Keysight Technologies, Inc 10-Q for FY2026 Q1

Keysight Technologies, Inc. (KEYS)

10-Q 2026-03-05 For: 2026-01-31

Added on April 03, 2026

About this 10-Q

Keysight Technologies, Inc filed this 10-Q on March 5, 2026, covering the quarter ended January 31, 2026 (FY2026 Q1).

Headline figures

Quarter ended January 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.6B; up 23.3% from $1.3B a year earlier
Net income: $281M; up 66.3% from net income of $169M a year earlier
Diluted EPS: $1.63; up 68.0% from $0.97 a year earlier

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Delaware		46-4254555
(State or other jurisdiction of		(IRS employer
incorporation or organization)		Identification no.)

1400 Fountaingrove Parkway
Santa Rosa	California	95403
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.01 per share	KEYS	New York Stock Exchange


Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐


			Page Number
Part I.	Financial Information		3
	Item 1.	Condensed Consolidated Financial Statements (Unaudited)	3
		Condensed Consolidated Statement of Operations	3
		Condensed Consolidated Statement of Comprehensive Income	4
		Condensed Consolidated Balance Sheet	5
		Condensed Consolidated Statement of Cash Flows	6
		Condensed Consolidated Statement of Equity	7
		Notes to Condensed Consolidated Financial Statements	8
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36
	Item 4.	Controls and Procedures	37
Part II.	Other Information		37
	Item 1.	Legal Proceedings	37
	Item 1A.	Risk Factors	38
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	53
	Item 5.	Other Information	53
	Item 6.	Exhibits	54
Signatures			55


	Three Months Ended
	January 31,
		2026		2025
Revenue:
Products		$	1,225	$	983
Services and other		375		315
Total revenue		1,600		1,298
Costs and expenses:
Cost of products		486		375
Cost of services and other		119		103
Total costs		605		478
Research and development		303		249
Selling, general and administrative		447		361
Other operating expense (income), net		(3)		(8)
Total costs and expenses		1,352		1,080
Income from operations		248		218
Interest income		16		19
Interest expense		(29)		(20)
Other income (expense), net		(37)		(18)
Income before taxes		198		199
Provision (benefit) for income taxes		(83)		30
Net income		$	281	$	169

Net income per share:
Basic		$	1.64	$	0.97
Diluted		$	1.63	$	0.97

Weighted average shares used in computing net income per share:
Basic		172		173
Diluted		173		174


	January 31, 2026		October 31, 2025
ASSETS
Current assets:
Cash and cash equivalents	$	2,178	$	1,873

Accounts receivable, net	914		939
Inventory	1,048		1,050
Other current assets	561		486
Total current assets	4,701		4,348
Property, plant and equipment, net	757		795
Operating lease right-of-use assets	229		236
Goodwill	3,474		3,424
Other intangible assets, net	1,251		1,304
Long-term investments	147		211
Long-term deferred tax assets	330		373
Other assets	592		610
Total assets	$	11,481	$	11,301
LIABILITIES AND EQUITY
Current liabilities:


Accounts payable	$	334	$	355
Employee compensation and benefits	329		399
Deferred revenue	729		652
Income and other taxes payable	196		207
Operating lease liabilities	52		51
Other accrued liabilities	165		186
Total current liabilities	1,805		1,850

Long-term debt	2,534		2,534
Retirement and post-retirement benefits	75		75
Long-term deferred revenue	237		232
Long-term operating lease liabilities	186		193
Other long-term liabilities	439		536
Total liabilities	5,276		5,420
Commitments and contingencies (Note 13)

Stockholders’ equity:
Preferred stock; $0.01 par value; 100 million shares authorized; none issued and outstanding	—		—
Common stock; $0.01 par value; 1 billion shares authorized; 203 million and 202 million shares issued, respectively	2		2
Treasury stock, at cost; 31.2 million shares and 30.8 million shares, respectively	(3,886)		(3,799)
Additional paid-in-capital	2,932		2,851
Retained earnings	7,356		7,075
Accumulated other comprehensive loss	(199)		(248)
Total stockholders' equity	6,205		5,881


Total liabilities and equity	$	11,481	$	11,301


	Common Stock					Treasury Stock
	Number of Shares	Par Value		Additional Paid-in Capital		Number of Shares	Treasury Stock at Cost		Retained Earnings		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
Balance as of October 31, 2025	202,080	$	2	$	2,851	(30,813)	$	(3,799)	$	7,075	$	(248)	$	5,881
Net income	—	—		—		—	—		281		—		281
Other comprehensive income (loss), net of tax	—	—		—		—	—		—		49		49
Issuance of common stock	656	—		32		—	—		—		—		32
Taxes related to net share settlement of equity awards	—	—		(31)		—	—		—		—		(31)
Share-based compensation	—	—		80		—	—		—		—		80
Repurchase of common stock, including excise tax	—	—		—		(423)	(87)		—		—		(87)
Balance as of January 31, 2026	202,736	$	2	$	2,932	(31,236)	$	(3,886)	$	7,356	$	(199)	$	6,205

