VIAVI Announces Second Quarter Fiscal 2025 Results
VIAVI (NASDAQ: VIAV) reported strong Q2 FY2025 results with net revenue of $270.8 million, up 6.4% year-over-year. The company's non-GAAP operating margin improved to 14.9%, while GAAP operating margin slightly decreased to 8.2%. Non-GAAP net income grew 24.1% to $29.4 million, with diluted EPS reaching $0.13.
Network Enablement segment showed significant growth of 15.1% year-over-year, while Service Enablement and Optical Security segments declined by 13.3% and 5.3% respectively. The company maintained a strong cash position of $512.8 million and generated $44.7 million in operating cash flow during the quarter.
Looking ahead, VIAVI projects Q3 FY2025 revenue between $276-288 million with non-GAAP EPS of $0.10-0.13. The company also completed the acquisition of Inertial Labs, Inc. on January 28, 2025.
VIAVI (NASDAQ: VIAV) ha riportato risultati solidi per il secondo trimestre dell'anno fiscale 2025, con un fatturato netto di 270,8 milioni di dollari, in aumento del 6,4% rispetto all'anno precedente. Il margine operativo non-GAAP dell'azienda è migliorato al 14,9%, mentre il margine operativo GAAP è leggermente diminuito all'8,2%. Il reddito netto non-GAAP è cresciuto del 24,1% arrivando a 29,4 milioni di dollari, con un utile per azione diluito che ha raggiunto 0,13 dollari.
Il segmento della Abilitazione della Rete ha mostrato una crescita significativa del 15,1% rispetto all'anno precedente, mentre i segmenti della Abilitazione dei Servizi e della Sicurezza Ottica hanno registrato un calo rispettivamente del 13,3% e del 5,3%. L'azienda ha mantenuto una posizione di liquidità forte di 512,8 milioni di dollari e ha generato 44,7 milioni di dollari di flusso di cassa operativo durante il trimestre.
Guardando al futuro, VIAVI prevede per il terzo trimestre dell'anno fiscale 2025 un fatturato compreso tra 276 e 288 milioni di dollari, con utili per azione non-GAAP di 0,10-0,13 dollari. L'azienda ha anche completato l'acquisizione di Inertial Labs, Inc. il 28 gennaio 2025.
VIAVI (NASDAQ: VIAV) informó sobre resultados sólidos para el segundo trimestre del año fiscal 2025, con ingresos netos de 270,8 millones de dólares, lo que representa un aumento del 6,4% en comparación con el año anterior. El margen operativo no-GAAP de la compañía mejoró al 14,9%, mientras que el margen operativo GAAP disminuyó ligeramente al 8,2%. La ganancia neta no-GAAP creció un 24,1% hasta alcanzar los 29,4 millones de dólares, con una EPS diluida que llegó a 0,13 dólares.
El segmento de Habilitación de Redes mostró un crecimiento significativo del 15,1% interanual, mientras que los segmentos de Habilitación de Servicios y Seguridad Óptica disminuyeron un 13,3% y un 5,3% respectivamente. La empresa mantuvo una sólida posición de efectivo de 512,8 millones de dólares y generó 44,7 millones de dólares en flujo de efectivo operativo durante el trimestre.
De cara al futuro, VIAVI proyecta ingresos para el tercer trimestre del año fiscal 2025 entre 276 y 288 millones de dólares, con una EPS no-GAAP de 0,10-0,13 dólares. La compañía también completó la adquisición de Inertial Labs, Inc. el 28 de enero de 2025.
VIAVI (NASDAQ: VIAV)는 2025 회계연도 2분기 강력한 실적을 보고하며, 순수익이 2억 7천 80만 달러로 전년 대비 6.4% 증가했다고 밝혔습니다. 회사의 비-GAAP 운영 마진은 14.9%로 개선되었고, GAAP 운영 마진은 8.2%로 약간 감소했습니다. 비-GAAP 순이익은 24.1% 증가하여 2천 940만 달러에 이르렀고, 희석 주당 순이익은 0.13달러에 도달했습니다.
네트워크 활성화 부문은 전년 대비 15.1%의 유의미한 성장을 보였으나, 서비스 활성화 및 광학 보안 부문은 각각 13.3% 및 5.3% 감소했습니다. 회사는 5억 1천 280만 달러의 강력한 현금 보유를 유지하며, 분기 동안 4천 470만 달러의 운영 현금 흐름을 창출했습니다.
