Viavi Solutions Inc (VIAV) Q4 2024 Earnings Call Highlights: Navigating Market Challenges with ...

GuruFocus News
4 min read

In This Article:

  • Net Revenue (Q4 2024): $252 million, up 2.4% sequentially, down 4.4% year-over-year.

  • Operating Margin (Q4 2024): 10.9%, up 160 basis points sequentially, down 80 basis points year-over-year.

  • EPS (Q4 2024): $0.08, up $0.02 sequentially, down $0.02 year-over-year.

  • Full Year Revenue (2024): $1 billion, down 9.6% year-over-year.

  • Full Year Operating Margin (2024): 11.5%, down 410 basis points from 2023.

  • Full Year EPS (2024): $0.33, down $0.22 from the prior year.

  • NSE Revenue (Q4 2024): $182.2 million, down 7.9% year-over-year.

  • NE Revenue (Q4 2024): $158.5 million, down 9.7% year-over-year.

  • SE Revenue (Q4 2024): $23.7 million, up 5.8% year-over-year.

  • OSP Revenue (Q4 2024): $69.8 million, up 6.2% year-over-year.

  • Cash and Short-term Investments (End of Q4 2024): $496.2 million.

  • Cash Flow from Operating Activities (Q4 2024): $26.2 million.

  • CapEx (Q4 2024): $3.8 million.

  • Share Repurchase (Q4 2024): 1.3 million shares for about $10 million.

  • Guidance for Q1 2025 Revenue: $235 million to $245 million.

  • Guidance for Q1 2025 Operating Margin: 10.8%, plus or minus 90 basis points.

  • Guidance for Q1 2025 EPS: $0.05 to $0.07.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Viavi Solutions Inc (NASDAQ:VIAV) reported net revenue of $252 million for the fourth quarter, which was at the midpoint of their guidance range.

  • Operating margin for the fourth quarter was 10.9%, above the midpoint of the guidance range.

  • OSP revenue for the quarter was $69.8 million, exceeding the high end of the guidance range, driven by strength across all products.

  • The company anticipates a gradual recovery in demand in the second half of fiscal 2025.

  • Viavi Solutions Inc (NASDAQ:VIAV) is seeing strong demand in its mil-aero business, which is expected to continue throughout fiscal 2025.

Negative Points

  • Fourth-quarter revenue was down 4.4% year-over-year, reflecting a challenging market environment.

  • Full-year revenue was $1 billion, down 9.6% year-over-year, primarily due to conservative spending by service providers and NEMs.

  • NSE revenue for the quarter was at the lower end of the guidance range, with a year-over-year decline of 7.9%.

  • The company initiated a restructuring plan, impacting approximately 6% of the global workforce, to improve operational efficiencies.

  • Viavi Solutions Inc (NASDAQ:VIAV) expects continued conservative spending by service providers and NEMs in the first half of fiscal 2025.

Q & A Highlights

Q: Can you provide insights on inventory levels at your customers for field and lab instruments? A: Oleg Khaykin, President and CEO, explained that there is no significant inventory buildup. Deliveries are just-in-time, aligning with major expansion projects or technology upgrades. The revenue is largely at maintenance levels due to equipment churn, and there's interest in fiber interworking by Tier 2 operators, indicating potential demand recovery.

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