Keysight Technologies posted third-quarter revenue of $1.85 billion and adjusted earnings per share of $3.07, both substantially exceeding analyst expectations in the company's August 18 earnings announcement.
The revenue figure represents a 37 percent increase from the prior year and beat consensus estimates by $110 million. Adjusted EPS grew 78 percent year-over-year and exceeded the $2.48 estimate by 24 percent. Free cash flow reached $403 million, more than double the $193 million projection and up 38 percent from the prior year period.
Keysight's Communications Service Group, which houses its wireless and telecom infrastructure business, generated $1.35 billion in net revenue, up 43 percent year-over-year. The Electronics Industrial Service Group, covering electronic design and measurement, posted $501 million, up 21 percent. The communications segment accounted for 73 percent of total revenue.
GAAP net income climbed to $397 million, roughly double the prior year figure. Operating cash flow reached $437 million, up 36 percent from the same quarter last year. The company cited record results in its announcement.
For the fourth quarter, Keysight guided revenue to $1.93 billion to $1.95 billion, above the $1.81 billion consensus estimate. It projected adjusted EPS of $3.34 to $3.40 versus the $2.70 estimate.
Keysight's three-quarter revenue growth of 37 percent places it among the stronger performers in the electronics measurement and semiconductor testing sector, where capital equipment demand has tracked semiconductor cycle recovery since 2023. The company's free cash flow of $403 million represents 22 percent of quarterly revenue, a margin that typically requires both top-line growth and operational discipline.
The fourth-quarter guide implies full-year adjusted EPS growth exceeding 75 percent and full-year revenue growth in the mid-30 percent range. The metric that settles whether Keysight sustains this trajectory is fourth-quarter revenue delivery within its $1.93 billion to $1.95 billion guidance range.
