CompetitorsNarrow moat

Cisco Systems (CSCO) — moat facet

Cisco holds almost 30% of Ethernet switching overall and is third in the data centre, behind a GPU maker and the rival that already passed it.

Cisco competes with more companies than almost any page here can list. Its 10-K names eighteen, from Arista, Broadcom, Nvidia and Hewlett Packard Enterprise to Palo Alto Networks, CrowdStrike, Datadog and Zoom1, and it says "Barriers to entry are relatively low"2.

Data-centre Ethernet switching share, 1Q26 (%)Nvidia21.5%Arista20.7%Cisco17.8%DataCenterKnowledge on IDC Ethernet switch tracker, 1Q26
Third in the market that is growing fastest.

The four that matter are four different kinds of relationship. Arista is the rival that took the data centre and whose own pages in this collection tell that story. Nvidia is the rival that arrives with the product the customer most needs, the GPU. Broadcom is the chip supplier whose model Cisco walked away from when it built Silicon One. And the security and observability specialists are the incumbents in markets Cisco entered by acquisition.

In the fastest-growing market Cisco is third. IDC put data-centre Ethernet switching shares in the first quarter of 2026 at 21.5% for Nvidia, 20.7% for Arista and 17.8% for Cisco3. In the market as a whole, including the campus, Cisco's switching share was 29.3%4.

The competitive picture is therefore split. Cisco is strongest where buyers change vendors least, and weakest where buyers are few, technical and willing to switch.

The rivalry has also changed Cisco's own filing. Juniper Networks appeared in the fiscal 2024 list and New Relic in the fiscal 2024 and 2025 lists; both are gone from the fiscal 2026 list56. Hewlett Packard Enterprise, which bought Juniper, now appears as the combined rival: its Ethernet business, including Juniper, took $1.15 billion in the second quarter of 2026, up 6.1%7, about a fifth of Cisco's $5.43 billion89.

Huawei is the rival Cisco rarely meets in its home market and often meets abroad. Cisco names it among its competitors10, and warns of price-focused competition from Asia11. Yet Cisco's product revenue in China grew 23% in fiscal 202612, so the pressure has not yet shown in the one country where Huawei is strongest.

The share that tells the story is data-centre switching. A rise toward 20% as the AI orders ship would show Cisco competing on equal terms; a fall below 15% would confirm that the growth market belongs to others.

Moat trajectory: Narrowing

Third in data-centre Ethernet in 1Q26 despite fast growth.

The number that tests this moat
Third-party estimate
Data-centre Ethernet share (IDC), latest quarter
Cisco 17.8%, third (1Q26); Nvidia 21.5%, Arista 20.7%

Cisco's standing where growth is fastest; a fall below 15% would confirm the AI market belongs to others.

