Keysight Technologies, Inc.

Keysight Technologies, Inc. is a global innovator in the computing, communications and electronics markets, committed to advancing customers' business success by helping them solve critical challenges in the development and commercialization of their products and services. The company serves a global set of customers in over 100 countries across a wide range of industry segments, including communications, aerospace, defense, and government, automotive, energy, industrial, general electronics, and semiconductor. The accelerating pace of technological innovation and engineering intensity are long-term secular drivers of demand for Keysight's solutions and services. The company's revenue is derived primarily from solutions addressing research and development applications, and to a lesser degree, applications in manufacturing and operations.

Keysight operates in a highly competitive and rapidly changing global marketplace, believing that its technology leadership serves as a competitive differentiator. The company competes with a variety of organizations that offer similar services and solutions, but none of its competitors offer the equivalent range of product and services at the scale it does or serve all the same markets in the aggregate or by segment. Competitors include companies or divisions of companies with substantial sales, marketing, research, and financial capabilities, as well as well-established regional competitors who are more specialized in particular markets. Keysight's competitive advantages include deep, long-term, global customer relationships with approximately 40,000 end customers each year, including many Fortune 1000 companies; unique technology expertise and capabilities; a differentiated, first-to-market solutions portfolio; a durable and resilient business model; and an innovative culture.

Keysight generates revenue primarily from the sale of products (hardware and/or software), services, or a combination thereof. The company's revenue is derived from solutions addressing research and development applications and, to a lesser degree, applications in manufacturing and operations. The main components of the portfolio are hardware, software, and services that are delivered on a standalone basis or combined into application-specific solutions. The company employs a comprehensive global direct sales channel, with more than 80 percent of its business coming from customer interactions with its direct sales organization, complemented by over 800 agreements with channel partners around the world, including distributors, resellers, and manufacturer's representatives.

Keysight's Communications Solutions Group (CSG) serves customers spanning the global commercial communications and aerospace, defense, and government end markets. The group's solutions consist of electronic design and test software, instrumentation, systems, and related services used in the design, simulation, validation, manufacturing, installation, and optimization of communication systems in wireless, wireline (data center ecosystem), enterprise, and aerospace, defense, and government end markets. CSG revenue was $3,726 million ¹ in 2025, $3,420 million ² in 2024, and $3,685 million ³ in 2023. Revenue from the commercial communications market represented approximately 67 percent ⁴ of total CSG revenue in 2025 and increased 10 percent ⁵ compared to 2024. Revenue from the aerospace, defense, and government market represented approximately 33 percent ⁶ of total CSG revenue in 2025 and increased 8 percent ⁷ compared to 2024. CSG gross margin was 66.9% ⁸ in 2025, 67.6% ⁹ in 2024, and 67.7% ¹⁰ in 2023. CSG income from operations was $986 million ¹¹ in 2025, $921 million ¹² in 2024, and $1,068 million ¹³ in 2023.

Keysight's Electronic Industrial Solutions Group (EISG) serves customers across a diverse set of end markets focused on automotive and energy, semiconductor solutions, and general electronics. The group's solutions consist of electronic design, test and simulation software, instrumentation, systems, computer-aided engineering solutions, and related services used in the design, simulation, validation, manufacturing, installation, and optimization of electronic equipment. EISG revenue was $1,649 million ¹⁴ in 2025, $1,559 million ¹⁵ in 2024, and $1,779 million ¹⁶ in 2023. EISG gross margin was 59.6% ¹⁷ in 2025, 59.9% ¹⁸ in 2024, and 61.9% ¹⁹ in 2023. EISG income from operations was $407 million ²⁰ in 2025, $357 million ²¹ in 2024, and $581 million ²² in 2023.

