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Employee Benefit Plans | 12 Months Ended
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Jul. 26, 2025
Retirement Benefits [Abstract] |
Employee Benefit Plans | Employee Benefit Plans (a)Employee Stock Incentive Plans We have one stock incentive plan: the 2005 Stock Incentive Plan (the “2005 Plan”). In addition, we have, in connection with our acquisitions of various companies, assumed the share-based awards granted under stock incentive plans of the acquired companies or issued share-based awards in replacement thereof. Share-based awards are designed to reward employees for their long-term contributions to us and provide incentives for them to remain with us. The number and frequency of share-based awards are based on competitive practices, our operating results, government regulations, and other factors. The 2005 Plan provides for the granting of stock options, stock grants, stock units and stock appreciation rights (SARs), the vesting of which may be time-based or upon satisfaction of performance goals, or both, and/or other conditions. Time-based and performance-based RSUs generally vest over three years with certain awards containing retirement eligible provisions. Employees (including employee directors and executive officers) and consultants of Cisco and its subsidiaries and affiliates and non-employee directors of Cisco are eligible to participate in the 2005 Plan. The 2005 Plan may be terminated by our Board of Directors at any time and for any reason, and is currently set to terminate at the 2030 Annual Meeting unless re-adopted or extended by our stockholders prior to or on such date. Under the 2005 Plan’s share reserve feature, a distinction is made between the number of shares in the reserve attributable to (i) stock options and SARs and (ii) “full value” awards (i.e., stock grants and stock units). Shares issued as stock grants, pursuant to stock units or pursuant to the settlement of dividend equivalents are counted against shares available for issuance under the 2005 Plan on a 1.5-to-1 ratio. For each share awarded as restricted stock or a restricted stock unit award under the 2005 Plan, 1.5 shares was deducted from the available share-based award balance. If awards issued under the 2005 Plan are forfeited or terminated for any reason before being exercised or settled, then the shares underlying such awards, plus the number of additional shares, if any, that counted against shares available for issuance under the 2005 Plan at the time of grant as a result of the application of the share ratio described above, will become available again for issuance under the 2005 Plan. As of July 26, 2025, 100 million shares were authorized for future grant under the 2005 Plan. (b)Employee Stock Purchase Plan We have an Employee Stock Purchase Plan under which eligible employees are offered shares through a 24-month offering period, which consists of four consecutive 6-month purchase periods. Employees may purchase a limited amount of shares of our stock at a discount of up to 15% of the lesser of the fair market value at the beginning of the offering period or the end of each 6-month purchase period. The Employee Stock Purchase Plan is scheduled to terminate on the earlier of (i) January 3, 2030 and (ii) the date on which all shares available for issuance under the Employee Stock Purchase Plan are sold pursuant to exercised purchase rights. We issued 18 million, 20 million, and 19 million shares under the Employee Stock Purchase Plan in fiscal 2025, 2024, and 2023, respectively. As of July 26, 2025, 50 million shares were available for issuance under the Employee Stock Purchase Plan. (c)Summary of Share-Based Compensation Expense Share-based compensation expense consists of expenses for RSUs, stock purchase rights, and stock options, granted to employees or assumed from acquisitions. The following table summarizes share-based compensation expense (in millions):
Years Ended | July 26, 2025 |  | July 27, 2024 |  | July 29, 2023
Cost of sales—product | $ | 255 |  |  | $ | 214 |  |  | $ | 151 |
