Keysight Technologies Inc. · NYSE:KEYS
Keysight Technologies — Investor Day (March 2020)
171 slides from Keysight Technologies's investor day presentation, Mar 3, 2020
Slide 1: Investor Day 2020
KEYSIGHT TECHNOLOGIES Investor Day 2020 MARCH 3, 2020 TECHNOLOGIES
Slide 2: Video Presentations and Slides
Video Presentations - One-click to YouTube videos Slides – Click to Advance to Slides Duration (Min) Ron Nersesian Company Overview and Strategic Direction Chairman, President and Chief Executive Officer 36:09 Ingrid Estrada Culture and Talent Transformation SVP, Chief Administrative Officer and Chi
Slide 3: Forward-looking statements
This communication contains forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and is subject to the safe harbors created therein. Statements preceded by, followed by, or that otherwise i
Slide 4: Agenda
8:30 am Welcome and Opening Remarks 11:15 am Global Services Jason Kary John Page VP, Treasurer and Investor Relations SVP, President – Global Services Company Overview and Strategic Direction Global Marketing Ron Nersesian Marie Hattar Chairman, President and Chief Executive Officer SVP and Chief M
Slide 5: Ron Nersesian
Ron Nersesian Chairman, President and Chief Executive Officer TOC
Slide 6: FY19 Key Statistics and Revenue Mix
FY19 KEY STATISTICS FY19 REVENUE MIX #1 >32,000 26% ◼ Commercial Market Position Total Customers1 Communications: $2.2B $4.3B ◼ Aerospace, Defense Total 51% and Government: $1.0B Revenue2 100+ 18% 23% ◼ Electronic Countries Served Recurring Revenue Industrial: $1.1B 24% 46% Operating Margin2 Earning
Slide 7: Leadership position and room to grow
Leadership position and room to grow $17.5B Served Addressable Market1 $8.5B $4.2B $4.8B +$2B vs. 2017 Commercial Aerospace Electronic Communications Defense Industrial 3-5% Avg. Market Growth Rate2 ~25% Keysight Keysight Keysight Keysight Market Share1 +300 bps vs. 2017 KEYSIGHT WELL-POSITIONED FOR
Slide 8: Industry leader with 32,000+ customers
INDUSTRY LEADER WITH 32,000+ CUSTOMERS Leading Market Positions1 Software Revenue for Electronic Hardware Revenue for Electronic Commercial Comms, Aero & Defense, #1 Design & Test #1 Design & Test #1 Electronic Industrial, Network Test (Ixia) Serving Market Leaders2 10 / 10 25 / 25 25 / 25 25 / 25 2
Slide 9: Engineering expertise aligned with customers across regions
REGIONAL REVENUE MIX REGIONAL EMPLOYEE MIX KEY STATISTICS Products >7,000 40% 37% Engineering Expertise >40,000 yrs. 43% $4.3B 44% ~13,600 FY19 Revenue1 Employees Patents2 >3,000 17% 19% R&D Centers3 15 Installed Base4 >$30B (estimated) ◼ Americas ◼ Europe ◼ Asia-Pacific ENGINEERING EXPERTISE ALIGNE
Slide 10: CSG and EISG
CSG EISG Communications Solutions Group Electronic Industrial Solutions Group Serving customers spanning the global Serving electronic industrial end markets, focusing communications end markets on high-growth applications • Wireless and Wired Communications • Next-Generation Automotive and Energy •
Slide 11: Accelerating innovation to connect and secure the world
Keysight is accelerating innovation to connect and secure the world WIRELESS AUTOMOTIVE QUANTUM $3.6T 5G mobile 70% of new vehicles and trucks Nations investing >$10B z value chain by 20351 shipped will be connected by 20232 through 2024 for leadership3 NETWORKING / CLOUD IOT AEROSPACE / DEFENSE Dat
Slide 12: What We Are Doing
What We Are Doing Accelerate customer Transforming from hardware-centric products 1 to first-to-market, software-centric success with solutions to enable customer success first-to-market, 2 Expanding margins Strengthening the durability of our differentiated 3 business model solutions Increasing org
Slide 13: Markets, workflow and differentiated solutions
1 Markets Commercial Automotive IoT Communications & Energy Network Applications Aerospace & Security Defense Workflow Simulate Prototype Validate Manufacture Optimize Differentiated, Market-Leading Solutions Hardware Software Services 13 TOC
Slide 14: Shifting to software-centric solutions