On October 15, 2025, Keysight acquired all of the outstanding common stock of Spirent Communications plc for $1,415 million ²³, net of $127 million ²⁴ cash acquired, using existing cash. On October 16, 2025, Keysight divested Spirent's high-speed ethernet, network security, and channel emulation business lines for $399 million ²⁵ to Viavi Solutions Inc. On October 17, 2025, Keysight acquired the Optical Solutions Group business from Synopsys, Inc. for $578 million ²⁶ and the PowerArtist RTL business from Ansys, Inc. for $26 million ²⁷. In 2024, Keysight acquired ESI Group SA for $477 million ²⁸, net of cash acquired, and subsequently acquired the remaining share capital for $458 million ²⁹. Keysight also acquired Riscure Holding B.V. for $78 million ³⁰, net of cash acquired, and AnaPico AG for $117 million ³¹, net of cash acquired. During fiscal 2025, Keysight repurchased 2,389,253 ³² shares of common stock for $377 million ³³, including excise tax payments. On March 6, 2023, the board of directors approved a stock repurchase program authorizing the purchase of up to $1,500 million ³⁴ of the company's common stock. On November 24, 2025, the board of directors approved a new stock repurchase program authorizing the purchase of up to $1,500 million ³⁵ of the company's common stock.

Total revenue was $5,375 million ³⁶ in 2025, $4,979 million ³⁷ in 2024, and $5,464 million ³⁸ in 2023. Net income was $850 million ³⁹ in 2025, $614 million ⁴⁰ in 2024, and $1,057 million ⁴¹ in 2023. Diluted net income per share was $4.91 ⁴² in 2025, $3.51 ⁴³ in 2024, and $5.91 ⁴⁴ in 2023. Gross margin was 62.1% ⁴⁵ in 2025, 62.9% ⁴⁶ in 2024, and 64.6% ⁴⁷ in 2023. Income from operations was $876 million ⁴⁸ in 2025, $833 million ⁴⁹ in 2024, and $1,358 million ⁵⁰ in 2023. Operating margin was 16.3% ⁵¹ in 2025, 16.7% ⁵² in 2024, and 24.8% ⁵³ in 2023. Net cash provided by operating activities was $1,409 million ⁵⁴ in 2025, $1,052 million ⁵⁵ in 2024, and $1,408 million ⁵⁶ in 2023.

Keysight's first-to-market solutions strategy enables customers to develop new technologies and accelerate innovation and provides a platform for the company's long-term growth. Customers are expected to continue to make R&D investments in certain next-generation technologies and applications, including evolution of 5G, early 6G, high-speed data center networks and infrastructure, satellite networks, artificial intelligence (AI), industrial internet of things (IoT), defense modernization, and next generation electric vehicles and autonomous vehicles. The company continues to engage actively with its customers and closely monitor the macroeconomic environment, including tariffs, trade restrictions and tightening of export control regulations, monetary and fiscal policies, and geopolitical tensions. Management remains confident in the long-term secular growth trends of its markets and its ability to outperform in a variety of market conditions.

Keysight is investing to capitalize on emerging technologies, expanding its portfolio of solutions and engaging earlier in customers' design and innovation life cycles. The company continues to work on multiple vectors for growth as it expands its contributions across the technology stack, building on its core strength in physical layer and adding new protocol layer and system emulation capabilities, as well as new application layer solutions that address opportunities in design and data management. In October 2025, Keysight acquired Spirent Communications plc, complementing its position in communications test with additional differentiated solutions and deep customer relationships. Additionally, in October 2025, the company completed the acquisition of the Optical Solutions Group business from Synopsys, Inc. and the PowerArtist RTL business from Ansys, Inc. to complement and expand its existing design engineering software portfolio and computer-aided engineering capabilities. In 2024, Keysight acquired ESI Group SA, broadening its software offerings with the addition of computer-aided engineering solutions.

The filing does not contain specific margin trajectory or efficiency targets with exact figures for the upcoming period.

Keysight expects capital expenditures to be approximately $160 million ⁵⁷ in 2026 compared to $127 million ⁵⁸ in 2025. For the next twelve months, the company does not expect to contribute to its U.S. defined benefit plan and U.S. post-retirement benefit plan, and expects to contribute $14 million ⁵⁹ to its non-U.S. defined benefit plans.

