Viavi Solutions (VIAV) Investor update summary

Offering overview

• $500 million common equity offering, 100% primary shares, with a 15% over-allotment option.

• Proceeds will be used to pay down $450 million Term Loan B and for general corporate purposes.

• The offering is being priced today after confidential marketing; lockup period is 60 days.

• Book runners are Stifel and Needham.

Business profile and growth drivers

• Annual revenue run rate is about $1.6 billion, with over 4,100 employees and 3,300+ patents.

• Two main business units: Network and Service Enablement (75% of revenue) and Optical Security and Performance Products (25%).

• Fastest-growing segments are AI data center ecosystem and aerospace/defense, together making up ~60% of revenue.

• Strong alignment with AI, high-performance computing, quantum computing, and resilient PNT trends.

• Significant investments and R&D focus on data center and resilient navigation technologies.

Financial performance and leverage

• Gross margins exceed 60%, with operating leverage driving rapid operating income expansion.

• Recent acquisitions (Spirent High-Speed Ethernet, Inertial Labs) are growing rapidly and accretive to margins.

• 43% revenue growth year-over-year led to 79% operating income growth.

• Retiring high-cost debt (6–6.5% interest) will save $35–$40 million in interest, directly boosting EPS due to $6 billion in U.S. NOLs.

• Leverage ratio will drop from 3.9 to 0.3 after debt repayment, increasing financial flexibility.