1 ACTIONS Revenue1 ($B) Shifting to software-centric solutions from hardware-centric products $4.31 11% HARDWARE + SOFTWARE + SERVICES CAGR $3.91 Reorganizing around industries enabling speed and solutions tailored to key customer end markets $3.25 $2.86 $2.93 Increasing investment in R&D ~16% of re
Slide 15: Expanding gross margin
2 ACTIONS Gross Margin1 Increasing R&D sales mix +670 versus manufacturing mix bps 63.2% 59.8% 60.4% Growing software sales ~$800M in FY19; up from ~$360M in FY15 57.4% 56.5% Focusing on first-to-market solutions higher selling prices and lower discounts Improving tools and processes to drive effici
Slide 16: Growing recurring revenues
3 ACTIONS Annualized Recurring Revenue1 ($M) Diversified business and portfolio with differentiated solutions and broad and deep customer base $838 $747 $699 Increasing software mix 19% of total FY19 revenue; up from 12% in FY15 $472 $491 Growing recurring revenues • Subscription / perpetual softwar
Slide 17: Earnings per share and market cap growth
4 ACTIONS Earnings per Share1 Doubling front-line sellers $4.72 through “Feet on the Street” initiative without incremental investment $3.24 $2.52 $2.43 $2.53 Increasing sales compensation variability and upside to drive higher performance FY15 FY16 FY17 FY18 FY19 Market Cap2 ($B) Centralizing marke
Slide 18: Capital allocation priorities
5 1 Fund Organic Growth R&D investment is ~16% of revenue; up from 12% at spin-off 2 M&A when strategic and financial criteria are met 3 Return Capital DISCIPLINED, RETURN-FOCUSED APPROACH IS A CORE STRENGTH 18 TOC
Slide 19: Evaluation criteria for M&A
5 EVALUATION CRITERIA FOR M&A Strategic Financial • Accelerates near- and long-term strategic objectives • ROIC above cost of capital • High software content and/or high recurring revenue • Accretive to growth and gross margin • Expands portfolio of high-value solutions • Revenue and cost synergy op
Slide 20: Our culture and compensation mix
6 OUR CULTURE COMPENSATION MIX AT ALL LEVELS IS based on the Keysight Leadership Model ALIGNED WITH SHAREHOLDER INTERESTS Results-oriented with a passion to win CEO Executive Officers1 7% 11% 21% Uncompromising integrity 18% 61% Collaborative, transparent, and open communication 82% Senior Managers
Slide 21: Our CSR vision
6 OUR CSR VISION Build a better planet by accelerating innovation to connect and secure the world and employing a global business framework of ethical, environmentally sustainable, and socially responsible operations Selected Recognitions Key Impact Goals Results as of by End of FY20 End of FY19 >$1
Slide 22: Keysight Leadership Model
6 MARKET INSIGHT EMPLOYEE GROWTH • Early trend identification • Encourage passion • Accelerate innovation • Inspire and facilitate growth • Anticipate change CAPITAL ALLOCATION • Focus on ROIC • Flexible, balanced approach OPERATIONAL EXCELLENCE • Highest quality • Continuous improvement • Flexible
Slide 23: Executed for long-term growth
2017 Executed for Long-term Growth 2016 • Acquired Ixia; expands software Enhanced Solutions and Capabilities 2014 – 2015 solutions and broadens communications development lifecycle reach • Delivered first-to-market 5G solutions Established Strong Foundation totaling $66M in orders • Acquired ScienL
Slide 24: Achieved record results
2019 2018 Achieved Record Results Delivered and Raised Commitments • Achieved record financial results with 11% core revenue growth, 63% GM, 24% OM, 46% EPS growth, and $878M free • Launched PathWave, industry-first design and test software cash flow platform accelerating workflows • Exceeded 2021 m
Slide 25: FY15–FY19 financial performance
Revenue1 ($B) Gross Margin1,2 Operating Margin1,2 Earnings per Share1 Market Cap3 ($B) 11% +670 +590 17% +$13B CAGR bps bps CAGR (237%) $4.31 63.2% 24.0% $4.72 $18.9 $3.91 60.4% 59.8% 57.4% $3.25 56.5% 18.8% 18.4% $2.86 $2.93 18.1% $3.24 17.6% $10.7 $8.3 $2.52 $2.53 $2.43 $5.6 $5.6 FY15 FY16 FY17 FY
