Acquisitions had a favorable impact of 2 percentage points on the year-over-year revenue change for Q3 2024. However, this contribution was insufficient to offset the overall revenue decline of 12%, indicating organic revenue contraction.

On March 28, 2024, Keysight announced its intention to acquire Spirent Communications PLC for $1.463 billion. The acquisition is expected to close in the first half of fiscal year 2025 and is subject to regulatory clearances.

R&D expense increased by 5% YoY to $226 million, demonstrating continued investment in innovation despite revenue pressures. Management is prioritizing investment in key growth opportunities and leading-edge technologies.

Selling, general, and administrative expenses increased by 3%, but the increase would have been higher without cost flexibility measures. These measures partially offset the impact of lower revenue volume on profitability.

Keysight reiterates its commitment to achieving net zero Scope 1 and 2 emissions by fiscal year 2040. This commitment involves significant investments in energy efficiency, renewable energy, and carbon offsets.

The company continues to integrate acquired businesses, including ESI Group, into its operations. This integration is impacting financial results, including higher amortization of acquisition-related balances.

The 10-Q highlights the sensitivity of Keysight's business to negative changes in general economic conditions, both inside and outside the United States. Global and regional economic uncertainty, inflation, potential recession or depression has and may continue to impact business.

The company's reliance on international operations exposes it to risks such as trade restrictions, sanctions, and volatile geopolitical turmoil. These factors could harm the company's future results.

The company and its partners are vulnerable to the increasing impact of climate change, and such extreme weather events can cause power outages and network disruptions that may result in disruption to operations.

The filing acknowledges increased competition and rapid technological changes in the industries Keysight serves, requiring continuous innovation and timely introduction of new solutions. Failure to do so could result in obsolescence of existing solutions.

The potential for industry consolidation among both competitors and customers is noted as a risk, potentially leading to stronger competitors and increased pricing pressure.

The company acknowledges that decreased demand for its customers' products or trade restrictions could adversely affect its results of operations.

The company is implementing cost flexibility measures to partially offset the impact of lower revenue volume on profitability. These measures include managing people-related costs and infrastructure expenses.

The company's reliance on contract manufacturers and outsourced IT functions is identified as a risk factor, potentially affecting its ability to bring solutions to market and operate effectively.

The company's operating results may suffer if its manufacturing capacity does not match the demand for its solutions, either exceeding or falling short of customer needs.

The company continues to invest in R&D to maintain its competitive position, focusing on new software and hardware products, improvements to existing products, and customer solutions.

The company acknowledges that its success depends on introducing successful new solutions and services in a timely manner to address increased competition, rapid technological changes, and changing industry standards.

The company acknowledges that cybersecurity attacks are evolving and include, but are not limited to, ransomware attacks, malicious software, attempts to gain unauthorized access to data, and other electronic security breaches that could lead to disruptions in systems, unauthorized release of confidential or otherwise protected information and corruption of data.

The company repurchased 1,074,021 shares of common stock for $139.87 million during the quarter as part of its existing repurchase program. $634.58 million remains available under the program.

The company announced its intention to acquire Spirent Communications PLC for $1.463 billion in cash, pending regulatory clearances.

The company expects capital spending to be approximately $150 million in 2024, primarily for investments in capacity expansion and technology investments.

The company reiterates its commitment to achieving net zero Scope 1 and 2 emissions by the end of fiscal year 2040. The company plans to meet this commitment by reducing energy consumption through efficiency and conservation measures, investments in renewable energy and selective purchase of certified offsets for residual emissions.

In September 2021, the company committed to developing approved science-based targets in line with limiting global warming to 1.5 degrees Celsius above pre-industrial levels. In addition to Scope 1 and Scope 2 emissions defined by our net zero goal, the company has developed Scope 3 reduction and engagement targets across relevant categories as part of our commitment to science-based targets, which were approved by Science Based Target Initiative (“SBTi”) on October 27, 2023.

The company's R&D, manufacturing and distribution operations involve the use of hazardous substances and are regulated under international, federal, state and local laws governing health and safety and the environment. The company is also regulated under a number of international, federal, state and local laws regarding recycling, product packaging and product content requirements.

The company's global operations continued to be affected by a challenging macro environment, including high interest rates, currency movements, inflationary pressures, geopolitical tensions and trade restrictions. These factors resulted in lower demand, as customers are also exercising caution in light of the same environment.

The company's quarterly sales and operating results are highly dependent on the volume and timing of technology-related spending and orders received during the fiscal quarter, which are difficult to forecast and may be cancelled by customers.

The company is a global company with international operations, and it sells its products and solutions in countries throughout the world. Regional conflicts, including the Russian invasion of Ukraine, which resulted in economic sanctions and the decision to discontinue operations in Russia, the war between Israel and Hamas, and the risk of increased tensions between China and Taiwan, could limit or prohibit the company's ability to transfer certain technologies, to sell its products and solutions, and could result in additional closure of facilities in sanctioned countries.