Viavi Q2 Earnings Beat Estimates, Revenues Rise Y/Y on Solid Demand

Viavi Solutions Inc. VIAV reported strong second-quarter fiscal 2026 results, with both top and bottom lines surpassing the Zacks Consensus Estimate.

The company posted a solid 36.4% year-over-year increase in revenues, supported by strong performance in its Network and Service Enablement (NSE) and Optical Security and Performance Products (OSP) segments. Growth was driven by sustained demand from data centers and ongoing 5G and fiber network upgrades, along with solid sales in the aerospace and defense markets.

Net Income

On a GAAP basis, Viavi incurred a net loss of $48.1 million or a loss of 21 cents per share against a net income of $9.1 million or 4 cents per share in the year-ago quarter. 

Non-GAAP net income in the reported quarter was $51.5 million or 22 cents per share compared with $29.4 million or 13 cents per share in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate of 19 cents.

Viavi Solutions Inc. Price, Consensus and EPS Surprise

Viavi Solutions Inc. price-consensus-eps-surprise-chart | Viavi Solutions Inc. Quote

Revenues

Net sales increased to $369.3 million from $270.8 million in the year-ago quarter, primarily driven by data center and 5G demand. The top line beat the consensus estimate by $3 million.

In the second quarter of fiscal 2026, the NSE segment generated $291.5 million in revenues, up 45.8% year over year. The segment accounted for 78.9% of total revenues. Higher software and services revenues, customer network upgrades, and improved sales execution drove solid sales growth in this segment.

The OSP segment revenues were $77.8 million, up 9.7% year over year, backed by demand for anti-counterfeiting solutions, aerospace & defense programs, and secure optical technologies.

Net sales from the Americas totaled $170.9 million, up from $116.1 million in the year-ago quarter. Revenues from Asia-Pacific were $108.1 million, up 15.5% year over year. Revenues from EMEA increased to $90.3 million from the prior-year quarter’s tally of $61.1 million.

Other Details

Non-GAAP gross profit was $228.1 million compared with $165.4 million in the year-ago quarter. with respective margins of 61.8% and 61.1%. Non-GAAP operating expenses increased to $156.7 million from $125 million a year ago. Non-GAAP operating income was $71.4 million compared with $40.4 million in the year-ago quarter.

Cash Flow & Liquidity

As of Dec. 27, 2025, VIAV had $765.5 million in cash and cash equivalents and $1.22 billion of long-term debt. The company generated $42.5 million in net cash from operating activities in the quarter, with a free cash flow of $36.9 million.

Outlook

For the third quarter of fiscal 2026, management expects revenues in the range of $386-$400 million. Non-GAAP operating margin is expected to be 19.7% (+/- 0.5 %) with non-GAAP earnings per share between 22 cents and 24 cents.

For the NSE segment, revenues are projected to be between $304 million and $316 million, with a non-GAAP operating margin of 15.5% (+/- 0.5 %). Revenues for the OSP segment are anticipated to be in the range of $82-$84 million, with a non-GAAP operating margin of 35.3% (+/- 0.5 %).

Zacks Rank

Viavi currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Lyft, Inc. LYFT is scheduled to release fourth-quarter 2025 earnings on Feb. 10. The Zacks Consensus Estimate for earnings is pegged at 32 cents per share, suggesting growth of 6.67% from the year-ago reported figure.

Lyft has a long-term earnings growth expectation of 24.41%. The company delivered an average earnings surprise of 1.17% in the last four reported quarters.

Akamai Technologies, Inc. AKAM is slated to release fourth-quarter 2025 earnings on Feb. 19. The Zacks Consensus Estimate for earnings is pegged at $1.75 per share, indicating 5.4% growth from the year-ago reported figure.

Akamai has a long-term earnings growth expectation of 5.96%. The company delivered an average earnings surprise of 10.46% in the last four reported quarters.

Advanced Micro Devices, Inc. AMD is set to release fourth-quarter 2025 earnings on Feb. 3. The Zacks Consensus Estimate for earnings is pegged at $1.32 per share, implying growth of 21.1% from the year-ago reported figure.

Advanced Micro Devices has a long-term earnings growth expectation of 43.26%. The company delivered an average earnings surprise of 2.45% in the last four reported quarters.

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