In 2025, Keysight invested $1,007 million ⁶⁰ in research and development. Capital expenditures were $127 million ⁶¹ in 2025, net of $1 million ⁶² of government incentives. On March 6, 2023, the board of directors approved a stock repurchase program authorizing the purchase of up to $1,500 million ⁶³ of the company's common stock. On November 24, 2025, the board of directors approved a new stock repurchase program authorizing the purchase of up to $1,500 million ⁶⁴ of the company's common stock, replacing the previously approved March 2023 program, under which $110 million ⁶⁵ remained as of October 31, 2025. The company does not currently pay dividends on its common stock.

Beginning in the second quarter of fiscal 2025, the U.S. government announced tariffs on products from most countries and additional reciprocal tariffs on certain countries, with changes effective August 1, 2025 resulting in broad-based increases in tariff rates. These tariffs have impacted Keysight's financial results for the year ended October 31, 2025. The company has taken actions across multiple vectors to reduce the impact on its results of operations, including a multipronged mitigation approach spanning its global manufacturing footprint and sourcing strategies, as well as pricing and cost actions. The company continues to engage actively with its customers and closely monitor the macroeconomic environment, including tariffs, trade restrictions and tightening of export control regulations, monetary and fiscal policies, and geopolitical tensions.

Keysight's business is sensitive to negative changes in general economic conditions, both inside and outside the U.S. Global and regional economic volatility and uncertainty, inflation and potential recession has and may continue to impact the business. The company faces risks related to international sales and operations, including the inability to conduct business in certain countries or regions due to U.S. sanctions or trade restrictions, uncertainty regarding U.S. government announced tariffs and potential changes, and volatile geopolitical turmoil including regional conflicts and war. The company also faces risks from economic and political policies favoring national interests, such as sanctions or trade restrictions, including those on advanced computing and semiconductor manufacturing and design software, withdrawal from or re-negotiation of global trade agreements, and increased tariffs and reciprocal tariffs.

Keysight faces material risks from the impact of U.S. government tariffs, which beginning in the second quarter of fiscal 2025 resulted in broad-based increases in tariff rates, including significantly higher rates on imports from China, and have impacted the company's financial results for the year ended October 31, 2025. The company is subject to ongoing tax examinations and on January 23, 2025, filed a lawsuit against the United States seeking a tax refund of $107 million ⁶⁶ related to GILTI tax deductions for intangible asset amortization; if unsuccessful, the company would be required to reverse the benefit previously recorded, most likely resulting in a material increase in the effective tax rate and income tax liability. Keysight benefits from tax incentives in Singapore, which expires July 31, 2029 ⁶⁷, and Malaysia, which expired on October 31, 2025 ⁶⁸; if these incentives are not renewed or are revoked, the company's effective tax rate could be higher. The company faces risks from intellectual property litigation, including a lawsuit filed by Centripetal Networks alleging patent infringement, and while the ITC issued a Notice of Determination that Keysight did not unfairly import products in violation of Section 337, Centripetal has appealed this determination. Keysight's business depends on customers' ability to manufacture, design, and sell their products, and international trade disputes, including increased tariffs on sales to or imports from impacted countries, could increase the cost of customers' components and raw materials and reduce demand for customers' products, adversely affecting the company's operating results and financial condition.

Management's message emphasizes confidence in the long-term secular growth trends of Keysight's markets and the company's ability to outperform in a variety of market conditions. The strategic priorities highlighted include investing to deliver differentiated, first-to-market solutions; capturing opportunities in the served addressable market and expanding in attractive adjacencies; growing recurring revenue; and strategic deployment of capital. Management notes that the company continues to engage actively with its customers and closely monitor the macroeconomic environment, including tariffs, trade restrictions and tightening of export control regulations, monetary and fiscal policies, and geopolitical tensions.