Accessibility StatementSkip Navigation Single 'go-to' tools for fiber, Ethernet, WiFi 7 and DOCSIS testing to enable fast, reliable multi-gig activation and validation CHANDLER, Ariz., Sept. 17, 2025 /PRNewswire/ --Â VIAVI Solutions Inc. (VIAVI) (NASDAQ: VIAV) has expanded its family of rugged and reliable portable devices for last-mile fiber service turn-up and activation with two new all-in-one handheld testers for multi-gig power and service testing at data rates up to 10 Gbps. The new testers will be on ...

Group 1 - Viavi has shown significant improvement, with a 27% rally in stock price over three months, indicating positive performance in Q4 [1] - The analysis emphasizes the importance of strong fundamentals and potential for growth in the tech, infrastructure, and internet services sectors [1] Group 2 - The article aims to provide thoughtful breakdowns and investment ideas, focusing on long-term returns rather than short-term market fluctuations [1]

Accessibility StatementSkip Navigation CHANDLER, Ariz., Sept. 10, 2025 /PRNewswire/ -- VIAVI Solutions Inc. (VIAVI) (NASDAQ: VIAV) today announced a partnership with CrowdStrike to integrate the VIAVI Observer network observability platform with CrowdStrike Falcon® Next-Gen SIEM. VIAVI brings end-user experience insights with network and service performance intelligence into Falcon Next-Gen SIEM, providing joint customers with deeper visibility across their security and IT operations. According to VIAVI's 2 ...

Core Viewpoint - Viavi Solutions Inc. has entered into agreements to issue $250 million of new senior convertible notes, replacing some of its existing notes and raising cash for debt repayment [1][3]. Group 1: Transaction Details - The company will issue approximately $100.9 million of new notes in exchange for about $97.5 million of its existing 1.625% Senior Convertible Notes due 2026, and will raise approximately $149.1 million in cash through subscription transactions [1][3]. - After the exchange, approximately $152.5 million of the 2026 Notes will remain outstanding with unchanged terms [1]. - The transactions are expected to close around August 20, 2025, subject to customary conditions [1]. Group 2: Financial Implications - The gross cash proceeds from the subscription transactions are estimated to be around $149.1 million, which will be used to repay a portion of the 2026 Notes due at maturity [3]. - The company plans to repurchase approximately $30 million of its common stock at a price of $11.03 per share, which is the last reported sale price on August 13, 2025 [4]. Group 3: New Notes Characteristics - The new notes will have a 0.625% annual interest rate, maturing on March 1, 2031, and will be convertible into cash or common stock under certain conditions [5]. - The initial conversion rate is set at 72.5295 shares per $1,000 principal amount, representing a conversion price of approximately $13.79 per share, which is a 25% premium over the common stock's closing price on August 13, 2025 [5]. - The company may redeem the new notes for cash starting September 6, 2028, under specific conditions [5]. Group 4: Investor Considerations - The new notes are offered only to institutional accredited investors and qualified institutional buyers, and have not been registered under the Securities Act [7]. - The placement agent for the transactions intends to purchase approximately $25 million of the company's common stock at a discount of about 5% to the last reported sale price [6].

Part I [Item 1. Business](index=5&type=section&id=Item%201.%20Business) Viavi Solutions Inc. provides network testing, monitoring, and optical technologies through its NSE and OSP segments, focusing on core leadership and growth - Effective March 30, 2025, the company realigned its reporting structure, combining NE and SE segments into a single **Network and Service Enablement (NSE) segment**[16](index=16&type=chunk) - The corporate strategy focuses on defending leadership in core segments, investing in secular growth trends like fiber and wireless, and extending technologies into adjacent markets such as aerospace and defense[18](index=18&type=chunk) - As of June 28, 2025, the company employed approximately **3,600 people** across 31 countries[68](index=68&type=chunk) [Business Segments](index=6&type=section&id=Business%20Segments) The company operates two segments: Network and Service Enablement (NSE) for network solutions and Optical Security and Performance Products (OSP) for optical technologies - The NSE segment provides solutions for lab, production, network management, and AIOps, serving major customers including AT&T, Cisco, and Verizon[21](index=21&type=chunk)[22](index=22&type=chunk)[27](index=27&type=chunk) - The OSP segment's technologies include **Optical Variable Pigment (OVP®)** for anti-counterfeiting on banknotes in over **100 countries** and optical filters for 3D sensing[34](index=34&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) - A key strategic alliance for the OSP segment is with **SICPA Holding SA Company** for global marketing and sales of OVP and OVMP products for banknote anti-counterfeiting[40](index=40&type=chunk) [Research and Development](index=9&type=section&id=Research%20and%20Development) Viavi invests substantially in R&D for new products and technologies, securing a **$21.7 million** grant for ORAN testing - In fiscal 2024, the company received approval for a grant of approximately **$21.7 million** over three years from the Public Wireless Supply Chain Innovation Fund to support Open Radio Access Network (ORAN) automated testing[54](index=54&type=chunk) [Seasonality](index=10&type=section&id=Seasonality) The company's