앞으로 VIAVI는 2025 회계연도 3분기 매출을 2억 7천 60만에서 2억 8천 80만 달러 사이로 예상하고 있으며, 비-GAAP EPS는 0.10-0.13달러로 예상하고 있습니다. 또한 회사는 2025년 1월 28일 Inertial Labs, Inc.의 인수를 완료했습니다.
VIAVI (NASDAQ: VIAV) a annoncé de solides résultats pour le deuxième trimestre de l'exercice 2025, avec un chiffre d'affaires net de 270,8 millions de dollars, en hausse de 6,4% par rapport à l'année précédente. La marge opérationnelle non-GAAP de l'entreprise s'est améliorée à 14,9%, tandis que la marge opérationnelle GAAP a légèrement diminué à 8,2%. Le bénéfice net non-GAAP a augmenté de 24,1% pour atteindre 29,4 millions de dollars, avec un bénéfice par action dilué atteignant 0,13 dollar.
Le segment des Activations de Réseau a montré une croissance significative de 15,1% par rapport à l'année précédente, tandis que les segments d'Activation de Services et de Sécurité Optique ont diminué de 13,3% et 5,3% respectivement. L'entreprise a maintenu une solide position de liquidités de 512,8 millions de dollars et a généré 44,7 millions de dollars de flux de trésorerie opérationnels au cours du trimestre.
En regardant vers l'avenir, VIAVI prévoit un chiffre d'affaires pour le troisième trimestre de l'exercice 2025 compris entre 276 et 288 millions de dollars, avec un bénéfice par action non-GAAP de 0,10 à 0,13 dollar. L'entreprise a également finalisé l'acquisition d'Inertial Labs, Inc. le 28 janvier 2025.
VIAVI (NASDAQ: VIAV) hat starke Ergebnisse für das zweite Quartal des Geschäftsjahres 2025 gemeldet, mit einem Nettoumsatz von 270,8 Millionen US-Dollar, was einen Anstieg von 6,4% im Vergleich zum Vorjahr darstellt. Die nicht-GAAP operative Marge des Unternehmens verbesserte sich auf 14,9%, während die GAAP operative Marge leicht auf 8,2% zurückging. Der nicht-GAAP Nettogewinn stieg um 24,1% auf 29,4 Millionen US-Dollar, mit einem verwässerten Gewinn pro Aktie von 0,13 US-Dollar.
Der Bereich Netzwerkaktivierung zeigte ein erhebliches Wachstum von 15,1% im Jahresvergleich, während die Bereiche Serviceaktivierung und optische Sicherheit um 13,3% bzw. 5,3% zurückgingen. Das Unternehmen hielt eine starke Cash-Position von 512,8 Millionen US-Dollar und generierte im Quartal 44,7 Millionen US-Dollar an operativem Cashflow.
Für die Zukunft rechnet VIAVI für das dritte Quartal des Geschäftsjahres 2025 mit einem Umsatz zwischen 276 und 288 Millionen US-Dollar und einem nicht-GAAP EPS von 0,10-0,13 US-Dollar. Das Unternehmen hat auch am 28. Januar 2025 die Übernahme von Inertial Labs, Inc. abgeschlossen.
- Net revenue increased 6.4% YoY to $270.8 million
- Non-GAAP operating margin improved by 170 bps to 14.9%
- Non-GAAP net income grew 24.1% to $29.4 million
- Network Enablement segment revenue increased 15.1% YoY
- Generated $44.7 million in operating cash flow
- Strong cash position of $512.8 million
- GAAP operating margin declined 60 bps YoY to 8.2%
- GAAP net income decreased 15% YoY to $9.1 million
- Service Enablement revenue declined 13.3% YoY
- Optical Security and Performance Products revenue decreased 5.3% YoY
Insights
VIAVI's Q2 FY2025 results reveal a compelling transformation story, marked by strategic diversification and operational efficiency gains. The standout
The geographic revenue distribution shows healthy market penetration with Americas leading at
The
The acquisition of Inertial Labs strategically positions VIAVI in the aerospace and defense sector, complementing its existing portfolio and potentially opening new revenue streams. The Q3 guidance of
Second Quarter
- Net revenue of
$270.8 million $16.3 million 6.4% year-over-year - GAAP operating margin of
8.2% , down 60 bps year-over-year - Non-GAAP operating margin of
14.9% , up 170 bps year-over-year - GAAP net income of
$9.1 million $1.6 million 15.0% year-over-year - Non-GAAP net income of
$29.4 million $5.7 million 24.1% year-over-year - GAAP diluted earnings per share (EPS) of
$0.04 $0.01 or20.0% year-over-year - Non-GAAP diluted EPS of
$0.13 $0.02 18.2% year-over-year
"VIAVI's financial performance exceeded expectations, largely driven by recovering NSE demand. We expect that the recovery in our traditional service provider end markets together with our diversification and growth opportunities in new end markets such as the data center ecosystem and aerospace and defense applications will position us favorably for a long term growth cycle," said Oleg Khaykin, VIAVI's President and Chief Executive Officer.