Slide 26: Accelerate customer success with first-to-market solutions
Accelerate customer success with first-to-market, differentiated solutions Utilizing our culture as a competitive advantage for speed, margin expansion, and value creation TREMENDOUS OPPORTUNITIES FOR CONTINUED VALUE CREATION 26 TOC
Slide 27: Decade-long opportunities ahead
2014 2019 FUTURE SEEDING CULTIVATING and ACCELERATING COMPOUNDING 1 Be First in 5G Wireless – Well-positioned to capitalize on early lead 2 Enter Next-Generation Automotive – “early innings” for a large market opportunity 3 Expand Leadership in Design and Test Software – focusing on recurring revenu
Slide 28: FY19 results versus commitments
2015 Investor Day 2018 Investor Day FY19 RESULTS • 11% core growth in FY19 Core Revenue Sustainable Sustainable • 11% CAGR since FY15 Growth1,2 4% CAGR 4% - 5% CAGR • Five consecutive years of market share gains • 24% in FY19 Operating 21% - 22% • Expanded 590 bps FY15 – FY19 17% - 18% Margin1,3 (by
Slide 29: New long-term targets
2015 Investor Day 2018 Investor Day New! 2020 INVESTOR DAY Core Revenue Sustainable Sustainable Sustainable Growth1,2 4% CAGR 4% - 5% CAGR 4% - 6% CAGR Operating 17% - 18% 21% - 22% 26% - 27% Margin1,3 (by 2021) (by 2023) EPS Growth1 8% - 10% ≥10% ≥10% 1 Non-GAAP measure; see appendix for reconcilia
Slide 30: Building a track record for delivering value
B U I L D I N G A T R AC K R E C O R D F O R D E L I V E R I N G VAL U E Ron Nersesian Neil Dougherty Ingrid Estrada Chairman, President and SVP, Chief Financial Officer SVP, Chief Administrative Officer, Chief Executive Officer Chief of Staff Jay Alexander Marie Hattar Elizabeth Cheever SVP, Chief
Slide 31: Key takeaways
1 Strong leadership team and employees successfully executing to deliver on commitments 2 Delivering first-to-market solutions aligned to key growth areas and end markets 3 Executing on our software-centric solutions strategy to meet customer needs and increase recurring revenue 4 Applying the Keysi
Slide 32: Ingrid Estrada
Ingrid Estrada SVP, Chief Administrative Officer and Chief of Staff TOC
Slide 33: Our culture is a competitive advantage
Our culture is a competitive advantage 1 2 3 4 Innovation and A diverse workforce The Keysight High employee collaboration thrive magnifies skills, Leadership Model is engagement drives in our culture understanding and a blueprint for our strategy, our idea-generation everything we do culture and ou
Slide 34: Core values, culture and purpose
Strong Core Values Unique Culture Compelling Purpose ✓ High performance ✓ One Keysight ✓ Accelerate customer innovation to connect and secure world ✓ Uncompromising integrity ✓ Move at speed of customer ✓ Make a difference in our ✓ Speed and courage ✓ Deeply care about people communities ✓ Respect f
Slide 35: Culture powers a stable talent environment
COMMITMENT ACQUIRED TALENT NEXT-GEN TALENT R&D FOCUS Low attrition rate of ~6% ~3K employees, 99.5% 49% increase in intern and 83% increase in software acceptance rate campus hiring since 2016 engineers since 2014 Our culture powers a rich, stable environment where some of the world’s deepest techno
Slide 36: Building a diverse workforce
BUILDING A DIVERSE WORKFORCE 30 5 31% 23% 16% Countries with Generations of Women in Women in Women in Keysight employees Keysight employees Keysight‘s workforce Keysight leadership roles Keysight R&D roles POSITIVELY IMPACTING THE GLOBAL COMMUNITY 12,000 ~670,000 7.4% 17.9% Employee volunteer Stude
Slide 37: KLM is part of everything we do
KLM IS PART OF EVERYTHING WE DO ✓ A common framework and language that creates employee alignment with company strategy ✓ Builds business competence and investment in Keysight’s success ✓ Company-wide training led to off-the-charts engagement Organizational Connectedness Metric & Visual1 VS. Typical
Slide 38: Employee testimonials
Drives commitment and contributions “My purpose and passion help me stretch “The Emeritus program was a perfect beyond my comfort zone.” opportunity to help early career engineers develop, grow, and thrive in their careers.” Deepty Chauhan John Swanstrom R&D Manager, PathWave Cloud Program Lead Keys
