XML 32 R18.htm IDEA: XBRL DOCUMENT v3.21.2
Financing Receivables
 3 Months Ended
Oct. 30, 2021
Receivables [Abstract]  
Financing Receivables Financing Receivables
(a)Financing Receivables
Financing receivables primarily consist of lease receivables, loan receivables, and financed service contracts. Lease receivables represent sales-type leases resulting from the sale of Cisco’s and complementary third-party products and are typically collateralized by a security interest in the underlying assets. Lease receivables consist of arrangements with terms of four years on average. Loan receivables represent financing arrangements related to the sale of our hardware, software, and services, which may include additional funding for other costs associated with network installation and integration of our products and services. Loan receivables have terms of three years on average. Financed service contracts include financing receivables related to technical support and advanced services. Revenue related to the technical support services is typically deferred and included in deferred service revenue and is recognized ratably over the period during which the related services are to be performed, which typically ranges from one year to three years.
A summary of our financing receivables is presented as follows (in millions):
October 30, 2021Lease
Receivables		Loan
Receivables		Financed Service
Contracts		Total
Gross$1,560 $4,809 $2,329 $8,698 
Residual value97 — — 97 
Unearned income(70)— — (70)
Allowance for credit loss(33)(74)(2)(109)
Total, net$1,554 $4,735 $2,327 $8,616 
Reported as:
Current$736 $2,198 $1,136 $4,070 
Noncurrent818 2,537 1,191 4,546 
Total, net$1,554 $4,735 $2,327 $8,616 
July 31, 2021Lease
Receivables		Loan
Receivables		Financed Service
Contracts		Total
Gross$1,710 $5,203 $2,453 $9,366 
Residual value103 — — 103 
Unearned income(78)— — (78)
Allowance for credit loss(38)(86)(3)(127)
Total, net$1,697 $5,117 $2,450 $9,264 
Reported as:
Current$780 $2,372 $1,228 $4,380 
Noncurrent917 2,745 1,222 4,884 
Total, net$1,697 $5,117 $2,450 $9,264 
(b)Credit Quality of Financing Receivables
Gross financing receivables(1) categorized by our internal credit risk rating by period of origination as of October 30, 2021 and July 31, 2021 are summarized as follows (in millions):
Fiscal YearThree Months Ended
Internal Credit Risk RatingPriorJuly 28, 2018July 27, 2019July 25, 2020July 31, 2021October 30, 2021Total
Lease Receivables:
1 to 4$11 $75 $134 $204 $244 $58 $726 
5 to 610 44 141 258 247 15 715 
7 and Higher1 4 9 19 4 12 49 
Total Lease Receivables$22 $123 $284 $481 $495 $85 $1,490 
Loan Receivables:
1 to 4$27 $108 $265 $733 $1,299 $503 $2,935 
5 to 611 55 170 439 764 307 1,746 
7 and Higher2 3 41 40 28 14 128 
Total Loan Receivables$40 $166 $476 $1,212 $2,091 $824 $4,809 
Financed Service Contracts:
1 to 4$3 $20 $85 $189 $824 $334 $1,455 
5 to 63 19 90 257 370 116 855 
7 and Higher— 1 4 7 4 3 19 
Total Financed Service Contracts$6 $40 $179 $453 $1,198 $453 $2,329 
Total$68 $329 $939 $2,146 $3,784 $1,362 $8,628 
Fiscal Year
Internal Credit Risk RatingPriorJuly 29, 2017July 28, 2018July 27, 2019July 25, 2020July 31, 2021Total
Lease Receivables:
1 to 4$2 $20 $100 $168 $282 $227 $799 
5 to 61 17 65 187 285 231 786 
7 and Higher— 2 6 12 23 4 47 
Total Lease Receivables$3 $39 $171 $367 $590 $462 $1,632 
Loan Receivables:
1 to 4$4 $86 $134 $577 $990 $1,552 $3,343 
5 to 6— 19 75 202 505 925 1,726 
7 and Higher1 2 4 50 43 34 134 
Total Loan Receivables$5 $107 $213 $829 $1,538 $2,511 $5,203 
Financed Service Contracts:
1 to 4$— $38 $26 $106 $252 $1,053 $1,475 
5 to 6— 6 26 105 302 520 959 
7 and Higher— — 1 6 7 5 19 
Total Financed Service Contracts$— $44 $53 $217 $561 $1,578 $2,453 
Total$8 $190 $437 $1,413 $2,689 $4,551 $9,288 
(1) Lease receivables calculated as gross lease receivables less unearned income.
The following tables present the aging analysis of gross receivables as of October 30, 2021 and July 31, 2021 (in millions):
DAYS PAST DUE
(INCLUDES BILLED AND UNBILLED)
October 30, 202131-6061-90 91+Total
Past Due		CurrentTotal120+ Still AccruingNonaccrual
Financing
Receivables		Impaired
Financing
Receivables
Lease receivables$34 $12 $22 $68 $1,422 $1,490 $8 $24 $24 
Loan receivables77 17 27 121 4,688 4,809 6 29 29 
Financed service contracts21 39 18 78 2,251 2,329 4 3 3 
Total$132 $68 $67 $267 $8,361 $8,628 $18 $56 $56 
DAYS PAST DUE
(INCLUDES BILLED AND UNBILLED)
July 31, 202131-6061-90 91+Total
Past Due		CurrentTotal120+ Still AccruingNonaccrual
Financing
Receivables		Impaired
Financing
Receivables
Lease receivables$21 $17 $29 $67 $1,565 $1,632 $1 $33 $26 
Loan receivables71 17 35 123 5,080 5,203 4 33 33 
Financed service contracts18 13 18 49 2,404 2,453 3 3 3 
Total$110 $47 $82 $239 $9,049 $9,288 $8 $69 $62 
Past due financing receivables are those that are 31 days or more past due according to their contractual payment terms. The data in the preceding tables is presented by contract, and the aging classification of each contract is based on the oldest outstanding receivable, and therefore past due amounts also include unbilled and current receivables within the same contract.
(c)Allowance for Credit Loss Rollforward
The allowances for credit loss and the related financing receivables are summarized as follows (in millions):
Three months ended October 30, 2021CREDIT LOSS ALLOWANCES
Lease
Receivables		Loan
Receivables		Financed Service
Contracts		Total
Allowance for credit loss as of July 31, 2021$38 $86 $3 $127 
Provisions (benefits)(5)(12)(1)(18)
Allowance for credit loss as of October 30, 2021$33 $74 $2 $109 
Three months ended October 24, 2020CREDIT LOSS ALLOWANCES
Lease
Receivables		Loan
Receivables		Financed Service
Contracts		Total
Allowance for credit loss as of July 25, 2020$48 $81 $9 $138 
Provisions (benefits)(3)3 (1)(1)
Other1 17 (1)17 
Allowance for credit loss as of October 24, 2020$46 $101 $7 $154