KEYS 10-K & 10-Q changes, risk factors and insider trading

UncertaintyVolatility and uncertainty in general economic conditions may adversely affect our operating results and financial condition.

Our business is sensitive to negative changes in general economic conditions, both inside and outside the United States.U.S. Global and regional economic volatility and uncertainty, inflation and potential recession has and may continue to impact our business, resulting in:

In addition, global and regional macroeconomic developments, such as increased unemployment, uncertainty related to future economic activity, increased tariff rates and reciprocal tariffs, volatility in financial and capital markets, reduced access to credit, changing interest rates, volatility in capital markets, decreased liquidity, uncertain or destabilizing national elections and reactions to national election results, political violence and unrest in the U.S., the U.K., Europe, and Asia, and negative changes or volatility in general economic conditions in thethose U.S., Europe, and Asiaregions could negatively affect our ability to conduct business in those territories. Financial difficulties experienced by our suppliers and customers due to economic volatility could result in product delays, reduced purchasing power, delays in payment or inability to pay us, and inventory issues. Economic risks related to accounts receivable could result in delays in collection and greater bad debt expense.

Because we operate our businesses and sell our solutions worldwide, our businesses are subject to risks associated with doing business internationally. We anticipate that revenue from international operations will continue to represent a majority of our total revenue. However, there can be no assurances that our international sales will continue at existing levels or grow in accordance with our effort to increase foreign market penetration. In addition, many of our employees, contract manufacturers, suppliers and manufacturing facilities are located outside the United States.U.S. Accordingly, our future results could be harmednegatively impacted by a variety of factors, including, but not limited to:

•changes in a specific country's or region's political, economic or other conditions, including but not limited to changes that favor national interests such as the imposition of or increase in tariffs and reciprocal tariffs, and economic volatility;

•difficulty in protecting and enforcing intellectual property rights;

Nationalistic economic policies and political trends such as opposition to globalization and free trade, sanctions or trade restrictions, including those on advanced computing and semiconductor manufacturing,manufacturing and design software, withdrawal from or re-negotiation of global trade agreements, increased tariffs and reciprocal tariffs, tax and local content policies that favor domestic industries and interests, changes to immigration laws or enforcement and other similar actions may result in conflicting local or regional requirements, increased transaction costs, reduced ability to hire employees, reduced access to components, supplies and materials, reduced demand or access to customers, and inability to conduct our operations as they have been conducted historically. Each of these factors may adversely affect our business.

InternationalThere tradehave disputesbeen recent and increasedongoing changes to U.S. tariff policy, resulting in broad-based increases in tariff rates. Commencing in the second quarter of fiscal 2025, new U.S. tariffs betweenapplying to imports from all countries were announced, including significantly higher rates on imports from China. In response, several countries, including China, have imposed or threatened to impose retaliatory measures on imports from the UnitedU.S. StatesThe U.S. government has announced various modifications and thedelays Unitedto Kingdom,its tariff policy and further changes may be made in the Europeanfuture. Union,There Singapore,has Malaysiaalso andbeen China,continuing among other countries could substantially change our expectations and ability to operatelitigation in suchthe jurisdictionsfederal ascourts weregarding havethe donevalidity historically.of the imposition of certain tariffs. Many of our suppliers, vendors, customers, partners, and other entities with whom we do business have strong ties to doing business in China.China and other countries impacted by the increased tariffs. Their ability to supply materials to us, buy products or services from us, or otherwise work with us is affected by their ability to do business in China.impacted countries. Continued uncertainty around trade policy could substantially change our cost of operating in such jurisdictions. Moreover, these tariffs and any other trade restrictions imposed on our customers or suppliers could adversely affect our financial results and position through reduced demand for our products and solutions, cancelled orders, supply chain disruptions, increased transaction costs, and increased expenses. If the U.S.’sU.S.’ relationship with Chinacountries subject to increased tariffs results in additional trade disputes, trade protection measures, retaliatory actions, tariffsactions and increased barriers, policies that favor domestic industries, or increased import or export licensing requirements or restrictions, then our deployment of resources in jurisdictions affected by such measures could be misaligned and our operations may be adversely affected due to such changes in the economic and political ecosystem in which our suppliers, vendors, customers, partners, and other entities with whom we do business operate.affected.

We are a global company with international operations, and we sell our 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 our operations in Russia, conflict in the warMiddle between Israel and Hamas,East, and the risk of increased tensions between China and Taiwan, could limit or prohibit our ability to transfer certain technologies, to sell our products and solutions, and could result in additional closure of facilities in sanctioned countries. In addition, international conflict could further result in global or regional market instability; increased energy costs, which could increase the cost of manufacturing, selling and delivering products and solutions; and increased risk of cybersecurity attacks, which could adversely impact our financial results.

Visibility into our markets is limited. Our 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 our customers. In addition, our revenues and earnings forecasts for future fiscal quarters are often based on the expected seasonality or cyclicality of our markets. However, due to factors such as inflation, the potential for recession, trade barriers or restrictions, increased geopolitical tensions, including regional conflict and war, the markets we serve may experience increased volatility and may not experience the seasonality or cyclicality that we expect. Our customers’ markets may also be affected by changes in the legal regulatory regime. If our customers’ markets decline, orders may decline, may be delayed or cancelled, and we may not be able to collect on outstanding amounts due to us. Such declines could harm our financial position, results of operations, cash flows and stock price, and could limit our profitability. In such an environment, pricing pressures could intensify. Since a significant portion of our operating expenses is relatively fixed in nature due to sales, R&D and manufacturing costs, if we were unable to respond quickly enough, these pricing pressures could further reduce our operating margins.

A decreased demand for our customers’ products or trade barriers or restrictions could adversely affect our results of operations.

OurMany of our suppliers, vendors, customers, partners, and other entities with whom we do business dependshave strong ties to doing business in China and other countries impacted by the increased tariffs. Increased tariffs on our customers’ ability to manufacture, design, and sell their products in the marketplace. International trade disputes affecting our customers could adversely affect our business. Tariffs on importssales to or imports from Chinaimpacted couldcountries, including China, will increase the cost of our customers’ components and raw materials, which could make our customers’ products and services more expensive and could reduce demand for our customers’ products. Protectionist and retaliatory trade measures by either China or the United States could limit our customers’ ability to sell their products and services and could reduce demand for our customers’ products. Our customers and other entities in our customer chain could decide to take actions in response to international trade disputes that we could not foresee. A decrease in demand or significant change in operations from our customers due to international trade disputes could adversely affect our operating results and financial condition.

On a regular basis, we review the existing technologies available in the market and identify strategic new technologies to develop and invest in. We devote significant resources to develop new technologies in the communications, aerospace and defense, automotive and the Internet of Things. We invest in R&D, grow and deepen relationships with customers and suppliers, and direct our corporate and operational resources to develop innovative technologies. Our financial results could be harmed if we fail to expand our customer base, if demand for our solutions is lower than we expect, or if our revenue related to our innovative technologies is lower than we anticipate. We provide solutions for the design, development, and manufacturing stages of our customers’ workflow. Our customers who currently use our solutions in one stage of their workflow may not use our solutions in other aspects of their manufacturing process.

Our income could be harmed if we are unable to adjust our purchases to address market fluctuations, including those caused by volatile global economic conditions,conditions including the impact of tariffs and reciprocal tariffs, geopolitical conflict, or the seasonal or cyclical nature of the markets in which we operate. The sale of our solutions and services are dependent, to a large degree, on customers whose industries are subject to seasonal or cyclical trends in the demand for their products. For example, the consumer electronics market is particularly volatile, making demand difficult to anticipate. Making such estimations in an economic climate affected by trade barriers, inflation or potential recession, fluctuations in global currency, geopolitical tension and war is particularly difficult as increased volatility may impact seasonal trends making it more difficult to anticipate demand fluctuations. Supply chain fluctuations could impact our ability to purchase parts and components. Some parts require custom design and may not be readily available from alternate suppliers due to their unique design or the length of time necessary for design work. Should a supplier cease manufacturing such a component, we would be forced to re-engineer our solution. In addition to discontinuing parts, suppliers may also extend lead times, limit supplies or increase prices due to capacity constraints or other factors. In order to secure components for the production of products, we may continue to enter into non-cancellable purchase commitments with vendors, or at times make advance payments to suppliers, which could impact our ability to adjust our inventory to declining market demands. Prior commitments of this type have resulted in an excess of parts when demand for electronic products has decreased. If demand for our solutions is less than we expect, we may experience additional excess and obsolete inventories and be forced to incur additional charges.

Because we cannot immediately adapt our production capacity and related cost structures to rapidly changing market conditions, when demand is lower than our expectations, our manufacturing capacity will likely exceed our production requirements. During an economic downturn, if we had excess manufacturing capacity, our fixed costs associated with excess manufacturing capacity would adversely affect our income, margins and operating results. By contrast, if, during a general market upturn or an upturn in our business, if we cannot increase our manufacturing capacity to meet product demand, we will not be able to fulfill all orders in a timely manner, which could lead to order cancellations, contract breaches or indemnification obligations. This inability could materially and adversely limit our ability to improve our income, margins and operating results. By contrast, if, during an economic downturn, we had excess manufacturing capacity, then our fixed costs associated with excess manufacturing capacity would adversely affect our income, margins and operating results.

As a global company, we have key customers all over the world, although no one customer makes up more than 10 percent of our revenue. Sales to those customers could be reduced or eliminated as a result of failure to respond to customer needs, reduced customer demand, increased sales to our competitors, inability to manufacture or ship products and solutions, supply chain constraints, government requirements, trade restrictions, sanctions and embargoes. We have experienced forced reductions in sales and been prevented from selling large orders to certain key customers due to trade restrictions, which we have been able to mitigate with the addition of new customers and new business. If we have future reductions in sales or lose key customers, there is no guarantee that we will be able to mitigate the impact of such reductions or losses, which could negatively impact our income, operating results and financial condition.

