Summary
Keysight Technologies, Inc. reported its second quarter fiscal year 2015 results, showing a slight decline in net revenue for the quarter to $740 million from $743 million in the prior year, though for the six-month period, revenue increased 2% to $1,441 million. The company experienced a decrease in orders for the quarter by 11% year-over-year, with declines across several key market segments, partially offset by growth in aerospace and defense. Net income for the quarter was $96 million, down from $110 million in the prior year, reflecting increased research and development expenses and a higher effective tax rate. Despite the near-term order softness, Keysight is focused on long-term market growth and operational efficiency. The company plans to invest in product development and cost-reduction initiatives. The balance sheet remains solid with $894 million in cash and cash equivalents, and the company is managing its debt effectively, with no borrowings outstanding under its credit facility. Management is optimistic about leveraging its 'hardware plus software plus people' strategy for future value creation.
Financial Highlights
51 data points| Revenue | $740.00M |
| Cost of Revenue | $324.00M |
| Gross Profit | $416.00M |
| R&D Expenses | $96.00M |
| SG&A Expenses | $192.00M |
| Operating Expenses | $607.00M |
| Operating Income | $133.00M |
| Interest Expense | $11.00M |
| Net Income | $96.00M |
| EPS (Basic) | $0.57 |
| EPS (Diluted) | $0.56 |
| Shares Outstanding (Basic) | 169.00M |
| Shares Outstanding (Diluted) | 171.00M |
Key Highlights
- 1Net revenue for the quarter was $740 million, a slight decrease of 0.4% year-over-year, while six-month revenue grew 2% to $1,441 million.
- 2Total orders decreased 11% year-over-year for the three months ended April 30, 2015, indicating a near-term slowdown in customer demand.
- 3Net income for the quarter was $96 million, a decrease from $110 million in the prior year, impacted by higher R&D expenses and an increased effective tax rate.
- 4The company reported a strong cash position with $894 million in cash and cash equivalents as of April 30, 2015.
- 5Research and development expenses increased 7% for both the three and six-month periods, reflecting continued investment in innovation.
- 6Keysight's effective tax rate increased to 21.7% for the quarter compared to 14.1% in the prior year, partly due to the impact of the Singapore tax incentive.
- 7The company's long-term debt remains stable at $1,099 million, with no borrowings outstanding on its $300 million credit facility.