Slide 39: Employee survey and global recognition
Internal Recognition from the Great Place to Work Employee Survey When you join the Management is I’m proud company, you are honest and ethical to tell others made to feel in business I work here welcome practices GLOBAL RECOGNITION 39 TOC
Slide 40: Key takeaways
Strengthening our competitive advantage for future growth 1 Company results fuel excitement for continued success 2 Building next-generation talent through internal networks to strengthen our culture 3 KLM provides a common framework and language to drive top and bottom line results 4 Our focus on R
Slide 41: Jay Alexander
Jay Alexander SVP and Chief Technology Officer TOC
Slide 42: Executing on strategy and driving growth
Executing on Keysight’s strategy and driving growth 1 2 3 4 Powerful R&D Sustainable Tremendous Attacking team and competitive growth in next growth innovation engine advantage software opportunities for creating from proprietary capabilities to augment the first-to-market technology and results, fo
Slide 43: Transform to software-centric solutions
1 Transform from hardware-centric products to software-centric solutions, including more services content Additional Opportunity to Differentiate and Capture Value Realm of data analytics Probe / Connect Acquire / Measure Analyze Report / Decide Hardware 100% Software Software and+ Services 100% Sof
Slide 44: From siloed divisions to industry-based solutions groups
1 In 2016 Keysight pivoted from siloed divisions to industry-based solutions groups Actions Taken Since 2018 FROM TO Investor Day • Individual products with hardware bias • Full solutions: Hardware + Software + Services • Further consolidated core • Slower, complex decision-making and execution • Fa
Slide 45: R&D investment focus and impact
1 R&D Investment Focus Impact ~16% Strong Financial Return of Revenue $710M FY15 – FY19 average ROIC of 22% 5G IoT enabled by many first-to-market solutions that drive growth ✓ 5G: Over 100 sustained EMSO and monetized customer Automotive Electromagnetic collaborations; 17 quarters of & Energy Spect
Slide 46: Expanded served market
1 And expanded our served market 5G Wireless Solutions Core & Edge Network Automotive & Beyond the Physical Layer Solutions Energy Solutions Software-centric Industry-leading Test, visibility and security solutions for Advanced test solutions for electric solutions for wireless solutions for test ne
Slide 47: Validating investments with first and best solutions
1 Validating our investments and enabling first and best solutions Fleet, United Kingdom Network emulation solutions Santa Rosa, CA Bucharest, Romania Custom analog chipsets, Network test, visibility modules, interconnect and security software Beijing, China Santa Clara, CA Worldwide wireless Keysig
Slide 48: Difficult-to-replicate approach
1 Difficult-to-Replicate Approach Delivers First-to-Market Solutions Partner with leading customers to create high-value solutions with faster time-to-market than previously possible Develop hardware and software products to address many Solutions applications, applying deep competencies in areas su
Slide 49: OTA measurement innovation
1 OTA Measurement – A Realm that Requires Significant Innovation Compared to cabled measurements, requires Keysight solution originally developed for early new specifications, calibration procedures, validation of mobile devices, since extended to and measurement software other segments such as Auto
Slide 50: Keysight Fab and Software Design Center
2 Keysight Fab Santa Rosa, CA Software Design Center Atlanta, GA • Proprietary chips, modules, and • Platform software developed with interconnects, purpose-built for Agile methods to support electronic advanced solutions such as 5G Delivers design and test solutions Accelerates and Automotive radar
Slide 51: World's most advanced oscilloscope
