VIAVI Announces Quarterly Financial Results
Thursday, May 07, 2020 | Comments

VIAVI reported results for its third fiscal quarter ended March 28.

Third quarter net revenue was $256.2 million, and GAAP net loss was $32.8 million. Second quarter of fiscal 2020 net revenue was $313.7 million. GAAP net income was $28 million. Third quarter of fiscal 2019 net revenue was $265.2 million, and GAAP net loss was $4.8 million.

"Fiscal Q3 2020 revenue came in below our guidance range," said Oleg Khaykin, VIAVI's president and CEO. "The emerging COVID-19 pandemic was the principal driver behind the revenue shortfall. Despite that, through disciplined OPEX management, we managed to deliver the midpoint of our non-GAAP EPS guidance range, at 14 cents per share. The NSE (network and service enablement) business segment was most impacted by the COVID-19 headwinds, as our customers increasingly went into WFH (work from home) and lockdown mode of operations, and many purchase decisions were either pushed out or put on hold. The OSP (optical security and performance) business segment, on another hand, saw some late quarter customer order upsides and expedites, coming in above the revenue and non-GAAP operating margin guidance range.

"VIAVI has a strong balance sheet with more than $530 million in cash and a $300 million line of credit. Strong liquidity position combined with many counter-cyclical businesses in our portfolio sets us up well to manage the near-term macroeconomic uncertainty. We remain positive on our long-term growth drivers in 5G wireless, fiber and 3D sensing."

Americas; Asia-Pacific; and Europe, Middle East and Africa (EMEA) customers represented 34.7%, 29% and 36.3%, respectively, of total net revenue for the quarter ended March 28. As of March 28, the company had $460 million aggregate principal amount of 1% senior convertible notes and $225 million aggregate principal amount of 1.75% senior convertible notes with a total net carrying value of $595.3 million classified as long-term debt.

During the fiscal quarter ended March 28, the company generated $39.1 million of cash from operations. The company recorded a GAAP tax charge of $31.6 million for withholding taxes related to the planned repatriation of cash from a foreign subsidiary to further strengthen U.S. cash and liquidity position.

Because of macroeconomic and business uncertainty as a result of the COVID-19 global pandemic, VIAVI did not provide fiscal fourth quarter 2020 guidance. Fiscal fourth-quarter revenue is expected to be sequentially flat to slightly better than fiscal third quarter 2020 driven by seasonal strength in NSE.

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