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17. Segment Information and Major Customers
(a) Revenue and Gross Margin by Segment
The Company conducts business globally and is primarily managed on a geographic basis consisting of three segments: the
Americas, EMEA, and APJC. 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 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 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 and
impairment of acquisition-related intangible assets, share-based compensation expense, significant litigation and other
contingencies, impacts to cost of sales from purchase accounting adjustments to inventory, 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 fiscal 2015, 2014, and 2013, 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):
Years Ended July 25, 2015 July 26, 2014 July 27, 2013
Revenue:
Americas ............................................................ $ 29,655 $ 27,781 $ 28,639
EMEA ............................................................... 12,322 12,006 12,210
APJC ................................................................ 7,184 7,355 7,758
Total ........................................................... $ 49,161 $ 47,142 $ 48,607
Gross margin:
Americas ............................................................ $ 18,670 $ 17,379 $ 17,887
EMEA ............................................................... 7,705 7,700 7,876
APJC ................................................................ 4,307 4,252 4,637
Segment total ................................................... 30,682 29,331 30,400
Unallocated corporate items ............................................... (1,001) (1,562) (960)
Total ........................................................... $ 29,681 $ 27,769 $ 29,440
Revenue in the United States was $26.0 billion, $24.3 billion, and $24.6 billion for fiscal 2015, 2014, and 2013, respectively.
(b) Revenue 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 groups its
products and technologies into the following categories: Switching, NGN Routing, Collaboration, Service Provider Video, Data
Center, Wireless, Security, 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 revenue for groups of similar products and services (in millions):
Years Ended July 25, 2015 July 26, 2014 July 27, 2013
Revenue:
Switching ............................................................ $ 14,741 $ 14,001 $ 14,711
NGN Routing ........................................................ 7,704 7,609 8,168
Collaboration ........................................................ 4,000 3,815 4,057
Service Provider Video .............................................. 3,555 3,969 4,855
Data Center .......................................................... 3,220 2,640 2,074
Wireless ............................................................. 2,542 2,293 2,257
Security ............................................................. 1,747 1,566 1,348
Other ................................................................ 241 279 559
Product ......................................................... 37,750 36,172 38,029
Service ......................................................... 11,411 10,970 10,578
Total ...................................................... $ 49,161 $ 47,142 $ 48,607
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