2 The world’s most advanced oscilloscope and a solution platform in its own right Vs. Predecessor • 110 GHz real-time bandwidth 175% • Full bandwidth on all 4 channels 200% • 256 GSa/s on all 4 channels 160% 10 Tb/s Total Data Rate Across 4 Channels Enabled by Proprietary Technology Capabilities • 1
Slide 52: Proprietary hardware and software enable new measurements
2 Proprietary hardware and software enable measurement performance not previously possible What applications need these measurements? Validation of 1 Tb/s Data Link Using UXR + Keysight Vector Signal Analysis Software Most core technologies being created to enable all of us to exchange more data, ac
Slide 53: Increase in software engineers
3 Number of Software Engineers 83% 2,500 2,000 Engineering Mix 1,500 33% Increase in 1,000 67% Software 500 ◼ Software ◼ Hardware Engineers 0 FY14 FY19 53 TOC
Slide 54: Increase in software revenue
3 Software Revenue 123% $1,000M 19% of Total $800M $600M Increase in $400M 12% of Total Software $200M Revenue $0M FY14 FY19 54 TOC
Slide 55: Lifecycle phases and customer pain point
3 LIFECYCLE PHASES Customer SIMULATE PROTOTYPE VALIDATE MANUFACTURE OPTIMIZE Pain Point: Inability to share Electronic Design Automation (EDA) Software specifications, Simulate designs before they are built to find and fix issues test software, and results Graphical Test Software Allows non-programm
Slide 56: Customer challenges led to PathWave
3 Customer challenges led to Keysight innovation of PathWave ENGINEERING CHALLENGES 93% ACROSS THE INDUSTRY >1-month correlating REPORTED WANTING A CHANGE data, at every iteration Engineers want to accelerate time-to-market with Getting design and test an integrated product development solution resu
Slide 57: Open, scalable, predictive platform
3 SIMULATE PROTOTYPE VALIDATE MANUFACTURE OPTIMIZE CONNECTED LIFECYCLE PHASES ✓ Consistent user experience ✓ Agnostic to measurement hardware form factor – ✓ Common data formats benchtop, modular, custom ✓ Integrates existing IP and measurement science ✓ Runs embedded, on the desktop, or in the clou
Slide 58: PathWave solutions timeline
3 2018 2019 2020 2021+ • Platform vision and • Platforms released: • Platform releases: • Updates to all platform architecture goals ✓ VXG Embedded Edition ✓ Cloud Edition editions • Components released: ✓ Desktop Edition • Enable broader developer • Component releases: ✓ Manufacturing Analytics • C
Slide 59: Cloud solution with leading 5G customer
3 Breakthrough cloud solution being developed with leading 5G customer Cloud-Based Testing Cockpit At-scale operation of complex, Optimized deployment of Real-time metrics for fast insights high-value test processes expensive test assets and continuous improvement Coordinated management of dozens of
Slide 60: 6G and quantum focus areas
4 Selected focus areas – executed in partnership with universities and industry consortia • Joined 6G Flagship Program at University of Oulu in Finland 6G • Assigned program leader (proven technical manager who led Keysight’s 5G efforts) • Assessing core technology requirements in Keysight Labs • Ac
Slide 61: Key takeaways
Transformed, growing, and exceeding commitments 1 Sustainable competitive advantage with powerful, industry-leading R&D team and proprietary hardware and software technology 2 Critical first-to-market advantage 3 Addressing customer pain point with software-centric approach based around PathWave 4 C
Slide 62: Satish Dhanasekaran
Satish Dhanasekaran SVP, President – Communications Solutions Group TOC
Slide 63: Communications Solutions Group priorities
1 2 3 4 Solidified #1 Actioning Delivering first to Driving portfolio position in end significant market, software- strategy that markets, delivering opportunities in key centric solutions enables customers’ substantial growth technology waves aligned with business outcomes and profitability includi
Slide 64: CSG FY19 highlights