Financial Overview:
The tables below (in millions, except percentage, and per share data) provide comparisons of quarterly results to prior periods, including sequential quarterly and year-over-year changes. A full reconciliation between the GAAP and non-GAAP measures included in the tables is contained in this release under the section titled "Use of Non-GAAP (Adjusted) Financial Measures."
Second Quarter Ended December 28, 2024
GAAP Results | |||||||||
Q2 | Q1 | Q2 | Change | ||||||
FY 2025 | FY 2025 | FY 2024 | Q/Q | Y/Y | |||||
Net revenue | $ 270.8 | $ 238.2 | $ 254.5 | 13.7 % | 6.4 % | ||||
Gross margin | 59.4 % | 57.1 % | 58.2 % | 230 bps | 120 bps | ||||
Operating margin | 8.2 % | 4.8 % | 8.8 % | 340 bps | (60) bps | ||||
Income from operations | $ 22.2 | $ 11.5 | $ 22.4 | 93.0 % | (0.9) % | ||||
Net income (loss) per share | 0.04 | (0.01) | 0.05 | 500.0 % | (20.0) % | ||||
Non-GAAP Results | |||||||||
Q2 | Q1 | Q2 | Change | ||||||
FY 2025 | FY 2025 | FY 2024 | Q/Q | Y/Y | |||||
Gross margin | 61.1 % | 59.1 % | 60.0 % | 200 bps | 110 bps | ||||
Operating margin | 14.9 % | 10.0 % | 13.2 % | 490 bps | 170 bps | ||||
Income from operations | $ 40.4 | $ 23.9 | $ 33.7 | 69.0 % | 19.9 % | ||||
Earnings per share | 0.13 | 0.06 | 0.11 | 116.7 % | 18.2 % | ||||
Net Revenue by Segment | |||||||||
Q2 | Q1 | Q2 | Change | ||||||
FY 2025 | FY 2025 | FY 2024 | Q/Q | Y/Y | |||||
Network Enablement | $ 179.0 | $ 141.6 | $ 155.5 | 26.4 % | 15.1 % | ||||
Service Enablement | 20.9 | 17.8 | 24.1 | 17.4 % | (13.3) % | ||||
Optical Security and Performance Products | 70.9 | 78.8 | 74.9 | (10.0) % | (5.3) % | ||||
Total | $ 270.8 | $ 238.2 | $ 254.5 | 13.7 % | 6.4 % | ||||
Americas ,Asia-Pacific and EMEA customers represented42.9% ,34.6% and22.5% , respectively, of total net revenue for the quarter ended December 28, 2024.- As of December 28, 2024, the Company held
$512.8 million - As of December 28, 2024, the Company had
$250 million 1.625% Senior Convertible Notes and$400 million 3.75% Senior Notes with a total net carrying value of$639.3 million - During the fiscal quarter ended December 28, 2024, the Company generated
$44.7 million
Inertial Labs, Inc. – Acquisition Update
VIAVI has completed the acquisition of Inertial Labs, Inc. on January 28, 2025.
Business Outlook for the Third Quarter of Fiscal 2025
For the third quarter of fiscal 2025 ending March 29, 2025, the Company expects net revenue to be between
With respect to our expectations above, the Company has not reconciled GAAP net income per share to non-GAAP EPS in this press release because it is unable to provide a meaningful or accurate estimate of certain reconciling items described in the "Use of Non-GAAP (Adjusted) Financial Measures" section below and the information is not available without unreasonable effort as a result of the inherent difficulty of forecasting the timing and/or amounts of certain items, including certain charges related to restructuring, acquisition, integration and related charges. In addition, the Company believes such reconciliations would imply a degree of precision that may be confusing or misleading to investors.
