We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Viavi Exhibits More Than Threefold Growth in a Year: Should You Buy?
Read MoreHide Full Article
Key Takeaways
VIAV surged 268.5% in a year as AI data-center demand, margins and testing capabilities improved.
NSE revenues jumped 69.2% to $353.9M, driven by testing demand and contributions from Spirent.
VIAV expects fiscal Q1 revenues of $450M-$460M and non-GAAP EPS of 40-42 cents.
Viavi Solutions Inc. (VIAV - Free Report) has surged 268.5% over the past year compared with the industry’s growth of 148.5%. It has outperformed peers like Corning Incorporated (GLW - Free Report) and Ooma, Inc. (OOMA - Free Report) . While Corning has gained 92.4%, OOMA jumped 79.9% during this period. The more than threefold growth was largely buoyed by growing investor optimism over Viavi’s rising exposure to artificial intelligence (AI)-driven data-center spending, improving profitability and expanding testing capabilities.
One-Year VIAV Stock Price Performance
Image Source: Zacks Investment Research
AI Data-Center Boom: Key Growth Catalyst
Viavi is increasingly benefiting from the rapid buildout of AI and hyperscale data center infrastructure. Demand for high-speed optical, Ethernet and network-testing solutions remains healthy as cloud service providers, semiconductor companies and networking vendors invest heavily in increasingly complex AI infrastructure.
The data-center ecosystem now accounts for roughly half of Network and Service Enablement (NSE) revenues, underscoring the growing importance of this market to Viavi’s growth profile. In the fiscal fourth quarter, NSE revenues surged 69.2% year over year to $353.9 million.
Growth was supported by robust demand for lab, production and field-testing solutions, strength in aerospace and defense and contributions from the acquired Spirent businesses. The Spirent assets have also strengthened Viavi’s capabilities in high-speed Ethernet testing, network security and channel emulation. The broader portfolio should support cross-selling opportunities while helping the company address increasingly sophisticated testing requirements across AI clusters and next-generation networks.
Margin Expansion Strengthens the Earnings Story
Viavi exited fiscal 2026 on a strong note, with both revenues and profitability exhibiting healthy improvement. Revenues increased 40% year over year to $1.52 billion, while non-GAAP earnings surged 112.8% to $1 per share.
Non-GAAP operating margin expanded 630 basis points to 20.6%. The sharp improvement highlights stronger operating leverage and suggests that rising revenues are translating effectively into earnings growth.
This margin expansion is particularly encouraging as Viavi integrates Spirent and increases its exposure to higher-growth markets such as AI data centers, aerospace and defense and advanced wireless testing.
Image Source: Zacks Investment Research
Upbeat Outlook Points to Continued Momentum
Management expects the positive momentum to extend into fiscal 2027. For the fiscal first quarter, Viavi projects revenues in the range of $450 million to $460 million and non-GAAP earnings of 40-42 cents per share. Both metrics indicate sequential improvement from the June quarter.
The outlook suggests that healthy demand trends are continuing across several important end markets. In addition to AI-related data-center opportunities, aerospace and defense remain a key growth avenue, particularly for positioning, navigation and timing solutions. Strength in these markets also helps diversify Viavi’s business and reduces its historical dependence on telecom carrier spending.
6G and Wireless Testing: Other Growth Pillars
Viavi is also positioning itself for emerging opportunities in next-generation wireless technologies. The company’s Vertex 6.0 advanced channel emulator is designed for 6G and Wi-Fi 7/8 testing. The platform supports up to 400 MHz of instantaneous bandwidth and carrier frequencies of up to 23.6 GHz, while extending across cellular, Wi-Fi, military and aerospace applications.
Viavi is also participating in the SHIELD-6G project, using its TeraVM AI RAN Scenario Generator to develop digital twins for AI-driven security testing. These developments broaden Viavi’s wireless-testing opportunity and provide exposure to emerging markets such as 6G, Wi-Fi, AI-RAN and specialized RF testing. Although these markets are still developing, early positioning could give VIAVI additional long-term growth opportunities.
Estimate Trend
The earnings estimate trend also remains favorable. The Zacks Consensus Estimate for Viavi’s fiscal 2027 earnings has increased 165.6% over the past year to $1.62 per share. Upward earnings estimate revisions generally reflect improving confidence in a company’s operating outlook. In Viavi’s case, the positive trend appears consistent with improving margins, healthy demand and growing contributions from acquired businesses.
Image Source: Zacks Investment Research
Should Investors Chase Viavi After the Rally?
Viavi’s 268.5% share price rally has been supported by a substantial improvement in business fundamentals. AI data-center demand is strengthening, the Spirent acquisition has expanded the company’s addressable market, profitability is improving and aerospace and defense continue to provide diversification. The company also appears well-positioned to benefit from long-term growth opportunities in 6G, Wi-Fi, AI-RAN and advanced network testing.
