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Table of Contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_____________________________________

FORM 10-Q

(Mark One)



☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended January 25, 2020



☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 0-18225

_____________________________________

CISCO SYSTEMS, INC.

(Exact name of registrant as specified in its charter)



California		77-0059951
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

170 West Tasman Drive

San Jose, California 95134

(Address of principal executive office and zip code)

(408) 526-4000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and formal fiscal year, if changed since last report.)

_____________________________________

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	CSCO	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.



Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of the registrant’s common stock outstanding as of February 13, 2020: 4,240,880,161

____________________________________

Table of Contents

Cisco Systems, Inc.

Form 10-Q for the Quarter Ended January 25, 2020

INDEX



		Page
Part I	Financial Information	3
Item 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets at January 25, 2020 and July 27, 2019	3
	Consolidated Statements of Operations for the Three and Six Months Ended January 25, 2020 and January 26, 2019	4
	Consolidated Statements of Comprehensive Income for the Three and Six Months Ended January 25, 2020 and January 26, 2019	5
	Consolidated Statements of Cash Flows for the Six Months Ended January 25, 2020 and January 26, 2019	6
	Consolidated Statements of Equity for the Three and Six Months Ended January 25, 2020 and January 26, 2019	7
	Notes to Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	43
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	65
Item 4.	Controls and Procedures	66
Part II.	Other Information	66
Item 1.	Legal Proceedings	66
Item 1A.	Risk Factors	67
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	84
Item 3.	Defaults Upon Senior Securities	84
Item 4.	Mine Safety Disclosures	84
Item 5.	Other Information	84
Item 6.	Exhibits	85
	Signature	86

Table of Contents

PART I. FINANCIAL INFORMATION



Item 1.	Financial Statements (Unaudited)

CISCO SYSTEMS, INC.

CONSOLIDATED BALANCE SHEETS

(in millions, except par value)

(Unaudited)



	January 25, 2020			July 27, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	8,475		$	11,750
Investments	18,587			21,663
Accounts receivable, net of allowance for doubtful accounts of $112 at January 25, 2020 and $136 at July 27, 2019	4,330			5,491
Inventories	1,353			1,383
Financing receivables, net	4,827			5,095
Other current assets	2,481			2,373
Total current assets	40,053			47,755
Property and equipment, net	2,621			2,789
Financing receivables, net	4,757			4,958
Goodwill	33,612			33,529
Purchased intangible assets, net	1,906			2,201
Deferred tax assets	3,896			4,065
Other assets	3,581			2,496
TOTAL ASSETS	$	90,426		$	97,793
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt	$	1,499		$	10,191
Accounts payable	1,935			2,059
Income taxes payable	819			1,149
Accrued compensation	2,690			3,221
Deferred revenue	10,638			10,668
Other current liabilities	4,507			4,424
Total current liabilities	22,088			31,712
Long-term debt	14,494			14,475
Income taxes payable	8,227			8,927
Deferred revenue	8,048			7,799
Other long-term liabilities	2,036			1,309
Total liabilities	54,893			64,222
Commitments and contingencies (Note 14)
Equity:
Cisco shareholders’ equity:
Preferred stock, no par value: 5 shares authorized; none issued and outstanding	—			—
Common stock and additional paid-in capital, $0.001 par value: 20,000 shares authorized; 4,241 and 4,250 shares issued and outstanding at January 25, 2020 and July 27, 2019, respectively	40,617			40,266
Accumulated deficit	(4,384		)	(5,903		)
Accumulated other comprehensive loss	(700		)	(792		)
Total equity	35,533			33,571
TOTAL LIABILITIES AND EQUITY	$	90,426		$	97,793

See Notes to Consolidated Financial Statements.

