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Keysight Q1 Earnings Beat Estimates on Healthy Top-Line Growth
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Key Takeaways
KEYS beats Q1 estimates with $1.6B revenue and EPS of $2.17, up from $1.82 a year ago.
KEYS saw 27% CSG growth on AI data centers, 5G/6G, NTN and strong wireline, wireless demand.
KEYS guided Q2 revenue to $1.69-$1.71B and EPS of $2.27-$2.33 after strong orders and margins.
Keysight Technologies, Inc. (KEYS - Free Report) reported strong first-quarter fiscal 2026 results, with both top and bottom lines surpassing the Zacks Consensus Estimate.
The leading electronic design and testing solution provider reported higher year-over-year revenues, backed by solid demand in AI data centers and strength in aerospace, defense and government markets. Management’s ongoing focus on strategic collaborations and technology innovation remains a positive factor.
Net Income
Net income on a GAAP basis was $281 million or $1.63 per share compared with $169 million or 97 cents per share in the prior-year quarter. Top-line growth and income tax benefit boosted the bottom line during the quarter.
Non-GAAP net income in the reported quarter was $376 million or $2.17 per share compared with $317 million or $1.82 per share in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate by 18 cents.
Keysight Technologies Inc. Price, Consensus and EPS Surprise
Net sales during the quarter increased to $1.6 billion from $1.3 billion in the year-ago quarter. owing to a solid growth in the Communication Solutions Group (CSG) segment. The top line beat the consensus estimate of $1.54 billion. Total orders were $1.65 billion compared with $1.26 billion in the year-ago quarter.
CSG generated $1.12 billion in revenues, up from the year-ago quarter’s $883 million. The 27% year-over-year growth was primarily driven by rising investments in AI data centers, Edge AI, next-generation wireless (5G/6G and NTN), and continued strength in both wireline and wireless testing demand. The top line beat our estimate of $1.06 billion.
The Electronic Industrial Solutions Group (EISG) segment’s revenues increased to $476 million from $415 million in the prior-year quarter. Growth was driven by software-defined vehicles, strong semiconductor wafer test demand, and steady industrial and digital health momentum supported by AI-related PCB and interconnect orders. The top line missed our revenue estimate of $482.4 million.
Region-wise, Asia-Pacific revenues aggregated $592 million compared with $488 million in the prior-year quarter. The company reported a 23% year-over-year improvement in revenues from the Americas to $680 million. Revenues from Europe were $328 million, up 27% from the year-ago quarter's $259 million.
During the quarter, revenues from Aerospace, Defense and Government increased to $366 million from $311 million in the year-ago quarter. The company reported a 33% year-over-year improvement in revenues from the Commercial Communications to $758 million. Electronic Industrial generated $476 million in revenues, up from the year-ago quarter’s $415 million.
Other Details
During the quarter, the company’s non-GAAP gross profit totaled $1.07 billion compared with $854 million in the year-ago quarter, with gross margins of 66.7% and 65.8%, respectively. Non-GAAP operating income totaled $439 million compared with $354 million in the year-ago period, with operating margins of 27.4% and 27.3%, respectively.
CSG reported a non-GAAP operating income of $309 million compared with $240 million in the year-ago period. EISG non-GAAP operating income increased to $130 million from $114 million in the prior-year quarter.
Cash Flow & Liquidity
In the first quarter of fiscal 2026, Keysight generated $441 million of net cash from operating activities compared with $378 million in the year-ago quarter. As of Jan. 31, 2026, the company had $2.18 billion in cash and cash equivalents and $2.53 billion of long-term debt.
Outlook
For the second quarter of fiscal 2026, Keysight expects revenues in the range of $1.69-$1.71 billion. Non-GAAP earnings per share are estimated to be between $2.27 and $2.33.
In the last reported quarter, it delivered an earnings surprise of 8.62%. With rising demand for AI and cloud infrastructure, Celestica is well-positioned to benefit. Its focus on higher-margin markets, diversified portfolio, and strong engineering capabilities support scalable production of complex electronic and data-center solutions. Its strong research and development capabilities enable it to produce high-volume electronics manufacturing across multiple industries.
Ericsson (ERIC - Free Report) carries a Zacks Rank #2 at present. It delivered an earnings surprise of 17.39% in the last reported quarter.
Ericsson is likely to gain from steady global 5G investments. Its competitive 5G portfolio and disciplined cost focus support network leadership, while expanding enterprise and private-network offerings create new growth opportunities. The company continues to execute its plan to become a leading mobile infrastructure provider. Ongoing innovation and partnerships should further strengthen its position in the wireless infrastructure market.
Ubiquiti Inc. (UI - Free Report) currently holds a Zacks Rank #2. It delivered an earnings surprise of 38.08% in the last reported quarter.
It offers a broad portfolio of networking solutions for enterprises and service providers. Its efficient and flexible business model supports healthy margins and scalable expansion. The company continues to invest in research and development to launch innovative networking products and advanced technologies. Strong channel management and a wide global distributor network improve demand visibility and inventory control.