Our ability to grow revenues, earnings and cash flow depends in part upon our ability to identify and successfully acquire and integrate businesses at appropriate prices and realize anticipated synergies and business performance. AppropriateIdentifying appropriate acquisition targets forand acquisitionclosing areacquisitions can be difficult to identify and complete for a variety of reasons, including, but not limited to, limited due diligence, high valuations, difficulty obtaining business and intellectual property evaluations, other interested parties, negotiations of the definitive documentation, satisfaction of closing conditions, the need to obtain antitrust or other regulatory approvals on acceptable terms, and availability of funding. The inability to close appropriate acquisitions on acceptable terms could adversely impact our growth rate, revenue, and financial performance.

We currently have outstanding debt as well as availability to borrow under athe revolvingRevolving creditCredit facility.Facility. We may borrow additional amounts in the future and use the proceeds from any future borrowing for general corporate purposes, future acquisitions, expansion of our business or repurchases of our outstanding shares of common stock.

Our currentRevolving revolvingCredit credit facilityFacility imposes restrictions on us, including restrictions on our ability to create liens on our assets and the ability of our subsidiaries to incur indebtedness, and requires us to maintain compliance with specified financial ratios. Our ability to comply with these ratios may be affected by events beyond our control. In addition, the indentureindentures governing our senior notes containscontain covenants that may adversely affect our ability to incur certain liens. If we breach any of the covenants and do not obtain a waiver from the lenders, then, subject to applicable cure periods, our outstanding indebtedness could be declared immediately due and payable.

Our effective tax rate may be adversely impacted by, among other things, changes in the mix of our earnings among countries with differing statutory tax rates, changes in the valuation allowance of deferred tax assets, and changes in tax laws. We cannot give any assurance as to what our effective tax rate will be in the future because, among other things, there is uncertainty regarding the tax policies of the jurisdictions where we operate. Changes in tax laws, such as tax reform in the United StatesU.S. or changes in tax laws resulting from the Organization for Economic Co-operation and Development’s (“OECD”) multi-jurisdictional plan of action to address “base erosion and profit shifting” and the taxation of the “Digital Economy,” could impact our effective tax rate.

On June 14, 2019, the U.S. Department of the Treasury (“Treasury”) issued final regulations relating to Global Intangible Low Taxed Income (“GILTI”) under IRC § 951A (the “tax regulations”). The tax regulations contained language which disallowed GILTI tax deductions for intangible asset amortization resulting from the Singapore restructuring completed in 2018. During the third quarter of fiscal year 2024, the companywe concluded, in response to recent U.S. Supreme Court decisions on a number of relevant cases, the evolving global tax landscape and other changes in circumstances, that Treasury exceeded regulatory authority and the intangible asset amortization should be deductible. The companyWe amended itsour U.S. federal income tax returns for the open tax years to claim the deduction and recognized the discrete benefit in the consolidated financial statements. The GILTI tax benefit for the fiscal year 2024 amortization is included in the annual effective tax rate, and the Singapore intangible assets will continue to be amortized for GILTI tax purposes until 2033. We believe the position meets the more likely than not recognition threshold.

TheOn companyJanuary believes23, 2025, we filed a lawsuit against the positionUnited meetsStates of America in the moreUnited likelyStates thanCourt notof recognitionFederal threshold.Claims Theseeking companya intendstax refund of $107 million, or such greater amount allowed by law, plus any other amount, including interest and cost, allowed by law. We intend to vigorously defend itsour position. The outcome cannot be predicted with certainty. If we are ultimately unsuccessful in defending our position,refund claim, we maywill be required to reverse the benefit previously recorded, whichmost maylikely impactresulting ourin financiala statementsmaterial and our profitabilityincrease in the quartereffective intax whichrate suchand aincome reversaltax is required.liability.

We are subject to federal, state, and local taxes in the United StatesU.S. and numerous foreign jurisdictions. We devote significant resources to evaluating our tax positions and our worldwide provision for taxes. Any changes to the positions we have taken could result in an impact to our financial statements. Our financial results and tax treatment are susceptible to changes in tax, accounting, and other laws, including the Tax Cuts and Jobs Act, the Inflation Reduction Act and Thethe TaxOne CutsBig andBeautiful JobsBill Act in the U.S, regulations, principles, and interpretations in the United StatesU.S. and in other jurisdictions where we do business. With the existence of economic and political policies that favor domestic interests, it is possible that more countries will enact tax laws that either increase the tax rates, or reduce or change the tax incentives available to multinational companies. Upon a change in tax laws in any territory where we do significant business, we may not be able to maintain our current tax rate or qualify for or maintain the benefits of any tax incentives offered, to the extent such incentives are offered.

Keysight benefits from tax incentives in several jurisdictions, most significantly in Singapore and Malaysia. The MalaysiaSingapore tax incentive expires Octoberon July 31, 2025.2029. The former SingaporeMalaysia tax incentive expired Julyon October 31, 2024.2025. We entered into a new Singapore tax incentive agreement effective August 1, 2024. TheThese tax incentives provide lower rates of taxation on certain classes of income and require thresholds of investments and employment in those jurisdictions. If we cannot or do not wish to satisfy all or portions of the tax incentives conditions, we will lose the related tax incentives and could be required to refund the benefits that the tax incentives previously provided. We believe that we will satisfy such conditions, but cannot guarantee that the tax environment will not change or that such conditions will be satisfied.

Our taxes could increase if the existing Malaysia and/or Singapore incentive is revoked or not renewed upon expiration. We are in the process of renewing our Malaysia tax incentive and believe that we will obtain the renewal from the taxing authorities. However, we cannot guarantee that we will be granted the Malaysian tax incentive and the timing of when we can renew our incentive rate. We also cannot guarantee that we will qualify for any new incentive regime that may exist going forward. As a result, our effective tax rate could be higher than it would have been hadif we had renewed or been granted renewal of the tax incentiveincentive, andwhich could harm our operating results after tax.

From time to timetime-to-time parties have claimed that one or more of our solutions or services infringe their intellectual property rights. We analyze and take action in response to such claims on a case-by-case basis. On January 1, 2022, Centripetal Networks filed a lawsuit in Federal District Court in Virginia, alleging that certain Keysight products infringe certain of Centripetal’s patents. We challenged the validity of claims of eight of these patents at the U.S. Patent and Trademark Office, with all or most claims being found invalid in each patent. Centripetal is appealing seven of these results. In addition, in February 2022, Centripetal filed complaints in Germany alleging infringement of certainthree of Centripetal’s German patents,patents. Keysight challenged the validity of the claims of these patents in German nullity or European Patent Office (“EPO”) opposition procedures. Two of the three patents were invalidated and inthe appeals process has ended. The third patent had all but one claim invalidated at trial and is under appeal. In April 2022, Centripetal filed a complaint with the International Trade Commission (“ITC”) requesting that they investigate whether Keysight violated Section 337 of the Tariff Act (“Section 337”) and should be enjoined from importing certain products that are manufactured outside of the U.S. which are alleged to infringe Centripetal patents. On December 5, 2023, the ITC issued its Notice of Determination that Keysight did not unfairly import products in violation of Section 337 and the investigation was terminated. Centripetal has appealed this determination. The lawsuit in Federal District Court in Virginia is stayed pending the finalization of appeals of the ITC findings and validity challenges. On August 21, 2024, Keysight was served in Germany with a complaint filed in the Unified Patent Court alleging that certain Keysight products sold in Germany, France, Italy and the Netherlands infringe a European Centripetal patent. In December 2025, the court issued its written determination that Keysight did not infringe the patent. Keysight also challenged the validity of the patent using EPO opposition procedures, and the EPO revoked the patent in its hearing in November 2025. Although we deny the allegations and are aggressively defending each case, the outcome of existing proceedings, lawsuits and claims may differ from our expectations because the outcomes of litigation are often difficult to reliably predict.

We rely on several centralized IT systems as well as cloud-based service providers to provide solutions and services, maintain financial records, retain sensitive data such as intellectual property, proprietary business information, and data related to customers, suppliers, and business partners, process orders, manage inventory, process shipments to customers and operate other critical functions. The ongoing maintenance and security of this information is pertinentimportant to the success of our business operations and our strategic goals.

Despite the implementation of network security measures by us and our third-party service providers, our network and our data may be vulnerable to cybersecurity attacks, computer viruses, break-ins and similar disruptions. Our network security measures include, but are not limited to, the implementation of firewalls, antivirus protection, patches, log monitors, routine backups, offsite storage, network audits, employee training and routine updates and modifications. Despite our efforts and those of our service providers to create these security barriers, as new threats emergeemerge, including the use of artificial intelligence by threat actors, it is virtually impossible to entirely eliminate this risk. 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. Any such event could have a material adverse effect on our business, reputation, operating results and financial condition, and no assurance can be given that efforts to reduce the risk of such attacks will be successful.

Our products may contain vulnerabilities that could be exploited by cybersecurity attackers, allowing them to introduce malicious code into our products to gain access to customer networks. Such attacks could lead to disruptions to our customers’ operations or processes, system downtime, financial loss, loss of their intellectual property, business information and proprietary data, or corruption of data, which could impact Keysight’s reputation, and result in loss of confidence in our products, loss of orders, and loss in revenue, which could materially impact our financial results. We proactively scan for vulnerabilities in our productproducts lines.and Whenaddress vulnerabilities are discovered, we respond with a predefined Product Security Response Processthem to addressminimize the vulnerability,potential butfor weexploitation. We cannot eliminate the possibility of a successful cybersecurity attack or exploitation of undiscovered vulnerabilities.or not yet remediated vulnerabilities impacting our internal systems and/or those of our customers.

In addition, our IT systems and those of our service providers may be susceptible to damage, disruptions, instability, or shutdowns due to power outages, hardware failures, telecommunication failures, user errors, cybersecurity attacks, hacking, sabotage, acts of vandalism, implementation of new operational systems or software or upgrades to existing systems and software, catastrophes, or other unforeseen events. Such events could result in the disruption of business processes, network degradation and system downtime, along with the potential that a third party will exploit our critical assets, such as intellectual property, proprietary business information and data related to our customers, suppliers and business partners. Further, such events could result in loss of revenue, loss of or reduction in purchase orders, inability to report financial information, litigation, regulatory fines and penalties, and other damage that could have a material impact on our business operations. To the extent that such disruptions occur, our customers and partners may lose confidence in our solutions, and we may lose business or brand reputation, resulting in a material and adverse effect on our business operating results and financial condition.

