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The test and measurement giant saw its best quarterly performance in two years, driven by AI and 6G push
In sum — what to know:
Revenue blew past estimates: Keysight’s fourth-quarter earnings beat Wall Street estimates, signaling renewed business momentum fueled by AI infrastructure buildouts and early 6G traction.
Strong upward growth: At $1.42 billion, quarterly revenue is up 10% year-over-year, and free cash flow for the year hit $1.3 billlion.
Statement from CEO: Satish Dhanasekaran called it “an outstanding quarter” and “strong close to the fiscal year.”
Keysight reported revenue of $1.42 billion in Q4 — above the high end of guidance, and reflecting a 10% year-over-year increase — supported by 14% growth in order and 16% higher adjusted earnings per share — numbers that were attributed to rapid AI infrastructure buildouts, 6G research, and defense modernization.
“These results reflect our leadership across the markets we serve and sustained demand for Keysight’s highly differentiated solutions,” CEO Satish Dhanasekaran said in a statement.
Emphasizing the increased test and design intensity in the wake of AI data center infrastructure builds, Dhanasekaran told analysts at the earnings call, ”roughly half of our wireline business is seeing that impact.”
Dhanasekaran also mentioned that Keysight’s wireless segment performed above expectations, supported by 5G investment stabilization, and early traction of 6G and other advanced technologies. He expects the momentum to continue into the next year.
For the full year, revenue climbed 8%, and adjusted earnings per share, 14%. Additionally, free cash flow reached $1.3 billion.
The Communications Solutions Group (CSG) reported 11% year-over-year growth with a revenue of $990 million, driven by steady demand in the key markets.
However, revenue in its automotive segment remains flat — in large part due to muted investments in the sector. But the company is hopeful that its three recent M&As — notably the high-value acquisition of Spirent — will boost its satellite simulation and positioning solutions, which would be pivotal to pushing into autonomous systems, aerospace, and defense end-markets.
Chief Financial Officer Neil Dougherty said, “The recently completed acquisitions of Spirent, the Optical Solutions Group, and PowerArtist are expected to contribute approximately $375 million of revenue in FY 2026.”
The slow growth in automotive was largely offset by heavy demand in AI-driven semiconductor and other industrial sectors. Core revenue in the Electronic Industrial Solutions Group (EISG) climbed 8% to $429 million, driven by the recent acquisitions.
Overall, the company has managed to maintain stable margins despite macro environment pressures, and analysts concur that AI has provided it the much-needed boost to unlock incremental order growth.
Looking to fiscal 2026, Keysight forecast first-quarter revenue and fiscal year profit ahead of analyst estimates. The company raised its outlook for the first fiscal quarter 2026 to the range of $1.53 billion to $1.55 billion — higher than the Wall Street estimates of $1.43 billion — and adjusted earnings to $1.95 to $2.01 per share, past the estimated $1.83 per share.
Following the announcement, shares rose 13% in after-market trading.
The company also announced a new share buyback program valued up to $1.5 billion replacing older programs effective immediately.