Cost of sales—services | 329 |  |  | 300 |  |  | 245 |
Share-based compensation expense in cost of sales | 584 |  |  | 514 |  |  | 396 |
Research and development | 1,625 |  |  | 1,316 |  |  | 1,008 |
Sales and marketing | 918 |  |  | 846 |  |  | 673 |
General and administrative | 476 |  |  | 375 |  |  | 270 |
Restructuring and other charges | 38 |  |  | 23 |  |  | 6 |
Share-based compensation expense in operating expenses | 3,057 |  |  | 2,560 |  |  | 1,957 |
Total share-based compensation expense | $ | 3,641 |  |  | $ | 3,074 |  |  | $ | 2,353 |
Income tax benefit for share-based compensation | $ | 871 |  |  | $ | 696 |  |  | $ | 449 |
As of July 26, 2025, the total compensation cost related to unvested share-based awards not yet recognized was $4.5 billion, which is expected to be recognized over approximately 1.9 years on a weighted-average basis. (d)Restricted Stock Unit Awards A summary of the restricted stock and stock unit activity, which includes time-based and performance-based or market-based RSUs, is as follows (in millions, except per-share amounts):
| Restricted Stock/ Stock Units |  | Weighted-Average Grant Date Fair Value per Share |  | Aggregate Fair Value
UNVESTED BALANCE AT JULY 30, 2022 | 97 |  |  | $ | 46.67 |  |  |
Granted and assumed | 72 |  |  | 42.08 |  |  |
Vested | (39) |  |  | 46.69 |  |  | $ | 1,746 |
Canceled/forfeited/other | (8) |  |  | 45.17 |  |  |
UNVESTED BALANCE AT JULY 29, 2023 | 122 |  |  | 44.04 |  |  |
Granted and assumed | 63 |  |  | 48.97 |  |  |
Vested | (58) |  |  | 43.46 |  |  | $ | 2,906 |
Canceled/forfeited/other | (10) |  |  | 45.65 |  |  |
UNVESTED BALANCE AT JULY 27, 2024 | 117 |  |  | 46.86 |  |  |
Granted and assumed | 70 |  |  | 55.73 |  |  |
Vested | (65) |  |  | 46.95 |  |  | $ | 3,707 |
Canceled/forfeited/other | (9) |  |  | 48.04 |  |  |
UNVESTED BALANCE AT JULY 26, 2025 | 113 |  |  | $ | 52.26 |  |  |
(e)Valuation of Employee Share-Based Awards Time-based restricted stock units and PRSUs that are based on our financial performance metrics or non-financial operating goals are valued using the market value of our common stock on the date of grant, discounted for the present value of expected dividends. For PRSUs granted, we included a relative total shareholder return (TSR) modifier to determine the number of shares earned at the end of the performance period. The TSR modifier is determined using a Monte Carlo simulation model. The PRSUs granted during the fiscal years presented are contingent on the achievement of our financial performance metrics, our comparative market-based returns, or the achievement of financial and non-financial operating goals. The assumptions for the valuation of time-based RSUs and PRSUs are summarized as follows:
| RESTRICTED STOCK UNITS
Years Ended | July 26, 2025 |  | July 27, 2024 |  | July 29, 2023
Number of shares granted (in millions) | 65 |  |  | 60 |  |  | 70 |
Grant date fair value per share | $ | 55.93 |  |  | $ | 48.71 |  |  | $ | 42.13 |
Weighted-average assumptions/inputs: |  |  |  |  |
Expected dividend yield | 2.7 | % |  | 3.0 | % |  | 3.4 | %
Range of risk-free interest rates | 3.5% – 4.9% |  | 4.2% – 5.6% |  | 3.7% – 5.7%
| PERFORMANCE BASED RESTRICTED STOCK UNITS
Years Ended | July 26, 2025 |  | July 27, 2024 |  | July 29, 2023
Number of shares granted (in millions) | 4 |  |  | 3 |  |  | 2 |
Grant date fair value per share | $ | 54.50 |  |  | $ | 59.31 |  |  | $ | 40.44 |
The assumptions for the valuation of employee stock purchase rights are summarized as follows:
| EMPLOYEE STOCK PURCHASE RIGHTS
Years Ended | July 26, 2025 |  | July 27, 2024 |  | July 29, 2023
Weighted-average assumptions: |  |  |  |  |
Expected volatility | 22.5 | % |  | 28.3 | % |  | 28.7 | %
Risk-free interest rate | 5.0 | % |  | 2.9 | % |  | 2.8 | %
Expected dividend | 3.3 | % |  | 3.5 | % |  | 3.6 | %
Expected life (in years) | 1.3 |  | 1.2 |  | 1.2
Weighted-average estimated grant date fair value per share | $ | 12.18 |  |  | $ | 11.59 |  |  | $ | 12.40 |
