10-KPeriod: FY2024

Keysight Technologies, Inc. Annual Report, Year Ended Oct 31, 2024

Filed December 17, 2024For Securities:KEYS

Summary

Keysight Technologies, Inc. reported a challenging fiscal year 2024, with revenue declining by 9% to $4.979 billion compared to $5.464 billion in fiscal year 2023. This decline was primarily driven by lower customer demand amidst a challenging macroeconomic environment characterized by high interest rates and geopolitical tensions. Net income saw a significant decrease of 42% year-over-year, falling to $614 million from $1.057 billion in fiscal year 2023. This was attributed to lower revenues, increased acquisition and integration costs, and restructuring expenses. Despite the near-term headwinds, Keysight remains focused on its long-term strategy of delivering differentiated, first-to-market solutions and capturing opportunities in emerging technologies like 5G/6G, AI, and advanced automotive systems. The company actively pursued strategic acquisitions in fiscal year 2024, including ESI Group SA, Riscure Holding B.V., and AnaPico AG, to broaden its software offerings and expand its reach in key markets. Management expressed confidence in the company's durable and resilient business model and its ability to navigate market conditions and deliver long-term value.

Financial Highlights

54 data points
Beta

Revenue

$4.98B

62.9% Gross Margin

Net Income

$618.00M

12.4% Net Margin

EPS (Diluted)

$3.51

Total Assets

$9.27B

Cash & Equivalents

$1.81B

Free Cash Flow

$898.00M

Financial Statements
Beta
Revenue$4.98B
Cost of Revenue$1.85B
Gross Profit$3.13B
R&D Expenses$919.00M
SG&A Expenses$1.40B
Operating Expenses$4.15B
Operating Income$833.00M
Interest Expense$84.00M
Net Income$618.00M
EPS (Basic)$3.53
EPS (Diluted)$3.51
Shares Outstanding (Basic)174.00M
Shares Outstanding (Diluted)175.00M

Key Highlights

  • 1Revenue for fiscal year 2024 decreased by 9% to $4.979 billion, down from $5.464 billion in fiscal year 2023, primarily due to lower customer demand.
  • 2Net income significantly decreased by 42% to $614 million in fiscal year 2024, compared to $1.057 billion in fiscal year 2023.
  • 3The Communications Solutions Group (CSG) revenue decreased by 7% to $3.420 billion, while the Electronic Industrial Solutions Group (EISG) revenue decreased by 12% to $1.559 billion in fiscal year 2024.
  • 4Keysight completed several strategic acquisitions in fiscal year 2024, including ESI Group SA, Riscure Holding B.V., and AnaPico AG, to enhance its capabilities and market presence.
  • 5The company maintained a strong R&D investment, spending $919 million in fiscal year 2024, representing 18% of revenue, to drive innovation and first-to-market solutions.
  • 6Cash flow from operations was $1.052 billion in fiscal year 2024, demonstrating continued operational cash generation despite the revenue decline.
  • 7The company ended fiscal year 2024 with $1.814 billion in cash and cash equivalents.

Frequently Asked Questions

Keysight's revenue declined by 9% to $4.979 billion in fiscal year 2024. The primary drivers were lower customer demand, influenced by a challenging macroeconomic environment characterized by high interest rates, inflationary pressures, and geopolitical tensions. This impacted purchasing decisions across both the Communications Solutions Group (CSG) and the Electronic Industrial Solutions Group (EISG).

Profitability saw a significant reduction in fiscal year 2024. Net income decreased by 42% to $614 million, down from $1.057 billion in fiscal year 2023. This was mainly due to lower revenues, coupled with increased acquisition and integration costs, restructuring expenses, and amortization of acquisition-related balances.

Keysight's core strategy remains centered on delivering differentiated, first-to-market solutions and capturing opportunities in high-growth areas such as 5G/6G, AI, high-speed data centers, advanced automotive, and defense modernization. The company made significant investments in acquisitions during fiscal year 2024, including ESI Group SA, Riscure Holding B.V., and AnaPico AG, to expand its software capabilities and market reach. Despite near-term macroeconomic challenges, Keysight is confident in the long-term secular growth trends of its markets and its ability to outperform.

Keysight made several strategic acquisitions in fiscal year 2024. The acquisition of ESI Group SA contributed $141 million in revenue but also resulted in $68 million in net loss attributable to Keysight shareholders for the year. Acquisitions also contributed to increased acquisition and integration costs, which impacted net income. Overall, acquisitions added approximately 3 percentage points to revenue growth and 4 percentage points to order growth, partially offsetting the underlying organic declines.