Balance as of October 31, 2024	201,008	$	2	$	2,664	(28,424)	$	(3,422)	$	6,225	$	(364)	$	5,105
Net income	—	—		—		—	—		169		—		169
Other comprehensive income (loss), net of tax	—	—		—		—	—		—		(79)		(79)
Issuance of common stock	673	—		31		—	—		—		—		31
Taxes related to net share settlement of equity awards	—	—		(29)		—	—		—		—		(29)
Share-based compensation	—	—		65		—	—		—		—		65
Repurchase of common stock, including excise tax	—	—		—		(449)	(75)		—		—		(75)
Balance as of January 31, 2025	201,681	$	2	$	2,731	(28,873)	$	(3,497)	$	6,394	$	(443)	$	5,187


	(in millions)
Cash consideration, net of cash acquired, outstanding awards, and currency impact	$	1,415
Consideration for share-based awards	14
Cash and cash equivalents assumed upon acquisition	127
Currency impact	8
Total consideration	$	1,564


	October 15. 2025
	(in millions)
Cash and cash equivalents	$	127
Inventory	36
Accounts receivable	71
Assets held for sale	433
Other current assets	27
Property, plant and equipment	24
Operating lease right-of-use assets	11

Other intangible assets	528
Other assets	8
Total assets acquired	1,265
Accounts payable	(13)
Employee compensation and benefits	(44)
Deferred revenue	(44)
Operating lease liabilities	(4)
Liabilities held for sale	(34)
Other accrued liabilities	(69)

Long-term deferred revenue	(14)
Long-term operating lease liabilities	(9)
Other long-term liabilities	(181)
Net assets acquired	853
Goodwill	711
Total consideration	$	1,564


	Estimated Fair Value		Estimated useful life	Valuation Method
	(in millions)		(in years)
Developed technology	$	370	6	Relief from royalty
Customer relationships	145		8	Multi-period excess earnings
Backlog	9		1	Multi-period excess earnings
Trademark/Tradename	4		1	Relief from royalty


Total intangible assets	$	528


	October 17, 2025
	(in millions)
Accounts receivable	$	15
Other current assets	1
Property, plant and equipment	1
Operating lease right-of-use assets	2

Other intangible assets	276
Total assets acquired	295

Deferred revenue	(9)


Operating lease liabilities	(1)


Long-term deferred revenue	(1)
Long-term operating lease liabilities	(1)

Net assets acquired	283
Goodwill	298
Total consideration	$	581


	CSG		EISG		Total
	(in millions)
Goodwill at October 31, 2025	$	1,967	$	1,457	$	3,424
Foreign currency translation impact	15		19		34
Goodwill arising from acquisitions	14		2		16
Goodwill at January 31, 2026	$	1,996	$	1,478	$	3,474


	January 31, 2026						October 31, 2025
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
	(in millions)
Developed technology	$	2,005	$	1,142	$	863	$	1,987	$	1,099	$	888
Backlog	49		37		12		51		34		17
Trademark/Tradename	43		40		3		43		39		4
Customer relationships	823		460		363		820		442		378

Total amortizable intangible assets	$	2,920	$	1,679	$	1,241	$	2,901	$	1,614	$	1,287
In-Process R&D	10		—		10		17		—		17
Total	$	2,930	$	1,679	$	1,251	$	2,918	$	1,614	$	1,304


	Amortization expense
	(in millions)
2026 (remainder)	$	196
2027	$	237
2028	$	233
2029	$	225
2030	$	143
2031	$	132
Thereafter	$	75


	Fair Value Measurements at
	January 31, 2026								October 31, 2025
	Total		Level 1		Level 2		Level 3			Total		Level 1		Level 2		Level 3
	(in millions)
Assets:
Short-term

Money market funds	$	1,439	$	1,439	$	—	$	—		$	1,349	$	1,349	$	—	$	—
Derivative instruments (foreign exchange contracts)	21		—		21		—			14		—		14		—
Long-term

