Viavi Solutions Inc. VIAV reported strong third-quarter fiscal 2026 results, with both top and bottom lines surpassing the Zacks Consensus Estimate.
The company posted a solid 42.8% year-over-year increase in revenues, supported by strong demand from data centers, continued 5G and fiber network upgrades, steady aerospace and defense demand, and contributions from the Spirent product line buyout.
Net Income
Net income on a GAAP basis was $6.4 million or 3 cents per share compared with $19.5 million or 9 cents per share in the prior-year quarter. Despite top-line growth, higher operating expenses and taxes impacted the bottom line.
Non-GAAP net income in the reported quarter was $67.6 million or 27 cents per share compared with $33.9 million or 15 cents per share in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate by 3 cents.
Viavi Solutions Inc. Price, Consensus and EPS Surprise
Viavi Solutions Inc. price-consensus-eps-surprise-chart | Viavi Solutions Inc. Quote
Revenues
Net sales increased to $406.8 million from $284.8 million in the year-ago quarter, primarily driven by strong performance in its Network and Service Enablement (NSE) and Optical Security and Performance Products (OSP) segments. The top line beat the consensus estimate of $393.5 million.
In the third quarter of fiscal 2026, the NSE segment generated $321.5 million in revenues, up 54.4% year over year. The segment accounted for 79% of total revenues. Acquisition of Spirent product lines and strong demand across lab, production and field products, mainly from the data center ecosystem and aerospace & defense sectors, drove solid sales growth in this segment.
The OSP segment revenues were $85.3 million, up 11.4% year over year, driven by strong demand for 3D Sensing and anti-counterfeiting.
Net sales from the Americas totaled $182.8 million, up from $108.1 million in the year-ago quarter. Revenues from Asia-Pacific were $128.2 million, up 27.3% year over year. Revenues from Europe, Middle East, and Africa increased to $95.8 million from the prior-year quarter’s tally of $76 million.
Other Details
Non-GAAP gross profit was $252.9 million compared with $170.8 million in the year-ago quarter. with respective margins of 62.2% and 60%. Non-GAAP operating expenses increased to $167.4 million from $123.1 million a year ago. Non-GAAP operating income was $85.5 million compared with $47.7 million in the year-ago quarter.
Cash Flow & Liquidity
As of March 28, 2026, VIAV had $499 million in cash and cash equivalents and $836.3 million of long-term debt. The company used $26.3 million of cash for operating activities in the quarter against a cash flow of $7.8 million in the year-earlier quarter.
Outlook
For the fourth quarter of fiscal 2026, management expects revenues in the range of $427-$437 million. Non-GAAP operating margin is expected to be 22.7% (+/- 0.5 %) with non-GAAP earnings per share between 29 cents and 31 cents.
For the NSE segment, revenues are projected to be between $340 million and $348 million, with a non-GAAP operating margin of 18.7% (+/- 0.5 %). Revenues for the OSP segment are anticipated to be in the range of $87-$89 million, with a non-GAAP operating margin of 38.4% (+/- 0.4 %).
Zacks Rank
Viavi currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Arista Networks Inc. ANET is scheduled to release first-quarter 2026 earnings on May 5. The Zacks Consensus Estimate for earnings is pegged at 81 cents per share, suggesting growth of 24.62% from the year-ago reported figure.
Arista has a long-term earnings growth expectation of 17.94%. The company delivered an average earnings surprise of 9% in the last four reported quarters.
CDW Corporation CDW is set to release first-quarter 2026 earnings on May 6. The Zacks Consensus Estimate for earnings is pegged at $2.28 per share, implying growth of 6.05% from the year-ago reported figure.
CDW has a long-term earnings growth expectation of 7.25%. The company delivered an average earnings surprise of 5.72% in the last four reported quarters.
Motorola Solutions, Inc. MSI is set to release first-quarter 2026 earnings on May 7. The Zacks Consensus Estimate for earnings is pegged at $3.25 per share, implying growth of 2.2% from the year-ago reported figure.
Corning has a long-term earnings growth expectation of 9.4%. The company delivered an average earnings surprise of 5.66% in the last four reported quarters.
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