Keysight Technologies (KEYS) Reports In-Line Q2 EPS, Beats on Revenues; Offers 3Q Revenue Outlook Above Consensus

Keysight Technologies (NYSE: KEYS) reported Q2 EPS of $0.83, in-line with the analyst estimate of $0.83. Revenue for the quarter came in at $990 million versus the consensus estimate of $960.61 million.

“Building on our outstanding start to the year, we delivered another excellent quarter with strong order growth and record revenue and we are raising our core revenue outlook for the year. Total revenue growth of 31 percent and 18 percent growth on a core basis was driven by broad-based core order strength as customers accelerate development in our key focus areas including 5G, automotive & energy and aerospace and defense,” said Ron Nersesian, Keysight president and CEO.

Second Quarter Financial Summary

• GAAP revenue grew 31 percent to reach $990 million, when compared with $753 million last year. Non-GAAP revenue, which excludes the impact of fair value adjustments to acquisition-related deferred revenue balances, grew 32 percent to reach $999 million. Non-GAAP core revenue, which also excludes the impact of foreign currency changes and revenue associated with businesses acquired within the last twelve months, increased 18 percent.
• GAAP net income was $64 million, or $0.34 per share, compared with $49 million, or $0.27 per share in the second quarter of 2017. Non-GAAP net income was $158 million, or $0.83 per share using 190 million weighted average shares, compared with $114 million, or $0.64 per share using 179 million weighted average shares in the second quarter of 2017.
• As of April 30, 2018, cash and cash equivalents totaled $784 million.

Outlook

Keysight’s third fiscal quarter of 2018 GAAP revenue is expected to be in the range of $937 million to $967 million and non-GAAP revenue for the third fiscal quarter of 2018 is expected to be in the range of $942 million to $972 million.

Non-GAAP earnings per share for the third fiscal quarter of 2018 are expected to be in the range of $0.72 to $0.82, which exclude items that pertain to future events and are not currently estimable with a reasonable degree of accuracy. Therefore, no reconciliation to GAAP amounts has been provided. Further information is discussed in the section titled “Non-GAAP Measures” below.

GUIDANCE:

Keysight Technologies sees Q3 2018 revenue of $942-972 million, versus the consensus of $916 million.

For earnings history and earnings-related data on Keysight Technologies (KEYS) click here.

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