NON-GAAP EPS Three Months EndedFiscal Year EndedJuly 26,2025July 27,2024July 26,2025July 27,2024 GAAP EPS $ 0.71$ 0.54$ 2.61$ 2.54 Adjustments to GAAP:Share-based compensation expense 0.240.200.900.75 Amortization of acquisition-related intangible assets 0.120.150.550.40 Acquisition/divestiture-related costs 0.030.080.210.18 Russia-Ukraine war costs —0.01—0.01 Significant asset impairments and restructurings 0.010.030.190.19 (Gains) and losses on investments (0.03)(0.01)(0.05)0.02 Income tax effect of non-GAAP adjustments (0.09)(0.08)(0.40)(0.33) Significant tax matters —(0.04)(0.21)(0.04) Non-GAAP EPS $ 0.99$ 0.87$ 3.81$ 3.73 Amounts may not sum due to rounding. CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES GROSS MARGINS, OPERATING EXPENSES, OPERATING MARGINS, INTEREST AND OTHER INCOME (LOSS), NET, AND NET INCOME (In millions, except percentages) Three Months EndedJuly 26, 2025ProductGrossMarginServicesGrossMarginTotalGrossMarginOperatingExpensesY/YOperatingIncomeY/YInterestandotherincome(loss),netNetIncomeY/Y GAAP amount $ 7,047$ 2,588$ 9,635$ 6,193— %$ 3,44232 %$ (88)$ 2,82331 % % of revenue 64.7 %68.3 %65.7 %42.2 %23.5 %(0.6) %19.2 % Adjustments to GAAP amounts:Share-based compensation expense 6684150797947—947 Amortization of acquisition-related intangible assets 233—233255488—488 Acquisition/divestiture-related costs 21113104117—117 Significant asset impairments and restructurings ———3535—35 (Gains) and losses on investments —————(115)(115) Income tax effect/significant tax matters ——————(344) Non-GAAP amount $ 7,348$ 2,683$ 10,031$ 5,0024 %$ 5,02913 %$ (203)$ 3,95112 % % of revenue 67.5 %70.8 %68.4 %34.1 %34.3 %(1.4) %26.9 % Three Months EndedJuly 27, 2024ProductGrossMarginServicesGrossMarginTotalGrossMarginOperatingExpensesOperating IncomeInterestandotherincome(loss),netNet Income GAAP amount $ 6,214$ 2,567$ 8,781$ 6,163$ 2,618$ (222)$ 2,162 % of revenue 63.0 %67.8 %64.4 %45.2 %19.2 %(1.6) %15.8 % Adjustments to GAAP amounts:Share-based compensation expense 5776133660793—793 Amortization of acquisition-related intangible assets 331—331268599—599 Acquisition/divestiture-related costs 51621297318—318 Russia-Ukraine war costs —————4949 Significant asset impairments and restructurings ———112112—112 (Gains) and losses on investments —————(32)(32) Income tax effect/significant tax matters ——————(470) Non-GAAP amount $ 6,607$ 2,659$ 9,266$ 4,826$ 4,440$ (205)$ 3,531 % of revenue 67.0 %70.3 %67.9 %35.4 %32.5 %(1.5) %25.9 % Amounts may not sum and percentages may not recalculate due to rounding. CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES GROSS MARGINS, OPERATING EXPENSES, OPERATING MARGINS, INTEREST AND OTHER INCOME (LOSS), NET, AND NET INCOME (In millions, except percentages) Fiscal Year EndedJuly 26, 2025ProductGrossMarginServicesGrossMarginTotalGrossMarginOperatingExpensesY/YOperatingIncomeY/YInterestandotherincome(loss),netNetIncomeY/Y GAAP amount $ 26,842$ 10,303$ 37,145$ 25,03011 %$ 12,115(1) %$ (660)$ 10,4531 % % of revenue 64.5 %68.5 %65.6 %44.2 %21.4 %(1.2) %18.5 % Adjustments to GAAP amounts:Share-based compensation expense 2553295843,0193,603—3,603 Amortization of acquisition-related intangible assets 1,150—1,1501,0292,179—2,179 Acquisition/divestiture-related costs 145266791857—857 Supplier component remediation charge (adjustment) (7)—(7)—(7)—(7) Significant asset impairments and restructurings ———744744—744 (Gains) and losses on investments —————(187)(187) Income tax effect/significant tax matters ——————(2,429) Non-GAAP amount $ 28,254$ 10,684$ 38,938$ 19,4478 %$ 19,4916 %$ (847)$ 15,213— % % of revenue 67.9 %71.0 %68.7 %34.3 %34.4 %(1.5) %26.9 % Fiscal Year EndedJuly 27, 2024ProductGrossMarginServicesGrossMarginTotalGrossMarginOperatingExpensesOperating IncomeInterestandotherincome(loss),netNet Income GAAP amount $ 24,914$ 9,914$ 34,828$ 22,647$ 12,181$ 53$ 10,320 % of revenue 63.5 %68.1 %64.7 %42.1 %22.6 %0.1 %19.2 % Adjustments to GAAP amounts:Share-based compensation expense 2143005142,5373,051—3,051 Amortization of acquisition-related intangible assets 936—9366981,634—1,634 Acquisition/divestiture-related costs 102434700734—734 Russia-Ukraine war costs ———(12)(12)4937 Significant asset impairments and restructurings ———789789—789 (Gains) and losses on investments —————100100 Income tax effect/significant tax matters ——————(1,515) Non-GAAP amount $ 26,074$ 10,238$ 36,312$ 17,935$ 18,377$ 202$ 15,150 % of revenue 66.4 %70.4 %67.5 %33.3 %34.2 %0.4 %28.2 % Amounts may not sum and percentages