Is Cisco's Dividend Enough to Attract Long-Term Investors in 2025?

Cisco Systems, Inc. (NASDAQ:CSCO) is one of the 10 Technology Dividend Aristocrats to Buy in 2025.

Cisco Systems, Inc. (NASDAQ:CSCO) is an American multinational digital communications technology company, headquartered in California. The company offers a wide range of networking hardware, software, and telecom equipment.

Cisco Systems, Inc. (NASDAQ:CSCO) has a strong dividend history, having raised its payouts for 18 consecutive years. While the company’s revenue growth over the past decade has been modest— averaging between 1% and 3%—its consistent cash generation has supported its ability to maintain and gradually raise dividends. In the third quarter of fiscal 2025, Cisco reported operating cash flow of $4.1 billion, reflecting a 2% increase year-over-year. The company returned $3.1 billion to shareholders during the quarter through dividends and share repurchases.

Cisco Systems, Inc. (NASDAQ:CSCO)’s acquisition strategy also plays a supportive role in its dividend policy, especially when these acquisitions contribute positively to cash flow. A prime example is the company’s 2024 acquisition of Splunk, which added approximately $1.4 billion to its fiscal 2024 revenue.

In terms of payout ratio, Cisco Systems, Inc. (NASDAQ:CSCO) remains on solid ground. Its five-year average payout ratio sits at 56.6%, suggesting that the company retains enough flexibility to continue rewarding shareholders while investing in growth. It currently offers a quarterly dividend of $0.41 per share and has a dividend yield of 2.47%, as of June 22.

While we acknowledge the potential of CSCO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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