Viavi Solutions (VIAV) Q1 2027 Earnings Report

The call was strongly positive. Viavi exceeded revenue, operating margin, and EPS guidance, reported substantial year-over-year growth in NSC and OSP, highlighted strong data center and aerospace and defense demand, and raised its near-term growth outlook. The main challenges were weak wireless spending and seasonally lower OSP revenue expected in Q2, while cash and short-term investments declined sequentially.

For the second fiscal quarter of 27, Viavi expects revenue in the range of $505 million and $515 million, NSE revenue between $426 million and $434 million, OSP revenue in the range of $79 million and $81 million, Viavi operating margin of 29.3% plus or minus 30 basis points, NSC operating margin of 28.1%, plus or minus 30 basis points, OSP operating margin of 35.7% plus or minus 20 basis points, EPS between $0.50 and $0.52, tax expenses around $12 million plus or minus $500 thousand, other income and expenses reflecting a net expense of approximately $3.5 million, and a share count around 264 million shares; quarter over quarter growth is expected to continue throughout the rest of the fiscal year, with strong NSE demand more than offsetting seasonally weaker OSP core, the company expects to reach $2 billion revenue run rate during this quarter, expects strong momentum to continue into the second half of the fiscal year, expects continued robust growth in the data center segment in calendar 2027, expects strong momentum in its A&D business unit to continue into calendar 2027, and expects the semiconductor packaging and test segment to become a major new growth area, potentially north of $100 million for Viavi in a couple years.