may not recalculate due to rounding. CISCO SYSTEMS, INC. RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES EFFECTIVE TAX RATE (In percentages) Three Months EndedFiscal Year EndedJuly 26,2025July 27,2024July 26, 2025July 27,2024 GAAP effective tax rate 15.8 %9.8 %8.7 %15.6 % Total adjustments to GAAP provision for income taxes 2.3 %6.8 %9.7 %2.9 % Non-GAAP effective tax rate 18.1 %16.6 %18.4 %18.5 % GAAP TO NON-GAAP GUIDANCEQ1 FY 2026Gross MarginOperating MarginEarnings perShare (1) GAAP 65% - 66%21.5% - 22.5%$0.63 - $0.68 Estimated adjustments for: Share-based compensation expense1.0 %6.5 %$0.18 - $0.19 Amortization of acquisition-related intangible assets and acquisition/divestiture-related costs1.5 %4.0 %$0.11 - $0.12 Significant asset impairments and restructurings (2)—1.0 %$0.02 - $0.03 Non-GAAP67.5% - 68.5%33% - 34%$0.97 - $0.99 FY 2026Earnings perShare (1) GAAP $2.79 - $2.91 Estimated adjustments for: Share-based compensation expense$0.69 - $0.71 Amortization of acquisition-related intangible assets and acquisition/divestiture-related costs$0.43 - $0.45 Significant asset impairments and restructurings (2)$0.03 - $0.05 Non-GAAP$4.00 - $4.06 (1) Estimated adjustments to GAAP earnings per share are shown after income tax effects. (2) Reflects charges related to a restructuring plan announced on August 14, 2024. We expect this plan to be substantially completed by the end of the second quarter of fiscal 2026. Margin and EPS guidance includes the estimated impact of tariffs based on current trade policy. Except as noted above, this guidance does not include the effects of any future acquisitions/divestitures, significant asset impairments and restructurings, significant litigation settlements and other contingencies, gains and losses on investments, significant tax matters, or other items, which may or may not be significant. Forward Looking Statements, Non-GAAP Information and Additional Information This release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events (such as the massive opportunity ahead as we lead the required architectural shift and building the critical infrastructure needed for the AI era, and our focus on making strategic investments in innovation, driving durable, profitable growth and delivering shareholder value) and the future financial performance of Cisco (including the guidance for Q1 FY 2026 and full year FY 2026) that involve risks and uncertainties, such as the actual impact of tariffs on our guidance for Q1 FY 2026 and full year FY 2026. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results due to a variety of factors, including: business and economic conditions and growth trends in the networking industry, our customer markets and various geographic regions; global economic conditions and uncertainties in the geopolitical environment; our development and use of artificial intelligence; overall information technology spending; the growth and evolution of the Internet and levels of capital spending on Internet-based systems; variations in customer demand for products and services, including sales to the service provider market, cloud, enterprise and other customer markets; the return on our investments in certain key priority areas, and in certain geographical locations, as well as maintaining leadership in Networking and services; the timing of orders and manufacturing and customer lead times; supply constraints; changes in customer order patterns or customer mix; insufficient, excess or obsolete inventory; variability of component costs; variations in sales channels, product costs or mix of products sold; our ability to successfully acquire businesses and technologies and to successfully integrate and operate these acquired businesses and technologies; our ability to achieve expected benefits of our partnerships; increased competition in our product and services markets, including the data center market; dependence on the introduction and market acceptance of new product offerings and standards; rapid technological and market change; manufacturing and sourcing risks; product defects and returns; litigation involving patents, other intellectual property, antitrust, stockholder and other matters, and governmental investigations; our ability to achieve the benefits of restructurings and possible changes in the size and timing of related charges; cyber attacks, data breaches or other incidents; vulnerabilities and critical security defects; our ability to protect personal