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CISCO SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per-share amounts)

(Unaudited)



	Three Months Ended						Six Months Ended
	January 25, 2020			January 26, 2019			January 25, 2020			January 26, 2019
REVENUE:
Product	$	8,671		$	9,273		$	18,549		$	19,163
Service	3,334			3,173			6,615			6,355
Total revenue	12,005			12,446			25,164			25,518
COST OF SALES:
Product	3,126			3,614			6,650			7,413
Service	1,115			1,059			2,286			2,186
Total cost of sales	4,241			4,673			8,936			9,599
GROSS MARGIN	7,764			7,773			16,228			15,919
OPERATING EXPENSES:
Research and development	1,570			1,557			3,236			3,165
Sales and marketing	2,279			2,271			4,759			4,681
General and administrative	455			509			974			720
Amortization of purchased intangible assets	38			39			74			73
Restructuring and other charges	42			186			226			264
Total operating expenses	4,384			4,562			9,269			8,903
OPERATING INCOME	3,380			3,211			6,959			7,016
Interest income	242			328			515			672
Interest expense	(158		)	(223		)	(336		)	(444		)
Other income (loss), net	70			27			82			8
Interest and other income (loss), net	154			132			261			236
INCOME BEFORE PROVISION FOR INCOME TAXES	3,534			3,343			7,220			7,252
Provision for income taxes	656			521			1,416			881
NET INCOME	$	2,878		$	2,822		$	5,804		$	6,371

Net income per share:
Basic	$	0.68		$	0.63		$	1.37		$	1.41
Diluted	$	0.68		$	0.63		$	1.36		$	1.40
Shares used in per-share calculation:
Basic	4,242			4,470			4,244			4,517
Diluted	4,260			4,505			4,265			4,557

See Notes to Consolidated Financial Statements.

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CISCO SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)

(Unaudited)



	Three Months Ended						Six Months Ended
	January 25, 2020			January 26, 2019			January 25, 2020			January 26, 2019
Net income	$	2,878		$	2,822		$	5,804		$	6,371
Available-for-sale investments:
Change in net unrealized gains and losses, net of tax benefit (expense) of $(15) and $(29) for the second quarter and first six months of fiscal 2020, respectively, and $(12) and $1 for the corresponding periods of fiscal 2019, respectively	66			82			139			87
Net (gains) losses reclassified into earnings, net of tax (benefit) expense of $7 and $12 for the second quarter and first six months of fiscal 2020, respectively, and $(1) for each of the corresponding periods of fiscal 2019, respectively	(4		)	4			(9		)	10
	62			86			130			97
Cash flow hedging instruments:
Change in unrealized gains and losses, net of tax benefit (expense) of $0 and $1 for the second quarter and first six months of fiscal 2020, respectively, and $1 and $2 for the corresponding periods of fiscal 2019, respectively	1			(4		)	1			(7		)
Net (gains) losses reclassified into earnings, net of tax (benefit) expense of $0 for each of the respective periods	2			(1		)	2			(1		)
	3			(5		)	3			(8		)
Net change in cumulative translation adjustment and actuarial gains and losses net of tax benefit (expense) of $(1) for each of the second quarter and first six months of fiscal 2020, respectively, and $0 and $(1) for the corresponding periods of fiscal 2019, respectively	50			27			(41		)	(182		)
Other comprehensive income (loss)	115			108			92			(93		)
Comprehensive income	$	2,993		$	2,930		$	5,896		$	6,278

See Notes to Consolidated Financial Statements.

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CISCO SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(Unaudited)



	Six Months Ended
	January 25, 2020			January 26, 2019
Cash flows from operating activities:
Net income	$	5,804		$	6,371
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, and other	918			952
Share-based compensation expense	779			792
Provision for receivables	46			30
Deferred income taxes	128			(257		)
(Gains) losses on divestitures, investments and other, net	(162		)	(77		)
Change in operating assets and liabilities, net of effects of acquisitions and divestitures:
Accounts receivable	1,084			1,613
Inventories	25			(203		)
Financing receivables	408			161
Other assets	130			(652		)
Accounts payable	(126		)	(296		)
Income taxes, net	(1,007		)	(830		)
Accrued compensation	(521		)	(339		)
Deferred revenue	236			207
Other liabilities	(355		)	88
Net cash provided by operating activities	7,387			7,560
Cash flows from investing activities:
Purchases of investments	(4,250		)	(677		)
Proceeds from sales of investments	3,410			3,055
Proceeds from maturities of investments	4,044			6,263
Acquisitions and divestitures	(163		)	(1,599		)
Purchases of investments in privately held companies	(97		)	(68		)
Return of investments in privately held companies	91			43
Acquisition of property and equipment	(391		)	(473		)
Proceeds from sales of property and equipment	131			10
Other	(10		)	(12		)
Net cash provided by investing activities	2,765			6,542
Cash flows from financing activities:
Issuances of common stock	334			312
Repurchases of common stock—repurchase program	(1,648		)	(10,062		)
Shares repurchased for tax withholdings on vesting of restricted stock units	(437		)	(514		)
Short-term borrowings, original maturities of 90 days or less, net	(3,470		)	—
Repayments of debt	(5,220		)	—
Dividends paid	(2,972		)	(2,970		)
Other	(12		)	18
Net cash used in financing activities	(13,425		)	(13,216		)
Net (decrease) increase in cash, cash equivalents, and restricted cash	(3,273		)	886
Cash, cash equivalents, and restricted cash, beginning of period	11,772			8,993
Cash, cash equivalents, and restricted cash, end of period	$	8,499		$	9,879

