VIAVI Solutions Reports 15.8% Revenue Growth and Net Income Recovery in Q3 Fiscal 2025

VIAVI Solutions Inc. reported a significant increase in financial performance for the third quarter of fiscal 2025, with total net revenue reaching $284.8 million, a 15.8% increase from $246.0 million in the same period last year. The company's product revenue rose to $241.5 million, up from $207.3 million, while service revenue also saw an increase to $43.3 million from $38.7 million. The gross profit for the quarter was $160.7 million, reflecting a gross margin of 56.4%, compared to 56.1% in the prior year. Net income for the quarter was $19.5 million, a substantial recovery from a net loss of $24.6 million in the same quarter of the previous year.

Comparatively, for the nine months ending March 29, 2025, total net revenue increased to $793.8 million from $748.4 million, with product revenue growing to $664.7 million from $623.8 million. The company reported a net income of $26.8 million for the nine-month period, a significant improvement from a loss of $4.1 million in the prior year. The increase in revenue was attributed to higher spending by network equipment manufacturers and aerospace and defense customers, despite some declines in wireless and 3D sensing revenues.

Strategically, VIAVI completed the acquisition of Inertial Labs, LLC on January 28, 2025, for approximately $134.4 million in cash, with additional contingent consideration of up to $175 million based on future revenue targets. This acquisition is expected to enhance VIAVI's offerings in position, navigation, and timing solutions. The company also announced plans to acquire Spirent Communications plc’s high-speed ethernet and network security business lines for $410 million, pending regulatory approvals.

Operationally, VIAVI's workforce has been impacted by restructuring initiatives aimed at improving efficiency, with approximately 7% of the global workforce expected to be affected by the ongoing Fiscal 2024 Plan. The company reported a total restructuring accrual of $4.5 million as of March 29, 2025. Additionally, the company’s cash and cash equivalents decreased to $374.2 million from $471.3 million as of June 29, 2024, primarily due to cash used in investing activities, including the acquisition of Inertial Labs.

Looking ahead, VIAVI remains optimistic about gradual recovery across its markets, despite uncertainties related to customer procurement decisions and global economic conditions. The company plans to continue focusing on its strategic priorities, including defending its market leadership, investing in growth opportunities, and optimizing its capital structure. The management anticipates that the evolving macro environment, including the impact of global tariffs, will require ongoing adjustments to operations and pricing strategies to mitigate potential cost increases.