data; evolving regulatory uncertainty; terrorism; natural catastrophic events (including as a result of global climate change); any pandemic or epidemic; our ability to achieve the benefits anticipated from our investments in sales, engineering, service, marketing and manufacturing activities; our ability to recruit and retain key personnel; our ability to manage financial risk, and to manage expenses during economic downturns; risks related to the global nature of our operations, including our operations in emerging markets; currency fluctuations and other international factors; changes in provision for income taxes, including changes in tax laws and regulations or adverse outcomes resulting from examinations of our income tax returns; potential volatility in operating results; and other factors listed in Cisco's most recent reports on Forms 10-Q and 10-K filed on May 20, 2025 and September 5, 2024, respectively. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes thereto included in Cisco's most recent reports on Forms 10-Q and 10-K as each may be amended from time to time. Cisco's results of operations for the three months and the year ended July 26, 2025 are not necessarily indicative of Cisco's operating results for any future periods. Any projections in this release are based on limited information currently available to Cisco, which is subject to change. Although any such projections and the factors influencing them will likely change, Cisco will not necessarily update the information, since Cisco will only provide guidance at certain points during the year. Such information speaks only as of the date of this release. This release includes non-GAAP net income, non-GAAP gross margins, non-GAAP operating expenses, non-GAAP operating income and margin, non-GAAP effective tax rates, non-GAAP interest and other income (loss), net, and non-GAAP net income per share data for the periods presented. It also includes future estimated ranges for gross margin, operating margin, tax provision rate and EPS on a non-GAAP basis. These non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles (GAAP) and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Cisco believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Cisco's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Cisco's results of operations in conjunction with the corresponding GAAP measures. Cisco believes that the presentation of non-GAAP measures when shown in conjunction with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations. For its internal budgeting process, Cisco's management uses financial statements that do not include, when applicable, share-based compensation expense, amortization of acquisition-related intangible assets, acquisition/divestiture-related costs, significant asset impairments and restructurings, significant litigation settlements and other contingencies, Russia-Ukraine war costs, gains and losses on investments, the income tax effects of the foregoing and significant tax matters. Cisco's management also uses the foregoing non-GAAP measures, in addition to the corresponding GAAP measures, in reviewing the financial results of Cisco. In prior periods, Cisco has excluded other items that it no longer excludes for purposes of its non-GAAP financial measures. From time to time in the future there may be other items that Cisco may exclude for purposes of its internal budgeting process and in reviewing its financial results. For additional information on the items excluded by Cisco from one or more of its non-GAAP financial measures, refer to the Form 8-K regarding this release furnished today to the Securities and Exchange Commission. About Cisco Cisco (NASDAQ: CSCO) is the worldwide technology leader that is revolutionizing the way organizations connect and protect in the AI era. For more than 40 years, Cisco has securely connected the world. With its industry leading AI-powered solutions and services, Cisco enables its customers, partners and communities to unlock innovation, enhance productivity and strengthen digital resilience. With purpose at its core, Cisco remains committed to creating a more connected and inclusive future for all. Discover more on The Newsroom and follow us on X at @Cisco. Copyright © 2025 Cisco and/or its affiliates. All rights reserved. Cisco and the Cisco logo are trademarks or registered trademarks of Cisco and/or its affiliates in the U.S. and other countries. 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