Our future success depends partly on the continued service of our key research, engineering, sales, marketing, manufacturing, executive and administrative personnel, including personnel joining our company through acquisitions. The markets in which we operate are dynamic, and from time to time we may need to respond with reorganizations, reductions in workforce, salary freezes or reductions, or site closings. We believe our compensation packages are competitive within the regions in which we operate. If we fail to retain key personnel and are unable to hire highly qualified replacements, we may not be able to meet key objectives, such as launching effective product innovations, meeting financial goals and maintaining or expanding our business. We rely occasionally on hiring qualified international candidates or transferring employees between the United States and several foreign countries. The immigration process can be subject to frequent changes and limitations. We may experience difficulty in obtaining work authorizations for some of our employees that are foreign nationals transferring to the United States and other key countries where we operate, which could negatively impact our ability to strategically locate our personnel. Changes to immigration policies and quotas impacting the granting of visas for higher education candidates and knowledge-based workers in many jurisdictions where we operate could impact our ability to recruit and retain the highly-trained and accomplished talent needed to maintain our operations.

Our 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. We are also regulated under a number of international, federal, state and local laws regarding recycling, product packaging and product content requirements. We apply strict standards for protection of the environment and occupational health and safety inside and outside the United States,U.S., even where not subject to regulation imposed by foreign governments. We believe that our properties and operations at our facilities comply in all material respects with applicable environmental and occupational health and safety laws. In spite of these efforts, no assurance can be given that we will be compliant with all applicable environmental and workplace health and safety laws and regulations and violations could result in civil or criminal sanctions, fines and penalties.

We are subject to legal proceedings, lawsuits and other claims in the normal course of business and could become subject to additional claims in the future, some of which could be material. On January 1, 2022, Centripetal Networks filed a lawsuit in Federal District Court in Virginia, alleging that certain Keysight products infringe certain of Centripetal’s patents. We challenged the validity of claims of eight of these patents at the U.S. Patent and Trademark Office, with all or most claims being found invalid in each patent. Centripetal is appealing seven of these results. In addition, in February 2022, Centripetal filed complaints in Germany alleging infringement of certainthree of Centripetal’s German patents,patents. Keysight challenged the validity of the claims of these patents in German nullity or EPO opposition procedures. Two of the three patents were invalidated, and inthe appeals process has ended. The third patent had all but one claim invalidated at trial and is under appeal. In April 2022, Centripetal filed a complaint with the International Trade Commission (“ITC”) requesting that they investigate whether Keysight violated Section 377 of the Tariff Act and should be enjoined from importing certain products that are manufactured outside of the U.S. and alleged to infringe Centripetal patents. On December 5, 2023, the ITC issued its Notice of Determination that Keysight did not unfairly import products in violation of Section 337 and the investigation was terminated. Centripetal has appealed this determination. The lawsuit in Federal District Court in Virginia is stayed pending the finalization of appeals of the ITC findings and validity challenges. On August 21, 2024, Keysight was served in Germany with a complaint filed in the Unified Patent Court alleging that certain Keysight products sold in Germany, France, Italy and the Netherlands infringe a European Centripetal patent. In December 2025, the court issued its written determination that Keysight did not infringe the patent. Keysight also challenged the validity of the patent using EPO opposition procedures, and the EPO revoked the patent in its hearing in November 2025.

We sponsor several defined benefit pension plans that cover many of our employees. The Federal Pension Protection Act of 2006 requires that certain capitalization levels be maintained in each of the U.S. plans, and there may be similar funding requirements in the plans outside the United States.U.S. Because it is unknown what the investment return on and the fair value of our pension assets will be in future years or what interest rates and discount rates may be at any point in time, no assurances can be given that applicable law will not require us to make future material plan contributions. Any such contributions could adversely affect our financial condition.

Our current manufacturing processes involve the use of substances regulated under various international, federal, state and local laws governing the environment. As a result, we may become subject to liabilities for environmental contamination, and these liabilities may be substantial. Although our policy is to apply strict standards for environmental protection at our sites inside and outside the United States,U.S., even if the sites outside the United StatesU.S. are not subject to regulations imposed by foreign governments, we may not be aware of all conditions that could subject us to liability.

•new or expanded trade barriers, tariffs and restrictions;

We do not currently pay dividends on our common stock. The payment of any dividends in the future, and the timing and amount thereof, to our stockholders fall within the discretion of our board of directors. The board’s decisions regarding the payment of dividends will depend on many factors, such as our financial condition, earnings, capital requirements, debt service obligations, restrictive covenants in our debt, industry practice, legal requirements, regulatory constraints and other factors that our board of directors deem relevant.

The following discussion should be read in conjunction with the consolidated financial statements and notes thereto included elsewhere in this Annual Report on Form 10-K. This report contains forward-looking statements which include but are not limited to predictions, future guidance, projections, beliefs, and expectations about the company’s trends, seasonality, cyclicality and growth in, and drivers of, the markets we sell into, our strategic direction, earnings from our foreign subsidiaries, remediation activities, new solution and service introductions, the ability of our solutions to meet market needs, changes to our manufacturing processes, the use of contract manufacturers, the impact of government regulations on our ability to conduct operations, our liquidity position, our ability to generate cash from operations, growth in our businesses, our investments, the potential impact of adopting new accounting pronouncements, our financial results, our purchase commitments, our contributions to our pension plans, the selection of discount rates and recognition of any gains or losses for our benefit plans, our cost-control activities, savings and headcount reduction recognized from our restructuring programs and other cost saving initiatives, and other regulatory approvals, the integration of our completed acquisitions and other transactions, and our transition to lower-cost regions. The forward-looking statements involve risks and uncertainties that could cause Keysight’s results to differ materially from management’s current expectations. Such risks and uncertainties include, but are not limited to, the impact of global economic conditions such as inflation or potential recession, the impacts of increased trade tensions such as an imposition of or increase in tariffs and tightening of export control regulations, slowing demand for products or services, volatility in financial markets, reduced access to credit, increasedchanges in interest rates, the existence of political or economic instability, uncertainty related to the impact of national elections results in the U.S. and UK,U.K., impacts of geopolitical tension and conflict in regions outside of the U.S., the impacts of increased trade tension and tightening of export control regulations, the impact of new and ongoing litigation, impacts related to net zero emissions commitments, and the impact of volatile weather caused by environmental conditions such as climate change. Our actual results could differ materially from the results contemplated by these forward-looking statements due to various factors, including but not limited to those risks and uncertainties discussed in Part I Item 1A and elsewhere in this Annual Report on Form 10-K.

Keysight Technologies, Inc. (“we,” “us,” “our,” “Keysight” or “the “company”), incorporated in Delaware on December 6, 2013, is a global innovator in the computing, communications and electronics market,markets, committed to advancing our customers’ business success by helping them solve critical challenges in the development and commercialization of their products and services. Our mission, “accelerating innovation to connect and secure the world,” speaks to the value we provide our customers in a world of ever-increasing technological complexity. We deliver this value through a broad range of design and test solutions that address the critical challenges our customers face in bringing their innovations to market on ever-shorter schedules.

InOn theOctober first15, quarter of fiscal 2024,2025, we acquired all of the outstanding common stock of ESISpirent GroupCommunications SAplc (“ESI GroupSpirent”) for $935$1,415 million, net of $127 million cash acquired, using existing cash. On October 16, 2025, Keysight divested Spirent’s high-speed ethernet, network security, and channel emulation business lines for $399 million to Viavi Solutions Inc. (“Viavi”) in connection with satisfying the regulatory conditions set out as part of the Spirent acquisition. For the year ended October 31, 2024,2025, our acquisition of ESI GroupSpirent resulted in incremental revenue of $141$9 million. In our discussion of changes in our results of operations, we have qualitatively disclosed the impact of the ESI GroupSpirent acquisition. See Note 2, “Acquisitions,” for additional information.

For additional discussion of risks related to potential impacts of macroeconomic headwindstariffs and geopoliticaltrade challengesrelations, onplease ourrefer operations, business results and financial condition, seeto Part I Item 1A “Risk Factors.”

Orders were $5,452 million, $5,033 million, $5,190 million, and $5,984$5,190 million in 2025, 2024, 2023 and 2022,2023, respectively. Orders of $5,452 million for 2025 increased 8 percent compared to 2024. Acquisitions had a favorable impact of 1 percentage point on the increase, while foreign currency movements had an immaterial impact. Orders grew across all regions. Orders of $5,033 million for 2024 decreased 3 percent compared to 2023. Acquisitions had a favorable impact of 4 percentage points on the orderchange, changewhile for 2024 compared to 2023. Foreignforeign currency movements had an immaterial impact on the order change for 2024 compared to 2023.impact. Orders declined in the Americas and Asia Pacific, while Europe was flat. Orders of $5,190 million for 2023 decreased 13 percent compared to 2022. Foreign currency movements had an unfavorable impact of 1 percentage point on the order change for 2023 compared to 2022. Orders declined across all regions, including a double-digit decline in Asia Pacific.

Revenue was $5,375 million, $4,979 million, $5,464 million, and $5,420$5,464 million in 2025, 2024, 2023 and 2022,2023, respectively. Revenue of $4,979$5,375 million for 20242025 decreasedincreased 98 percent compared to 2023.2024. Acquisitions hadand a favorable impact of 3 percentage points on the revenue change for 2024 compared to 2023. Foreignforeign currency movements had an immaterial impact on the revenue change for 2024 compared to 2023.change. Revenue declinedincreased in both the Communications Solutions Group (“CSG”) and the Electronic Industrial Solutions Group (“EISG”). Revenue from CSG and EISG represented approximately 69 percent and 31 percent, respectively, of total revenue for 2024.2025. Revenue of $5,464$4,979 million for 20232024 increaseddecreased 19 percent compared to 2022.2023. ForeignAcquisitions had a favorable impact of 3 percentage points on the change, while foreign currency movements had an unfavorableimmaterial impactimpact. ofRevenue 2 percentage points on the revenue growth for 2023 compared to 2022. A revenue increasedeclined in EISGboth wasCSG partiallyand offset by a decline in CSG.EISG. Revenue from CSG and EISG represented approximately 6769 percent and 3331 percent, respectively, of total revenue for 2023.2024.

