Keysight Technologies (KEYS) Tops Q4 EPS by 16c, Revenues Beat, Announces $750M Share Buyback; Offers 1Q EPS/Revenue Guidance Above Consensus

Keysight Technologies (NYSE: KEYS) reported Q4 EPS of $1.62, $0.16 better than the analyst estimate of $1.46. Revenue for the quarter came in at $1.22 billion versus the consensus estimate of $1.18 billion.

• Achieved Record Orders, Revenue, Gross Margin, Operating Margin, Free Cash Flow
• Announces $750 Million Share Repurchase Program

Fourth Quarter Financial Summary

• Revenue grew 9 percent to reach $1.22 billion, when compared with $1.12 billion last year. Non-GAAP revenue grew 7 percent on a core basis, which excludes the impact of foreign currency changes and revenue associated with businesses acquired or divested within the last twelve months.
• GAAP net income was $217 million, or $1.15 per share, compared with $195 million, or $1.02 per share, in the fourth quarter of 2019.
• Non-GAAP net income was $305 million, or $1.62 per share, compared with $254 million, or $1.33 per share in the fourth quarter of 2019.
• Keysight acquired approximately 2.2 million shares in the open market at an average share price of $96.55, for a total consideration of $215 million, exhausting the $500 million share repurchase authorization from May 2019.
• As of October 31, 2020, cash and cash equivalents totaled $1.76 billion.

“Keysight delivered an outstanding quarter and finish to our fiscal year, driven by strong execution and broad-based demand for our differentiated solutions. Despite COVID-related macro challenges, it was a record year for orders, gross margin, operating margin, earnings per share and free cash flow," said Ron Nersesian, Keysight’s Chairman, President and CEO. “Our people and culture are a competitive differentiator and, in the face of unprecedented challenges, Keysight exits this year stronger than ever, and well-positioned to capitalize on our growth opportunities ahead.”

Share Repurchase Program

Keysight also announced today that its Board of Directors authorized a new share repurchase program for up to $750 million of its common stock. The new repurchase program is effective immediately. Shares may be purchased from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases, privately negotiated transactions or other means. The repurchase authorization may be commenced, suspended or discontinued at any time at the company’s discretion.

GUIDANCE:

Keysight Technologies sees Q1 2021 EPS of $1.32-$1.38, versus the consensus of $1.25. Keysight Technologies sees Q1 2021 revenue of $1.14-1.16 billion, versus the consensus of $1.11 billion.

Keysight’s first fiscal quarter of 2021 revenue is expected to be in the range of $1.14 billion to $1.16 billion. Non-GAAP earnings per share for the first fiscal quarter of 2021 are expected to be in the range of $1.32 to $1.38, 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 “Use of Non-GAAP Financial Measures” below

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

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