Conference Call
The Company will discuss these results and other related matters at 1:30 p.m. Pacific Time on January 30, 2025 in a live webcast, which will also be archived for replay on the Company's website at https://investor.viavisolutions.com. The Company will post supplementary slides outlining the Company's latest financial results on https://investor.viavisolutions.com under the "Quarterly Results" section concurrently with this earnings press release. This press release is being furnished as a Current Report on Form 8-K with the Securities and Exchange Commission, and will be available at www.sec.gov.
About VIAVI Solutions
VIAVI (NASDAQ: VIAV) is a global provider of network test, monitoring and assurance solutions for telecommunications, cloud, enterprises, first responders, military, aerospace and railway. VIAVI is also a leader in light management technologies for 3D sensing, anti-counterfeiting, consumer electronics, industrial, automotive, government and aerospace applications.
Learn more about VIAVI at www.viavisolutions.com. Follow us on VIAVI Perspectives, LinkedIn and YouTube.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include any expectation, anticipation or guidance as to future financial performance, including future revenue, gross margin, operating expense, operating margin, profitability targets, cash flow and other financial metrics, as well as the impact and duration of certain trends and market position and conditions, including market stabilization and recovery. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected. In particular, the Company's ability to predict future financial performance continues to be difficult due to, among other things: (a) continuing general limited visibility across many of our product lines; (b) quarter-over-quarter product mix fluctuations, which can materially impact profitability measures due to the broad gross margin ranges across our portfolio; (c) consolidations in our industry and customer base; (d) competitive pressures; (e) unforeseen changes or deceleration in the demand for current and new products, technologies, services, delays or unforeseen events in the roll-out of new industry platforms or evolving technology such as 3D sensing and customer purchasing delays due to macroeconomic conditions, tightening of expenditures or as they assess or transition to such new technologies and/or architectures, all of which limit near-term demand visibility, and could negatively impact potential revenue; (f) continued decline of average selling prices across our businesses; (g) notable seasonality and a significant level of in-quarter book-and-ship business; (h) various product and manufacturing transfers, site consolidations, product discontinuances and restructuring and workforce reduction plans, including anticipated cost savings associated with such plans; (i) challenges in execution of business strategy; (j) challenges integrating the businesses the Company has acquired and realizing all of the expected benefits and savings; (k) supply chain and materials constraints and the ability of our suppliers and contract manufacturers to meet production and delivery requirements to our forecasted demand; (l) potential disruptions or delays to our manufacturing and operations due to climate conditions and natural disasters in the regions where we operate, such as wildfires, drought conditions and related water shortages in
Contact Information
Investors:
Vibhuti Nayar
408-404-6305
vibhuti.nayar@viavisolutions.com
Press:
Amit Malhotra
202-341-8624
amit.malhotra@viavisolutions.com
The following financial tables are presented in accordance with GAAP, unless otherwise specified.
-SELECTED PRELIMINARY FINANCIAL DATA -
VIAVI SOLUTIONS INC. | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(in millions, except per share data) | |||||||
(unaudited) | |||||||
PRELIMINARY | |||||||
Three Months Ended | Six Months Ended | ||||||
December 28, 2024 | December 30, 2023 | December 28, 2024 | December 30, 2023 | ||||
Net revenue | $ 270.8 | $ 254.5 | $ 509.0 | $ 502.4 | |||
Cost of revenues | 106.7 | 103.1 | 205.5 | 203.1 | |||
Amortization of acquired technologies | 3.3 | 3.4 | 6.6 | 6.9 | |||
Gross profit | 160.8 | 148.0 | 296.9 | 292.4 | |||
Operating expenses: | |||||||
Research and development | 52.1 | 49.5 | 101.5 | 99.4 | |||