FY19 Highlights +12% YoY $0.7B 52% YoY +620 bps2 $12.7B Revenue Growth Operating Income3 Operating Income Growth Operating Margin Growth Addressable Markets Revenue1 & Operating Margin2,3 Communications Solutions for Diverse, Growing End Markets $3,400 $3,177 35% 3,000+ Global, Close-to-Customer Eng
Slide 65: 2018 Investor Day commitments and actions
What We Said At 2018 Investor Day Actions Taken 5G technology wave will Developed end-to-end 5G platform and drive growth delivered solutions at scale RESULTS 2 Consecutive Years of Double-Digit Growth, Extend solutions Integrated Ixia and accelerated synergies and Outperforming Market leadership an
Slide 66: Commercial communications
• Business organized around the wireless and wireline ecosystems; delivering end-to-end Revenue ($M) value, up and down the technology stack, and across the ecosystem $2,203 • Accelerating innovations through software-centric solutions that address key challenges $1,871 around user experience, mobil
Slide 67: Aerospace, defense and government
• Enable global defense modernization by providing mission-critical instrumentation, Revenue ($M) solutions, and services to government agencies, prime contractors and broad supply chain $972 $974 $875 $887 • Solve challenges around new threats surfacing as a result of digital transformation $848 So
Slide 68: Mega-trends and innovation strategy
EMSO 5G / 6G Electromagnetic Industry 4.0 Spectrum Operations Mega- New Space Cloud Trends AI / Cybersecurity Machine Quantum Learning Our Innovation Disciplined, Early Co-Innovating Connecting Accelerating Strategy with Market-Defining Investment Critical Workflows through Acquisitions Customers 1
Slide 69: Sustain, expand, grow
VOICE OF OUR “Create and execute the test CUSTOMERS strategy for our enterprise.” “Launch our first 5G product for the global market.” “Accurately troubleshoot and GROW debug our designs.” EXPAND Providing greater value throughout customer lifecycle SUSTAIN Delivering first-to-market • Collaborative
Slide 70: Maximize, accelerate, seed
1 2 3 Maximize Accelerate Seed 5G Lifecycle Defense Next-Gen Growth Opportunity Modernization Opportunities Solutions 70 TOC
Slide 71: 5G deployments and standards evolution
1 2018 2019 2020 2021 2022 2023+ DEPLOYMENTS Continued Global Proliferation of 5G Service & Devices GLOBAL 1st Launch Sub-6 GHz Oct. ‘18 mmWave RELEASE 15 STANDARDS RELEASE WIRELESS 16 RELEASE • 5G NR NSA and SA 6G 17 • Sub-6 GHz and mmWave • C-V2X (automotive) • Industrial private networks • Advanc
Slide 72: Increasing digitization across the value chain
1 Devices RAN1 Edge Network Core Network Data Centers Enterprise Mobile Services, Application Layer Analytics Cloud Increasing Digitization and Software Content Applications Security Design RAN Transport: Core Network Protocol Layer Workflow Virtualization 400G Virtualization Physical Layer Wider Ba
Slide 73: Momentum in physical and protocol layers
1 Devices RAN1 Edge Network Core Network Data Centers Enterprise Application Layer Mobile Services, Greenfield SpaceCloud Analytics Increasing Digitization Applications Security and Software Content (Emerging) Protocol Layer Design RAN Transport: Core Network (Expanded) Enabled Workflow by Strategic
Slide 74: Keysight 5G technology stack
1 Keysight’s 5G “technology stack” is a Greenfield proprietary combination of layers of product Space hardware, embedded software, connectivity, test, and security tools that enable customers throughout the entire 5G lifecycle ✓ Provides end-to-end lifecycle coverage from simulation through deployme
Slide 75: Winning across the 5G ecosystem
1 Winning Across the Ecosystem …With Increasingly Differentiated Solutions 90 >900 >100 Solutions 3GPP 5G Trials Invented Standards Participation Contributions >75% EXECUTING 5G Designs Enabled1 TO MULTI-YEAR ROADMAPS ~1,000 >100 Sustained and Monetized Employees Globally Joint Customer Working on 5
Slide 76: Case study: portfolio breadth