business experiences seasonality, with NSE revenue peaking in Q2/Q4 and OSP revenue highest in Q1/Q2 due to market cycles - NSE revenue is typically highest in **Q2 and Q4** and weakest in **Q3**, influenced by customer calendar year spending and budget cycles[66](index=66&type=chunk) - OSP revenue is seasonally higher in **Q1 and Q2** due to smartphone market exposure, with demand declining in Q3 and Q4[67](index=67&type=chunk) [Human Capital Management](index=11&type=section&id=Human%20Capital%20Management) Viavi manages human capital for **3,600 employees** across 31 countries, focusing on culture, talent, and rewards, with a best-in-class safety record - The company's safety program achieved a best-in-class **Total Recordable Injury Rate (TRIR) of 0.08 injuries per 100 full-time workers** per year[80](index=80&type=chunk) [Item 1A. Risk Factors](index=13&type=section&id=Item%201A.%20Risk%20Factors) The company faces diverse risks including geopolitical, technological, customer concentration, operational, cybersecurity, regulatory, environmental, and financial leverage - Global risks, including geopolitical tensions in Ukraine, the Middle East, and U.S.-China relations, could cause market instability, supply chain pressure, and increased costs[83](index=83&type=chunk) - Reliance on a limited number of customers, including a strategic alliance with **SICPA** for OVP and OVMP products, creates vulnerability to order reductions or loss of key relationships[93](index=93&type=chunk)[94](index=94&type=chunk) - Risks associated with the **Inertial Labs acquisition** and proposed **Spirent acquisition** include failure to realize anticipated benefits and integration challenges[97](index=97&type=chunk)[98](index=98&type=chunk) - Outstanding debt, including **Senior Convertible Notes due 2026** and **Senior Notes due 2029**, increases leverage, potentially limiting operational flexibility and future financing access[128](index=128&type=chunk)[130](index=130&type=chunk) [Item 1B. Unresolved Staff Comments](index=28&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments - None[146](index=146&type=chunk) [Item 1C. Cybersecurity](index=28&type=section&id=Item%201C.%20Cybersecurity) Viavi maintains a comprehensive cybersecurity risk management strategy, overseen by the Audit Committee, with no material security breaches in the last three fiscal years - The company's cybersecurity approach utilizes **NIST and ISO frameworks** and includes an Incident Response Plan[148](index=148&type=chunk)[149](index=149&type=chunk) - Cybersecurity oversight is delegated to the **Audit Committee**, which formed a Cybersecurity Steering Committee including independent directors and key management[153](index=153&type=chunk) - The company has not experienced any material information security breach incidents in the **last three fiscal years**, with immaterial related expenses[151](index=151&type=chunk) [Item 2. Properties](index=29&type=section&id=Item%202.%20Properties) This item is not applicable [Item 3. Legal Proceedings](index=29&type=section&id=Item%203.%20Legal%20Proceedings) Information on legal proceedings is incorporated by reference from Note 18, 'Commitments and Contingencies,' in the financial statements - Information for this section is located in **Note 18** of the financial statements[160](index=160&type=chunk) [Item 4. Mine Safety Disclosures](index=29&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=30&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq under VIAV, with **1,392 holders**, no cash dividends, and **$198.4 million** authorized for repurchases - The company has not paid cash dividends on its common stock and does not anticipate paying them in the foreseeable future[163](index=163&type=chunk) - No shares were repurchased in Q4 FY2025, leaving **$198.4 million** authorized under the September 2022 stock repurchase plan[164](index=164&type=chunk) [Item 6. [Reserved]](index=31&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In fiscal 2025, Viavi's net revenue grew **8.4% to $1.08 billion**, with improved operating margins and **$89.8 million** in operating cash flow, driven by strategic acquisitions Fiscal 2025 Financial Highlights (Year-over-Year) | Metric | Fiscal 2025 | Change vs. FY2024 | % Change | | :--- | :--- | :--- | :--- | | Net Revenue | $1.08 billion | +$83.9 million | +8.4% | | GAAP Operating Margin | 5.3% | +320 bps | N/A | | Non-GAAP Operating Margin | 14.2% | +270 bps | N/A | | GAAP Diluted EPS | $0.15 | +$0.27 | +225.0% | | Non-GAAP Diluted EPS | $0.47 | +$0.14 | +42.4% | - The company agreed to acquire **Spirent Communications plc's** high-speed ethernet, network security, and channel emulation testing businesses for **$425 million**, expected to close by September 2025[177](index=177&type=chunk) - In fiscal 2025, the company generated **$89.8 million** in operating cash flow, used **$121.7 million** for the **Inertial Labs acquisition**, and repurchased **$16.4 million** of common stock[182](index=182&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Fiscal 2025 net revenue increased **8.4% to $1,084.3 million**, driven by NSE growth, with gross margin slightly down and income from operations significantly up to **$57.5 million** Consolidated Statement of Operations Summary (FY2025 vs. FY2024) | Metric (in millions) | 2025 | 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Net Revenue** | **$1,084.3** | **$1,000.4** | **$83.9** | **8.4%** | | Gross Profit | $621.1 | $575.9 | $45.2 | 7.8% | | *Gross Margin* | *57.3%* | *57.6%* | *-0.3 p.p.