Selling, general and administrative | 84.3 | 74.8 | 158.4 | 152.0 | |||
Amortization of other intangibles | 1.0 | 1.4 | 2.1 | 3.5 | |||
Restructuring and related charges (benefits) | 1.2 | (0.1) | 1.2 | (0.9) | |||
Total operating expenses | 138.6 | 125.6 | 263.2 | 254.0 | |||
Income from operations | 22.2 | 22.4 | 33.7 | 38.4 | |||
Interest and other income, net | 3.9 | 3.8 | 7.1 | 14.0 | |||
Interest expense | (7.5) | (7.9) | (15.0) | (15.7) | |||
Income before income taxes | 18.6 | 18.3 | 25.8 | 36.7 | |||
Provision for income taxes | 9.5 | 7.6 | 18.5 | 16.2 | |||
Net income | $ 9.1 | $ 10.7 | $ 7.3 | $ 20.5 | |||
Net income per share: | |||||||
Basic | $ 0.04 | $ 0.05 | $ 0.03 | $ 0.09 | |||
Diluted | $ 0.04 | $ 0.05 | $ 0.03 | $ 0.09 | |||
Shares used in per share calculations: | |||||||
Basic | 222.0 | 222.5 | 222.0 | 222.2 | |||
Diluted | 224.8 | 223.5 | 224.4 | 223.9 | |||
The preliminary financial statements are estimated based on our current information. |
VIAVI SOLUTIONS INC. | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(in millions, unaudited) | |||
PRELIMINARY | |||
December 28, 2024 | June 29, 2024 | ||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 488.0 | $ 471.3 | |
Short-term investments | 21.4 | 19.9 | |
Restricted cash | 3.4 | 5.0 | |
Accounts receivable, net | 212.5 | 213.1 | |
Inventories, net | 92.8 | 96.5 | |
Prepayments and other current assets | 62.3 | 70.7 | |
Total current assets | 880.4 | 876.5 | |
Property, plant and equipment, net | 225.9 | 228.2 | |
Goodwill, net | 451.1 | 452.9 | |
Intangibles, net | 29.2 | 38.2 | |
Deferred income taxes | 80.5 | 82.5 | |
Other non-current assets | 58.0 | 58.0 | |
Total assets | $ 1,725.1 | $ 1,736.3 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Current liabilities: | |||
Accounts payable | $ 55.7 | $ 50.4 | |
Accrued payroll and related expenses | 57.9 | 48.2 | |
Deferred revenue | 57.8 | 65.7 | |
Accrued expenses | 27.2 | 25.3 | |
Other current liabilities | 49.4 | 57.5 | |
Total current liabilities | 248.0 | 247.1 | |
Long-term debt | 639.3 | 636.0 | |
Other non-current liabilities | 155.0 | 171.6 | |
Total liabilities | 1,042.3 | 1,054.7 | |
Total stockholders' equity | 682.8 | 681.6 | |
Total liabilities and stockholders' equity | $ 1,725.1 | $ 1,736.3 | |
The preliminary financial statements are estimated based on our current information. |
VIAVI SOLUTIONS INC. | |||||||||||
REPORTABLE SEGMENT INFORMATION | |||||||||||
(in millions, unaudited) | |||||||||||
PRELIMINARY | |||||||||||
Three Months Ended December 28, 2024 | |||||||||||
Network and Service Enablement | |||||||||||
Network | Service | Network and | Optical Security | Other Items (1) | Consolidated | ||||||
Net revenue | $ 179.0 | $ 20.9 | $ 199.9 | $ 70.9 | $ — | $ 270.8 | |||||
Gross profit | $ 115.4 | $ 14.1 | $ 129.5 | $ 35.9 | $ (4.6) | $ 160.8 | |||||
Gross margin | 64.5 % | 67.5 % | 64.8 % | 50.6 % | 59.4 % | ||||||
Operating income | $ 17.4 | $ 23.0 | $ (18.2) | $ 22.2 | |||||||
Operating margin | 8.7 % | 32.4 % | 8.2 % | ||||||||
Three Months Ended December 30, 2023 | |||||||||||
Network and Service Enablement | |||||||||||
Network | Service | Network and | Optical Security | Other Items (1) | Consolidated | ||||||
Net revenue | $ 155.5 | $ 24.1 | $ 179.6 | $ 74.9 | $ — | $ 254.5 | |||||
Gross profit | $ 97.2 | $ 16.6 | $ 113.8 | $ 39.0 | $ (4.8) | $ 148.0 | |||||
Gross margin | 62.5 % | 68.9 % | 63.4 % | 52.1 % | 58.2 % | ||||||
Operating income | $ 6.4 | $ 27.3 | $ (11.3) | $ 22.4 | |||||||
Operating margin | 3.6 % | 36.4 % | 8.8 % | ||||||||
Six Months Ended December 28, 2024 | |||||||||||
Network and Service Enablement | |||||||||||
Network | Service | Network and | Optical Security | Other Items (1) | Consolidated | ||||||
Net revenue | $ 320.6 | $ 38.7 | $ 359.3 | $ 149.7 | $ — | $ 509.0 | |||||
Gross profit | $ 201.7 | $ 24.9 | $ 226.6 | $ 79.5 | $ (9.2) | $ 296.9 | |||||
Gross margin | 62.9 % | 64.3 % | 63.1 % | 53.1 % | 58.3 % | ||||||
Operating income | $ 10.1 | $ 54.2 | $ (30.6) | $ 33.7 | |||||||
Operating margin | 2.8 % | 36.2 % | 6.6 % | ||||||||
Six Months Ended December 30, 2023 | |||||||||||
Network and Service Enablement | |||||||||||
Network | Service | Network and | Optical Security | Other Items (1) | Consolidated | ||||||
Net revenue | $ 305.5 | $ 44.5 | $ 350.0 | $ 152.4 | $ — | $ 502.4 | |||||
