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CLAIM #17785 · CSCO (CSCO) · 2025Q1 earnings call · Nov 13, 2024 · due Jul 31, 2025

There will be a tail of those now that we've got that process in place. It will be significantly less as we look at Q2, Q3 and Q4.

Scott Herren · CFO

PENDING
graded after results covering Jul 31, 2025 are reported

In context

ss margin. Obviously, Splunk was in -- obviously, the quarter and last quarter as well. So, I think product mix was probably a pretty big factor here. I'm wondering if there was a big difference in terms of the mix of UCS servers or other product lines that kind of drove the day there. Any details would be great. Thanks. Scott Herren: Sure. I talked about gross margin improvement during Q1, in particular, having a one-time benefit from the duty drawback because it's a couple of years of duty that we've been working through this process of not just getting the filings together, but getting it all approved and getting the cash back. I would say that was a substantial contributor to the benefit we saw in Q1, somewhere between probably 0.5 point and 1 point of improvement just driven by that. There will be a tail of those now that we've got that process in place. It will be significantly less as we look at Q2, Q3 and Q4. On the product mix front, we definitely got a benefit from Splunk coming in, not surprisingly. As you know, they had gross margins -- product gross margins in the 80% range. That's been a tailwind to us overall. There's also favorable product mix across some other product lines inside there and that will continue. The team has also done a really nice job driving cost out, as I said earlier, I give credit to our supply chain and our product teams on continuing to drive cost out of that cost infrastructure. So full year, I see that those gross margins settling into the range that we guided in Q2 into that 68% to 69% range. I would point out that pricing is back to the normalized trend that we had seen pre-pandemic, which is somewhere between 1 point and 2 points of headwind exactly as we sa

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SEC filings for CSCO · Claim quote is verbatim from the 2025Q1 earnings call.