Keysight Q4 2025 slides: 10% revenue growth fueled by AI and semiconductor demand

Introduction & Market Context

Keysight Technologies Inc (NYSE:KEYS) delivered a strong finish to fiscal year 2025, as revealed in its Q4 earnings presentation on November 24, 2025. The electronic measurement technology company reported double-digit growth in both revenue and earnings per share, exceeding analyst expectations amid robust demand for AI infrastructure and semiconductor testing solutions.

The company’s stock responded positively to the results, rising 2.87% in after-hours trading to $177.67, approaching its 52-week high of $187.67. This performance comes as Keysight continues to strengthen its position in high-growth technology segments through strategic acquisitions and R&D investments.

Quarterly Performance Highlights

Keysight reported Q4 2025 revenue of $1.419 billion, representing a 10% year-over-year increase, surpassing the forecasted $1.39 billion. Non-GAAP earnings per share reached $1.91, growing 16% year-over-year and exceeding analyst expectations of $1.82.

The company demonstrated strong order momentum with Q4 orders of $1.533 billion, up 14% year-over-year, contributing to a robust backlog of $2.7 billion. Operating margin improved to 26.3%, a 50 basis point increase compared to the same period last year.

As shown in the following chart of quarterly financial highlights:

For the full fiscal year 2025, Keysight achieved revenue of $5.375 billion, representing an 8% increase from fiscal year 2024. The company’s long-term performance trends show consistent growth across key financial metrics:

Segment and Regional Analysis

Keysight’s business is divided into two main segments: Communications Solutions Group (CSG) and Electronic Industrial Solutions Group (EISG), which contributed 70% and 30% of total revenue respectively in Q4 2025.

The revenue breakdown by segment and region is illustrated in the following chart:

The Communications Solutions Group generated $990 million in revenue, growing 11% year-over-year, driven primarily by AI data center infrastructure investments. However, operating margin for this segment declined by 120 basis points year-over-year to 26.7%.

The Electronic Industrial Solutions Group delivered $429 million in revenue, up 9% year-over-year, with significant operating margin expansion of 430 basis points to 25.4%. This improvement was fueled by double-digit growth in the semiconductor business, while automotive revenue remained stable.

Geographically, Keysight saw balanced growth across all regions, with particularly strong performance in Asia Pacific:

By end market, Commercial Communications led growth at 12% year-over-year, followed by Aerospace, Defense & Government and Electronic Industrial Solutions, both growing at 9%:

Strategic Initiatives and Acquisitions

A key element of Keysight’s growth strategy has been its acquisition activity, which has expanded the company’s software-centric solutions portfolio and addressable market. During fiscal year 2025, Keysight deployed $1.7 billion for acquisitions, including Spirent, Optical Solutions Group, and PowerArtist.

These strategic acquisitions have expanded Keysight’s served addressable market by approximately $1.25 billion and are expected to contribute around $375 million in revenue in fiscal year 2026. The acquired businesses feature attractive gross margins exceeding 75% and are anticipated to be EPS accretive within 12 months of closing.

In addition to acquisitions, Keysight continued its share repurchase program, buying back 2.4 million shares for $375 million during the fiscal year. The company also announced a new $1.5 billion share repurchase authorization, reflecting confidence in its financial position and future prospects.

Forward-Looking Statements

Looking ahead to the first quarter of fiscal year 2026, Keysight provided guidance for revenue between $1.530 billion and $1.550 billion, with non-GAAP earnings per share expected to range from $1.95 to $2.01.

For the full fiscal year 2026, the company outlined several financial considerations, including:

• Interest expense of approximately $110 million
• Non-GAAP tax rate of 14%
• First quarter weighted average diluted share count of approximately 173 million shares
• Capital expenditures of approximately $160 million

CEO Satish Dhanasekaran expressed optimism about future opportunities in next-generation connectivity, compute, and semiconductor technologies. The company’s focus on AI infrastructure, 6G development (with standardization expected between 2028 and 2029), and semiconductor testing positions it well for continued growth in these expanding markets.

With its strong backlog, strategic acquisitions, and focused investments in high-growth areas, Keysight appears well-positioned to maintain its growth trajectory into fiscal year 2026, despite potential challenges from supply chain issues, market saturation in wireless, and macroeconomic pressures that could affect customer spending.

Full presentation:

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