Keysight technologies reports second quarter 2022 results
Santa rosa, calif.--(business wire)--keysight technologies, inc. (nyse: keys) today reported financial results for the second fiscal quarter ended april 30, 2022. "the keysight team delivered another strong quarter, exceeding the high end of our revenue and eps guidance. demand for our broad-based portfolio of differentiated solutions remains strong. we executed well and successfully navigated the geopolitical and supply chain challenges within the quarter,” said satish dhanasekaran, keysight’s president and ceo. “our consistent performance is a testament to our strategy, our people, and the resilience of our business, and gives us confidence in our raised outlook for the year." second quarter financial summary orders grew 9 percent to reach $1.46 billion, compared with $1.33 billion last year, or 11 percent on a core basis, which excludes the impact of foreign currency changes and orders associated with businesses acquired or divested within the last twelve months. revenue grew 11 percent to reach $1.35 billion, compared with $1.22 billion last year, or 12 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 $258 million, or $1.41 per share, compared with $186 million, or $0.99 per share, in the second quarter of 2021. non-gaap net income was $334 million, or $1.83 per share, compared with $270 million, or $1.44 per share in the second quarter of 2021. keysight acquired approximately 1.9 million shares in the open market at an average share price of $153.78, for a total consideration of $289 million. as of april 30, 2022, cash and cash equivalents totaled $1.89 billion. reporting segments communications solutions group (csg) csg reported revenue of $963 million in the second quarter, up 10 percent over last year, driven by continued investments in 5g r&d and o-ran adoption, new communications technologies such as 400g, 800g and terabit r&d, and wireline applications, as well as signal monitoring, cyber, space and satellite solutions. csg reported growth across all regions. electronic industrial solutions group (eisg) eisg reported revenue of $388 million in the second quarter, up 13 percent over last year, driven by next-generation automotive and energy technologies and semiconductor measurement solutions. eisg reported growth across all regions. outlook keysight’s third fiscal quarter of 2022 revenue is expected to be in the range of $1.33 billion to $1.35 billion. non-gaap earnings per share for the third fiscal quarter of 2022 are expected to be in the range of $1.74 to $1.80. full fiscal year 2022 revenue growth is expected to approach 8 percent. non-gaap earnings per share growth for fiscal year 2022 is expected to be in the range of 14 to 15 percent. non-gaap financial measures 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. webcast keysight’s management will present more details about its second quarter fy2022 financial results and its third quarter fy2022 outlook on a conference call with investors today at 1:30 p.m. pt. this event will be webcast in listen-only mode. listeners may log on to the call at www.investor.keysight.com under the “upcoming events” section and select “q2 2022 keysight technologies inc. earnings conference call” to participate or dial +1-844-200-6205 (u.s. only) or +1-929-526-1599 (international) and enter passcode 740819. the webcast will remain on the company site for 90 days. forward-looking statements this communication contains forward-looking statements as defined in the securities exchange act of 1934 and is subject to the safe harbors created therein. the words “expect,” “intend,” “will,” “should,” and similar expressions, as they relate to the company, are intended to identify forward-looking statements. these forward-looking statements involve risks and uncertainties that could significantly affect the expected results and are based on certain key assumptions of keysight’s management and on currently available information. due to such uncertainties and risks, no assurances can be given that such expectations or assumptions will prove to have been correct, and readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. keysight undertakes no responsibility to publicly update or revise any forward-looking statement. the forward-looking statements contained herein include, but are not limited to, predictions, future guidance, projections, beliefs, and expectations about the company’s goals, revenues, financial condition, earnings, impacts of us export control regulations, and operations that involve risks and uncertainties that could cause keysight’s results to differ materially from management’s current expectations. such risks and uncertainties include, but are not limited to, impacts to the supply chain; government mandates related to covid-19 and its variants; export control regulations and compliance; net zero emissions commitments; increasing geopolitical tension in regions outside of the u.s.; increases in attrition and our ability to retain key personnel; changes in the demand for current and new products, technologies, and services; customer purchasing decisions and timing; and order cancellations. in addition to the risks above, other risks that keysight faces include those detailed in keysight’s filings with the securities and exchange commission on keysight’s yearly report on form 10-k for the period ended october 31, 2021, and keysight’s quarterly report on form 10-q for the period ended january 31, 2022. segment data segment data reflect the results of our reportable segments under our management reporting system. segment data are provided on page 5 of the attached tables. use of non-gaap financial measures in addition to financial information