Keysight Technologies (KEYS)

Electronic test & measurement leader — general-purpose test for comms/semi/defense

AI exposure 25% — derived from reported segment revenue, not asserted.

Where it sits

Connectivity → Test & Measurement Instruments · figures rebased to Q3 FY2026, reported 2026-08-18

Commercial communications test (5G/6G, data-center, network/optical) — test instruments leads 3 businesses in this sub-tier that together are 100% of revenue, so Test & Measurement Instruments is effectively the whole company rather than one leg of it.

Reported segments

• Communications Solutions Group (CSG) — 72.9% of revenue
• Electronic Industrial Solutions Group (EISG) — 27.1% of revenue

Keysight ($1.846B Q3 FY2026, +36% YoY — a record, with orders of $2.091B, +56%, also a record). CSG 72.9% ($1,345M, +43%, 34% operating margin) = primary B3 Test & Measurement Instruments; EISG 27.1% ($501M, +21%, 31% operating margin). Two firsts in the quarter: commercial communications revenue passed $1B, and WIRELINE REVENUE EXCEEDED WIRELESS for the first time in company history — AI data-centre test has overtaken the mobile franchise Keysight was built on. Management named supply chain, not demand, as the constraint on converting orders. Q4 guided to $1.93-$1.95B.

How the 25% is built

• Communications Solutions Group (CSG) — 72.9% of revenue × 30% AI-driven (disclosed). Wireline now exceeds wireless inside this segment and AI data-centre orders more than doubled, though aerospace and defence and conventional wireless remain a large part
• Electronic Industrial Solutions Group (EISG) — 27.1% of revenue × 12% AI-driven (disclosed). Semiconductor test is the AI-linked part; general electronics, automotive and energy are not

Investment read

Moat. General-purpose test instruments qualified into customers' own validation flows, which is a slow thing to change. The structural evidence arrived this quarter: wireline revenue exceeded wireless for the first time in company history and commercial communications passed $1B, so the AI data-centre franchise has overtaken the mobile one Keysight was built on rather than merely supplementing it.

Bottleneck / pricing power. Real pricing power at a 71% CSG gross margin and 34% operating margin, and orders of $2.091B running 13% ahead of revenue. Management named supply chain rather than demand as the limit on conversion — a seller's position, and the reason the backlog is the number to watch.

Role in the AI stack. The general-purpose test & measurement layer.

Connected companies

• Amkor Technology (AMKR) — KEYS supplies: test & measurement instruments for packaging validation
• Cisco Systems (CSCO) — KEYS supplies: network test & validation for switching/routing R&D
• Ciena (CIEN) — KEYS supplies: coherent optical + high-speed test for transport systems
• Arista Networks (ANET) — KEYS supplies: 400/800G Ethernet validation for datacenter switching
• NVIDIA (NVDA) — KEYS supplies: AI data-center interconnect + networking test
• Taiwan Semiconductor (TSM) — KEYS supplies: wafer-level + RF characterization test (TSMC partnership)
• Intel (INTC) — KEYS supplies: semiconductor design validation (Intel partnership)
• Tesla (TSLA) — KEYS supplies: EV battery + automotive electronics test
• Samsung Electronics (SSNLF) — KEYS supplies: RF/wireless (5G/6G) test equipment for Samsung mobile R&D
• MACOM Technology (MTSI) — KEYS is supplied by: MACOM foundry PDKs (GaN/GaAs models) integrated into Keysight ADS design software — design partnership
• Viavi Solutions (VIAV) — KEYS competes with: Keysight (broad comms/network T&M) vs Viavi (network/fiber/5G lab + field test) — overlapping network test buyers
• Anritsu (ANIRY) — KEYS competes with: wireless/network/microwave test — Anritsu vs Keysight
• Teledyne Technologies (TDY) — KEYS competes with: Teledyne LeCroy oscilloscopes/protocol analyzers vs Keysight — direct oscilloscope/high-speed digital test rivals
• Emerson Electric (EMR) — KEYS competes with: test & measurement — Emerson/NI (National Instruments) vs Keysight

Others in Test & Measurement Instruments

• Viavi Solutions (VIAV)
• Anritsu (ANIRY)
• Mirion Technologies (MIR)

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