* | *N/A* | | R&D Expense | $208.7 | $201.9 | $6.8 | 3.4% | | SG&A Expense | $349.4 | $333.3 | $16.1 | 4.8% | | Restructuring Charges | $0.7 | $13.6 | ($12.9) | (94.9)% | | **Income from Operations** | **$57.5** | **$20.8** | **$36.7** | **176.4%** | - Net revenue growth was primarily driven by the data center ecosystem and aerospace and defense products, including a **$25.2 million contribution** from the **Inertial Labs acquisition**, partially offset by declines in wireless and cable spending[199](index=199&type=chunk) [Operating Segment Information](index=42&type=section&id=Operating%20Segment%20Information) In fiscal 2025, NSE revenue grew **10.6% to $776.6 million** with expanded margin, while OSP revenue increased **3.1% to $307.7 million** with slight margin improvement Segment Performance (FY2025 vs. FY2024) | Segment | Metric (in millions) | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | :--- | | **NSE** | Net Revenue | $776.6 | $702.0 | 10.6% | | | Operating Income | $41.6 | $8.0 | 420.0% | | | *Operating Margin* | *5.4%* | *1.1%* | *+4.3 p.p.* | | **OSP** | Net Revenue | $307.7 | $298.4 | 3.1% | | | Operating Income | $112.3 | $107.0 | 5.0% | | | *Operating Margin* | *36.5%* | *35.9%* | *+0.6 p.p.* | - NSE revenue growth was driven by higher volume in Lab and Production and Aerospace and Defense, including a **$25.2 million contribution** from the **Inertial Labs acquisition**[228](index=228&type=chunk) - OSP revenue growth was primarily driven by higher Anti-Counterfeiting and Other revenues, partially offset by a decrease in 3D sensing revenue[230](index=230&type=chunk) [Liquidity and Capital Resources](index=43&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 28, 2025, cash decreased by **$49.7 million to $432.1 million**, with **$89.8 million** from operations, **$128.4 million** used in investing, and **$23.6 million** in financing Cash Flow Summary (Fiscal Year 2025) | Cash Flow Activity | Amount (in millions) | | :--- | :--- | | Net cash provided by operating activities | $89.8 | | Net cash used in investing activities | ($128.4) | | Net cash used in financing activities | ($23.6) | | **Net decrease in cash** | **($49.7)** | - The company secured commitments for a **$600 million 7-year Term Loan B facility** to fund the pending **Spirent acquisition** and for general corporate purposes, closing concurrently with the acquisition[239](index=239&type=chunk) Material Contractual Obligations as of June 28, 2025 | Obligation Type | Total (in millions) | Due in < 1 year | Due in 1-3 years | Due in 3-5 years | Due > 5 years | | :--- | :--- | :--- | :--- | :--- | :--- | | Debt (Principal & Interest) | $722.6 | $269.7 | $30.4 | $422.5 | $0 | | Purchase obligations | $160.7 | $141.7 | $18.5 | $0.4 | $0.1 | | Operating lease obligations | $41.2 | $10.6 | $16.6 | $6.0 | $8.0 | | **Total** | **$1,008.9** | **$432.9** | **$85.8** | **$447.8** | **$42.4** | [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks from foreign currency, investments, and debt, managing foreign exchange with forward contracts totaling **$60.4 million** to purchase and **$24.1 million** to sell - The company uses foreign exchange forward contracts to hedge currency risk, with notional amounts of **$60.4 million** to purchase and **$24.1 million** to sell foreign currencies as of June 28, 2025[256](index=256&type=chunk)[258](index=258&type=chunk) Fair Value of Debt as of June 28, 2025 | Debt Instrument | Carrying Value (in millions) | Fair Value (in millions) | | :--- | :--- | :--- | | 1.625% Senior Convertible Notes due 2026 | $246.2 | $252.0 | | 3.75% Senior Notes due 2029 | $396.3 | $373.6 | [Item 8. Financial Statements and Supplementary Data](index=48&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for fiscal years 2023-2025, including the auditor's report, core statements, and detailed notes [Report of Independent Registered Public Accounting Firm](index=48&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) PricewaterhouseCoopers LLP issued an unqualified opinion on financial statements and internal controls, identifying **NSE revenue recognition** and **Inertial Labs acquisition valuation** as Critical Audit Matters - The auditor, **PricewaterhouseCoopers LLP**, issued an unqualified opinion on the financial statements and internal controls[268](index=268&type=chunk) - Critical Audit Matters included **NSE segment revenue recognition** and the **valuation of contingent consideration and developed technology** from the **Inertial Labs acquisition**[275](index=275&type=chunk)[277](index=277&type=chunk)[281](index=281&type=chunk) [Consolidated Financial Statements](index=51&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements show fiscal 2025 net revenue of **$1,084.3 million**, income from operations of **$57.5 million**, and total assets of **$1,993.8 million** Key Financial Statement Data (Fiscal Year 2025) | Metric (in millions) | Amount | | :--- | :--- | | **Statement of Operations** | | | Total Net Revenue | $1,084.3 | | Gross Profit | $621.1 | | Income from Operations | $57.5 | | Net Income | $34.8 | | **Balance Sheet (as of June 28, 2025)** | | | Total Assets | $1,993.8 | | Total Liabilities | $1,213.6 | | Total Stockholders' Equity | $780.2 | [Notes to Consolidated Financial Statements](index=56&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed accounting policies and financial data, including acquisitions (Note 5), debt (Note 11), and segment realignment (Note 19) - **Note 5**: On January 28, 2025, the company acquired **Inertial Labs** for approximately **$134.4 million** in cash and up to **$175.0 million** in contingent consideration, resulting in **$130.3 million** of goodwill[395](index=395&type=chunk)[396](index=396&type=chunk)[399](index=399&type=chunk) - **Note 11**: As of June 28, 