Equity investments	115		115		—		—			169		169		—		—

Total assets measured at fair value	$	1,575	$	1,554	$	21	$	—		$	1,532	$	1,518	$	14	$	—
Liabilities:
Short-term
Derivative instruments (foreign exchange contracts)	$	7	$	—	$	7	$	—		$	8	$	—	$	8	$	—
Long-term
Deferred compensation liability	38		—		38		—			40		—		40		—
Derivative instruments (cross-currency swap contracts)	18		—		18		—			—		—		—		—
Total liabilities measured at fair value	$	63	$	—	$	63	$	—		$	48	$	—	$	48	$	—


	Three Months Ended
	January 31,
	2026						2025
	CSG		EISG		Total		CSG		EISG		Total
	(in millions)
Region
Americas	$	589	$	91	$	680	$	448	$	103	$	551
Europe	166		162		328		137		122		259
Asia Pacific	369		223		592		298		190		488
Total revenue	$	1,124	$	476	$	1,600	$	883	$	415	$	1,298

End Market
Aerospace, Defense & Government	$	366	$	—	$	366	$	311	$	—	$	311
Commercial Communications	758		—		758		572		—		572
Electronic Industrial	—		476		476		—		415		415
Total revenue	$	1,124	$	476	$	1,600	$	883	$	415	$	1,298

Timing of Revenue Recognition
Revenue recognized at a point in time	$	907	$	400	$	1,307	$	700	$	346	$	1,046
Revenue recognized over time	217		76		293		183		69		252
Total revenue	$	1,124	$	476	$	1,600	$	883	$	415	$	1,298


	Derivatives in Cash Flow Hedging Relationships		Derivatives Not Designated as Hedging Instruments
	Forward Contracts		Forward Contracts
Currency	Buy/(Sell)		Buy/(Sell)
	(in millions)
Euro	$	21	$	168
Pounds Sterling	12		64
Singapore Dollar	30		22

Malaysian Ringgit	129		7
Japanese Yen	(165)		(78)
Other currencies	(28)		10
Total	$	(1)	$	193


	Three Months Ended
	January 31,
	2026		2025
	(in millions)
Derivatives designated as hedging instruments:
Fair value hedges
Gain (loss) recognized in interest expense	$	—	$	—
Cash flow hedges
Gain (loss) recognized in accumulated other comprehensive income (loss)	$	7	$	(1)
Gain (loss) reclassified from accumulated other comprehensive income (loss) into earnings:
Cost of products	$	4	$	2
Selling, general and administrative	$	1	$	—
Interest expense	$	3	$	3




Gain (loss) excluded from effectiveness testing recognized in earnings based on amortization approach:
Cost of products	$	1	$	1


Net investment hedges
Gain (loss) recognized in accumulated other comprehensive income (loss)	$	(18)	$	—
Gain (loss) excluded from effectiveness testing recognized in earnings:
Interest expense	$	—	$	—


Derivatives not designated as hedging instruments:


Gain (loss) recognized in other income (expense), net	$	10	$	(72)


	January 31, 2026		October 31, 2025
(in millions, except percentages)
2027 Senior Notes at 4.60% ($700 face amount less unamortized costs of $1 and $1)	$	699	$	699
2029 Senior Notes at 3.00% ($500 face amount less unamortized costs of $2 and $2)	498		498
2030 Senior Notes at 5.35% ($750 face amount less unamortized costs of $7 and $7)	743		743
2034 Senior Notes at 4.95% ($600 face amount less unamortized costs of $6 and $6)	594		594
Total debt	$	2,534	$	2,534


Fair Values of Derivative Instruments
Assets Derivatives					Liabilities Derivatives
	Fair Value					Fair Value
Balance Sheet Location	January 31, 2026		October 31, 2025		Balance Sheet Location	January 31, 2026		October 31, 2025
(in millions)
Derivatives designated as hedging instruments:
Fair value hedges
Interest rate swap contracts
Other assets	$	—	$	—	Long-term debt	$	—	$	—

Cash flow hedges
Foreign exchange contracts
Other current assets	13		9		Other accrued liabilities	4		2

Net investment hedges
Cross-currency swap contracts

Other assets	—		—		Other long-term liabilities	18		—

Derivatives not designated as hedging instruments:
Foreign exchange contracts
Other current assets	8		5		Other accrued liabilities	3		6
Total derivatives	$	21	$	14		$	25	$	8


	Pensions
	U.S. Defined Benefit Plans				Non-U.S. Defined Benefit Plans				U.S. Post-Retirement Benefit Plan
	Three Months Ended
	January 31,
	2026		2025		2026		2025		2026		2025
	(in millions)
Service cost—benefits earned during the period	$	4	$	4	$	2	$	2	$	—	$	—
Interest cost on benefit obligation	9		10		9		9		2		2
Expected return on plan assets	(13)		(13)		(16)		(15)		(3)		(3)

