16.

Segment Information and Major Customers

(a) Net Sales and Gross Margin by Segment

The Company conducts business globally and is primarily managed on a geographic basis. As of January 28, 2012, the Company has three geographic segments: the Americas; EMEA; and APJC. In fiscal 2011, the Company was organized into four geographic segments, which consisted of United States and Canada, European Markets, Emerging Markets, and Asia Pacific Markets. As a result of this geographic segment change in fiscal 2012, countries within the former Emerging Markets segment were consolidated into either EMEA or the Americas segment depending on their respective geographic locations. The Company has reclassified the geographic segment data for the prior period to conform to the current period's presentation.

The Company's management makes financial decisions and allocates resources based on the information it receives from its internal management system. Sales are attributed to a geographic segment based on the ordering location of the customer. The Company does not allocate research and development, sales and marketing, or general and administrative expenses to its geographic segments in this internal management system because management does not include the information in its measurement of the performance of the operating segments. In addition, the Company does not allocate amortization of acquisition-related intangible assets, share-based compensation expense, charges related to asset impairments and restructurings, and certain other charges to the gross margin for each segment because management does not include this information in its measurement of the performance of the operating segments.

Summarized financial information by segment for the three and six months ended January 28, 2012 and January 29, 2011 is based on the Company's internal management system and as utilized by the Company's Chief Operating Decision Maker (CODM) is as follows (in millions):


	Three Months Ended						Six Months Ended
	January 28, 2012			January 29, 2011			January 28, 2012			January 29, 2011
Net sales:
Americas ⁽¹⁾	$	6,552		$	6,011		$	13,140		$	12,327
EMEA		3,250			2,835			6,095			5,630
APJC		1,725			1,561			3,548			3,200

Total	$	11,527		$	10,407		$	22,783		$	21,157

Gross margin:
Americas	$	4,106		$	3,720		$	8,266		$	7,771
EMEA		2,095			1,814			3,849			3,623
APJC		992			955			2,100			2,009

Segment total		7,193			6,489			14,215			13,403
Unallocated corporate items ⁽²⁾		(128	)		(228	)		(260	)		(387	)

Total	$	7,065		$	6,261		$	13,955		$	13,016

⁽¹⁾	Net sales in the United States were $5.6 billion and $5.2 billion for the three months ended January 28, 2012 and January 29, 2011, respectively. Net sales in the United States were $11.2 billion and $10.6 billion for the six months ended January 28, 2012 and January 29, 2011, respectively.

⁽²⁾	The unallocated corporate items include the effects of amortization and impairment of acquisition-related intangible assets, share-based compensation expense, and charges related to asset impairments and restructurings.

(b) Net Sales for Groups of Similar Products and Services

The Company designs, manufactures, and sells Internet Protocol (IP)-based networking and other products related to the communications and IT industry and provides services associated with these products and their use. The Company formerly grouped its products and technologies into categories of Switches, Routers, New Products, and Other. Effective in the first quarter of fiscal 2012, the Company re-categorized its products and technologies into Switching, Next Generation Network ("NGN") Routing, Collaboration, Service Provider Video, Wireless, Security, Data Center, and Other Products. These products, primarily integrated by Cisco IOS Software, link geographically dispersed local-area networks (LANs), metropolitan-area networks (MANs) and wide-area networks (WANs).

The following table presents net sales for groups of similar products and services (in millions):


	Three Months Ended				Six Months Ended
	January 28, 2012		January 29, 2011		January 28, 2012		January 29, 2011
Net sales:
Switching	$	3,607	$	3,341	$	7,282	$	7,030
NGN Routing		2,077		1,919		4,185		4,096
Collaboration		1,047		952		2,140		1,929
Service Provider Video		1,015		825		1,894		1,603
Wireless		418		335		780		669
Security		334		270		654		560
Data Center		333		177		592		302
Other		287		417		543		747

Product		9,118		8,236		18,070		16,936
Service		2,409		2,171		4,713		4,221

Total	$	11,527	$	10,407	$	22,783	$	21,157

(c) Additional Segment Information

The majority of the Company's assets, excluding cash and cash equivalents and investments, as of January 28, 2012 and July 30, 2011 were attributable to its U.S. operations. The Company's total cash and cash equivalents and investments held by various foreign subsidiaries was $41.7 billion and $39.8 billion as of January 28, 2012 and July 30, 2011, respectively, and the remaining $5.0 billion and $4.8 billion at the respective period ends was available in the United States.

Property and equipment information is based on the physical location of the assets. The following table presents property and equipment information for geographic areas (in millions):


	January 28, 2012		July 30, 2011
Property and equipment, net:
United States	$	3,153	$	3,284
International		558		632

Total	$	3,711	$	3,916