Source: DataCenterKnowledge on IDC 1Q26 ↗
Dig deeper
DIG DEEPER 01
Arista: The Rival That Took the Data Centre
Arista is still marginally ahead of Cisco in data-centre Ethernet revenue, $2.3 billion to $2.24 billion in a quarter, but Cisco is growing twice as…
DIG DEEPER 02
Nvidia: The Rival That Arrives With the GPUs
Nvidia's Ethernet revenue grew 2.8 times in a quarter because it sells the network to buyers who already have to buy its GPUs.
DIG DEEPER 03
Broadcom: The Chip Supplier Cisco Now Competes With
Cisco left Broadcom's chip model to build its own silicon, and now spends $9.6 billion a year on research partly to compete with its former supplier.
DIG DEEPER 04
The Specialists in the Markets Cisco Bought Into
In security and observability Cisco is the challenger to specialists, and its lines grew 2% and 4% while it spent $27 billion to get in.
References
  1. ReportedIts 10-K names eighteen, from Arista, Broadcom, Nvidia and Hewlett Packard Enterprise to Palo Alto Networks, CrowdStrike, Datadog and Zoom, and it says "Barriers to entry are relatively low".
    Cisco Systems Form 10-K for fiscal 2026 (year ended 25 July 2026) - Item 1A risk factors, competition and legal proceedings. — FY2026 · publ. 2 September 2026 · source ↗
  2. ReportedIts 10-K names eighteen, from Arista, Broadcom, Nvidia and Hewlett Packard Enterprise to Palo Alto Networks, CrowdStrike, Datadog and Zoom, and it says "Barriers to entry are relatively low".
    Cisco Systems Form 10-K for fiscal 2026 (year ended 25 July 2026) - Item 1A risk factors, competition and legal proceedings. — FY2026 · publ. 2 September 2026 · source ↗
  3. Third-party estimateIDC put data-centre Ethernet switching shares in the first quarter of 2026 at 21.5% for Nvidia, 20.7% for Arista and 17.8% for Cisco.
    DataCenterKnowledge on IDC 1Q26 - data-centre Ethernet switching shares: Nvidia 21.5%, Arista 20.7%, Cisco 17.8%. — 1Q26 · publ. 2026 · source ↗
  4. Third-party estimateIn the market as a whole, including the campus, Cisco's switching share was 29.3%.
    IDC, Worldwide Ethernet switch and router tracker, 1Q26 - Cisco switching revenue $4.5B and 29.3% share, router share 35.1%. — 1Q26 · publ. 2026 · source ↗
  5. ReportedJuniper Networks appeared in the fiscal 2024 list and New Relic in the fiscal 2024 and 2025 lists; both are gone from the fiscal 2026 list.
    Cisco Systems Form 10-K for fiscal 2026 (year ended 25 July 2026) - Item 1 business: products, strategy, employees and sales. — FY2026 · publ. 2 September 2026 · source ↗
  6. ReportedJuniper Networks appeared in the fiscal 2024 list and New Relic in the fiscal 2024 and 2025 lists; both are gone from the fiscal 2026 list.
    Cisco Systems Form 10-K for fiscal 2024 - the new product categories with fiscal 2022-2023 restated, segment revenue and margins, and the Splunk acquisition. — FY2024 · publ. September 2024 · source ↗
  7. Third-party estimateHewlett Packard Enterprise, which bought Juniper, now appears as the combined rival: its Ethernet business, including Juniper, took $1.15 billion in the second quarter of 2026, up 6.1%, about a fifth of Cisco's $5.43 billion.
    The Next Platform on IDC's Q2 2026 Ethernet data - Cisco Ethernet $5.43bn (+36.2%), data-centre $2.24bn (+77.3%), Arista $2.3bn, Nvidia $3.86bn. — Q2 2026 · publ. 20 September 2026 · source ↗
  8. Third-party estimateHewlett Packard Enterprise, which bought Juniper, now appears as the combined rival: its Ethernet business, including Juniper, took $1.15 billion in the second quarter of 2026, up 6.1%, about a fifth of Cisco's $5.43 billion.
    The Next Platform on IDC's Q2 2026 Ethernet data - Cisco Ethernet $5.43bn (+36.2%), data-centre $2.24bn (+77.3%), Arista $2.3bn, Nvidia $3.86bn. — Q2 2026 · publ. 20 September 2026 · source ↗