Net income was $614$850 million, $1,057$614 million, and $1,124$1,057 million in 2025, 2024, 2023 and 2022,2023, respectively. Net income of $850 million for 2025 increased 38 percent compared to 2024, primarily driven by higher revenue and net gains on equity investments and derivative instruments and lower income tax provisions, partially offset by higher people-related costs, higher acquisition and integration costs, impact of tariffs, and loss from discontinued operations, net of income taxes. Net income of $614 million for 2024 decreased 42 percent compared to 2023, primarily driven by lower revenue,revenue and higher acquisition and integration costs, restructuring costscosts, and amortization of acquisition-related balances, partially offset by lower provision for income taxes, favorable gross margin impact from the ESI Group acquisitionacquisition, and lower people-related costs. Net income of $1,057 million for 2023 decreased 6 percent compared to 2022, primarily driven by higher income tax expense, R&D expense, and selling, general and administrative expense, partially offset by higher interest income, higher revenue, and favorable mix.

Our first-to-market solutions strategy enables customers to develop new technologies and accelerate innovation and provides a platform for Keysight's long-term growth. Our customers are expected to continue to make R&D investments in certain next-generation technologies and applications, including evolution of 5G, early 6G, high-speed data center networks and infrastructure, satellite networks, Artificialartificial Intelligenceintelligence (“AI”), next generation electric vehicles and autonomous vehicles, industrial internet of things (“IoT”), defense modernization, and defensenext modernization.generation electric vehicles and autonomous vehicles. We continue to engage actively with our customers,customers and closely monitor the current macroeconomic environment, including trade,tariffs, tariffs,trade restrictions and tightening of export control regulations, monetary and fiscal policiespolicies, and geopolitical tensions. We remain confident in the long-term secular growth trends of our markets and our ability to outperform in a variety of market conditions.

Our revenues, costs and expenses, and monetary assets and liabilities are exposed to changes in foreign currency exchange rates asdue a result ofto our global operating, investinginvesting, and financing activities. We hedge revenues, expenses, and balance sheet exposures that are not denominated in the functional currencies of our subsidiaries on a short-term and anticipated basis. The result of these hedging hasactivities beenare included in our consolidated balance sheet and consolidated statement of operations. We may experience some fluctuations within individual lines of the consolidated balance sheet and consolidated statement of operations because our hedging program is not designed to offset the currency movements in each category of revenues, expenses, and monetary assets and liabilities. Our cash flow hedging program is designed to hedge short-term currency movements based on a rolling period of up to twelve months. Therefore, we are exposed to currency fluctuations over the longer term. To the extent that we are required to pay for all, or portions, of an acquisition price in foreign currencies, we may enter into foreign exchange contracts to reduce the risk that currency movements will impact the U.S. dollar cost of the transaction.

Gross Margin, Operating MarginMargin, and Income Before Taxes

Gross margin decreased 1 percentage point in 2025 compared to 2024, primarily driven by the impact of tariffs and unfavorable mix, partially offset by favorable pricing, higher revenue volume, and lower restructuring costs. Gross margin decreased 2 percentage points in 2024 compared to 2023, primarily driven by lower revenue volume, higher amortization of acquisition-related balancesbalances, and higher restructuring costs, partially offset by lower material costs, favorable gross margin impact from the ESI Group acquisitionacquisition, and lower variable people-related costs. Gross margin increased 1 percentage point in 2023 compared to 2022, primarily driven by price increases and favorable mix, partially offset by higher warranty costs.

Selling, general and administrative expenses increased 6 percent in 2025 compared to 2024, primarily driven by higher acquisition and integration costs, people-related costs, travel costs, and incremental costs from acquired businesses, partially offset by lower infrastructure costs and amortization of acquisition-related balances. Selling, general and administrative expenses increased 7 percent in 2024 compared to 2023, primarily driven by higher acquisition and integration costs, incremental costs from acquired businesses, and higher amortization of acquisition-related balances, partially offset by lower people-related, marketing, and infrastructure costs resulting from the flexibility of our operating model and cost efficiency measures. Selling, general and administrative expenses increased 2 percent in 2023 compared to 2022, primarily driven by higher infrastructure-related, restructuring, and travel-related costs, partially offset by lower sales commission and variable people-related costs.

Other operating expense (income) was income of $14$20 million, $15$14 million, and $8$15 million for 2025, 2024, 2023 and 2022,2023, respectively, and primarily includeincludes property rental income. During fiscal year 2022, other operating expense (income) included asset impairment charges of $7 million related to the discontinuance of our Russia operations.

Operating margin was flat in 2025 compared to 2024, as declines in gross margin were offset by lower operating expenses as percentage of sales. Operating margin decreased 8 percentage points in 2024 compared to 2023, primarily driven by higher selling, general and administrative and R&D expenses on lower revenue coupled with gross margin declines. Operating margin was flatdeclines in 2023 compared to 2022, primarily driven by gross margin gains offset by higher R&D expenses as a percentage of sales.margin.

Interest income for 2025, 2024, and 2023 andwas 2022$102 wasmillion, $81 million, $102 million, and $16$102 million, respectively, and primarily related to interest earned on our cash balances. The increase in interest income in 2025 compared to 2024 was primarily driven by increase in year-over-year cash balances. The decline in interest income in fiscal 2024 compared to 2023 was primarily driven by decline in year-over-year cash balances. The increase in interest income in fiscal 2023 compared to 2022 was primarily driven by an increase in interest rates and higher year-over-year cash balances. Interest expense for 2025, 2024, and 2023 andwas 2022$96 wasmillion, $84 million, $78 million, and $79$78 million, respectively, and primarily related to interest on our senior notes. Interest expense for 2024, included amortization of debt issuance costs of $4 million related to the bridge credit agreement.instruments. See Note 9,11, “Derivatives,” and Note 11,”Debt,” for additional information.

Other income (expense) for 2024, 2023 and 2022 was income of $200 million, $35 million, and expense of $25 million, for 2025, 2024, and 2023, respectively. The increase in net other income offor $142025 million,compared respectively,to 2024 was primarily driven by net gains on equity investments, gains on derivative instruments and primarily include net income related to our defined benefit and post-retirement benefit plans (interest cost, expected return on assets,lower amortization of net actuarial loss and prior service credits, and gains (losses) on settlements and curtailments), gains (losses) due to currency and derivative instruments, and the change in fair value of our equity investments.losses. The increase in net other income for 2024 compared to 2023 was primarily driven by gains on derivative instruments and higher net gains on our equity investments, partially offset by an increase in pension costs due to higher interest cost on benefit obligations. The increase in net other expense for 2023 compared to 2022 was primarily driven by losses on derivative instruments and higher amortization of net actuarial losses, partially offset by net gains on our equity investments.

Our headcount was approximately 16,800 as of October 31, 2025, compared to approximately 15,500 as of October 31, 2024, compared to approximately 14,900 as of October 31, 2023.2024. The increase was primarily driven by acquisitions, partially offset by reductions from our cost efficiency measures.acquisitions.

The 7 percentage point increasedecrease in the effective tax rate of 9 percentage points from 20232024 to 20242025 was primarily due to thesethe absence of the 2024 one-time income tax items in 2024.2025, partially offset by the increase of taxes on the impact of Pillar Two minimum taxes.

The tax rate in 2024 was higher than the U.S. statutory rate primarily due to the impact of a one-time income tax charge to decrease deferred tax asset values from the Singapore statutory tax rate to an incentive tax rate, partially offset by a one-time income tax benefit related to the GILTI tax deductions for intangible asset amortization and the release of tax reserves related to Malaysia income tax assessment appeal. The tax rate in 2023 was higher than the U.S. statutory rate primarily due to the impact of U.S. tax capitalization of research and experimental expenditures, partially offset by the net impact from the proportion of worldwide earnings taxed at lower statutory tax rates in non-U.S. jurisdictions and the U.S. tax imposed on those non-U.S. earnings. The tax rate in 2022 was lower than the U.S. statutory rate primarily due to the proportion of worldwide earnings that are taxed at lower statutory tax rates in non-U.S. jurisdictions, partially offset by U.S. tax imposed on earnings in non-U.S. jurisdictions. The increase in the effective tax rate of 97 percentpercentage points from 20222023 to 20232024 was primarily due to athe 5one-time percent increase from U.S.income tax capitalization of research and experimental expendituresitems in 2023.2024.

Keysight benefits from tax incentives in several jurisdictions, most significantly in Singapore and Malaysia. The tax incentives provide lower rates of taxation on certain classes of income and require thresholds of investments and employment in those jurisdictions. The Malaysia tax incentive expires October 31, 2025. The Singapore tax incentive expires July 31, 2029.2029 while the Malaysia tax incentive expired on October 31, 2025. We are in the process of renewing our Malaysia tax incentive.

At this time, management does not believe that the outcome of any future or currently ongoingcurrent examination will have a material impact on our consolidated financial statements. We believe that we have an adequate provision for any adjustments that may result from tax examinations. However, the outcome of tax examinations cannot be predicted with certainty. Given the numerous tax years and matters that remain subject to examination in various tax jurisdictions, the ultimate resolution of current and future tax examinations could be inconsistent with management’s current expectations. If that were to occur, it could have an impact on our effective tax rate in the period in which such examinations are resolved.

