Viavi Accelerates Revenue Growth as Operating Margins Widen
Viavi forecast fiscal first-quarter revenue of $450 million to $460 million, extending its sales expansion.
Viavi Solutions (VIAV), a network-testing and optical-technology company, reported a 52.5% increase in fiscal fourth-quarter revenue as growth accelerated for a fourth consecutive quarter.
Revenue rose to $443.1 million from $290.5 million a year earlier and increased 8.9% sequentially. The year-over-year pace accelerated from 42.8% in the third quarter and exceeded Viavi’s prior guidance by $6.1 million at the top of the range.
GAAP diluted earnings increased to $0.13 a share from $0.04 a year earlier, while adjusted earnings climbed to $0.34 from $0.13. The adjusted result topped the high end of the company’s guidance by $0.03 a share.
Network and Service Enablement remained the main growth driver, with revenue rising 69.2% to $353.9 million. Its operating margin expanded to 20.0% from 4.6%, lifting operating income to $70.7 million from $9.7 million. Optical Security and Performance Products revenue grew 9.6% to $89.2 million, while its margin held near 40%.
The stronger segment mix helped GAAP gross margin widen to 59.1% from 56.3% a year earlier. GAAP operating margin reached 13.8%, up from 5.3%, and quarterly operating cash flow swung to a positive $66.7 million after a $26.3 million use of cash in the preceding quarter.
Viavi eliminated its Term Loan B balance during the quarter, leaving $250 million of convertible notes and $400 million of senior notes outstanding. The company recorded a $10.5 million loss tied to extinguishing convertible notes and the term loan, while cash, short-term investments and restricted cash rose sequentially to $656.7 million.
For fiscal 2027’s first quarter, Viavi expects revenue of $450 million to $460 million and adjusted earnings of $0.40 to $0.42 a share. The ranges imply another sequential increase in sales and a further rise in adjusted earnings from the fourth quarter.