Riding on a robust earnings surprise history and favorable Zacks Rank, Viavi appears primed for further stock price appreciation. Consequently, investors are likely to profit if they bet on this high-flying stock now.
View the Zacks #1 Rank List
Image: Bigstock
Viavi Exhibits More Than Threefold Growth in a Year: Should You Buy?
Key Takeaways
Viavi Solutions Inc. (VIAV - Free Report) has surged 268.5% over the past year compared with the industry’s growth of 148.5%. It has outperformed peers like Corning Incorporated (GLW - Free Report) and Ooma, Inc. (OOMA - Free Report) . While Corning has gained 92.4%, OOMA jumped 79.9% during this period. The more than threefold growth was largely buoyed by growing investor optimism over Viavi’s rising exposure to artificial intelligence (AI)-driven data-center spending, improving profitability and expanding testing capabilities.
One-Year VIAV Stock Price Performance
Image Source: Zacks Investment Research
AI Data-Center Boom: Key Growth Catalyst
Viavi is increasingly benefiting from the rapid buildout of AI and hyperscale data center infrastructure. Demand for high-speed optical, Ethernet and network-testing solutions remains healthy as cloud service providers, semiconductor companies and networking vendors invest heavily in increasingly complex AI infrastructure.
The data-center ecosystem now accounts for roughly half of Network and Service Enablement (NSE) revenues, underscoring the growing importance of this market to Viavi’s growth profile.
In the fiscal fourth quarter, NSE revenues surged 69.2% year over year to $353.9 million.
Growth was supported by robust demand for lab, production and field-testing solutions, strength in aerospace and defense and contributions from the acquired Spirent businesses. The Spirent assets have also strengthened Viavi’s capabilities in high-speed Ethernet testing, network security and channel emulation. The broader portfolio should support cross-selling opportunities while helping the company address increasingly sophisticated testing requirements across AI clusters and next-generation networks.
Margin Expansion Strengthens the Earnings Story
Viavi exited fiscal 2026 on a strong note, with both revenues and profitability exhibiting healthy improvement. Revenues increased 40% year over year to $1.52 billion, while non-GAAP earnings surged 112.8% to $1 per share.
Non-GAAP operating margin expanded 630 basis points to 20.6%. The sharp improvement highlights stronger operating leverage and suggests that rising revenues are translating effectively into earnings growth.
This margin expansion is particularly encouraging as Viavi integrates Spirent and increases its exposure to higher-growth markets such as AI data centers, aerospace and defense and advanced wireless testing.
Image Source: Zacks Investment Research
Upbeat Outlook Points to Continued Momentum
Management expects the positive momentum to extend into fiscal 2027. For the fiscal first quarter, Viavi projects revenues in the range of $450 million to $460 million and non-GAAP earnings of 40-42 cents per share. Both metrics indicate sequential improvement from the June quarter.
The outlook suggests that healthy demand trends are continuing across several important end markets. In addition to AI-related data-center opportunities, aerospace and defense remain a key growth avenue, particularly for positioning, navigation and timing solutions. Strength in these markets also helps diversify Viavi’s business and reduces its historical dependence on telecom carrier spending.
6G and Wireless Testing: Other Growth Pillars
Viavi is also positioning itself for emerging opportunities in next-generation wireless technologies. The company’s Vertex 6.0 advanced channel emulator is designed for 6G and Wi-Fi 7/8 testing. The platform supports up to 400 MHz of instantaneous bandwidth and carrier frequencies of up to 23.6 GHz, while extending across cellular, Wi-Fi, military and aerospace applications.
Viavi is also participating in the SHIELD-6G project, using its TeraVM AI RAN Scenario Generator to develop digital twins for AI-driven security testing. These developments broaden Viavi’s wireless-testing opportunity and provide exposure to emerging markets such as 6G, Wi-Fi, AI-RAN and specialized RF testing. Although these markets are still developing, early positioning could give VIAVI additional long-term growth opportunities.
Estimate Trend
The earnings estimate trend also remains favorable. The Zacks Consensus Estimate for Viavi’s fiscal 2027 earnings has increased 165.6% over the past year to $1.62 per share. Upward earnings estimate revisions generally reflect improving confidence in a company’s operating outlook. In Viavi’s case, the positive trend appears consistent with improving margins, healthy demand and growing contributions from acquired businesses.
Image Source: Zacks Investment Research
Should Investors Chase Viavi After the Rally?
Viavi’s 268.5% share price rally has been supported by a substantial improvement in business fundamentals. AI data-center demand is strengthening, the Spirent acquisition has expanded the company’s addressable market, profitability is improving and aerospace and defense continue to provide diversification. The company also appears well-positioned to benefit from long-term growth opportunities in 6G, Wi-Fi, AI-RAN and advanced network testing.
VIAV sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Riding on a robust earnings surprise history and favorable Zacks Rank, Viavi appears primed for further stock price appreciation. Consequently, investors are likely to profit if they bet on this high-flying stock now.