Supplemental cash flow information:
Cash paid for interest	$	349		$	425
Cash paid for income taxes, net	$	2,295		$	1,968

See Notes to Consolidated Financial Statements.

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CISCO SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(in millions, except per-share amounts)

(Unaudited)



Three Months Ended January 25, 2020	Shares of Common Stock		Common Stock and Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total Equity
BALANCE AT OCTOBER 26, 2019	4,241		$	40,321		$	(5,083	)	$	(815	)	$	34,423
Net income						2,878						2,878
Other comprehensive income									115			115
Issuance of common stock	23		332									332
Repurchase of common stock	(18	)	(177		)	(693		)				(870		)
Shares repurchased for tax withholdings on vesting of restricted stock units	(5	)	(243		)							(243		)
Cash dividends declared ($0.35 per common share)						(1,486		)				(1,486		)
Share-based compensation			384									384
BALANCE AT JANUARY 25, 2020	4,241		$	40,617		$	(4,384	)	$	(700	)	$	35,533



Six Months Ended January 25, 2020	Shares of Common Stock		Common Stock and Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total Equity
BALANCE AT JULY 27, 2019	4,250		$	40,266		$	(5,903	)	$	(792	)	$	33,571
Net income						5,804						5,804
Other comprehensive income									92			92
Issuance of common stock	34		334									334
Repurchase of common stock	(34	)	(325		)	(1,313		)				(1,638		)
Shares repurchased for tax withholdings on vesting of restricted stock units	(9	)	(437		)							(437		)
Cash dividends declared ($0.70 per common share)						(2,972		)				(2,972		)
Share-based compensation			779									779
BALANCE AT JANUARY 25, 2020	4,241		$	40,617		$	(4,384	)	$	(700	)	$	35,533

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CISCO SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(in millions, except per-share amounts)

(Unaudited)



Three Months Ended January 26, 2019	Shares of Common Stock		Common Stock and Additional Paid-In Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Equity
BALANCE AT OCTOBER 27, 2018	4,517		$	41,897		$	3,169		$	(1,218	)	$	43,848
Net income						2,822						2,822
Other comprehensive income									108			108
Issuance of common stock	22		304									304
Repurchase of common stock	(111	)	(1,033		)	(3,983		)				(5,016		)
Shares repurchased for tax withholdings on vesting of restricted stock units	(4	)	(196		)							(196		)
Cash dividends declared ($0.33 per common share)						(1,470		)				(1,470		)
Share-based compensation			389									389
BALANCE AT JANUARY 26, 2019	4,424		$	41,361		$	538		$	(1,110	)	$	40,789



Six Months Ended January 26, 2019	Shares of Common Stock		Common Stock and Additional Paid-In Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Equity
BALANCE AT JULY 28, 2018	4,614		$	42,820		$	1,233		$	(849	)	$	43,204
Net income						6,371						6,371
Other comprehensive loss									(93		)	(93		)
Issuance of common stock	41		312									312
Repurchase of common stock	(220	)	(2,049		)	(7,993		)				(10,042		)
Shares repurchased for tax withholdings on vesting of restricted stock units	(11	)	(514		)							(514		)
Cash dividends declared ($0.66 per common share)						(2,970		)				(2,970		)
Effect of adoption of accounting standards						3,897			(168		)	3,729
Share-based compensation			792									792
BALANCE AT JANUARY 26, 2019	4,424		$	41,361		$	538		$	(1,110	)	$	40,789

See Notes to Consolidated Financial Statements.