2025, total debt carrying value was **$642.5 million**, comprising **$246.2 million** in short-term debt (2026 Notes) and **$396.3 million** in long-term debt (2029 Notes)[459](index=459&type=chunk) - **Note 19**: The company realigned segments into **Network and Service Enablement (NSE)** and **Optical Security and Performance Products (OSP)**, with FY2025 revenues of **$776.6 million** for NSE and **$307.7 million** for OSP[585](index=585&type=chunk)[589](index=589&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=110&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[600](index=600&type=chunk) [Item 9A. Controls and Procedures](index=110&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of **June 28, 2025**, excluding the recently acquired **Inertial Labs** - The CEO and CFO concluded that disclosure controls and procedures were effective as of **June 28, 2025**[601](index=601&type=chunk) - Management concluded that internal control over financial reporting was effective as of **June 28, 2025**, excluding the recently acquired **Inertial Labs** (2.3% of consolidated revenue, 2.1% of total assets)[602](index=602&type=chunk)[603](index=603&type=chunk) [Item 9B. Other Information](index=111&type=section&id=Item%209B.%20Other%20Information) No directors or Section 16 officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement during Q4 fiscal 2025 - No directors or Section 16 officers adopted, modified, or terminated a **Rule 10b5-1 trading plan** in the fourth fiscal quarter of 2025[607](index=607&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections](index=111&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20That%20Prevent%20Inspections) This item is not applicable Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=112&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the company's 2025 Definitive Proxy Statement [Item 11. Executive Compensation](index=113&type=section&id=Item%2011.%20Executive%20Compensation) Information on executive compensation, including Compensation Discussion and Analysis, is incorporated by reference from the company's 2025 Proxy Statement [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=113&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on security ownership of beneficial owners, management, and equity compensation plans is incorporated by reference from the company's 2025 Proxy Statement [Item 13. Certain Relationships and Related Transactions and Director Independence](index=113&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence) Information on related person transactions and director independence is incorporated by reference from the company's 2025 Proxy Statement [Item 14. Principal Accounting Fees and Services](index=113&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information on principal accounting fees and services is incorporated by reference from the company's 2025 Proxy Statement Part IV [Item 15. Exhibits, Financial Statement Schedules](index=114&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists financial statements, schedules, and exhibits filed as part of the Annual Report on Form 10-K, including corporate documents and certifications [Item 16. 10-K Summary](index=116&type=section&id=Item%2016.%2010-K%20Summary) The company reports no 10-K summary - None[628](index=628&type=chunk)

Core Insights - Viavi Solutions Inc. reported strong fourth-quarter fiscal 2025 results, with revenues and net income exceeding expectations, driven by growth in the Network and Service Enablement (NSE) and Optical Security and Performance Products (OSP) segments [1][4][10] - The company faces challenges due to a constrained spending environment influenced by macroeconomic factors [1] Financial Performance - GAAP net income for the quarter was $8 million or 4 cents per share, a significant improvement from a net loss of $21.7 million or 10 cents per share in the same quarter last year [2] - Non-GAAP net income rose to $29.7 million or 13 cents per share, up from $17.1 million or 8 cents per share year-over-year, surpassing the Zacks Consensus Estimate by a penny [2] - For fiscal 2025, GAAP net income was $34.8 million or 15 cents per share compared to a net loss of $25.8 million or 12 cents per share in fiscal 2024 [3] - Non-GAAP net income for fiscal 2025 was $105.4 million or 47 cents per share, an increase from $73.5 million or 33 cents per share in fiscal 2024 [3] Revenue Breakdown - Quarterly revenues reached $290.5 million, reflecting a 15.3% year-over-year increase, driven by strong demand in the NSE and OSP segments [4][10] - NSE segment revenues were $209.1 million, up from $182.2 million, marking a 14.8% growth due to demand for fiber lab and production products [5] - OSP revenues increased to $81.4 million from $69.8 million, primarily due to strength in anti-counterfeiting products [5] - Revenue contributions from different regions included $112.3 million from America, $99.4 million from Asia-Pacific, and $78.8 million from EMEA [6] Margins and Operating Performance - Non-GAAP gross margin for the quarter was 60.1%, up 50 basis points from the prior year [7] - Non-GAAP operating margin improved by 350 basis points year-over-year to 14.4%, with NSE operating margin at 4.7% and OSP operating margin at 39.4% [8][10] Cash Flow and Liquidity - Viavi generated $89.8 million in cash from operating activities, with a free cash flow of $62 million [11] - As of June 30, 2025, the company had $423.6 million in cash and cash equivalents, with long-term debt of $396.1 million [11] Outlook - For the first quarter of fiscal 2026, management expects revenues between $290 million and $298 million, with non-GAAP earnings per share projected between 13 cents and 14 cents [12]