The calculation of our tax liabilities involves uncertainties in the application of complex tax law and regulations in a multitude of jurisdictions. Although the guidance on the accounting for uncertainty in income taxes prescribes the use of a recognition and measurement model, the determination of whether an uncertain tax position has met those thresholds requires significant judgment by management. In accordance with the guidance on the accounting for uncertainty in income taxes, for all U.S. and other tax jurisdictions, we recognize potential liabilities for anticipated tax audit issues based on our estimate of whether, and the extent to which, additional taxes and interest will be due. We include interest and penalties related to unrecognized tax positions within the provision for income taxes in the consolidated statements of operations. Accrued interest and penalties are included onin the related tax liability line in the consolidated balance sheet.

WeKeysight havehas two reportable operating segments, CSG and EISG. The profitability of each of the segments is measured after excluding share-based compensation expense, amortization of acquisition-related balances, acquisition and integration costs, restructuring costs, interest income, interest expense and other items.

Communications Solutions Group (“CSG”)

CSG serves customers spanning the global commercial communications and aerospace, defense, and government end markets. The group’s solutions consist of electronic design and test software, instrumentation, systems, and related services. These solutions are used in the design, simulation, design, validation, manufacturing, installation, and optimization of communication systems in wireless, wireline,wireline (data center ecosystem), enterprise, and aerospace, defense, and government end markets. InOur addition,recent theacquisition groupof providesSpirent automatedadds softwarewireless network test and assurance and positioning technology solutions to automaticallyour identify,portfolio, build,complementing our design, validation, and executeperformance tests criticalofferings to digitaldeliver businessend-to-end successsolutions andto aour strong customer experience.customers.

Revenue for CSG in 20242025 decreasedincreased 79 percent compared to 2023.2024. Acquisitions had a favorable impact of 1 percentage point on the year-over-year revenue change.change, Foreignwhile foreign currency movements had an immaterial impact on the year-over-year revenue change.impact. Revenue declinedincreased across all regions and in both the commercial communications and the aerospace, defense, and government end markets. The declineincrease was primarily driven primarily by lowerhigher customerinvestments in high-speed networks to support increasing demand asfor comparedAI tocapabilities lastand year,increased whichinvestment benefitedin fromaerospace robustand backlogdefense conversion.solutions. Our customersCustomers continued to maketheir R&D investments in next-generation technologies and applications, including AI-driven data center expansion, ongoing 5G standards development and deployment, 400G/800G/terabit Ethernet, development of new communications technologies (e.g.,such as 6G, Open Radio Access Networks, commercial non-terrestrial networks, and quantum), high-speed networking and major defense and government programs worldwide. CSG revenue for 20232024 decreased 37 percent compared to 2022.2023. ForeignAcquisitions had a favorable impact of 1 percentage point on the year-over-year revenue change, while foreign currency movements had an unfavorableimmaterial impact of 2 percentage points on year-over-year revenue change.impact. Revenue declined inacross Asiaall Pacificregions and the Americas were partially offset by an increase in Europe. A revenue decline inboth the commercial communications end market was partially offset by growth inand the aerospace, defense, and government end market.markets.

Selling, general and administrative expense in 2025 increased 5 percent compared to 2024, primarily driven by higher people-related and incremental costs from acquired businesses, partially offset by lower infrastructure costs. Selling, general and administrative expense in 2024 decreased 4 percent compared to 2023, primarily driven by lower people-related, marketingmarketing, and infrastructure costs resulting from the flexibility of our operating model and cost efficiency measures, partially offset by incremental costs of acquired businesses. Selling, general and administrative expense in 2023 decreased 3 percent compared to 2022, primarily driven by lower sales commission and variable people-related costs, partially offset by higher travel-related costs.

Other operating expense (income), net,net was income of $14 million in 2025, $10 million in 2024, and $11 million in 2023, and $11 million in 2022, and primarily includeincludes property rental income.

Operating margin in 2025 was flat compared to 2024, as gross margin declines were offset by a decline in operating expense as a percentage of sales. Operating margin in 2024 decreased 2 percentage points compared to 2023, primarily driven by higher R&D and selling, general and administrative expenses on lower revenue. Operating margin in 2023 increased 1 percentage point compared to 2022, primarily driven by gross margin gains offset by higher R&D expenses as a percentage of sales.

Electronic Industrial Solutions Group (“EISG”)

EISG serves customers across a diverse set of end markets focused on automotive and energy, semiconductor solutions, and general electronics. The group’sgroup's solutions consist of electronic design, test and simulation software, instrumentation, systems, computer-aided engineering solutions, and related services. These solutions are used in the design, simulation, design, validation, manufacturing, installation, and optimization of electronic equipment. In addition, the group provides automated software test solutions to automatically identify, build, and execute tests critical to digital business success and a strong customer experience. Our recent acquisition of ESI Group expands our application layer portfolio with simulation capabilities in automotive and general electronics sectors.

In February 2026, the Supreme Court of the United States (“U.S. Supreme Court”) determined that certain tariffs imposed pursuant to the International Emergency Economic Powers Act (“IEEPA”) were not authorized by law. Subsequent rulings by the U.S. Court of International Trade have directed U.S. Customs and Border Protection to implement processes for the refund of certain tariffs previously collected. In light of these developments, we have submitted, or intend to submit, claims seeking refunds of tariffs previously paid. However, uncertainty remains regarding the ultimate outcome of these claims, including:

Many of our suppliers, vendors, customers, partners, and other entities with whom we do business have strong ties to doing business in China and other countries impacted by thethese increasedtariff tariffs.regimes. Their ability to supply materials to us, buy products or services from us, or otherwise work with us is affected by their ability to do business in impacted countries. Continued uncertainty around trade policy could substantially change our cost of operating in such jurisdictions. Moreover, these tariffs and any other trade restrictions imposed on our customers or suppliers could adversely affect our financial results and position through reduced demand for our products and solutions, cancelled orders, supply chain disruptions, increased transaction costs, and increased expenses. If the U.S.’ relationship with countries subject to increased tariffs results in additional trade disputes, trade protection measures, retaliatory actions and increased barriers, policies that favor domestic industries, or increased import or export licensing requirements or restrictions, then our deployment of resources in jurisdictions affected by such measures could be misaligned and our operations may be adversely affected.

Many of our suppliers, vendors, customers, partners, and other entities with whom we do business have strong ties to doing business in China and other countries impacted by thethese increasedtariff tariffs.regimes. Increased tariffs on sales to or imports from impacted countries, including China, will increase the cost of our customers’ components and raw materials, which could make our customers’ products and services more expensive and could reduce demand for our customers’ products. A decrease in demand or significant change in operations from our customers due to international trade disputes could adversely affect our operating results and financial condition.

On a regular basis, we review the existing technologies available in the market and identify strategic new technologies to develop and invest in. We devote significant resources to develop new technologies in communications, aerospace and defense, automotive, and the Internet of Things. We invest in R&D, grow and deepen relationships with customers and suppliers, and direct our corporate and operational resources to develop innovative technologies. Our financial results could be harmed if we fail to expand our customer base, if demand for our solutions is lower than we expect, or if our revenue related to our AI-related or innovative technologies is lower than we anticipate. We provide solutions for the design, development, and manufacturing stages of our customers’ workflow. Our customers who currently use our solutions in one stage of their workflow may not use our solutions in other aspects of their manufacturing process.

Dependence on contract manufacturing and outsourcing other portions of our supply chain may adversely affect our ability to bring solutions to market and damage our reputation.reputation Dependencedependence on outsourced information technology and other administrative functions may impair our ability to operate effectively.

As part of our efforts to streamline operations and to cut costs, we outsource aspects of our manufacturing processes and other functions and continue to evaluate additional outsourcing. If our contract manufacturers or other outsourcers fail to perform their obligations in a timely manner or at satisfactory quality levels, our ability to bring solutions to market and our reputation could suffer. For example, during a market upturn, our contract manufacturers may be unable to meet our demand requirements, which may preclude us from fulfilling our customers’ orders on a timely basis. The ability of these manufacturers to perform is largely outside of our control. Additionally, changing or replacing our contract manufacturers or other outsourced vendors could cause disruptions or delays. We outsource significant portions of our information technology (“IT”) and other administrative functions. Since IT is critical to our operations, any failure of our IT providers or third-party software companies to perform could impair our ability to operate effectively. Problems with manufacturing ormanufacturing, IT outsourcing or third-party software vulnerabilities could result in lower revenues and unrealized efficiencies and could impact our results of operations and stock price. Much of our outsourcing takes place in developing countries and, as a result, may be subject to heightened geopolitical uncertainty.

We may need to seek additional financing or refinance existing debt for our general corporate purposes. For example, we may need to increase our investment in R&D activities or need funds to make acquisitions. We may be unable to obtain any desired additional financing on terms favorable to us, if at all. If adequate funds are not available on acceptable terms, we may be unable to fund our expansion, successfully develop or enhance solutions, or respond to competitive pressures, any of which could negatively affect our business. If we raise additional funds through the issuance of equity securities, our shareholders will experience dilution of their ownership interest. If we raise additional funds by issuing debt, we may be subject to further limitations on our operations and ability to pay dividends due to restrictive covenants.

We currently have outstanding debt as well as availability to borrow under the Revolving Credit Facility. We may borrow additional amounts or refinance existing debt in the future and use the proceeds from any future borrowing for general corporate purposes, future acquisitions, expansion of our business, or repurchases of our outstanding shares of common stock.

On June 14, 2019, the U.S. Department of the Treasury (“Treasury”) issued final regulations relating to Global Intangible Low-Taxed Income (“GILTI”) under IRC § 951A (the “tax regulations”). The tax regulations contained language which disallowed GILTI tax deductions for intangible asset amortization resulting from the Singapore restructuring completed in 2018. During the third quarter of fiscal year 2024, we concluded, in response to recent U.S. Supreme Court decisions on a number of relevant cases, the evolving global tax landscape and other changes in circumstances, that U.S. Treasury exceeded its regulatory authority and the intangible asset amortization should be deductible. We amended our U.S. federal income tax returns for the open tax years to claim the deduction and recognized the discrete benefit in the condensed consolidated financial statements. The Singapore intangible assets will continue to be amortized for GILTI tax purposes until 2033. We believe the position meets the more likely than not recognition threshold.