Gross profit | $ 191.8 | $ 30.3 | $ 222.1 | $ 79.7 | $ (9.4) | $ 292.4 | |||||
Gross margin | 62.8 % | 68.1 % | 63.5 % | 52.3 % | 58.2 % | ||||||
Operating income | $ 7.9 | $ 56.6 | $ (26.1) | $ 38.4 | |||||||
Operating margin | 2.3 % | 37.1 % | 7.6 % | ||||||||
(1) See Reconciliation of GAAP Measures from Continuing Operations to Non-GAAP Measures below for details of Other Items. |
The preliminary financial schedules are estimated based on our current information. |
Use of Non-GAAP (Adjusted) Financial Measures
The Company provides non-GAAP operating income, non-GAAP operating margin, non-GAAP net income and non-GAAP EPS financial measures as supplemental information regarding the Company's operational performance and believes providing this additional information allows investors to see Company results through the eyes of management, better understand its financial performance and evaluate the efficacy of the methodology used by management to measure such performance. The Company uses the measures disclosed in this Report to evaluate the Company's historical and prospective financial performance, as well as its performance relative to its competitors. Specifically, management uses these items to further its own understanding of the Company's core operating performance, which the Company believes represents its performance in the ordinary, ongoing and customary course of its operations. Accordingly, management excludes from core operating performance items such as those relating to certain purchase price accounting adjustments, amortization of acquisition-related intangibles, stock-based compensation, legal settlements, restructuring, changes in fair value of contingent consideration liabilities and certain investing and acquisition related expenses and other activities that management believes are not reflective of such ordinary, ongoing and core operating activities. The non-GAAP adjustments described in this release are excluded by the Company from its GAAP financial measures because the Company believes excluding these items enables investors to evaluate more clearly and consistently the Company's core operational performance. The non-GAAP adjustments are outlined below.
Cost of revenues, costs of research and development and costs of selling, general and administrative: The Company's GAAP presentation of gross margin and operating expenses may include (i) additional depreciation and amortization from changes in estimated useful life and the write-down of certain property, equipment and intangibles that have been identified for disposal but remained in use until the date of disposal, (ii) charges such as severance, benefits and outplacement costs related to restructuring plans, (iii) costs for facilities not required for ongoing operations, and costs related to the relocation of certain equipment from these facilities and/or contract manufacturer facilities, (iv) stock-based compensation, (v) amortization expense related to acquired intangibles, (vi) changes in fair value of contingent consideration liabilities and (vii) other charges unrelated to our core operating performance comprised mainly of acquisition related transaction costs, integration costs related to acquired entities, litigation and legal settlements and other costs and contingencies unrelated to current and future operations, including transformational initiatives such as the implementation of simplified automated processes, site consolidations, and reorganizations. The Company excludes these items in calculating non-GAAP gross margin, non-GAAP operating margin, non-GAAP net income, non-GAAP EPS, EBITDA and adjusted EBITDA.
Non-cash interest expense and other expense: The Company excludes certain investing expenses, including accretion of debt discount, and other non-cash activities that management believes are not reflective of such ordinary, ongoing and core operating activities, when calculating non-GAAP net income and non-GAAP EPS.
Income tax expense or benefit: The Company excludes certain non-cash tax expense or benefit items, such as the utilization of net operating losses where valuation allowances were released, intra-period tax allocation benefit and the tax effect for amortization of non-tax deductible intangible assets, when calculating non-GAAP net income and non-GAAP EPS.
