Summary
Keysight Technologies, Inc. reported solid top-line growth in its third quarter and the first nine months of fiscal year 2025, with total revenue increasing by 11% and 7%, respectively, year-over-year. This growth was driven by strong performance in both the Communications Solutions Group (CSG) and the Electronic Industrial Solutions Group (EISG), particularly in areas like AI-driven data centers, 5G evolution, and aerospace & defense. Despite revenue growth, net income for the quarter and nine-month period declined compared to the prior year, primarily due to a significant one-time income tax benefit recorded in the prior year. The company also faced increased operating expenses related to people costs, tariffs, and integration expenses from acquisitions. However, a substantial increase in operating cash flow to $1.184 billion for the nine months ended July 31, 2025, up from $693 million in the prior year, demonstrates improved operational cash generation. The company also raised $750 million in senior notes and is progressing with its announced acquisition of Spirent Communications.
Financial Highlights
52 data points| Revenue | $1.35B |
| Cost of Revenue | $518.00M |
| Gross Profit | $834.00M |
| R&D Expenses | $250.00M |
| SG&A Expenses | $354.00M |
| Operating Expenses | $1.12B |
| Operating Income | $234.00M |
| Net Income | $191.00M |
| EPS (Basic) | $1.11 |
| EPS (Diluted) | $1.10 |
| Shares Outstanding (Basic) | 172.00M |
| Shares Outstanding (Diluted) | 173.00M |
Key Highlights
- 1Total revenue increased by 11% to $1,352 million for the three months ended July 31, 2025, and by 7% to $3,956 million for the nine months ended July 31, 2025, compared to the prior year periods.
- 2Net income decreased to $191 million for the three months and $617 million for the nine months ended July 31, 2025, largely due to a significant prior-year income tax benefit.
- 3Operating cash flow saw a substantial increase, reaching $1,184 million for the nine months ended July 31, 2025, compared to $693 million in the prior year.
- 4The company issued $750 million in 5.35% senior notes due 2030 in April 2025 to support its financial strategy.
- 5Keysight is actively pursuing the acquisition of Spirent Communications, with expectations to close in the fourth quarter of fiscal year 2025, subject to regulatory approvals.
- 6Gross margins remained strong, at 61.7% for the quarter and 62.4% for the nine months, though slightly down year-over-year, impacted by tariffs and higher people-related costs.
- 7Research and Development expenses increased by 11% and 9% for the three and nine-month periods, respectively, reflecting continued investment in innovation.