On January 23, 2025, we filed a lawsuit against the United States of America in the U.S. Court of Federal Claims seeking a tax refund of $107 million, or such greater amount allowed by law, plus any other amount, including interest and cost, allowed by law. WeOn July 2, 2026, the U.S. Court of Federal Claims granted our motion for partial summary judgment, finding the tax regulation we challenged to be invalid. The granting of our partial summary judgment motion does not, however, preclude other challenges or appeals from the United States. Accordingly, we intend to continue to vigorously defend our position. The outcome cannot be predicted with certainty. If we are ultimately unsuccessful in defending our refund claim, we will be required to reverse the benefit previously recorded, most likely resulting in a material increase in the effective tax rate and income tax liability.

Our products or the products of our software providers may contain vulnerabilities that could be exploited by cybersecurity attackers, allowing them to introduce malicious code into our products to gain access to customer networks. Such attacks could lead to disruptions to our customers’ operations or processes, system downtime, financial loss, loss of their intellectual property, business information and proprietary data, or corruption of data, which could impact Keysight’s reputation, and result in loss of confidence in our products, loss of orders, and loss in revenue, which could materially impact our financial results. We proactively scan for vulnerabilities in our products and address them to minimize the potential for exploitation. We cannot eliminate the possibility of a successful cybersecurity attack or exploitation of undiscovered or not yet remediated vulnerabilities impacting our internal systems and/or those of our customers.

Our future success depends partly on the continued service of our key research, engineering, sales, marketing, manufacturing, executive, and administrative personnel, including personnel joining our company through acquisitions. The markets in which we operate are dynamic, and from time to time we may need to respond with reorganizations, reductions in workforce, salary freezes or reductions, or site closings. We believe our compensation packages are competitive within the regions in which we operate. If we fail to retain key personnel and are unable to hire highly qualified replacements, we may not be able to meet key objectives, such as launching effective product innovations, meeting financial goals, and maintaining or expanding our business. We rely occasionally on hiring qualified international candidates or transferring employees between the U.S. and several foreign countries. The immigration process can be subject to frequent changes and limitations. We may experience difficulty in obtaining work authorizations for some of our employees that are foreign nationals transferring to the U.S. and other key countries where we operate, which could negatively impact our ability to strategically locate our personnel. Changes to immigration policies and quotas impacting the granting of visas for higher education candidates and knowledge-based workers in many jurisdictions where we operate could impact our ability to recruit and retain the highly-trained and accomplished talent needed to maintain our operations.

•the division of our board of directors into three classes of directors, with each class serving a staggered three-year term, and this classified board provision could have the effect of making the replacement of incumbent directors more time consumingtime-consuming and difficult. While this provision was recently amended by a stockholders’ vote at the company’s annual meeting of stockholders on March 19, 2026, the implementation of the declassification of the board of directors will be done on a phased basis through 2029. The co-existence of directors serving differing terms will make the replacement of incumbent directors during this interim period more challenging;

Our amended and restated certificate of incorporation provideprovides that unless the board of directors otherwise determines, the state courts in the State of Delaware or, if no state court located within the State of Delaware has jurisdiction, the federal court for the District of Delaware, will be the sole and exclusive forum for any derivative action or proceeding brought on our behalf, any action asserting a claim of breach of a fiduciary duty owed by any of our directors or officers to the company or our shareholders, any action asserting a claim against us or any of our directors or officers arising pursuant to any provision of the DGCL or Keysight's amended and restated certificate of incorporation or bylaws, or any action asserting a claim against us or any of our directors or officers governed by the internal affairs doctrine. This exclusive forum provision may limit the ability of our shareholders to bring a claim in a judicial forum that such shareholders find favorable for disputes with us or our directors or officers, which may discourage such lawsuits against us and our directors and officers.

The following discussion should be read in conjunction with the condensed consolidated financial statements and notes thereto included elsewhere in this Form 10-Q and our Annual Report on Form 10-K for the fiscal year ended October 31, 2025. This report contains forward-looking statements which include, but are not limited to predictions, future guidance, projections, beliefs, and expectations about the company’s trends, seasonality, cyclicality and growth in, and drivers of, the markets we sell into, our strategic direction, earnings from our foreign subsidiaries, remediation activities, new solution and service introductions, the ability of our solutions to meet market needs, changes to our manufacturing processes, the use of contract manufacturers, the impact of government regulations on our ability to conduct operations, our liquidity position, our ability to generate cash from operations, growth in our businesses, our investments, the potential impact of adopting new accounting pronouncements, our financial results, our purchase commitments, our contributions to our pension plans, the selection of discount rates and recognition of any gains or losses for our benefit plans, our cost-control activities, savings and headcount reduction recognized from our restructuring programs and other cost saving initiatives, other regulatory approvals, the integration of our completed acquisitions and other transactions, and our transition to lower-cost regions. The forward-looking statements involve risks and uncertainties that could cause Keysight’s results to differ materially from management’s current expectations. Such risks and uncertainties include, but are not limited to, the impact of global economic conditions such as inflation or potential recession, the impacts of increased trade tensions such as an imposition of or increase in tariffs and tightening of export control regulations, slowing demand for products or services, volatility in financial markets, reduced access to credit, changes in interest rates or currency exchange rates, the existence of political or economic instability, impacts of geopolitical tension and conflict in regions outside of the U.S., the impact of new and ongoing litigation, impacts related to net zero emissions commitments, and the impact of volatile weather caused by environmental conditions such as climate change. Our actual results could differ materially from the results contemplated by these forward-looking statements due to various factors, including but not limited to those risks and uncertainties discussed in Part II Item 1A and elsewhere in this Form 10-Q. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law.

In the fourth quarter of fiscal 2025, we acquired all of the outstanding common stock of Spirent Communications plc (“Spirent”) for $1,415 million, net of $127 million cash acquired, using existing cash. For the three and sixnine months ended AprilJuly 30,31, 2026, our acquisition of Spirent resulted in incremental revenue of $55$61 million and $143$204 million, respectively. In our discussion of changes in our results of operations, we have qualitatively disclosed the impact of the Spirent acquisition.

Changes to U.S. tariff policy,policy which resulted in broad-based increases in tariff rates, IEEPA tariff refund claims, and related customer surcharge refunds impacted our financial results for the three and sixnine months ended AprilJuly 30,31, 2026. We continue to closely monitor and assess the potential impact of ongoing tariff actionsactions, including the recently introduced Section 301 “forced labor” tariffs, on our results, and take steps across multiple vectors to reduce the impact. This multipronged mitigation approach spans our global manufacturing footprint and sourcing strategies, as well as pricing and cost actions.

In February 2026, the Supreme Court of the United States (“U.S. Supreme Court”) determined that certain tariffs imposed pursuant to the International Emergency Economic Powers Act (“IEEPA”) were not authorized by law. Subsequent rulings by the U.S. Court of International Trade have directed the U.S. Customs and Border Protection to establish processes to effect refunds of certain tariffs previously collected. Based on these judicial determinations, forduring the three and sixnine months ended AprilJuly 30,31, 2026, we recorded a receivable of $100 million within “other current assets” in the condensed consolidated balance sheet, representing recovery of tariffs previously paid and statutory interest accrued, with corresponding offsets of $93 million to “cost of sales,” $4 million to “selling, general and administrative,” and $3 million to “interest income” in the condensed consolidated statement of operations. In addition, we recorded a $40 million liability within “other accrued liabilities” in the condensed consolidated balance sheet as a result of our decision to refund IEEPA tariff surcharges collected from our customers, with a corresponding reduction of revenue in the condensed consolidated statement of operations. During the three and nine months ended July 31, 2026, we received $37 million of refund proceeds, resulting in outstanding IEEPA tariff refund claims receivable of $64 million as of July 31, 2026. For additional information regarding the basis of accounting for tariff refund claims, see Note 1, “Overview and Summary of Significant Accounting Policies,” to the condensed consolidated financial statements. In our discussion of changes in our results of operations and segment overview, we have qualitatively disclosed the impact of the IEEPA tariff refund claims and related customer surcharge refunds.

Three and sixnine months ended AprilJuly 30,31, 2026 and 2025

Total orders for the three and sixnine months ended AprilJuly 30,31, 2026 were $2,051$2,091 million and $3,696$5,787 million, respectively, an increase of 56 percent and 4348 percent, respectively, compared to the same periods last year. For both the three and six months ended April 30, 2026, foreignForeign currency movements and acquisitions had aan favorableunfavorable impact of 1 percentage point and 7an immaterial impact, respectively, on the year-over-year change for the three and nine months ended July 31, 2026. Acquisitions had a favorable impact of 5 percentage points and 6 percentage points, respectively, on the year-over-year change.change for the three and nine months ended July 31, 2026. For the three and sixnine months ended April,July 30,31, 20262026, orders increased across all regions.

Revenue for the three and sixnine months ended AprilJuly 30,31, 2026 was $1,717$1,846 million and $3,317$5,163 million, respectively, an increase of 3136 percent and 2731 percent, respectively, compared to the same periods last year. For both the three and six months ended April 30, 2026, foreignForeign currency movements had an immaterial impact and acquisitions had a favorable impact of 1 percentage pointpoint, respectively, on the year-over-year change for the three and nine months ended July 31, 2026. Acquisitions had a favorable impact of 6 percentage points and 7 percentage points, respectively, on the year-over-year change.change for the three and nine months ended July 31, 2026. For both periods, revenue increased in the Communications Solutions Group (“CSG”) and the Electronic Industrial Solutions Group (“EISG”). Revenue from CSG and EISG represented 73 percent and 27 percent, respectively, of total revenue for the three months ended July 31, 2026. Revenue from CSG and EISG represented 72 percent and 28 percent, respectively, of total revenue for the threenine months ended AprilJuly 30,31, 2026. Revenue from CSG and EISG represented 71 percent and 29 percent, respectively, of total revenue for the six months ended April 30, 2026.