Interest, taxes, depreciation, amortization and other adjustments: The Company's EBITDA calculation primarily excludes interest income and other income (expense), interest expense, taxes, depreciation and amortization, and other items that are not part of its core operating performance described above. The Company's adjusted EBITDA excludes items in addition to the items excluded from the EBITDA calculation, such as stock-based compensation, restructuring, gain or loss on sale of available for-sale investments, changes in fair value of contingent consideration liabilities arising from prior acquisitions and other charges related to activities that are not part of its core operating performance described above. Management believes adjusted EBITDA is a helpful indicator of the Company's core operational cash flow.
Non-GAAP financial measures are not in accordance with, preferable to, or an alternative for, generally accepted accounting principles in
VIAVI SOLUTIONS INC. | |||||||||||||||
RECONCILIATION OF GAAP MEASURES FROM CONTINUING OPERATIONS | |||||||||||||||
TO NON-GAAP MEASURES | |||||||||||||||
(in millions, except per share data) | |||||||||||||||
(unaudited) | |||||||||||||||
PRELIMINARY | |||||||||||||||
The following tables reconcile GAAP measures to non-GAAP measures: | |||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||
December 28, 2024 | December 30, 2023 | December 28, 2024 | December 30, 2023 | ||||||||||||
Gross | Gross | Gross | Gross | Gross | Gross | Gross | Gross | ||||||||
GAAP measures | $ 160.8 | 59.4 % | $ 148.0 | 58.2 % | $ 296.9 | 58.3 % | $ 292.4 | 58.2 % | |||||||
Stock-based compensation | 1.3 | 0.5 % | 1.2 | 0.5 % | 2.5 | 0.5 % | 2.4 | 0.5 % | |||||||
Other charges unrelated to core operating performance | — | — % | 0.2 | — % | 0.1 | — % | 0.1 | — % | |||||||
Amortization of intangibles | 3.3 | 1.2 % | 3.4 | 1.3 % | 6.6 | 1.3 % | 6.9 | 1.4 % | |||||||
Total related to Cost of Revenue | 4.6 | 1.7 % | 4.8 | 1.8 % | 9.2 | 1.8 % | 9.4 | 1.9 % | |||||||
Non-GAAP measures | $ 165.4 | 61.1 % | $ 152.8 | 60.0 % | $ 306.1 | 60.1 % | $ 301.8 | 60.1 % | |||||||
Three Months Ended | Six Months Ended | ||||||||||||||
December 28, 2024 | December 30, 2023 | December 28, 2024 | December 30, 2023 | ||||||||||||
Operating | Operating | Operating | Operating | Operating | Operating | Operating | Operating | ||||||||
GAAP measures | $ 22.2 | 8.2 % | $ 22.4 | 8.8 % | $ 33.7 | 6.6 % | $ 38.4 | 7.6 % | |||||||
Stock-based compensation | 13.7 | 5.1 % | 12.5 | 4.9 % | 26.4 | 5.2 % | 23.7 | 4.7 % | |||||||
Change in fair value of contingent liability | (3.9) | (1.4) % | (7.0) | (2.8) % | (7.4) | (1.4) % | (8.4) | (1.7) % | |||||||
Acquisition and integration related charges | 2.8 | 1.0 % | 0.6 | 0.2 % | 3.4 | 0.7 % | 0.6 | 0.1 % | |||||||
Other charges (benefits) unrelated to core operating performance (1) | 0.1 | — % | 0.5 | 0.2 % | (0.4) | (0.1) % | 0.7 | 0.2 % | |||||||
Amortization of intangibles | 4.3 | 1.6 % | 4.8 | 1.9 % | 8.7 | 1.7 % | 10.4 | 2.1 % | |||||||
Restructuring and related charges (benefits) | 1.2 | 0.4 % | (0.1) | — % | 1.2 | 0.2 % | (0.9) | (0.2) % | |||||||
Litigation settlement | — | — % | — | — % | (1.3) | (0.3) % | — | — % | |||||||
Total related to Cost of Revenue and Operating Expenses | 18.2 | 6.7 % | 11.3 | 4.4 % | 30.6 | 6.0 % | 26.1 | 5.2 % | |||||||
Non-GAAP measures | $ 40.4 | 14.9 % | $ 33.7 | 13.2 % | $ 64.3 | 12.6 % | $ 64.5 | 12.8 % | |||||||