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CISCO SYSTEMS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


1.	Basis of Presentation

The fiscal year for Cisco Systems, Inc. (the “Company,” “Cisco,” “we,” “us,” or “our”) is the 52 or 53 weeks ending on the last Saturday in July. Fiscal 2020 and fiscal 2019 are each 52-week fiscal years. The Consolidated Financial Statements include our accounts and those of our subsidiaries. All intercompany accounts and transactions have been eliminated. We conduct business globally and are primarily managed on a geographic basis in the following three geographic segments: the Americas; Europe, Middle East, and Africa (EMEA); and Asia Pacific, Japan, and China (APJC).

We have prepared the accompanying financial data as of January 25, 2020 and for the second quarter and first six months of fiscal 2020 and 2019, without audit, pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The July 27, 2019 Consolidated Balance Sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. However, we believe that the disclosures are adequate to make the information presented not misleading. These Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended July 27, 2019.

Our consolidated financial statements include our accounts and entities consolidated under the variable interest and voting models. The noncontrolling interests attributed to these investments, if any, are presented as a separate component from our equity in the equity section of the Consolidated Balance Sheets. The share of earnings attributable to the noncontrolling interests are not presented separately in the Consolidated Statements of Operations as these amounts are not material for any of the fiscal periods presented.

In the opinion of management, all normal recurring adjustments necessary to present fairly the consolidated balance sheet as of January 25, 2020, the results of operations, the statements of comprehensive income (loss) and the statements of equity for the second quarter and first six months of fiscal 2020 and 2019; and the statements of cash flows for the first six months of fiscal 2020 and 2019, as applicable, have been made. The results of operations for the second quarter and first six months of fiscal 2020 are not necessarily indicative of the operating results for the full fiscal year or any future periods.

Certain reclassifications have been made to the amounts in prior periods in order to conform to the current period’s presentation. We have evaluated subsequent events through the date that the financial statements were issued.


2.	Recent Accounting Pronouncements


(a)	New Accounting Updates Recently Adopted

Leases In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Codification (ASC) 842, Leases, a new standard requiring lessees to recognize operating and finance lease liabilities on the balance sheet, as well as corresponding right-of-use (ROU) assets. This standard also made some changes to lessor accounting and aligns key aspects of the lessor accounting model with the revenue recognition standard. In addition, new disclosures are required to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. ASC 842 requires adoption using the modified retrospective approach, with the option of applying the requirements of the standard either i) retrospectively to each prior comparative reporting period presented, or ii) retrospectively at the beginning of the period of adoption. We adopted this standard at the beginning of our first quarter of fiscal 2020 and applied it at the beginning of the period of adoption and did not restate prior periods. We adopted ASC 842 on July 28, 2019 which resulted in the recognition of $1.2 billion of operating lease ROU assets included in other assets and $1.2 billion of operating lease liabilities included in other current liabilities and other long-term liabilities. There were no transition adjustments recorded from the adoption of ASC 842 as a lessor.

We have elected to apply the package of practical expedients permitted under the transition guidance within ASC 842 which does not require reassessment of initial direct costs, classification of a lease and definition of a lease. We also elected additional practical expedients which resulted in: i) allowing us not to reassess the accounting treatment for existing or expired land easements in transition; ii) combining lease and non-lease components and iii) not recording leases with an initial term of less than 12 months on our Consolidated Balance Sheet.

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CISCO SYSTEMS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

As a lessee, we determine if an arrangement is a lease at commencement. Our ROU lease assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments related to the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. We use incremental borrowing rates based on information available at the commencement date to determine the present value of our lease payments.

As a lessor, we determine if an arrangement is a lease at inception. We provide leasing arrangements for our equipment to certain qualified customers. Our lease portfolio primarily consists of sales-type leases. We allocate the consideration in a bundled contract with our customers based on relative standalone selling prices of our lease and non-lease components. The residual value on our leased equipment is determined at the inception of the lease based on an analysis of estimates of the value of equipment, market factors and historical customer behavior. Residual value estimates are reviewed on a periodic basis and other-than-temporary declines are expensed in the period they occur. Our leases generally provide an end-of-term option for the customer to extend the lease under mutually-agreed terms, return the leased equipment, or purchase the equipment for either the then-market value of the equipment or a pre-determined purchase price. If a customer chooses to terminate their lease prior to the original end of term date, the customer is required to pay all remaining lease payments in full.