The valuation of employee stock purchase rights and the related assumptions are for the employee stock purchases made during the respective fiscal years. We used the implied volatility for traded options (with contract terms corresponding to the expected life of the employee stock purchase rights) on our stock as the expected volatility assumption required in the Black-Scholes model. The implied volatility is more representative of future stock price trends than historical volatility. The risk-free interest rate assumption is based upon observed interest rates appropriate for the term of our employee stock purchase rights. The dividend yield assumption is based on the history and expectation of dividend payouts at the grant date. (f)Employee 401(k) Plans We sponsor the Cisco Systems, Inc. 401(k) Plan (the “Plan”) to provide retirement benefits for our employees. As allowed under Section 401(k) of the Internal Revenue Code, the Plan provides for tax-deferred salary contributions and after-tax contributions for eligible employees. The Plan allows employees to contribute up to 75% of their annual eligible earnings to the Plan on a pretax and after-tax basis, including Roth contributions. Employee contributions are limited to a maximum annual amount as set periodically by the Internal Revenue Code. We match pretax and Roth employee contributions up to 100% of the first 4.5% of eligible earnings that are contributed by employees. Therefore, the maximum matching contribution that we may allocate to each participant’s account will not exceed $15,750 for the 2025 calendar year due to the $350,000 annual limit on eligible earnings imposed by the Internal Revenue Code. All matching contributions vest immediately. Our matching contributions to the Plan totaled $373 million, $358 million, and $342 million in fiscal 2025, 2024, and 2023, respectively. The Plan allows employees who meet the age requirements and reach the Plan contribution limits to make catch-up contributions (pretax or Roth) not to exceed the lesser of 75% of their annual eligible earnings or the limit set forth in the Internal Revenue Code. Catch-up contributions are not eligible for matching contributions. In addition, the Plan provides for discretionary profit-sharing contributions as determined by the Board of Directors. Such contributions to the Plan are allocated among eligible participants in the proportion of their salaries to the total salaries of all participants. There were no discretionary profit-sharing contributions made in fiscal 2025, 2024, and 2023. We also sponsor other 401(k) plans as a result of acquisitions of other companies. Our contributions to these plans were not material to Cisco on either an individual or aggregate basis for any of the fiscal years presented. (g)Deferred Compensation Plans The Cisco Systems, Inc. Deferred Compensation Plan (the “Deferred Compensation Plan”), a nonqualified deferred compensation plan, became effective in 2007. As required by applicable law, participation in the Deferred Compensation Plan is limited to a select group of our management employees. Under the Deferred Compensation Plan, which is an unfunded and unsecured deferred compensation arrangement, a participant may elect to defer base salary, bonus, and/or commissions, pursuant to such rules as may be established by Cisco, up to the maximum percentages for each deferral election as described in the plan. We may also, at our discretion, make a matching contribution to the employee under the Deferred Compensation Plan. A matching contribution equal to 4.5% of eligible compensation in excess of the Internal Revenue Code limit for qualified plans for calendar year 2025 that is deferred by participants under the Deferred Compensation Plan (with a $1.5 million cap on eligible compensation) will be made to eligible participants’ accounts at the end of calendar year 2025. The total deferred compensation liability under the Deferred Compensation Plan, together with deferred compensation plans assumed from acquired companies, was approximately $1.2 billion and $1.1 billion as of July 26, 2025 and July 27, 2024, respectively, and was recorded primarily in other long-term liabilities.

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