10-Q · April 30, 2026
Viavi Solutions reported robust Q3 fiscal 2026 results, with revenue increasing 42.8% year-over-year to $406.8 million, driven by significant contributions from its NSE segment following strategic acquisitions. While…
Earnings analysis · 10-K
VIAV earnings analysis
Filed August 13, 2026 · Our reading of the company's report
The latest report
VIAVI delivered a substantial operating improvement in fiscal 2026, with revenue up 40.0%, GAAP operating margin expanding to 6.9%, and non-GAAP operating margin reaching 20.6%. Growth was concentrated in NSE,…
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VIAVI delivered a substantial operating improvement in fiscal 2026, with revenue up 40.0%, GAAP operating margin expanding to 6.9%, and non-GAAP operating margin reaching 20.6%. Growth was concentrated in NSE, particularly data-center testing, Spirent and aerospace/defense, while OSP grew more modestly and maintained a high 36.6% operating margin. However, GAAP diluted EPS fell to $(0.13) because of a $56.7 million debt-extinguishment loss and higher amortization, and the outlook remains exposed to tariffs, convertible-debt obligations, customer concentration, and restructuring execution.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.13
What stood out
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Strategy targets core leadership and adjacencies
VIAVI describes itself as a global leader in test and measurement and optical technologies. Its fiscal 2027 priorities are to defend and consolidate leadership in core segments, invest in secular trends to expand its total addressable market, and extend its platforms into adjacent markets.
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Strong three-year revenue and margin inflection
Fiscal 2026 revenue increased 40.0% to $1,518.3 million from $1,084.3 million in fiscal 2025 and $1,000.4 million in fiscal 2024. Gross margin improved to 57.7% from 57.3% and 57.6%, while GAAP operating margin rose to 6.9% from 5.3% and 2.1%.
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NSE drives growth and operating leverage
NSE was the primary growth engine, with revenue increasing 52.3% to $1,182.9 million. Growth was driven by data-center-related lab and production products, the Spirent HSE and CE acquisition, aerospace and defense, and Inertial Labs; Wireless spending declined.
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Acquisitions expand testing and PNT capabilities
The Spirent HSE and CE business contributed $145.0 million of fiscal 2026 revenue after a $399.3 million acquisition, while Inertial Labs contributed $86.1 million. The company also acquired Direct Optical Research on July 9, 2026 for base consideration of $14.0 million plus up to $5.0 million of contingent consideration.
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Liquidity improved despite acquisition spending
Operating cash flow was $113.9 million in fiscal 2026 versus $89.8 million in fiscal 2025 and $116.4 million in fiscal 2024. Capital expenditures were $31.1 million, or 2.0% of revenue, and cash, cash equivalents and restricted cash increased $227.7 million to $659.8 million.
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Debt repayment prioritized over dividends
The company prepaid the entire $600.0 million Term Loan B, issued 12.8 million shares for net public-offering proceeds of approximately $557.7 million, and repurchased 2.7 million shares for $30.0 million. It paid no cash dividend and had $168.4 million remaining under its repurchase authorization.
What to watch
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Evolving tariffs threaten margins
The tariff environment remains materially uncertain. VIAVI paid approximately $22.4 million of IEEPA tariffs through June 27, 2026 and had approximately $11.0 million of refund claims not yet recognized at year-end; management states that future tariffs could raise material and product costs and pressure profitability or demand.
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Convertible debt creates liquidity and dilution risk
The $250.0 million principal amount of 0.625% Senior Convertible Notes became convertible for July 1 through September 30, 2026 after the stock exceeded 130% of the conversion price for at least 20 of the last 30 trading days. The $244.8 million carrying value was classified as short-term debt, while the notes had a $889.1 million fair value and an initial conversion price of approximately $13.79 per share, creating refinancing and dilution exposure.
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Restructuring execution remains a near-term risk
The new Fiscal 2026 restructuring plan affects approximately 5% of the global workforce and generated $16.4 million of plan charges in fiscal 2026. Although management estimates approximately $30.0 million of annualized gross savings, completion is not expected until the end of calendar 2026 and the filing warns that workforce reductions, facilities rationalization, and integration could disrupt operations.
Management's outlook
The 10-K provides qualitative fiscal 2027 priorities rather than numeric revenue or EPS guidance. Management expects continued growth in many traditional businesses and plans to defend core leadership, invest in secular trends, and extend technologies into adjacent markets.
Earlier filings 4
10-K · August 17, 2023
VIAVI positions itself as a leader in network test/assurance (NE/SE) and optical/light‑management technologies (OSP) and is pursuing growth in 5G, fiber and 3D sensing while also targeting capital returns and M&A. The…
10-Q · February 7, 2022
VIAVI reported quarterly revenue of $314.8 million (up from $299.9 million a year ago) and diluted EPS of $0.14 (vs $0.12 a year ago), driven by higher product revenue and gross profit. Operating income improved to…
10-Q · February 9, 2021
VIAVI reported Q2 revenue of $299.9M, down from $313.7M a year ago (-$13.8M, -4.4%). Gross profit fell to $180.1M and diluted EPS declined to $0.09 from $0.12. Offsets include a large increase in operating cash flow to…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.