Keysight Technologies Reports Decline in Revenue for Q3 and Nine Months of Fiscal 2024

Keysight Technologies, Inc. reported a decline in revenue for the third quarter and the first nine months of fiscal 2024, reflecting broader market challenges and the impact of recent acquisitions. For the three months ended July 31, 2024, total revenue was $1,217 million, down 12% from $1,382 million in the same period of 2023. For the nine months, revenue decreased by 11% to $3,692 million from $4,153 million year-over-year. The decline was attributed to lower investments in the commercial communications sector and a strong comparison to the previous year, which benefited from robust backlog conversion.

Despite the revenue drop, Keysight's net income for the third quarter increased to $389 million, a 35% rise from $288 million in the prior year, primarily due to a one-time tax benefit. However, net income for the nine months fell to $687 million, down 17% from $831 million in 2023, driven by lower revenue and higher acquisition costs. The company reported a net income per share of $2.23 for the third quarter, compared to $1.62 in the same period last year.

Keysight's total costs and expenses for the third quarter were $1,012 million, slightly down from $1,017 million in 2023. The company’s income from operations for the third quarter was $205 million, a significant decrease of 44% from $365 million in the same quarter of the previous year. For the nine months, income from operations was $603 million, down 42% from $1,041 million in 2023.

Strategically, Keysight has been active in acquisitions, including the purchase of ESI Group SA for $935 million, which was completed in early 2024. This acquisition contributed $119 million in revenue for the nine months ended July 31, 2024. Additionally, the company acquired Riscure Holding B.V. for $78 million and AnaPico AG for $117 million, further expanding its capabilities in automated security assessments and electronic design solutions.

As of July 31, 2024, Keysight's cash and cash equivalents stood at $1,632 million, a decrease from $2,472 million at the end of the previous fiscal year. The company’s total assets increased to $9,323 million, up from $8,683 million, largely due to the assets acquired from ESI Group. The company’s total debt remained stable at $1,796 million.

Keysight's long-term growth strategy continues to focus on next-generation technologies, including 5G, AI, and IoT, despite facing challenges from market conditions and increased operational costs.