  9. Moat Explorer calcHewlett Packard Enterprise, which bought Juniper, now appears as the combined rival: its Ethernet business, including Juniper, took $1.15 billion in the second quarter of 2026, up 6.1%, about a fifth of Cisco's $5.43 billion.
    Moat Explorer calculation from Cisco's reported revenue, margins and financial statements ($ millions unless stated). Revenue growth FY2026 63,325 / 56,654 - 1 = 11.8%; increase 63,325 - 56,654 = 6,671. Networking share 34,668 / 63,325 = 54.7%; of product revenue 34,668 / 48,295 = 71.8%; networking increase 34,668 - 28,304 = 6,364, 6,364 / 6,671 = 95.4% of the revenue increase. Networking against FY2023 34,668 / 34,570 - 1 = 0.3%; FY2024 29,229 / 34,570 - 1 = -15.4% (a fall of 5,341); FY2025 28,304 / 29,229 - 1 = -3.2% (a fall of 925); FY2023 34,570 - 29,265 = +5,305. Other lines FY2026 changes: security 8,232 - 8,094 = +138 (+1.7%); collaboration 4,300 - 4,154 = +146 (+3.5%); observability 1,095 - 1,055 = +40 (+3.8%); services 15,030 - 15,046 = -16 (-0.1%). Product revenue 48,295 / 41,608 - 1 = 16.1%. Shares of FY2026 revenue: services 15,030 / 63,325 = 23.7%; security 8,232 / 63,325 = 13.0%; collaboration 4,300 / 63,325 = 6.8%; observability 1,095 / 63,325 = 1.7%. Observability shares: 581 / 51,557 = 1.1% (FY2022); 661 / 56,998 = 1.2%; 837 / 53,803 = 1.6%; 1,055 / 56,654 = 1.9%. Observability growth 661 / 581 - 1 = 13.8%; 837 / 661 - 1 = 26.6%; 1,055 / 837 - 1 = 26.0%; 1,095 / 1,055 - 1 = 3.8%; 1,095 / 581 = 1.88 times. Services growth 13,856 / 13,539 - 1 = 2.3% (FY2023); 14,550 / 13,856 - 1 = 5.0%; 15,046 / 14,550 - 1 = 3.4%; FY2016 to FY2026 15,030 / 11,993 - 1 = 25.3%. Services gross profit 10,346 / 40,860 = 25.3% of gross margin. Subscription services 13,663 / 15,030 = 90.9% of services. Non-subscription product 48,295 - 18,314 = 29,981; non-subscription services 15,030 - 13,663 = 1,367. Subscription share 31,977 / 63,325 = 50.5% (FY2026); 31,526 / 56,654 = 55.6% (FY2025); 27,380 / 53,803 = 50.9% (FY2024); subscription growth 31,977 / 31,526 - 1 = 1.4%. Security: 3,382 / 1,969 - 1 = 71.8% (FY2016 to FY2021, older basis); 8,094 / 3,859 = 2.1 times (FY2023 to FY2025); 8,232 / 3,699 = 2.2 times (FY2022 to FY2026). Collaboration 4,300 / 4,823 - 1 = -10.8% against FY2020. Segments: Americas revenue 37,799 / 33,656 - 1 = 12.3%; Americas gross margin 68.2% - 65.1% = 3.1 points (310 basis points); EMEA 16,613 / 14,824 - 1 = 12.1%; APJC 8,914 / 8,174 - 1 = 9.1%. United States revenue 34.4 / 63.3 = 54.3%; outside the United States 63.3 - 34.4 = 28.9 bn; United States growth 34.4 / 30.4 - 1 = 13.2%. AI and orders: Q3 FY2026 hyperscaler orders 5.3 - 1.3 - 2.1 = 1.9 bn; Acacia about 1,000 / 9,791 networking = 10.2%; FY2027 revenue guidance midpoint (72.2 + 73.4) / 2 = 72.8 bn, 72.8 / 63.325 - 1 = 15.0%; AI revenue target 7.5 / 72.8 = 10.3%; price increases 4.5 points / 15 = about a third; Q1 FY2027 gross margin guidance midpoint (65 + 66) / 2 = 65.5%; Q1 FY2027 operating margin guidance midpoint (35.5 + 36.5) / 2 = 36.0%. Security plus observability Q4 FY2026 2,226 + 275 = 2,501. Backlog: remaining performance obligations 46,734 / 63,325 = 73.8% of revenue; short-term 22,776 / 21,723 - 1 = 4.8%; long-term 23,958 / 21,810 - 1 = 9.8%. Purchase commitments 17,165 / 7,599 - 1 = 125.9%; 17,165 / 63,325 = 27.1% of revenue. Inventory 5,694 / 3,164 - 1 = 80.0%. Competitors named in the FY2026 10-K: 18 (Amazon Web Services, Arista, Broadcom, Ciena, CrowdStrike, Datadog, Dell, Dynatrace, Fortinet, Hewlett Packard Enterprise, Huawei, Microsoft, Nokia, Nvidia, Palo Alto Networks, RingCentral, Zoom, Zscaler). Balance sheet, cash flow and market data: Net income 13,267 / 10,180 - 1 = 30.3%; free cash flow 12,767 / 13,288 - 1 = -3.9%; capital spending 1,410 / 905 - 1 = 55.8%; capital spending 1,410 / 63,325 = 2.2% of revenue; free cash flow margin 12,767 / 63,325 = 