Viavi Solutions (VIAV) Q1 2027 earnings summary

Executive summary

• Q1 FY27 revenue was $469.3M, up 56.9% YoY, and results exceeded the high end of guidance; data center and aerospace and defense demand supported growth.

• The quarter covered 14 weeks versus 13 weeks in the prior-year quarter.

Financial highlights

• Revenue rose 5.9% QoQ and 56.9% YoY; non-GAAP gross margin was 64.4%, up 210 bps QoQ and 430 bps YoY.

• Non-GAAP operating income was $136.1M, up 179.5% YoY; non-GAAP net income was $125.8M, up 262.5%.

• GAAP net income was $76.0M versus a $21.4M loss YoY; GAAP diluted EPS was $0.29 versus a $0.10 loss.

• Non-GAAP diluted EPS was $0.47 versus $0.15 YoY; tariff refunds and the additional week’s variable costs provided a net ~$0.02 benefit.

• Operating cash flow was $104.7M and free cash flow was $92.7M; capital expenditures were $12.0M.

Outlook and guidance

• Q2 FY27 revenue guidance is $505M–$515M: NSE $426M–$434M and OSP $79M–$81M.

• Q2 non-GAAP operating margin guidance is 29.3% ±30 bps overall, 28.1% ±30 bps NSE and 35.7% ±20 bps OSP; non-GAAP EPS guidance is $0.50–$0.52.

• Sequential Q2 growth is expected as NSE strength more than offsets seasonal OSP softness; sequential growth is expected through FY27, with a $2B revenue run rate targeted during Q2.

• Q2 non-GAAP tax expense is expected at $12.0M ±$0.5M; other income and expense is expected to be a $3.5M net expense.

• Fiscal 2026 restructuring is expected to be substantially complete by the end of calendar 2026, with ~$30M in annualized gross cost savings, excluding one-time charges.