1 VAL U E P R O P O S I T I O N C AS E S T U D Y: P O R T F O L I O B R E AD T H Customer need – form an ecosystem to Keysight selected to deliver end-to-end launch 5G under challenging timelines solutions for the connected workflow KEYSIGHT SOLUTION • Established regional R&D presence to engineer s
Slide 77: Case study: manufacturing impact
1 VAL U E P R O P O S I T I O N C AS E S T U D Y: M AN U FAC T U R I N G I M PAC T 5G Workflow Simulation Design Validation Manufacturing Operations Drivers for 5G Manufacturing Complexity KEYSIGHT SOLUTION Breakthrough throughput with virtualized Spectrum (mmWave frequency, new bands) measurement I
Slide 78: Emulating threats in the lab
1 U N I Q U E S O L U T I O N A C C E L E R AT E D B Y S Y N E R G I E S B E T W E E N 5 G P L AT F O R M A N D I X I A Keysight Solution Emulates Threats in the Lab Ixia Security Toolkit Proliferation of connected devices results in magnified security vulnerabilities Network & Device Emulation 78 T
Slide 79: 5G opportunity drivers
1 5G REL- 17 Opportunity Drivers REL- 16 Industry R&D investment continues $30B in R&D spend through 20261 REL- 15 Scaling deployments drive increased need for 600 1,000+ 5G 375 Keysight Customers Keysight Customers Keysight Customers validation, conformance, manufacturing and operational solutions
Slide 80: Electromagnetic spectrum operations and space
2 EMSO SPACE & COMMUNICATIONS & ADVANCED RESEARCH / (ELECTROMAGNETIC SPECTRUM OPERATIONS) SATELLITE SUPPLY CHAIN METROLOGY Race for Privatization of space and 5G extending to New technologies needed to control of spectrum satellite revolution Aerospace Defense applications enhance performance Strong
Slide 81: Threat simulators selected by U.S. DoD
2 INTRODUCED November 2019 Complex high-fidelity APPLICATION threat environments Real-time kinematics and angle of arrival calculation RF emitter verification KEY ATTRIBUTES Legacy threat database translation Complete EW lifecycle test platform Multi-channel EMSO solution Simulation View software si
Slide 82: Quantum opportunity
3 OPPORTUNITY LARGE-SCALE INVESTMENTS BEING MADE At maturity, quantum technology has the potential to upend entire R&D investment directed at solving Nations of the world investing industries through an exponential critical integration and scaling breakthrough in parallel challenges $10B+ for leader
Slide 83: Quantum research partnership with MIT
3 Early access to Keysight’s technology has been key to enabling our research for the past few years. EQuS looks forward to applying Keysight’s emerging quantum software and hardware solutions to our new 64-qubit test bed. Professor William D. Oliver, Ph.D. Director | Center for Quantum Engineering
Slide 84: Addressable market
ADDRESSABLE MARKET1 Commercial Aerospace, Defense and Communications Government $14.3B Market Size $8.5B $4.2B 2022E Growth Rate 4% - 6%2 2% - 3%2 $12.7B Industry 2020E ICT global spend of $5.3T expected to increase to $6.0T by 2022E3 2020 U.S. defense budget $738B4 2019 Share: 25% Dynamics • Expone
Slide 85: Key takeaways
1 Investing to expand market position and leadership 2 Accelerating portfolio transformation to enable digital revolution in end markets 3 Expanding software, services in high growth markets creating runway for profit expansion 4 Increasing differentiation and customer adoption enabling lifecycle va
Slide 86: Q&A Session
- S, eo. Q&A Session , sl
Slide 87: Break
BREAK
Slide 88: Gooi Soon Chai
Gooi Soon Chai SVP, President – Electronic Industrial Solutions Group TOC
Slide 89: EISG strategy priorities
1 2 3 4 Strengthening EISG Driving strategy to Capitalizing on Advancing customers market position by capture technology technology innovation process delivering inflection points in leadership for wins in across their value sustainable and high-value advanced wafer chain through profitable growth a
Slide 90: EISG FY19 highlights
FY19 Highlights +6% YoY $294M 20% YoY +300 bps $4.8B Revenue Growth Operating Income1 Operating Income Growth Operating Margin Growth Addressable Markets Revenue & Operating Margin1 Key Markets and Customers $1,200 $1,135 35% $1,071 30% $1,000 $929 $849 $870 25% $800 25.9% 22.5% 22.9% 20% $600 20.1%
