Keysight Technologies (KEYS) Earnings Date & Reports

Key Takeaways

• Keysight Technologies reported fiscal third-quarter 2026 revenue of $1.85 billion, up about 37% year over year and above the $1.75 billion consensus estimate.
• Adjusted earnings per share (EPS) of $3.07 beat the $2.48 analyst consensus by $0.59; EPS under generally accepted accounting principles (GAAP) was $2.30, up from $1.10 a year earlier.
• Third-quarter orders reached $2.091 billion, up 56% from a year earlier and marking a second consecutive quarter above $2 billion.
• Communications Solutions Group revenue rose 43% to $1.345 billion, as commercial communications revenue exceeded $1 billion for the first time.
• Management raised its outlook, guiding fiscal fourth-quarter revenue to $1.93 billion–$1.95 billion and adjusted EPS to $3.34–$3.40, both above consensus.
• KEYS shares slid about 5.5% in regular trading before the release, then rebounded in extended trading after the results.

Earnings Context and Why It Matters

Keysight Technologies is a leading provider of electronic design, simulation, and test-and-measurement solutions used across communications, aerospace and defense, automotive, semiconductor, and general electronics markets. Its quarterly results are closely watched as a real-time indicator of capital spending on high-speed networking and artificial intelligence (AI) infrastructure, because Keysight tools are used to validate components such as high-speed optical transceivers and silicon photonics. Following several quarters of strengthening orders tied to AI data center buildouts, this report tested whether that demand momentum could continue and whether management's raised outlook is supported by order trends, segment mix, and margins.

Reported Results

For the fiscal third quarter ended July 31, 2026, Keysight posted revenue of $1.85 billion, an increase of about 37% from $1.35 billion a year earlier. That exceeded the consensus estimate of $1.75 billion. Adjusted earnings per share came in at $3.07, compared with $2.48 expected by analysts. On a GAAP basis, net income was $397 million, or $2.30 per diluted share, up from $191 million, or $1.10 per diluted share, in the prior-year quarter.

Demand was broad-based. Orders rose 56% year over year to $2.091 billion, and core orders increased 52%. The Communications Solutions Group, Keysight's largest segment, grew revenue 43% to $1.345 billion; within it, commercial communications revenue jumped 56% to $1.006 billion, crossing $1 billion for the first time. Aerospace, defense, and government revenue rose 14% to $339 million. The Electronic Industrial Solutions Group grew revenue 21% to $501 million, with gains across semiconductor, general electronics, and automotive and energy markets. Operating cash flow was $437 million, and free cash flow (cash from operations minus capital expenditures) was $403 million. Cash, cash equivalents, and restricted cash totaled $2.62 billion at quarter-end.

For the fiscal fourth quarter, management guided revenue to a range of $1.93 billion to $1.95 billion and adjusted EPS to $3.34 to $3.40, above consensus estimates of about $2.68 in adjusted EPS and roughly $1.82 billion in revenue. The company also raised its full-year fiscal 2026 outlook, projecting revenue growth of about 32% and adjusted EPS growth of about 60%.

AI Screener

Tickeron's AI Screener is an AI-powered stock and exchange-traded fund (ETF) discovery tool that helps traders and investors filter the market based on technical patterns, fundamentals, trends, volatility, and AI-driven signals. Users can scan thousands of stocks and ETFs using customizable filters such as industry, market capitalization, technical indicators, price patterns, and performance metrics. The screener is designed to help identify trade ideas, trending stocks, breakout candidates, and market opportunities more efficiently than manual screening. For investors tracking earnings momentum in companies such as Keysight Technologies, the AI Screener can serve as a practical starting point for broader market research.

Market Reaction and Investor Sentiment

Heading into the report, investor caution was visible: KEYS shares fell about 5.5% during Tuesday's regular session, closing near $341. The mood shifted after the release, when the earnings beat and raised guidance sent the stock higher in extended trading, with after-hours gains reported in the range of roughly 3% to 4%. The rebound highlighted that investors were focused on the durability of AI infrastructure demand rather than the pre-earnings sell-off.

Sentiment remains constructive but valuation-sensitive. The stock has more than doubled over the past 12 months and trades at a price-to-earnings (P/E) multiple well above its historical norm, so even strong quarterly results can be met with volatility. Sell-side commentary ahead of the report was broadly positive, and analyst price targets have been moving higher, though the elevated valuation keeps the bar for continued upside relatively high.

Forward Outlook and Key Factors to Monitor

The clearest catalyst to watch is whether AI data center buildouts continue to translate into orders. On the earnings call, management indicated a historically high sales pipeline and suggested fiscal fourth-quarter orders could exceed $2 billion for a third consecutive quarter. Strength in high-speed wireline orders, including advanced optical transceivers, silicon photonics, and pre-silicon validation for hyperscale cloud data center customers, remains a central theme.

Supply chain constraints are another factor. Keysight has noted that converting strong demand into recognized revenue remains partly limited by component availability, so investors will likely monitor whether delivery conditions improve and support the company's raised guidance.

Margins and mix also matter. Segment gross margins were about 71% for Communications Solutions and about 64% for Electronic Industrial Solutions, and software and services now represent roughly one-third of total revenue. Sustaining that mix, along with acquisition-related cost synergies, could support profitability.

Finally, broader risks include export controls, tariffs and trade policy uncertainty, geopolitical tensions, and customer purchasing timing. Any shift in data center spending plans or regulatory changes could influence order patterns in the quarters ahead.

Disclaimer

The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.

Disclaimers and Limitations