SANTA ROSA, CA – Keysight Technologies reported fiscal second quarter GAAP revenue was $895 million, down 17.9% year-over-year.
GAAP net income was $71 million for the quarter ended Apr. 30, a decrease of 53.6% compared to the same period in 2019.
"Keysight delivered strong operating margin and free cash flow due to solid execution in a challenging environment,” said chairman, president and CEO Ron Nersesian. “While supply chain disruptions dampened our revenue performance during the second half of the quarter, which includes April, our results demonstrated the resiliency of our operating model and durable cash generation as we reached a record cash balance of $1.8 billion. Keysight is committed to the health and safety of our employees, customers and suppliers and acted quickly to implement risk mitigation measures in response to the pandemic. After site closures and limited capacity in March and April, we are pleased to announce we are reopening sites and ramping our production, which we expect to be back to 100% capacity by the end of the third quarter."
Orders during the quarter were nearly $1.1 billion, down 3% year-over-year.
As of Apr. 30, cash and cash equivalents totaled $1.8 billion.
The Electronic Industrial Solutions Group reported revenue of $242 million, down 19% due to supply chain disruption related to the Covid-19 pandemic. General electronics, education and automotive markets were weak, slightly offset by continued foundry investment in advanced process node technologies.
The Communications Solutions Group reported fiscal second quarter revenue of $653 million, down 18% due to supply chain disruption related to the Covid-19 pandemic. From a demand perspective, investment continued in next-generation technologies such as 5G and 400G, driving record 5G orders in the quarter. Demand was strong in the US for aerospace, defense and government solutions.
After site closures resulted in limited production capacity in March and April, Keysight’s production operations and those of its suppliers are now ramping capacity. Continued progress is expected in the third quarter with third quarter revenue, operating margin and earnings expected to be in line with, or better than, the most recent quarter. These expectations are based on the order funnel and a strong backlog position and assume limited incremental supply chain constraints or disruption from additional shutdowns or a second wave of the pandemic.