20.2%; returned 12,659 / 12,767 = 99.2% of free cash flow. Dividends / free cash flow: 6,384 / 10,210 = 62.5% (FY2024); 6,437 / 13,288 = 48.4% (FY2025); 6,553 / 12,767 = 51.3% (FY2026). Dividends per share 1.66 / 0.72 = 2.3 times (FY2014 to FY2026). Buybacks: 117 - 76 = 41 million fewer shares than FY2024; average price 80.26 / 49.45 - 1 = 62.3%; FY2018-FY2026 17,661 + 20,577 + 2,619 + 2,902 + 7,734 + 4,271 + 5,764 + 5,995 + 6,106 = 73,629. Diluted shares 3,987 / 5,146 - 1 = -22.5%. Net income 13,267 / 8,981 - 1 = 47.7%; diluted EPS 3.33 / 1.75 - 1 = 90.3% (FY2015 to FY2026). Net debt 29,533 - 15,918 (cash and investments, about 15.9 bn) = 13,615, about 13.6 bn. Net interest 1,365 - 1,006 = +359 (FY2024); 1,001 - 1,593 = -592 (FY2025); 866 - 1,470 = -604 (FY2026). Goodwill 59,477 / 129,637 = 45.9% of total assets; Splunk goodwill 19,301 / 27,090 = 71.2% of consideration. Employees 82,400 / 90,400 - 1 = -8.8%; R&D 9,563 - 9,300 = +263; sales and marketing 11,559 - 10,966 = +593; R&D 9,563 / 63,325 = 15.1% of revenue; restructuring 693 / 63,325 = 1.1% of revenue. FY2025 net income as released about 10,500 - 10,180 as filed = about 320 (about 0.3 bn); EPS 2.61 - 2.55 = 0.06. Free cash flow yield 12,767 / 421,740 = 3.0%. Price against the 52-week high 106.97 / 130.37 - 1 = -17.9%. P/E 421,740 / 13,267 = 31.8; P/S 421,740 / 63,325 = 6.66. Further: revenue FY2023 to FY2026 63,325 / 56,998 - 1 = 11.1%; HPE and Juniper Ethernet 1.15 / 5.43 = 21.2% of Cisco Ethernet; non-GAAP EPS 4.33 / 3.81 - 1 = 13.6%; FY2026 order forecast 9 / 5 - 1 = 80%; FY2025 AI orders 2.0 / 56.654 = 3.5% of revenue; FY2026 9.3 / 63.325 = 14.7%; product subscription 18,314 / 17,783 - 1 = 3.0%; FY2018 buyback 17,661 / 80.26 = 220 million shares; 76 / 3,946 = 1.9% of shares; revenue FY2024 to FY2026 63,325 / 53,803 - 1 = 17.7%; Arista 2.30 - 2.24 = 0.06 bn; R&D 9,300 / 7,983 - 1 = 16.5% and revenue 56,654 / 53,803 - 1 = 5.3% (FY2025); R&D 9,563 / 9,300 - 1 = 2.8% (FY2026); Q1 FY2027 guidance midpoint 18.1 / 14.883 - 1 = 21.6%; FY2028 consensus P/E 106.97 / 5.62 = 19.0; cash 15.9 / 6.553 = 2.4 years of dividends; services obligations 23,298 / 46,734 = 49.9% and 23,298 / 15,030 = 1.55 years; short-term debt 10,161 / 29,533 = 34.4%; authorisation 8.1 / 6.1 = 1.3 years; product-services margin spread 68.8 - 63.2 = 5.6 points; FY2024 returns (6,384 + 5,764) / 10,210 = 119%; diluted shares 4,254 / 4,881 - 1 = -12.8% (FY2018 to FY2020); buybacks FY2018 and FY2019 17,661 + 20,577 = 38,238; AI revenue 7.5 / 3.8 = 1.97 times; FY2027 GAAP EPS guidance midpoint (4.00 + 4.06) / 2 = 4.03, 4.03 / 3.33 - 1 = 21.0%; G&A 2,761 / 2,992 - 1 = -7.7%; Q4 security 2,226 / 8,232 = 27.0% of the year - revenue-line totals, growth and orders. — FY2015-FY2027 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Cisco's Forms 10-K, quarterly results releases, the Q4 FY2026 call and market data; operands shown in the source line.
  10. ReportedCisco names it among its competitors, and warns of price-focused competition from Asia.
    Cisco Systems Form 10-K for fiscal 2026 (year ended 25 July 2026) - Item 1A risk factors, competition and legal proceedings. — FY2026 · publ. 2 September 2026 · source ↗
  11. ReportedCisco names it among its competitors, and warns of price-focused competition from Asia.
    Cisco Systems Form 10-K for fiscal 2026 (year ended 25 July 2026) - Item 1A risk factors, competition and legal proceedings. — FY2026 · publ. 2 September 2026 · source ↗
  12. ReportedYet Cisco's product revenue in China grew 23% in fiscal 2026, so the pressure has not yet shown in the one country where Huawei is strongest.
    Cisco Systems Form 10-K for fiscal 2026 (year ended 25 July 2026) - Item 1A risk factors, competition and legal proceedings. — FY2026 · publ. 2 September 2026 · source ↗
Sources
Generated September 25, 2026