Q4 2024 Keysight Technologies Inc Earnings Call Transcript
Key Points
- Keysight Technologies Inc (KEYS) delivered fourth-quarter revenue and earnings per share above the high end of their guidance range.
- Orders grew 1% year over year and 8% sequentially, driven by strength in AI and strong year-end bookings in the US aerospace, defense, and government business.
- The company demonstrated resilience by delivering 26% operating profit and over $900 million in free cash flow, returning approximately 50% of free cash flow to shareholders through repurchases.
- Keysight Technologies Inc (KEYS) progressed its software-centric solution strategy, investing in organic growth opportunities through innovation and industry collaborations.
- Revenues from software and services grew 8% this quarter, accounting for 39% of total revenue, with annual recurring revenue from these segments growing 16%.
- Full-year revenue of $4.979 billion was down 9% as reported or down 12% on a core basis.
- Operating expenses increased by 5% year over year, impacting overall profitability.
- The Electronic Industrial Solutions Group saw revenue decline year over year, with automotive market headwinds contributing to the downturn.
- The company anticipates continued challenges in the automotive sector, with headwinds expected to persist into 2025.
- Gross margin for the full year was down 60 basis points compared to the prior year, reflecting some pressure on profitability.
Good day, ladies and gentlemen, and welcome to the Keysight Technologies fiscal fourth-quarter 2024 earnings conference call. My name is Joel and I will be your lead operator today. (Operator Instructions)
This call is being recorded today, Tuesday, November 19, 2024, at 1:30 PM, Pacific Time.
I would now like to hand the call over to Paulenier Sims, Director of Investor Relations. Please go ahead, Ms. Sims.
Thank you, and welcome, everyone, to Keysight's fourth-quarter earnings conference call for fiscal year 2024. Joining me are Keysight's President and CEO, Satish Dhanasekaran; and our CFO, Neil Dougherty. In the Q&A session, we will be joined by Chief Customer Officer, Mark Wallace. The press release and information to supplement today's discussion are on our website at investor.keysight.com under Financial Information and Quarterly Reports.
Today's comments will refer to non-GAAP financial measures. We will also make reference to core growth, which
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