For additional information, see Note 8.


(b)	Recent Accounting Standards or Updates Not Yet Effective

Credit Losses of Financial Instruments In June 2016, the FASB issued an accounting standard update that requires measurement and recognition of expected credit losses for financial assets held based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. The accounting standard update will be effective for us beginning in the first quarter of fiscal 2021 on a modified retrospective basis. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements.


3.	Revenue

We enter into contracts with customers that can include various combinations of products and services which are generally distinct and accounted for as separate performance obligations. As a result, our contracts may contain multiple performance obligations. We determine whether arrangements are distinct based on whether the customer can benefit from the product or service on its own or together with other resources that are readily available and whether our commitment to transfer the product or service to the customer is separately identifiable from other obligations in the contract. We classify our hardware, perpetual software licenses, and software-as-a-service (SaaS) as distinct performance obligations. Term software licenses represent multiple obligations, which include software licenses and software maintenance. In transactions where we deliver hardware or software, we are typically the principal and we record revenue and costs of goods sold on a gross basis. We refer to our term software licenses, security software licenses, SaaS, and associated service arrangements as subscription offers.

We recognize revenue upon transfer of control of promised goods or services in a contract with a customer in an amount that reflects the consideration we expect to receive in exchange for those products or services. Transfer of control occurs once the customer has the contractual right to use the product, generally upon shipment or once title and risk of loss has transferred to the customer. Transfer of control can also occur over time for software maintenance and services as the customer receives the benefit over the contract term. Our hardware and perpetual software licenses are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses include multiple performance obligations where the term licenses are recognized upfront upon transfer of control, with the associated software maintenance revenue recognized ratably over the contract term as services and software updates are provided. SaaS arrangements do not include the right for the customer to take possession of the software during the term, and therefore have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term as the customer consumes the services. On our product sales, we record consideration from shipping and handling on a gross basis within net product sales. We record our revenue net of any associated sales taxes.

Significant Judgments

Revenue is allocated among these performance obligations in a manner that reflects the consideration that we expect to be entitled to for the promised goods or services based on standalone selling prices (SSP). SSP is estimated for each distinct performance obligation and judgment may be required in their determination. The best evidence of SSP is the observable price of a product or service when we sell the goods separately in similar circumstances and to similar customers. In instances where SSP is not directly observable, we determine SSP using information that may include market conditions and other observable inputs.

We apply judgment in determining the transaction price as we may be required to estimate variable consideration when determining the amount of revenue to recognize. Variable consideration includes contractual potential penalties and various rebate, cooperative

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CISCO SYSTEMS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

marketing and other incentive programs that we offer to our distributors, partners and customers. When determining the amount of revenue to recognize, we estimate the expected usage of these programs, applying the expected value or most likely estimate and update the estimate at each reporting period as actual utilization becomes available. We also consider the customers' right of return in determining the transaction price, where applicable.

We assess certain software licenses, such as for security software, that contain critical updates or upgrades which customers can download throughout the contract term. Without these updates or upgrades, the functionality of the software would diminish over a relatively short time period. These updates or upgrades provide the customer the full functionality of the purchased security software licenses and are required to maintain the security license's utility as the risks and threats in the environment are rapidly changing. In these circumstances, the revenue from these software arrangements is recognized as a single performance obligation satisfied over the contract term.


(a)	Disaggregation of Revenue

We disaggregate our revenue into groups of similar products and services that depict the nature, amount, and timing of revenue and cash flows for our various offerings. The sales cycle, contractual obligations, customer requirements, and go-to-market strategies differ for each of our product categories, resulting in different economic risk profiles for each category. The following table presents this disaggregation of revenue (in millions):



	Three Months Ended				Six Months Ended
	January 25, 2020		January 26, 2019		January 25, 2020		January 26, 2019
Revenue:
Infrastructure Platforms	$	6,528	$	7,102	$	14,067	$	14,724
Applications	1,349		1,465		2,847		2,884
Security	748		684		1,563		1,354
Other Products	46		22		72		200
Total Product	8,671		9,273		18,549		19,163
Services	3,334		3,173		6,615		6,355
Total ⁽¹⁾	$	12,005	$	12,446	$