Net income for the three and sixnine months ended AprilJuly 30,31, 2026 was $349$397 million and $630$1,027 million, respectively, compared to $257$191 million and $426$617 million, respectively, for the same periods last year. The increase in net income for the three months ended AprilJuly 30,31, 2026 was primarily driven by higher revenue and favorable mix, partially offset by incremental costs from acquired businesses, higher people-related costs, higher amortization of acquisition-related balances and higher net income tax expense. The increase in net income for the nine months ended July 31, 2026 was primarily driven by higher revenue, favorable mix, and net IEEPA tariff refund claims, partially offset by previous year net gains on derivative instruments, higher people-related costs, incremental costs from acquired businesses, higher amortization of acquisition-related balances, and the impact of ongoing tariffs. The increase in net income for the six months ended April 30, 2026 was primarily driven by higher revenue, favorable mix, higherlower net income tax benefit,expense, and net IEEPA tariff refund claims, partially offset by incremental costs from acquired businesses, higher people-related costs, net losses on equity investment, higher amortization of acquisition-related balances, net losses on equity investments, and the impact of ongoing tariffs.

Cash flows generated from operating activities were $942$1,379 million and $862$1,184 million, respectively, for the sixnine months ended AprilJuly 30,31, 2026 and 2025. Refer to the “Financial Condition” section of Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations for additional information.

Our first-to-market solutions strategy enables customers to develop new technologies andtechnologies, accelerate innovation andwhile providesproviding a platform for Keysight's long-term growth. Our customers are expected to continue to make R&D investments in certain next-generation technologies and applications, including evolution ofadvancing 5G, early 6G, quantum computing, high-speed data center networks and infrastructure, satellitenon-terrestrial networks, artificial intelligence (“AI”),AI, industrial internet of things (“IoT”),things, defense modernization, next generation electric vehicles, and autonomous vehicles. We continue to engage actively with our customers and closely monitor the macroeconomic environment, including tariffs, trade restrictions and tightening of export control regulations, monetary and fiscal policies, and geopolitical tensions. We remain confident in the long-term secular growth trends of our markets and our ability to outperform in a variety of market conditions.

ThereDuring the nine months ended July 31, 2026, there were no material changes during the three and six months ended April 30, 2026 to the critical accounting estimates described in “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended October 31, 2025.

Our revenues, costs and expenses, and monetary assets and liabilities are exposed to changes in foreign currency exchange rates due to our global operating, investing, and financing activities. We hedge revenues, expenses, and balance sheet exposures that are not denominated in the functional currencies of our subsidiaries on a short-term and anticipated basis. The resultresults of these hedging activities are included in the condensed consolidated balance sheet and condensed consolidated statement of operations. We may experience some fluctuations within individual lines of the condensed consolidated balance sheet and condensed consolidated statement of operations because our hedging program is not designed to offset the currency movements in each category of revenues, expenses, and monetary assets and liabilities. Our cash flow hedging program is designed to hedge short-term currency movements based on a rolling period of up to twelve months. Therefore, we are exposed to currency fluctuations over the longer term. To the extent that we are required to pay for all, or portions, of an acquisition price in foreign currencies, we may enter into foreign exchange contracts to reduce the risk that currency movements will impact the U.S. dollar cost of the transaction.

Results from Operations - Three and sixnine months ended AprilJuly 30,31, 2026 and 2025

The following table presents the percentage change in revenue by geographic region for the three and sixnine months ended AprilJuly 30,31, 2026 and the impact of foreign currency movements as compared to the same periods last year.

Refer to the “Segment Overview” section of Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations for additional information on changes in revenue during the three and sixnine months ended AprilJuly 30,31, 2026.

Gross margin for the three and six months ended AprilJuly 30,31, 2026 increased 64 percentage points and 3 percentage points, respectively, compared to the same periodsperiod last year, primarily driven by nethigher IEEPArevenue tariffvolume, refundfavorable claims,mix, and incremental gross margin impact from acquisitions, partially offset by higher people-related costs and higher amortization of acquisition-related balances. Gross margin for the nine months ended July 31, 2026 increased 3 percentage points compared to the same period last year, primarily driven by higher revenue volume, favorable mix, net IEEPA tariff refund claims, and incremental gross margin impact from acquisitions, partially offset by higher amortization of acquisition-related balances, higher people-related costs, and the impact of ongoing tariffs.

R&D expense for both the three and sixnine months ended AprilJuly 30,31, 2026 increased 2825 percent and 25 percent, respectively, compared to the same periods last year, primarily driven by incremental costs from acquired businesses, higher variable people-related costs, and continued investments in key growth opportunities in our end markets and leading-edge technologies.

Selling, general and administrative expense for both the three and sixnine months ended AprilJuly 30,31, 2026 increased 26 percent and 25 percent, respectively, compared to the same periods last year, primarily driven by incremental costs from acquired businesses, higher people-related costs, higher amortization of acquisition-related balances, and higher sellingselling, marketing, and marketinginfrastructure costs, partially offset by lower acquisition and integration costs.

Other operating expense (income), net for the three and sixnine months ended AprilJuly 30,31, 2026 was income of $5 million and $8 million, respectively, compared to income of $3 million and $11 million, respectively, compared to income of $4 million and $15 million, respectively, for the same periods last year.

Operating margin for the three and nine months ended AprilJuly 30,31, 2026 increased 8 percentage points and 5 percentage points, respectively, compared to the same periodperiods last year, primarily due to gross margin gains and lower operating expenses as a percentage of sales. Operating margin for the six months ended April 30, 2026 increased 3 percentage points compared to the same period last year, primarily due to gross margin gains.

Interest income for the three and sixnine months ended AprilJuly 30,31, 2026 was $18$20 million and $34$54 million, respectively, compared to $21$31 million and $40$71 million, respectively, for the same periods last year and primarily relates to interest earned on our cash balances. Interest expense for the three and sixnine months ended AprilJuly 30,31, 2026 was $25$26 million and $54$80 million, respectively, compared to $20$28 million and $40$68 million, respectively, for the same periods last year and primarily relates to interest on our senior notes.

Other income (expense), net for the three and sixnine months ended AprilJuly 30,31, 2026 was income of $18$22 million and expense of $19$3 million, respectively, compared to income of $112$4 million and $94$98 million, respectively, for the same periods last year. The decreaseincrease in other income, net for the three months ended AprilJuly 30,31, 2026 iswas primarily driven by previous yearlower net gainslosses on derivative instruments (see Note 9, “Derivatives,” for additional information), partially offset by net gains on equity investments and lower amortization of actuarial losses.losses, partially offset by lower net gains on equity investments. The increasedecrease in other expense,income, net for the sixnine months ended AprilJuly 30,31, 2026 iswas primarily driven by higher net losses on equity investments and previous yearhigher net gainslosses on derivative instruments (see Note 9, “Derivatives,” for additional information),instruments, partially offset by lower amortization of actuarial losses.

As of AprilJuly 30,31, 2026 and 2025, our headcount was approximately 16,50016,600 and 15,400,15,500, respectively. The increase is primarily driven by acquisitions.

For the three and sixnine months ended AprilJuly 30,31, 2026, we recorded income tax expense of $69$80 million and an income tax benefit of $14$66 million, respectively, resulting in an effective tax rate of 16.516.7 percent and (2.36.0 percent),percent, respectively. For the three and sixnine months ended AprilJuly 30,31, 2025, we recorded an income tax expense of $63$50 million and $93$143 million, respectively, resulting in an effective tax rate of 19.520.8 percent and 17.918.8 percent, respectively. The effective tax rate is generally lower than the U.S. federal statutory rate of 21 percent primarily due to favorable tax rates on certain earnings from operations in lower tax jurisdictions, partially offset by U.S. tax on Global Intangible Low-Taxed Income (“GILTI”). inclusions and other taxes on foreign income.

For the sixthree months ended AprilJuly 30,31, 2026, we recorded net income tax expense of $12 million from discrete items, driven primarily by a valuation allowance recorded against the deferred tax asset related to California research tax credits now limited under state tax legislation and expense from unrecognized tax benefits. For the nine months ended July 31, 2026, we recorded net income tax benefits of $87$74 million from discrete items, driven by a $97 million net benefit from a favorable audit settlement and a $12$19 million release of reserves due to the expiration of the statute of limitations.limitations, including interest and penalties. These items were partially offset by a $15 million expense related to IEEPA tariff refund claimsclaims, and $10$21 million expense from unrecognized tax benefitsbenefits, and $6 million of other immaterial discrete items recorded infor the second quarter.period.

As of AprilJuly 30,31, 2026 and October 31, 2025, our long-term income tax liabilities forfrom unrecognized tax benefits were $185$194 million and $241 million, respectively. The decrease primarily reflected the release of $68 million of uncertain tax positions in connection with an audit settlement in January 2026 as well as a $12 million release of reserves due to the expiration of the statute of limitations, partially offset by current year increases of $25 million.increases.

CSG revenue for the three and sixnine months ended AprilJuly 30,31, 2026 grew across all regions and in both the commercial communications and the aerospace, defense, and government end marketsmarkets. The increase in revenue was primarily driven by demand in high-speed networks to support the growing need for AI capabilities and aerospace and defense solutions. Our customers continued their R&D spend in next-generation technologies and applications, including AI-driven data center expansion, ongoing 5G standards development and deployment, 400G/800G//1.6 terabit Ethernet, development of new communications technologies (e.g., 6G, Open Radio Access Networks, commercial non-terrestrial networks, quantum), high-speed networking, and major defense and government programs worldwide.

Our commercial communications end market revenue for the three and sixnine months ended AprilJuly 30,31, 2026 increased 4056 percent and 3643 percent, respectively, year-over-yearcompared to the same periods last year and represented 7075 percent and 6971 percent, respectively, of total CSG revenue. For both the three and sixnine months ended AprilJuly 30,31, 2026, revenue grew across all regions. The year-over-year increase in revenue was primarily driven by our customers R&D spend in terabit solutions and expanding 400G/800G/1.6 terabit transceiver manufacturing capacity to meet rising demand for AI capabilities. We continued to see investments in high-speed networks due to increasing need for AI capabilities in the data center infrastructure ecosystem, which drove demand for our 400G/800G/1.6 terabit Ethernet solutions, both in R&D and manufacturing.

