Cisco 2004 Annual Report Download - page 20

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Gross Margin
The following table shows the gross margin for each theater (in millions, except percentages):
AMOUNT PERCENTAGE
Years Ended July 31, 2004 July 26, 2003 July 27, 2002 July 31, 2004 July 26, 2003 July 27, 2002
Gross margin:
Americas $ 8,274 $ 7,340 $ 6,733 67.6% 69.6% 63.2%
EMEA 4,244 3,659 3,269 69.3% 70.3% 63.8%
Asia Pacific 1,532 1,313 1,121 68.7% 70.6% 63.5%
Japan 1,076 921 890 73.9% 72.4% 65.0%
Total $15,126 $ 13,233 $ 12,013 68.6% 70.1% 63.5%
The following table shows the gross margin for products and services (in millions, except percentages):
AMOUNT PERCENTAGE
Years Ended July 31, 2004 July 26, 2003 July 27, 2002 July 31, 2004 July 26, 2003 July 27, 2002
Gross margin:
Product $12,784 $ 10,971 $ 9,755 68.9% 70.5% 62.3%
Service 2,342 2,262 2,258 67.0% 68.3% 69.6%
Total $15,126 $13,233 $12,013 68.6% 70.1% 63.5%
Research and Development, Sales and Marketing, and General and Administrative Expenses
Research and development (“R&D”), sales and marketing, and general and administrative (“G&A”) expenses are summarized in the
following table (in millions, except percentages):
Variance Variance Variance Variance
Years Ended July 31, 2004 July 26, 2003 in Dollars in Percent July 26, 2003 July 27, 2002 in Dollars in Percent
Research and
development $ 3,192 $3,135 $ 57 1.8% $ 3,135 $ 3,448 $ (313) (9.1)%
Percentage of net sales 14.5% 16.6% 16.6% 18.2%
Sales and marketing 4,530 4,116 414 10.1% 4,116 4,264 (148) (3.5)%
Percentage of net sales 20.6% 21.8% 21.8% 22.5%
General and
administrative 867 702 165 23.5% 702 618 84 13.6%
Percentage of net sales 3.9% 3.7% 3.7% 3.3%
Total $ 8,589 $ 7,953 $ 636 8.0% $ 7,953 $ 8,330 $ (377) (4.5)%
Percentage of net sales 39.0% 42.1% 42.1% 44.0%
Interest and Other Income (Loss), Net
Interest and other income (loss), net were as follows (in millions):
Variance Variance
Years Ended July 31, 2004 July 26, 2003 in Dollars July 26, 2003 July 27, 2002 in Dollars
Interest income $ 512 $ 660 $ (148) $ 660 $ 895 $(235)
Other income (loss), net 188 (529) 717 (529) (1,104) 575
Total $700 $ 131 $ 569 $ 131 $ (209) $ 340
2004 ANNUAL REPORT 23