Amortization of net actuarial loss (gain)	1		1		(1)		(1)		(1)		—


Net periodic benefit cost (benefit)	$	1	$	2	$	(6)	$	(5)	$	(2)	$	(1)


	Foreign currency translation		Net defined benefit pension cost and post-retirement plan costs		Gains (losses) on derivatives		Total


	(in millions)
As of October 31, 2025	$	(66)	$	(264)	$	82	$	(248)
Other comprehensive income (loss) before reclassifications	49		—		7		56
Amounts reclassified out of accumulated other comprehensive gain (loss)	—		—		(8)		(8)
Tax benefit (expense)	4		(4)		1		1
Other comprehensive income (loss)	53		(4)		—		49
As of January 31, 2026	$	(13)	$	(268)	$	82	$	(199)

As of October 31, 2024	$	(136)	$	(317)	$	89	$	(364)
Other comprehensive income (loss) before reclassifications	(73)		—		(1)		(74)
Amounts reclassified out of accumulated other comprehensive gain (loss)	—		—		(5)		(5)
Tax benefit (expense)	—		—		—		—
Other comprehensive income (loss)	(73)		—		(6)		(79)
As of January 31, 2025	$	(209)	$	(317)	$	83	$	(443)


Details about accumulated other comprehensive loss components		Amounts reclassified from accumulated other comprehensive loss				Affected line item in statement of operations
	Three Months Ended
	January 31,
		2026		2025
		(in millions)
Gain (loss) on derivatives		$	4	$	2	Cost of products
		1		—		Selling, general and administrative
		3		3		Interest expense
		(2)		—		Benefit (provision) for income tax
		$	6	$	5	Net of income tax


	Three Months Ended							Year-over-Year
	January 31,							Change
		2026			2025				Three Months
		(in millions, except percentages)

Revenue		$	1,600		$	1,298			23%
Gross margin		62.2		%	63.1		%		(1) ppt
Research and development		$	303		$	249			22%
Percentage of revenue		19		%	19		%		—
Selling, general and administrative		$	447		$	361			24%
Percentage of revenue		28		%	28		%		—
Other operating expense (income), net		$	(3)		$	(8)			(58)%
Income from operations		$	248		$	218			14%
Operating margin		15.5		%	16.8		%		(1) ppt
Interest income		$	16		$	19			(16)%
Interest expense		$	(29)		$	(20)			46%
Other income (expense), net		$	(37)		$	(18)			106%
Income before taxes		$	198		$	199			—
Provision (benefit) for income taxes		$	(83)		$	30			—
Net income		$	281		$	169			67%


	Three Months Ended					Year- over-Year
	January 31,					Change
		2026		2025			Three Months
		(in millions)
Total revenue		$	1,124	$	883		27%


Period	Total Number of Shares of Common Stock Purchased (1)	Weighted Average Price Paid per Share of Common Stock (2)		Total Number of Shares of Common Stock Purchased as Part of Publicly Announced Plans or Programs (1)	Maximum Approximate Dollar Value of Shares of Common Stock that May Yet Be Purchased Under the Program (in millions) (1)

November 1, 2025 through November 30, 2025	—	$	—	—	$	1,500
December 1, 2025 through December 31, 2025	363,351	$	206.41	363,351	$	1,425
January 1, 2026 through January 31, 2026	59,704	$	208.20	59,704	$	1,413
Total	423,055			423,055


(1)			On November 24, 2025, our board of directors approved a new stock repurchase program authorizing the purchase of up to $1,500 million of the company’s common stock, replacing the program previously approved in March 2023, under which $110 million of common stock remained. Under our stock repurchase program, shares may be purchased from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases, privately negotiated transactions or other means. All such shares and related costs are held as treasury stock and accounted for at trade date using the cost method.
(2)			The weighted average price paid per share of common stock does not include the cost of commissions or excise taxes.


Exhibit
Number						Description

31.1						Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2						Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1						Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2						Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS						XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

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101.CAL						XBRL Extension Calculation Linkbase Document

101.LAB						XBRL Extension Label Linkbase Document

101.PRE						XBRL Extension Presentation Linkbase Document

101.DEF						XBRL Extension Definition Linkbase Document

104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


Dated:	March 5, 2026	By:	/s/ Neil Dougherty
			Neil Dougherty
			Executive Vice President and Chief Financial Officer
			(Principal Financial Officer)


Dated:	March 5, 2026	By:	/s/ Lisa M. Poole
			Lisa M. Poole
			Vice President and Corporate Controller
			(Principal Accounting Officer)


Date:	March 5, 2026
		/s/ Satish Dhanasekaran
		Satish Dhanasekaran
		President and Chief Executive Officer