Company Performance - Viav Solutions reported quarterly earnings of $0.13 per share, exceeding the Zacks Consensus Estimate of $0.12 per share, and up from $0.08 per share a year ago, representing an earnings surprise of +8.33% [1] - The company posted revenues of $290.5 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.93% and increasing from $252 million year-over-year [2] - Over the last four quarters, Viav Solutions has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] Market Context - Viav Solutions shares have declined approximately 0.6% since the beginning of the year, while the S&P 500 has gained 7.9% [3] - The current consensus EPS estimate for the upcoming quarter is $0.13 on revenues of $279.11 million, and for the current fiscal year, it is $0.55 on revenues of $1.17 billion [7] Industry Outlook - The Communication - Components industry, to which Viav Solutions belongs, is currently ranked in the bottom 35% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Viav Solutions' stock performance [5]

Financial Data and Key Metrics Changes - Net revenue for Q4 2025 was $290.5 million, up 2% sequentially and 15.3% year over year, at the high end of guidance [6][11] - Operating margin for Q4 was 14.4%, a decrease of 230 basis points from the prior quarter but an increase of 350 basis points year over year [6][7] - EPS for Q4 was $0.13, down $0.02 sequentially but up $0.05 year over year [7][11] - Full year revenue for 2025 was $1.084 billion, up 8.4% year over year [11] Business Segment Data and Key Metrics Changes - Network and Service Enablement (NSE) revenue for Q4 was $209.1 million, up 14.8% year over year, driven by strong demand in fiber lab and production products [8][11] - NSE gross margin for Q4 was 62.2%, up 10 basis points year over year, while operating margin was 4.7%, an increase of 290 basis points year over year [8][9] - OSP revenue for Q4 was $81.4 million, up 16.6% year over year, primarily due to strength in anti-counterfeiting products [9][10] - OSP gross margin was 54.7%, up 170 basis points year over year, and operating margin was 39.4%, an increase of 460 basis points year over year [10] Market Data and Key Metrics Changes - The revenue growth was mainly driven by strong demand from the data center ecosystem and aerospace and defense sectors [11][21] - The company noted a decline in spending for wireless and cable products by NEMS and service providers, but growth was observed in aerospace and defense products [11][21] Company Strategy and Development Direction - The company is focusing on diversifying its revenue streams, with approximately 30% of revenue now coming from the data center ecosystem, a significant increase from previous years [50] - The acquisition of Inertia Labs is expected to contribute to growth in aerospace and defense, with the company prioritizing capital allocation towards M&A [13][21] - The company anticipates continued strong demand from the data center ecosystem and aerospace and defense customers, which is expected to mitigate traditional revenue seasonality [19][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in mitigating tariff impacts, estimating a total impact of around $1.5 million, which has been largely addressed through pricing adjustments and supply chain realignment [26] - The company expects NSE revenue to be slightly up quarter on quarter, driven by strong demand from the data center ecosystem and aerospace and defense sectors [19][21] - Management indicated that the wireless business remains mixed, with healthy demand for wireless field instruments but sluggish recovery in infrastructure testing [19][41] Other Important Information - The company successfully priced and allocated a $600 million Term Loan B to fund acquisitions and general corporate purposes [16] - The company has approximately $200 million remaining under its current authorized share repurchase program [13] Q&A Session Summary Question: Impact of tariffs on revenue - Management indicated that the tariff impact is primarily on North American sales, with a total impact of around $1.5 million, which has been mitigated [26] Question: Competitive dynamics in the data center market - Management noted strong demand for their 1.6 terabit test solutions, with significant engagement from leading semiconductor vendors and optical module developers [30][34] Question: End markets performance in NSE - Management highlighted that fiber demand is driving growth, particularly from data center operators and specialty fiber companies [40] Question: Guidance for Q1 and seasonality - Management expects Q1 to be slightly up compared to Q4, driven by strong demand from the data center ecosystem, despite traditional seasonality [44][62] Question: Size of the data center business - Management indicated that approximately 30% of NSE revenue comes from the data center ecosystem, with expectations for continued growth in this segment [50] Question: Margin expectations for NSE - Management aims to move NSE operating margins into the mid to high teens as the business recovers, with long-term goals of reaching the twenties [58]

Fiscal Q4 2025 Earnings Call Supplementary Slides August 7, 2025 Cautionary Language Concerning Forward-Looking Statements This presentation contains forward-looking statements under Section 27A of the Securities Act of 1934. Forward-looking statements are all statements we make other than those dealing specifically with historical matters. These forward-looking statements include, among other things, financial guidance. Please refer to the Company's filings with the Securities and Exchange Commission, incl ...