prepared in accordance with u.s. gaap (“gaap”), this document also contains certain non-gaap financial measures based on management’s view of performance, including: core revenue non-gaap net income/earnings non-gaap net income per share/earnings per share income per share is based on weighted average diluted share count. see the attached supplemental schedules for reconciliations of each non-gaap financial measure to its most directly comparable gaap financial measure for the three months ended april 30, 2022. following the reconciliations is a discussion of the items adjusted from our non-gaap financial measures and the company’s reasons for including or excluding certain categories of income or expenses from our non-gaap results. about keysight technologies keysight delivers advanced design and validation solutions that help accelerate innovation to connect and secure the world. keysight’s dedication to speed and precision extends to software-driven insights and analytics that bring tomorrow’s technology products to market faster across the development lifecycle, in design simulation, prototype validation, automated software testing, manufacturing analysis, and network performance optimization and visibility in enterprise, service provider and cloud environments. our customers span the worldwide communications and industrial ecosystems, aerospace and defense, automotive, energy, semiconductor and general electronics markets. keysight generated revenues of $4.9b in fiscal year 2021. for more information about keysight technologies (nyse: keys), visit us at www.keysight.com. additional information about keysight technologies is available in the newsroom at www.keysight.com/go/news and on facebook, linkedin, twitter and youtube. source: ir-keys keysight technologies, inc. condensed consolidated statement of operations (in millions, except per share data) (unaudited) preliminary three months ended april 30, percent 2022 2021 inc/(dec) $ 1,458 $ 1,332 9 % $ 1,351 $ 1,221 11 % 492 484 2 % 210 209 1 % 319 297 7 % 3 (4 ) - 1,024 986 4 % 327 235 39 % 1 - - (19 ) (19 ) - (2 ) (8 ) (75 )% 307 208 47 % 49 22 123 % $ 258 $ 186 38 % $ 1.42 $ 1.01 $ 1.41 $ 0.99 181 185 183 187 keysight technologies, inc. condensed consolidated statement of operations (in millions, except per share data) (unaudited) preliminary six months ended april 30, percent 2022 2021 inc/(dec) $ 2,953 $ 2,555 16 % $ 2,601 $ 2,401 8 % 938 957 (2 )% 420 408 3 % 645 598 8 % - (9 ) - 2,003 1,954 3 % 598 447 34 % 2 1 63 % (39 ) (39 ) - 10 (6 ) - 571 403 42 % 84 45 88 % $ 487 $ 358 36 % $ 2.67 $ 1.93 $ 2.65 $ 1.91 182 185 183 188 keysight technologies, inc. condensed consolidated balance sheet (in millions, except par value and share data) (unaudited) preliminary april 30, october 31, 2022 2021 $ 1,886 $ 2,052 803 735 810 777 387 270 3,886 3,834 664 650 208 227 1,605 1,628 228 272 81 70 673 711 419 389 $ 7,764 $ 7,781 $ 313 $ 287 318 355 538 478 52 74 40 41 99 74 1,360 1,309 1,792 1,791 141 167 196 187 176 191 320 352 3,985 3,997 - - 2 2 (1,920 ) (1,425 ) 2,254 2,219 3,917 3,430 (474 ) (442 ) 3,779 3,784 $ 7,764 $ 7,781 keysight technologies, inc. condensed consolidated statement of cash flows (in millions) (unaudited) preliminary six months ended april 30, 2022 2021 $ 487 $ 358 59 57 53 115 77 64 13 (18 ) 13 14 - 16 22 7 (84 ) (61 ) (54 ) (23 ) 31 18 (41 ) 51 90 89 (26 ) 7 (14 ) 4 (104 ) (1 ) 522 697 (95 ) (61 ) (17 ) (136 ) (30 ) - (142 ) (197 ) 31 29 (74 ) (51 ) (484 ) (240 ) - (2 ) (527 ) (264 ) (21 ) 6 (168 ) 242 2,068 1,767 $ 1,900 $ 2,009 $ 37 $ 37 $ 122 $ 55 $ 963 $ 877 10 % 66.2 % 64.7 % $ 271 $ 222 28 % 25 % $ 388 $ 344 13 % 62.0 % 64.0 % $ 118 $ 98 30 % 28 % $ 1,351 $ 1,221 11 % (3 ) - 20 - $ 1,368 $ 1,221 12 % keysight technologies, inc. non-gaap net income and diluted eps reconciliation (in millions, except per share data) (unaudited) preliminary three months ended six months ended april 30, april 30, 2022 2021 2022 2021 net income diluted eps net income diluted eps net income diluted eps net income diluted eps $ 258 $ 1.41 186 $ 0.99 $ 487 $ 2.65 $ 358 $ 1.91 26 0.14 56 0.30 52 0.29 114 0.61 26 0.15 22 0.11 77 0.42 65 0.35 2 0.01 3 0.02 5 0.03 6 0.03 18 0.10 18 0.10 21 0.11 25 0.13 4 0.02 (15 ) (0.08 ) (3 ) (0.02 ) (28 ) (0.15 ) $ 334 $ 1.83 $ 270 $ 1.44 $ 639 $ 3.48 $ 540 $ 2.88 183 187 183 188 restructuring and others: we exclude incremental expenses associated with restructuring initiatives, usually aimed at material changes in the business or cost structure. such costs may include employee separation costs, asset impairments, facility-related costs, contract termination fees, and costs to move operations from one location to another. these activities can vary significantly from period to period based on the timing, size and nature of restructuring plans; therefore, we do not consider such costs to be normal, recurring operating expenses. we also exclude “others”, not normal, recurring, cash operating income/expenses from our non-gaap financial measures. such items are evaluated on an individual basis, based on both quantitative and qualitative factors and generally represent items that we do not anticipate occurring as part of our normal business. while not all-inclusive, examples of such items would include net unrealized gains on equity investments still held, significant non-recurring events like realized gains or losses associated with our employee benefit plans, costs and recoveries related to unusual events, gain on sale of assets/divestitures, etc. we believe that these costs do not reflect expected future operating expenses and do not contribute to a meaningful evaluation of the company’s current operating performance or comparisons to our operating performance in other periods.