Three Months Ended | Six Months Ended | ||||||||||||||
December 28, 2024 | December 30, 2023 | December 28, 2024 | December 30, 2023 | ||||||||||||
Net | Diluted | Net | Diluted | Net | Diluted EPS | Net | Diluted EPS | ||||||||
GAAP measures | $ 9.1 | $ 0.04 | $ 10.7 | $ 0.05 | $ 7.3 | $ 0.03 | $ 20.5 | $ 0.09 | |||||||
Items reconciling GAAP Net Income and EPS to Non-GAAP Net Income and EPS: | |||||||||||||||
Stock-based compensation | 13.7 | 0.06 | 12.5 | 0.06 | 26.4 | 0.12 | 23.7 | 0.11 | |||||||
Change in fair value of contingent liability | (3.9) | (0.02) | (7.0) | (0.03) | (7.4) | (0.03) | (8.4) | (0.04) | |||||||
Acquisition and integration related charges | 2.8 | 0.01 | 0.6 | — | 3.4 | 0.02 | 0.6 | — | |||||||
Other charges (benefits) unrelated to core operating performance (1) | 0.1 | — | 0.5 | — | (0.4) | (0.01) | 0.7 | — | |||||||
Amortization of intangibles | 4.3 | 0.02 | 4.8 | 0.02 | 8.7 | 0.04 | 10.4 | 0.04 | |||||||
Restructuring and related charges (benefits) | 1.2 | 0.01 | (0.1) | — | 1.2 | 0.01 | (0.9) | — | |||||||
Litigation settlement | — | — | 0.3 | — | (1.3) | (0.01) | (7.0) | (0.03) | |||||||
Non-cash interest expense and other expense | 1.1 | 0.01 | 1.2 | 0.01 | 2.2 | 0.01 | 2.4 | 0.01 | |||||||
Provision for income taxes | 1.0 | — | 0.2 | — | 1.7 | 0.01 | 1.2 | 0.01 | |||||||
Total related to Net Income and EPS | 20.3 | 0.09 | 13.0 | 0.06 | 34.5 | 0.16 | 22.7 | 0.10 | |||||||
Non-GAAP measures | $ 29.4 | $ 0.13 | $ 23.7 | $ 0.11 | $ 41.8 | $ 0.19 | $ 43.2 | $ 0.19 | |||||||
Shares used in per share calculation for Non-GAAP EPS | 224.8 | 223.5 | 224.4 | 223.9 | |||||||||||
Note: Certain totals may not add due to rounding. |
(1) Included in the six months ended December 28, 2024 is a gain of |
The preliminary financial schedules are estimated based on our current information. |
VIAVI SOLUTIONS INC. | |||||||
RECONCILIATION OF GAAP MEASURES FROM CONTINUING OPERATIONS | |||||||
TO ADJUSTED EBITDA | |||||||
(in millions, unaudited) | |||||||
PRELIMINARY | |||||||
Three Months Ended | Six Months Ended | ||||||
December 28, | December 30, | December 28, | December 30, | ||||
GAAP Net Income | $ 9.1 | $ 10.7 | $ 7.3 | $ 20.5 | |||
Interest and other income, net (1) | (3.9) | (3.8) | (7.1) | (14.0) | |||
Interest expense | 7.5 | 7.9 | 15.0 | 15.7 | |||
Provision for income taxes | 9.5 | 7.6 | 18.5 | 16.2 | |||
Depreciation | 9.8 | 9.7 | 19.5 | 19.5 | |||
Amortization | 4.3 | 4.8 | 8.7 | 10.4 | |||
EBITDA | 36.3 | 36.9 | 61.9 | 68.3 | |||
Restructuring and related charges (benefits) | 1.2 | (0.1) | 1.2 | (0.9) | |||
Stock-based compensation | 13.7 | 12.5 | 26.4 | 23.7 | |||
Change in fair value of contingent liability | (3.9) | (7.0) | (7.4) | (8.4) | |||
Acquisition and integration related charges | 2.8 | 0.6 | 3.4 | 0.6 | |||
Other charges (benefits) unrelated to core operating performance (2) | — | 0.1 | (1.9) | 0.2 | |||
Adjusted EBITDA | $ 50.1 | $ 43.0 | $ 83.6 | $ 83.5 | |||
Note: Certain totals may not add due to rounding. |
(1) Includes favorable litigation settlement of |
(2) Included in the six months ended December 28, 2024 is a gain on litigation settlement of |
The preliminary financial schedules are estimated based on our current information. |
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SOURCE VIAVI Financials
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