[Financial Performance Summary](index=1&type=section&id=Financial%20Performance%20Summary) [Q4 FY2025 Performance Highlights](index=1&type=section&id=Q4%20FY2025%20Performance%20Highlights) In the fourth quarter of fiscal year 2025, VIAVI demonstrated strong year-over-year growth, with net revenue increasing by 15.3% to $290.5 million. Profitability saw significant improvement, as GAAP net income turned positive to $8.0 million from a loss in the prior year, and non-GAAP net income grew by 73.7% to $29.7 million. Non-GAAP diluted EPS rose 62.5% to $0.13 Q4 FY2025 Key Financial Metrics (YoY) | Metric | Q4 FY2025 | Change (YoY) | | :--- | :--- | :--- | | Net Revenue | $290.5M | ▲ 15.3% | | GAAP Operating Margin | 5.3% | ▲ 760 bps | | Non-GAAP Operating Margin | 14.4% | ▲ 350 bps | | GAAP Net Income | $8.0M | ▲ 136.9% | | Non-GAAP Net Income | $29.7M | ▲ 73.7% | | GAAP Diluted EPS | $0.04 | ▲ 140.0% | | Non-GAAP Diluted EPS | $0.13 | ▲ 62.5% | [Full Year FY2025 Performance Highlights](index=1&type=section&id=Full%20Year%20FY2025%20Performance%20Highlights) For the full fiscal year 2025, VIAVI reported an 8.4% increase in net revenue to $1.08 billion. The company achieved a significant turnaround in profitability, with GAAP net income reaching $34.8 million compared to a loss in the previous year. Non-GAAP net income grew substantially by 43.4% to $105.4 million, resulting in a non-GAAP diluted EPS of $0.47, a 42.4% increase year-over-year Full Year FY2025 Key Financial Metrics (YoY) | Metric | FY 2025 | Change (YoY) | | :--- | :--- | :--- | | Net Revenue | $1.08B | ▲ 8.4% | | GAAP Operating Margin | 5.3% | ▲ 320 bps | | Non-GAAP Operating Margin | 14.2% | ▲ 270 bps | | GAAP Net Income | $34.8M | ▲ 234.9% | | Non-GAAP Net Income | $105.4M | ▲ 43.4% | | GAAP Diluted EPS | $0.15 | ▲ 225.0% | | Non-GAAP Diluted EPS | $0.47 | ▲ 42.4% | [Management Commentary](index=1&type=section&id=Management%20Commentary) CEO Oleg Khaykin highlighted a strong finish to fiscal 2025, with Q4 performance at the high end of guidance. He noted stabilization in the base businesses of service provider test & measurement and optical security pigments. Growth was accelerated by the data center ecosystem and aerospace & defense segments, with positive momentum expected to continue through calendar year 2025 - Stabilization observed in core businesses: service provider test and measurement, and optical security pigments[4](index=4&type=chunk) - Growth was accelerated by high-growth segments: data center ecosystem and aerospace & defense[4](index=4&type=chunk) - Management expects positive momentum in end markets to continue through calendar year 2025[4](index=4&type=chunk) [Detailed Financial Results](index=2&type=section&id=Detailed%20Financial%20Results) [Q4 FY2025 Financial Performance](index=2&type=section&id=Q4%20FY2025%20Financial%20Performance) In Q4 FY2025, total net revenue grew 15.3% YoY and 2.0% sequentially to $290.5 million. Both segments contributed to the YoY growth, with Network and Service Enablement up 14.8% and Optical Security and Performance Products up 16.6%. GAAP operating margin improved significantly to 5.3% from -2.3% a year ago, while non-GAAP operating margin expanded by 350 basis points to 14.4% Q4 FY2025 GAAP Results vs. Prior Periods | Metric | Q4 FY2025 | Q3 FY2025 | Q4 FY2024 | Change Q/Q | Change Y/Y | | :--- | :--- | :--- | :--- | :--- | :--- | | Net Revenue | $290.5M | $284.8M | $252.0M | ▲ 2.0% | ▲ 15.3% | | Gross Margin | 56.3% | 56.4% | 57.8% | ▼ (10) bps | ▼ (150) bps | | Operating Margin | 5.3% | 3.0% | (2.3)% | ▲ 230 bps | ▲ 760 bps | Q4 FY2025 Non-GAAP Results vs. Prior Periods | Metric | Q4 FY2025 | Q3 FY2025 | Q4 FY2024 | Change Q/Q | Change Y/Y | | :--- | :--- | :--- | :--- | :--- | :--- | | Gross Margin | 60.1% | 60.0% | 59.6% | ▲ 10 bps | ▲ 50 bps | | Operating Margin | 14.4% | 16.7% | 10.9% | ▼ (230) bps | ▲ 350 bps | | EPS | $0.13 | $0.15 | $0.08 | ▼ (13.3)% | ▲ 62.5% | [Full Year FY2025 Financial Performance](index=2&type=section&id=Full%20Year%20FY2025%20Financial%20Performance) For the full fiscal year 2025, net revenue increased by 8.4% to $1.084 billion, driven primarily by a 10.6% growth in the Network and Service Enablement segment. GAAP operating margin expanded by 320 basis points to 5.3%, and non-GAAP operating margin grew by 270 basis points to 14.2%. Geographically, revenues were led by the Americas at 39.2% of the total Full Year FY2025 GAAP & Non-GAAP Results (YoY) | Metric | FY 2025 | FY 2024 | Change Y/Y | | :--- | :--- | :--- | :--- | | **GAAP Results** | | | | | Net Revenue | $1,084.3M | $1,000.4M | ▲ 8.4% | | Operating Margin | 5.3% | 2.1% | ▲ 320 bps | | Net Income (Loss) per Share | $0.15 | ($0.12) | ▲ 225.0% | | **Non-GAAP Results** | | | | | Operating Margin | 14.2% | 11.5% | ▲ 270 bps | | EPS | $0.47 | $0.33 | ▲ 42.4% | - Revenue breakdown by region for FY2025: Americas (**39.2%**), Asia-Pacific (**35.0%**), and EMEA (**25.8%**)[8](index=8&type=chunk) [Segment Performance](index=2&type=section&id=Segment%20Performance) For FY2025, the Network and Service Enablement (NSE) segment's revenue grew 10.6% YoY to $776.6 million, with a GAAP operating margin of 5.4%. The Optical Security and Performance Products (OSP) segment's revenue grew 3.1% to $307.7 million, but it delivered a much higher GAAP operating margin of 36.5%, making it the more profitable segment Full Year FY2025 vs FY2024 Segment Performance (GAAP) | Segment | Metric | FY 2025 | FY 2024 | Change Y/Y | | :--- | :--- | :--- | :--- | :--- | | **Network and Service Enablement** | Net Revenue | $776.6M | $702.0M | ▲ 10.6% | | | Operating Margin | 5.4% | 1.1% | ▲ 430 bps | | **Optical Security and Performance** | Net Revenue | $307.7M | $298.4M | ▲ 3.1% | | | Operating Margin | 36.5% | 35.9% | ▲ 60 bps | Q4 FY2025 Segment Revenue Performance | Segment | Q4 FY2025 Revenue | Change Q/Q | Change Y/Y | | :--- | :--- | :--- | :--- | | Network and Service Enablement | $209.1M | ▲ 0.4% | ▲ 14.8% | | Optical Security and Performance | $81.4M | ▲ 6.3% | ▲ 16.6% | [Balance Sheet and Cash Flow](index=2&type=section&id=Balance%20Sheet%20and%20Cash%20Flow) As of June 28, 2025, VIAVI held $429.0 million in total cash, short-term investments, and restricted cash. Total assets increased to $1.99 billion from $1.74 billion in the prior year, primarily due to increases in Goodwill and Intangibles. The company generated $89.8 million in cash flow from operations for the full fiscal year and held a total net carrying value of debt of $642.5 million - The company held **$429.0 million** in total cash, short-term investments, and short-term restricted cash as of June 28, 2025[9](index=9&type=chunk) - Generated **$23.8 million** in cash from operations in Q4 and **$89.8 million** for the full fiscal year 2025[15](index=15&type=chunk) Key Balance Sheet Items (June 28, 2025 vs June 29, 2024) | Item | June 28, 2025 | June 29, 2024 | | :--- | :--- | :--- | | Total Current Assets | $885.2M | $876.5M | | Total Assets | $1,993.8M | $1,736.3M | | Total Liabilities | $1,213.6M | $1,054.7M | | Total Stockholders' Equity | $780.2M | $681.6M | - Total debt had a net carrying value of **$642.5 million**, consisting of **$250 million** in 1.625% Senior Convertible Notes and **$400 million** in 3.75% Senior Notes[15](index=15&type=chunk) [Business Outlook](index=3&type=section&id=Business%20Outlook) [Q1 FY2026 Guidance](index=3&type=section&id=Q1%20FY2026%20Guidance) For the first quarter of fiscal 2026, ending September 27, 2025, VIAVI anticipates net revenue to be in the range of $290 million to $298 million. The company projects non-GAAP earnings per share to be between $0.13 and $0.14. A reconciliation to GAAP EPS was not provided due to the difficulty in forecasting certain reconciling items Q1 FY2026 Outlook | Metric | Guidance Range | | :--- | :--- | | Net Revenue | $290M - $298M | | Non-GAAP EPS | $0.13 - $0.14 | - The company has not reconciled its forward-looking non-GAAP EPS to GAAP EPS because it is unable to provide an accurate estimate of certain reconciling items without unreasonable effort[11](index=11&type=chunk) [Appendix: Financial Statements and Reconciliations](index=5&type=section&id=Appendix%3A%20Financial%20Statements%20and%20Reconciliations) [Consolidated Statements of Operations (GAAP)](index=5&type=section&id=Consolidated_Statements_of_Operations) The Consolidated Statements of Operations show a significant improvement in profitability for FY2025. Net revenue grew to $1.084 billion from $1.000 billion in the prior year. Income from operations increased to $57.5 million from $20.8 million, and the company reported a net income of $34.8 million, a reversal from a net loss of $25.8 million in FY2024 FY2025 vs FY2024 Statement of Operations Highlights (GAAP) | Metric (in millions) | Year Ended June 28, 2025 | Year Ended June 29, 2024 | | :--- | :--- | :--- | | Net Revenue | $1,084.3 | $1,000.4 | | Gross Profit | $621.1 | $575.9 | | Income from Operations | $57.5 | $20.8 | | Net Income (Loss) | $34.8 | $(25.8) | | Diluted EPS | $0.15 | $(0.12) | [Consolidated Balance Sheets (GAAP)](index=6&type=section&id=Consolidated_Balance_Sheets) The company's balance sheet as of June 28, 2025, shows total assets of $1.99 billion, an increase from $1.74 billion a year prior. This growth was driven by increases in Goodwill and Intangibles. Total liabilities also increased to $1.21 billion from $1.05 billion, while total stockholders' equity rose to $780.2 million Key Balance Sheet Data (in millions) | Account | June 28, 2025 | June 29, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $423.6 | $471.3 | | Total Assets | $1,993.8 | $1,736.3 | | Total Liabilities | $1,213.6 | $1,054.7 | | Total Stockholders' Equity | $780.2 | $681.6 | [Reconciliation of GAAP to Non-GAAP Measures](index=8&type=section&id=Reconciliation_of_GAAP_to_Non-GAAP_Measures) VIAVI provides non-GAAP metrics to offer a clearer view of its core operational performance by excluding items like stock-based compensation, amortization of intangibles, and restructuring charges. For FY2025, the largest adjustments to reconcile GAAP Net Income of $34.8 million to Non-GAAP Net Income of $105.4 million were stock-based compensation ($53.1 million), amortization of intangibles ($24.3 million), and acquisition-related charges ($22.3 million) - Management uses non-GAAP measures to evaluate core operating performance, excluding items like purchase price accounting adjustments, stock-based compensation, and restructuring charges[28](index=28&type=chunk) Key Reconciling Items from GAAP to Non-GAAP Net Income (FY2025, in millions) | Item | Adjustment Amount | | :--- | :--- | | **GAAP Net Income** | **$34.8** | | Stock-based compensation | $53.1 | | Amortization of intangibles | $24.3 | | Acquisition and integration related charges | $22.3 | | Provision for income taxes (Benefit) | $(30.5) | | **Non-GAAP Net Income** | **$105.4** | [Reconciliation to Adjusted EBITDA](index=11&type=section&id=Reconciliation_to_Adjusted_EBITDA) For the full fiscal year 2025, Adjusted EBITDA was $191.9 million, a significant increase from $153.0 million in the prior year. The reconciliation from GAAP Net Income of $34.8 million includes adding back taxes, interest, depreciation, amortization, and other non-core items such as $53.1 million in stock-based compensation Reconciliation of GAAP Net Income to Adjusted EBITDA (in millions) | Metric | Q4 FY2025 | FY 2025 | | :--- | :--- | :--- | | GAAP Net Income (Loss) | $8.0 | $34.8 | | Interest, Taxes, D&A, etc. | $17.6 | $81.6 | | EBITDA | $33.2 | $120.2 | | Stock-based compensation | $12.6 | $53.1 | | Other Adjustments | $5.5 | $18.6 | | **Adjusted EBITDA** | **$51.3** | **$191.9** |