Is Cisco Systems Stock Halal?
Table of Contents
How much of Cisco’s revenue comes from haram?
Is Cisco Systems Stock Halal? Cisco earns its revenue from the following revenue sources:
- Product:
Includes IP-based networking hardware related to communication and Information Technology.
Cisco also offers video conferencing solutions through Cisco TelePresence.
In addition, Cisco provides security products such as network security, cloud and email security, identity and access management, advanced threat protection, and unified threat management products.
- Service:
Includes technical support and advanced services.
The contributions from each of Cisco’s revenue segments in their Q3 FY21 report were as follows:
Practical Islamic Finance concludes:
None of Cisco’s revenue comes from anything inherently haram.
Does Cisco rely on interest to operate?
For the Trailing Twelve Months as of May 1, 2021 (Numbers in thousands, U.S. Dollars):
Interest Income: $675,000
Total Revenue: $48,846,000
Interest Expense: $455,000
Total Expenses: $35,336,000
Interest Income / Revenue: 1.38%
Interest Expense / Total Expense: 1.29%
The following table depicts the declining percentages of Cisco’s interest income and expenses relative to total revenues and expenses from 2018 to 2021.
| 2018 | 2019 | 2020 | 2021 | |
| Interest Income / Revenue | 3.06% | 2.52% | 1.87% | 1.38% |
| Interest Expense / Total Expense | 2.57% | 2.30% | 1.66% | 1.29% |
Practical Islamic Finance concludes:
Riba is used but is not relied upon in Cisco’s operations.
What is Cisco’s Environmental, Social, and Governance (ESG) impact?
Environment
According to Cisco’s 2020 CSR Impact Report, 83% of Cisco’s total global electricity comes from wind, solar, and hydroelectric sources.
In addition, Cisco has reduced direct and indirect greenhouse emissions associated with purchasing electricity, heat, cooling, or steam by 55% from its FY07 baseline.
Social
In 2020, Cisco made $53M in donations towards Covid-19 relief to hospital workers, including N95 masks and face shields 3D-printed by Cisco volunteers.
In addition, Cisco has a high Glassdoor rating of 4.3 out of 5.0 from over 24,000 current and previous employees compared to a 3.3 average for all other Glassdoor rated companies.
Governance
No notable governance highlights.
Practical Islamic Finance concludes:
Cisco has a net positive ESG impact.
Comfort Rating
From Cisco’s business, financial, and ESG reviews, Practical Islamic Finance rates Cisco stock as: