That wraps up our initial coverage of Keysight Technologies’ Q3 results. Thank you for stopping by!
Management expects fourth-quarter revenue of $1.93-$1.95 billion, representing 37% year-over-year growth at the midpoint and easily crushing analysts’ previous estimates of $1.81 billion.
This might explain why KEYS stock is now up 4% after earnings, after initially trading flat.
Adjusted earnings guidance of $3.34 to $3.40 per share also came in far above the $2.70 consensus. Keysight has the financial capacity to support that expansion, generating $403 million in third-quarter free cash flow, up 38.5% year over year.
Cash and restricted cash ended the quarter at $2.62 billion, even after the company spent $520 million on share repurchases during the first nine months of fiscal 2026.
Keysight’s Communications Solutions Group remained the primary growth engine, with revenue climbing 43% to $1.35 billion.
Commercial communications revenue grew 56% to $1.01 billion, while aerospace, defense, and government sales increased 14% to $339 million.
The growth also carried significant operating leverage, with the Communications segment’s gross margin expanding from 67% to 71%, while its operating margin jumped from 26% to 34%.
That combination of rapid growth and widening margins helps explain why Keysight’s earnings beat was substantially larger than its revenue beat.
Keysight’s orders reached $2.09 billion, up 56% from $1.34 billion last year and surpassing $2 billion for the second consecutive quarter.
Revenue rose 36.5% to $1.85 billion, while non-GAAP earnings jumped 78.5% to $3.07 per share. The order growth is especially important because it suggests Keysight’s recent acceleration is not simply clearing existing backlog.
Demand continues to build as AI infrastructure and other advanced computing projects require more sophisticated design, emulation, and testing equipment.
Keysight Technologies just reported fiscal third-quarter earnings, with shares initially down 1% despite beating expectations across the board. Here are the key numbers:
The company also issued fiscal fourth-quarter guidance well ahead of Wall Street’s forecasts:
Keysight delivered a decisive double beat, with adjusted earnings topping consensus by nearly 24% and revenue exceeding estimates by more than 6%.
Its fourth-quarter outlook was even stronger, suggesting continued momentum across the test-and-measurement business.
With shares down 6.43% today heading into tonight’s earnings report, here are some top factors to watch:
Keysight Technologies (NYSE:KEYS) trades at $337.91, down about 6.3% today after last week’s 7.67% rally. Shares are still up 77.74% year to date and 121.02% over one year, with analysts holding a $388.33 average target.
The full-chain put/call ratio sits at 0.36, but the Aug 21 weekly flipped defensive with 1,065 calls versus 1,431 puts as traders hedge tonight’s release.
Historical earnings-day reactions have averaged 7.36%, ranging from -3.04% to +23.05%. Consensus tracks the guided $2.43 to $2.49 EPS on $1.730 billion to $1.750 billion revenue.
Stronger Q4 guidance plus a book-to-bill ratio above 1.0x could reverse today’s slide, while soft AI orders or cautious tariff commentary could likely extend the drop.
With Keysight Technologies (NYSE:KEYS) trading at $335.65 after today’s 7.06% slide, here is the pre-release scorecard.
Consensus benchmarks: Management guided non-GAAP EPS to $2.43 to $2.49 on revenue of $1.730 billion to $1.750 billion, implying ~29% YoY growth. Keysight has beaten EPS in each of the last four quarters.
KPIs to watch: Communications Solutions Group growth (last print +35% YoY), orders following $2.05 billion in Q2, CSG operating margin (33%), and free cash flow ($472 million prior).
Triggers: A book-to-bill slipping below 1.0x or soft Q4 guidance could extend losses. A raised FY26 outlook likely reverses today’s move. Options skew bullish, with a 0.38 full-chain put/call ratio, while the analyst target sits at $388.33.
Keysight (NYSE:KEYS)’s Q3 results are largely spoken for. Management guided revenue of $1.730 billion to $1.750 billion and EPS of $2.43 to $2.49, and the team has beaten every quarter in the last four reports with a 100% beat rate. The real swing factor will be the company’s Q4 outlook.
Investors will also parse orders, CSG growth, and any color on the $500-$600 million AI business trajectory.
Keysight Technologies reports fiscal third-quarter earnings at 4:05 PM ET after the closing bell today, with guidance pointing to roughly 29% year-over-year revenue growth at the midpoint.
The company enters the report with significant momentum after generating more AI-related revenue during the first half of fiscal 2026 than it did throughout all of 2025.
Management has sized Keysight’s AI infrastructure business at about $500-$600 million, with demand benefiting from the massive buildout in data centers, networking and advanced computing. This increasingly positions Keysight as an indirect way to invest in rising hyperscaler capital spending.
However, much of that optimism may already be reflected in the stock. Keysight has soared 65% year to date and nearly 7% in the past month.
Wall Street remains bullish, with 10 Buy ratings and an average price target of $388.33, but that also raises the bar for tonight’s results. A clean beat paired with stronger fourth-quarter guidance would reinforce the multi-year AI infrastructure thesis.
Live coverage has ended. The full story is below.
Keysight Technologies (NYSE:KEYS | KEYS Price Prediction) reports Q3 FY2026 results today at 4:05 PM ET after the market closes. With the stock up 102.85% over the past year but down 7.3% today, this earnings report will test whether AI test and measurement demand can drive a record-setting year for Keysight.
Last quarter was, by CEO Satish Dhanasekaran’s own words, “the strongest quarter in the company’s history.” Q2 revenue hit $1.717 billion, growing 31.47% YoY, while non-GAAP EPS of $2.87 beat expectations.
Orders reached $2.51 billion, up 56% YoY, with book-to-bill above 1.0x. CSG operating margin expanded to 33% from 26% a year earlier, and free cash flow hit a record $472 million. Management raised the FY2026 outlook to high 20% revenue growth.
| Metric | Q3 FY2026 Guidance | YoY Change |
|---|---|---|
| Revenue | $1.730B to $1.750B | +29% |
| Non-GAAP EPS | $2.43 to $2.49 | +43% |
Guidance implies a modest sequential dip from Q2’s record, which management attributed to product mix and NPI ramp timing. The Street expects EPS of $2.48, right at the high end of the range.
Tonight, I’ll be watching the company’s book-to-bill ratio first. Orders grew 48% on a core basis last quarter, and any deceleration could call the AI runway thesis into question.
Commercial Communications will be an important segment to watch, having grown 40% YoY on wireline strength tied to 800-gig, 1.6-terabit, and silicon photonics validation work. The CFO flagged 59% incremental margins in Q2. Sustaining anything near that at these growth rates would extend the company’s operating leverage story.
I’ll also watch aerospace and defense, where European demand is accelerating, plus commentary on the Synopsys, Ansys, and Spirent integrations tracking to $375 million in FY26 contribution. Any updates on 6G standardization from next month’s 3GPP meeting in Singapore would matter for the FY2027 setup.
| Quarter | EPS Surprise | Earnings Day Move | 1-Week Move | 30-Day Move |
|---|---|---|---|---|
| Q2 FY2026 | +23.69% | -0.59% | -0.86% | +3.07% |
| Q1 FY2026 | +8.75% | +23.05% | +0.35% | -6.77% |
| Q4 FY2025 | +4.16% | +10.01% | +5.70% | +5.83% |
| Q3 FY2025 | +2.88% | -3.04% | +4.11% | +12.18% |
On average, shares moved +2.33% seven days after earnings over the past year.
Contact [email protected] for any questions or corrections.
Thomas Richmond is a financial writer and content strategist with 5+ years of experience covering stocks and financial markets. He has published over 250 articles focused on individual stock analysis, helping investors better understand business fundamentals, stock valuations, and long-term opportunities.
Thomas previously served as a Content Lead at TIKR, a stock research platform, where he helped scale the company’s blog to hundreds of articles per month and contributed to a weekly newsletter reaching more than 100,000 investors.
He specializes in breaking down complex companies into clear, actionable insights for everyday investors, with a focus on fundamentals-driven research.
His work has also been featured on platforms including Seeking Alpha and Sure Dividend.
Outside of work, Thomas enjoys weight lifting and soccer.
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