Cisco Systems, Inc.

- There is no mention of any new or planned fundraising through debt or equity in the provided transcript. - Cisco continues to focus on capital allocation through share buybacks and dividends. - The Splunk acquisition is expected to be cash flow positive from the first year and is not anticipated to affect capital returns such as dividends or share buybacks. - The company remains committed to returning capital to shareholders while investing in innovation organically and inorganically. - No specific plans to issue new debt or equity were discussed during the call.

- Cisco continues to invest organically and inorganically in its innovation pipeline. - In Q1, Cisco announced its intent to acquire Splunk to strengthen its position in cloud, security, observability, and AI via targeted strategic acquisitions. - The Splunk acquisition is expected to close in the calendar quarter of 2024, subject to regulatory approvals. - Cisco is working with GPU and storage partners (AMD, Intel, NVIDIA) to create AI infrastructure solutions, including Ethernet fabric for AI and validated reference architectures. - Investments focus on AI infrastructure, security platforms, and full-stack observability. - Cisco emphasizes disciplined expense management alongside these investments. - Capital return commitments continue with significant share repurchases and dividend payments in Q1. - The Splunk deal is expected to be cash flow positive from the first year and not affect Cisco’s capital return strategy.

- Cisco expects a temporary slowdown in product orders due to customers implementing previously shipped inventory, with an estimated 1-2 quarters of shipping "in customers' hands" causing lower near-term orders and revenue. - Revenue growth is expected to improve sequentially in the second half of fiscal 2024, with Q3 and Q4 anticipated to show stronger performance. - The company forecasts revenue to be up sequentially in Q3 year-over-year despite difficult compares in the second half. - Growth opportunities remain strong in AI infrastructure, security, observability, and cloud, with Cisco confident in its expanding position and product demand. - Web scale cloud orders are expected to improve in the second half, while the service provider segment may remain challenged. - Cisco continues to invest in strategic acquisitions like Splunk to drive longer-term growth. - Overall, Cisco is confident in returning to typical order growth and revenue seasonality after the inventory digestion phase.

- Cisco expects revenue growth to resume with sequential increases in the second half of fiscal 2024, particularly in Q3 and Q4, following a temporary slowdown due to customers implementing backlog inventory. - Non-GAAP gross margin is projected to be stable at the higher end of the 65%-66% range in the second half. - Non-GAAP operating margin is guided to decline by 400 to 500 basis points in Q2 due to revenue mix but expected to improve with operating leverage as the year progresses. - For fiscal year 2024, Cisco expects non-GAAP EPS in the range of $3.87 to $3.93. - The company anticipates one to two quarters of lower revenue from digestion of shipped inventory but remains confident in long-term growth drivers including AI infrastructure, security, observability, and growing software/recurring revenue. - Strong operating leverage and disciplined expense management underpin guidance, with emphasis on capital return to shareholders.

- Backlog has largely normalized at the end of Q1, with shipments largely completed and lead times back to pre-pandemic levels (Page 5). - Q1 product orders declined 20% due to customers digesting inventory; major customers are in an implementation pause (Page 2). - Cisco expects one to two quarters of lower revenue/orders due to this inventory digestion (Page 2, 3). - Sequential improvement in orders is anticipated in the second half of fiscal year 2024, with expected order growth in Q3 and Q4 (Page 4). - Web scale customers show signs of order improvement; service providers expected to remain difficult (Page 4). - $1 billion plus AI-related orders are included in forward-looking orders for fiscal year 2025, reflecting increasing demand (Page 3). - Overall, Cisco is confident in a return to typical order growth rates beyond this temporary pause (Page 2).