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Keysight Q1 Earnings Beat Estimates on Healthy Top-Line Growth
Key Takeaways
Keysight Technologies, Inc. (KEYS - Free Report) reported strong first-quarter fiscal 2026 results, with both top and bottom lines surpassing the Zacks Consensus Estimate.
The leading electronic design and testing solution provider reported higher year-over-year revenues, backed by solid demand in AI data centers and strength in aerospace, defense and government markets. Management’s ongoing focus on strategic collaborations and technology innovation remains a positive factor.
Net Income
Net income on a GAAP basis was $281 million or $1.63 per share compared with $169 million or 97 cents per share in the prior-year quarter. Top-line growth and income tax benefit boosted the bottom line during the quarter.
Non-GAAP net income in the reported quarter was $376 million or $2.17 per share compared with $317 million or $1.82 per share in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate by 18 cents.
Keysight Technologies Inc. Price, Consensus and EPS Surprise
Keysight Technologies Inc. price-consensus-eps-surprise-chart | Keysight Technologies Inc. Quote
Revenues
Net sales during the quarter increased to $1.6 billion from $1.3 billion in the year-ago quarter. owing to a solid growth in the Communication Solutions Group (CSG) segment. The top line beat the consensus estimate of $1.54 billion. Total orders were $1.65 billion compared with $1.26 billion in the year-ago quarter.
CSG generated $1.12 billion in revenues, up from the year-ago quarter’s $883 million. The 27% year-over-year growth was primarily driven by rising investments in AI data centers, Edge AI, next-generation wireless (5G/6G and NTN), and continued strength in both wireline and wireless testing demand. The top line beat our estimate of $1.06 billion.
The Electronic Industrial Solutions Group (EISG) segment’s revenues increased to $476 million from $415 million in the prior-year quarter. Growth was driven by software-defined vehicles, strong semiconductor wafer test demand, and steady industrial and digital health momentum supported by AI-related PCB and interconnect orders. The top line missed our revenue estimate of $482.4 million.
Region-wise, Asia-Pacific revenues aggregated $592 million compared with $488 million in the prior-year quarter. The company reported a 23% year-over-year improvement in revenues from the Americas to $680 million. Revenues from Europe were $328 million, up 27% from the year-ago quarter's $259 million.
During the quarter, revenues from Aerospace, Defense and Government increased to $366 million from $311 million in the year-ago quarter. The company reported a 33% year-over-year improvement in revenues from the Commercial Communications to $758 million. Electronic Industrial generated $476 million in revenues, up from the year-ago quarter’s $415 million.
Other Details
During the quarter, the company’s non-GAAP gross profit totaled $1.07 billion compared with $854 million in the year-ago quarter, with gross margins of 66.7% and 65.8%, respectively. Non-GAAP operating income totaled $439 million compared with $354 million in the year-ago period, with operating margins of 27.4% and 27.3%, respectively.
CSG reported a non-GAAP operating income of $309 million compared with $240 million in the year-ago period. EISG non-GAAP operating income increased to $130 million from $114 million in the prior-year quarter.
Cash Flow & Liquidity
In the first quarter of fiscal 2026, Keysight generated $441 million of net cash from operating activities compared with $378 million in the year-ago quarter. As of Jan. 31, 2026, the company had $2.18 billion in cash and cash equivalents and $2.53 billion of long-term debt.
Outlook
For the second quarter of fiscal 2026, Keysight expects revenues in the range of $1.69-$1.71 billion. Non-GAAP earnings per share are estimated to be between $2.27 and $2.33.
KEYS’s Zacks Rank
Keysight currently carries a Zacks Rank #2 (Buy).
Other Stocks to Consider
Celestica Inc. (CLS - Free Report) sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the last reported quarter, it delivered an earnings surprise of 8.62%. With rising demand for AI and cloud infrastructure, Celestica is well-positioned to benefit. Its focus on higher-margin markets, diversified portfolio, and strong engineering capabilities support scalable production of complex electronic and data-center solutions. Its strong research and development capabilities enable it to produce high-volume electronics manufacturing across multiple industries.
Ericsson (ERIC - Free Report) carries a Zacks Rank #2 at present. It delivered an earnings surprise of 17.39% in the last reported quarter.
Ericsson is likely to gain from steady global 5G investments. Its competitive 5G portfolio and disciplined cost focus support network leadership, while expanding enterprise and private-network offerings create new growth opportunities. The company continues to execute its plan to become a leading mobile infrastructure provider. Ongoing innovation and partnerships should further strengthen its position in the wireless infrastructure market.
Ubiquiti Inc. (UI - Free Report) currently holds a Zacks Rank #2. It delivered an earnings surprise of 38.08% in the last reported quarter.
It offers a broad portfolio of networking solutions for enterprises and service providers. Its efficient and flexible business model supports healthy margins and scalable expansion. The company continues to invest in research and development to launch innovative networking products and advanced technologies. Strong channel management and a wide global distributor network improve demand visibility and inventory control.