Our aerospace, defense, and government end market revenue for the three and sixnine months ended AprilJuly 30,31, 2026 increased 2414 percent and 2119 percent, respectively, year-over-yearcompared to the same periods last year and represented 3025 percent and 3129 percent, respectively, of total CSG revenue. For both the three and sixnine months ended AprilJuly 30,31, 2026, revenue growth in the Americas and Europe was partially offset by a decline in Asia Pacific. The year-over-year increase in revenue was primarily driven by strong growth in radar and spectrum operations coupled with space and satellite solutions. We continue to see investments in defense modernization and emerging technologies.

Gross margin for the three and six months ended AprilJuly 30,31, 2026 increased 74 percentage points and 4 percentage points, respectively, compared to the same periodsperiod last year, primarily driven by nethigher IEEPArevenue tariffvolume, refundfavorable claims,mix, and incremental gross margin impact from acquisitions, partially offset by higher people-related costs. Gross margin for the nine months ended July 31, 2026 increased 4 percentage points compared to the same period last year, primarily driven by higher revenue volume, favorable mix, net IEEPA tariff refund claims, and incremental gross margin impact from acquisitions, partially offset by higher people-related costs and the impact of ongoing tariffs.

R&D expense for both the three and sixnine months ended AprilJuly 30,31, 2026 increased 2926 percent and 25 percent, respectively, compared to the same periods last year, primarily driven by incremental costs from acquired businesses, higher variable people-related costs, and continued investments in key growth opportunities in our end markets and leading-edge technologies.

Selling, general and administrative expense for the three and sixnine months ended AprilJuly 30,31, 2026 increased 3831 percent and 3533 percent, respectively, compared to the same periods last year, primarily driven by incremental costs from acquired businessesbusinesses, higher people-related costs, and higher people-related,selling, selling,marketing, and marketinginfrastructure costs.

Other operating expense (income), net for the three and sixnine months ended AprilJuly 30,31, 2026 was income of $3 million and $5 million, respectively. Other operating expense (income), net for the three and six months ended April 30, 2025 was income of $2 million and $8$7 million, respectively.respectively, compared to income of $3 million and $11 million, respectively, for the same periods last year.

Operating margin for the three and nine months ended AprilJuly 30,31, 2026 increased 8 percentage points and 5 percentage points, respectively, compared to the same periodperiods last year, driven by gross margin gains and lower operating expenses as a percentage of sales. Operating margin for the six months ended April 30, 2026 increased 4 percentage points compared to the same period last year, primarily driven by gross margin gains.

EISG revenue for the three andmonths sixended July 31, 2026 grew across all regions. EISG revenue for the nine months ended AprilJuly 30,31, 2026 increased in Asia Pacific and Europe, partially offset by a decline in the Americas. Revenue increased across all markets. The increase in revenue was driven by AI-driven demand for advanced semiconductor technologies and fabrication capacity, next-generation printed circuit board (“PCB”)interconnects interconnects,and capacitors, software-defined vehicles and autonomous drivingdriving, and digital health.

OperatingGross margin for the three months ended AprilJuly 30,31, 2026 increased 107 percentage points compared to the same period last year, primarily driven by higher revenue volume, favorable mix, and incremental gross margin gainsimpact andfrom loweracquisitions, operatingpartially expensesoffset asby ahigher percentagepeople-related ofcosts. sales. OperatingGross margin for the sixnine months ended AprilJuly 30,31, 2026 increased 5 percentage points compared to the same period last year, primarily driven by higher revenue volume, favorable mix, net IEEPA tariff refund claims, and incremental gross margin gains.impact from acquisitions, partially offset by higher people-related costs and the impact of ongoing tariffs.

Net cash provided by operating activities increased $80$195 million during the sixnine months ended AprilJuly 30,31, 2026 compared to the same period last year.

•Net income for the sixnine months ended AprilJuly 30,31, 2026 increased by $204$410 million compared to the same period last year. Non-cash adjustments to net income increased by $192$277 million, primarily due to a $71$98 million increase in amortization, a $77 million increase in net unrealized losses on investments in equity securities,investments, a $65 million increase in amortization, a $36$52 million increase in share-based compensation expense, a $13$30 million decrease in deferred tax benefit, a $19 million increase in depreciation expense, and a $10$7 million decreaseincrease in deferredother taxnon-cash benefit,expenses, partially offset by a $6 million gain on sale of investments.

•The aggregate change in accounts receivable, inventory, and accounts payable used net cash of $49$92 million during the first sixnine months of fiscal 2026, compared to net cash provided of $112$181 million in the same period last year. Cash flow generated from or used by the aggregate of accounts receivable, inventory, and accounts payable depends upon the cash conversion cycle, which represents the number of days between payments for raw materials and components and the collection of cash from customers. This cycle can be significantly impacted by the timing of shipments and purchases, as well as the timing of collections and payments in a period.

•The aggregate movements in other assets and liabilities used net cash of $24$101 million during the first sixnine months of fiscal 2026 compared to net cash provided of $131$118 million in the same period last year. This change was primarily driven by higher income and other tax payments, net of accruals, andhigher interest payments on senior notes, net of accruals, net IEEPA tariff refund claims receivable, and changes in derivative assets and liabilities, partially offset by higher payroll-related accruals, net of payments, an increase in deferred revenue, and changes in other assets and liabilities.

Net cash used in investing activities increasedwas by $14$135 million during the sixfirst nine months endedof April 30,fiscal 2026 compared to net cash used of $97 million in the same period last year. TheThis increasechange was primarily driven by a $14$30 million increase in cash used for acquisition activities, a $13$23 million increase in cash used for purchase of investments, and a $4$7 million increase in cash used for purchases of property, plant and equipment, partially offset by $17$22 million of proceeds from the sale of investments.

Net cash used in financing activities increasedwas by $843$515 million during the sixfirst nine months endedof April 30,fiscal 2026 compared to net cash provided of $487 million in the same period last year. TheThis increasechange was primarily driven by $748 million of proceeds received in the previous year from the issuance of our 2030 Senior Notes, $82$242 million higher treasury stock repurchases, and a $14$21 million payment of acquisition-related consideration.

On November 24, 2025, our board of directors approved a new stock repurchase program,program inthat replacement ofreplaced the prior program approved in March 2023. The new stock repurchase program authorizes the company to expend up to $1,500 million to repurchase outstanding shares of common stock of the company. As of AprilJuly 30,31, 2026, $1,192$983 million remained available to the company for this purpose. See “Issuer Purchases of Equity Securities” in Part II Item 2 for additional information.

There have been no changes to the principal, maturity, interest ratesrates, and interest payment terms of our senior notes during the sixnine months ended AprilJuly 30,31, 2026 as compared to the senior notes described in our Annual Report on Form 10-K for the fiscal year ended October 31, 2025.

On April 21, 2026, we entered into a new credit agreement (the “Revolving Credit Facility”) that amended and restated our existing credit agreement dated July 30, 2021 (the “2021 Revolving Credit Facility”) in its entirety and provides for a $750 million five-year unsecured revolving credit facility that will expire on April 21, 2031. In addition, the Revolving Credit Facility permits the company, subject to certain customary conditions, on one or more occasions to request to increase the total commitments under the Revolving Credit Facility by up to $350 million in the aggregate. We are obligated to pay an annual facility fee of 0.09 percent for the Revolver Credit Facility. Borrowings under the Revolving Credit Facility in U.S. Dollars bear interest at a rate equal to, at our option, (a) Term Benchmark Rate (primarily Secured Overnight Financing Rate or “SOFR”) plus a margin of 0.91 percent, or (b) the higher of (1) the prime rate, (2) the New York Federal Reserve Bank rate plus 0.5 percent, or (3) SOFR plus 1 percent. We may use amounts borrowed under the Revolving Credit Facility for general corporate purposes. As of AprilJuly 30,31, 2026, we had no borrowings outstanding under the Revolving Credit Facility.Facility Weand were in compliance with theits covenants of the 2021 Revolving Credit Facility until it was replaced on April 21, 2026, and with the covenants of the Revolving Credit Facility for the period between April 21 and April 30, 2026.covenants.

Our cash and cash equivalents mainly consist of investments in institutional money market funds investments,funds, short-term deposits held at major global financial institutions, and similar short duration instruments with original maturities of three months or less. We continuously monitor the creditworthiness of the financial institutions and money market fund asset managers with whom we invest our funds. We utilize a variety of funding strategies in an effort to ensure that our worldwide cash is available in the locations in which it is needed. Most significant international locations have access to internal funding through an offshore cash pool for working capital needs. In addition, a few locations that are unable to access internal funding have access to temporary local overdraft and short-term working capital lines of credit.

Our total commitments to contract manufacturers and suppliers increased to $602$762 million as of AprilJuly 30,31, 2026, compared to $487 million as of October 31, 2025. The increase was primarily driven by advance purchase orders placed to support fulfillment of a strong order backlog. As of AprilJuly 30,31, 2026, we had non-cancellable purchase commitments that aggregated to approximately $545$704 million, of which the majority is for less than one year. See Note 13, “Commitments and Contingencies,” for additional information.

During the sixnine months ended AprilJuly 30,31, 2026, we released $68 million of uncertain tax positions resulting from an audit settlement. We believe that we have an adequate provision for any adjustments that may result from tax examinations. However, the outcome of tax examinations cannot be predicted with certainty. Given the numerous tax years and matters that remain subject to examination in various tax jurisdictions, the ultimate resolution of current and future tax examinations could be inconsistent with management’s current expectations.

As of AprilJuly 30,31, 2026, we believe our cash and cash equivalents, cash generated from operations, and our ability to access capital markets and credit lines will satisfy our cash needs for the foreseeable future both globally and domestically.