Slide 91: 2018 Investor Day commitments and actions
What We Said At 2018 Investor Day Actions Taken Capture opportunities in ✓ Broadened solutions portfolio for high-value automotive, automotive and emerging IoT RESULTS emerging IoT applications applications and next-generation • Delivered 11% revenue CAGR and ✓ Extended solutions into high power 340
Slide 92: Connected devices, automotive and semiconductor trends
1 Proliferation of Connected Devices 2 Automotive Industry Transformation 3 Semiconductor Innovation • Connected devices to increase from • Increase in automotive electronics from • 5X surge in data volumes from 14ZB1 to 22B1 to 50B by 20302 35% to 50% by 20305 79ZB by 20258 • 127 new IoT devices co
Slide 93: Accelerate, enable, drive
1 2 3 Accelerate Enable Drive Innovation for the Next-Generation Advancement in Internet of Things Semiconductor Next-Generation (“IoT”) Ecosystem Capabilities Automotive 93 TOC
Slide 94: 5Cs of IoT
1 Connectivity Ensuring robust and reliable connections Complying to global standards and regulations Compliance for market access 5Cs of Coexistence Operating harmoniously in crowded IoT IoT environment Optimizing power consumption to maximize Continuity battery life Securing devices and infrastruc
Slide 95: Semiconductor solutions beyond Moore's Law
2 MORE than MOORE’s : Functional Diversification Function Function Analog / MEMS1 High mmWave Image Silicon Advance Node RF Power Sensor Photonics Materials Node Size MOORE’s LAW : Node Size Scaling 90 nm KEYSIGHT SOLUTIONS 65 nm 45 nm DESIGN PRECISION WAFER VERIFICATION POSITIONING TEST 32 nm • Mat
Slide 96: Automotive industry dynamics and sub-segments
3 3 SUB-SEGMENTS CURRENT INDUSTRY DYNAMICS • Reinvention of automotive ecosystem 1 Electric Vehicle / Battery Development • New entrants and business models 2 ADAS1, Radar & Communications • Restructuring and retooling of auto supply chain • Slowdown of global car sales 3 Electronic Manufacturing •
Slide 97: Automotive solutions across technology domains
3 … Fully Connected … Electric Powered … Self Driving 88 Keysight Solutions Automotive In-car Mobile V2X Radar Across Multiple Technology Domains Diagnostics Network Integration Comms Vehicle to Everything (V2X) Communications • Radar Collision Avoidance • Infotainment and Entertainment • Emergency
Slide 98: EV and battery test customer validation
3 EV / EV Supply Battery Battery Lab Equipment Characterization Management Management Charging Interface and Development Systems Testing CUSTOMERS VALIDATION Our mission is to produce special application, tailor-made cells The combination of industry-leading hardware, software and that meet our cust
Slide 99: Key customers and local expertise
3 Nagoya, KEY CUSTOMERS Japan Automotive OEMs Stuttgart, Electronic Germany Components Suppliers Semiconductor Chipset Manufacturers Battery and Charging Detroit, Shanghai, Infrastructure Providers Michigan China Compliance Labs BRINGING MEASUREMENT EXPERTISE CLOSER TO CUSTOMERS 99 V TOC
Slide 100: Key takeaways
1 Delivering strong results consistently: 6% revenue growth and 300 bps OM improvement in FY19 2 Capturing technology inflection points in high-value automotive and IoT applications 3 Leveraging innovation to maintain leadership and enable technology advancements in the semiconductor industry 4 Well
Slide 101: John Page
John Page SVP, President – Global Services TOC
Slide 102: Global Services priorities
1 2 3 4 Global Services orders Essential and Continue to launch Increasingly well- expected to exceed growing part of new, differentiated positioned for $600M in FY20 (>48% Keysight’s software- and higher-value continued increase vs. FY17) centric solutions services to meet profitable organic model
Slide 103: Services FY17–FY19 highlights
FY17 – FY19 Highlights 20+ 17% 10% 54% Countries with Services Presence Services Orders CAGR Services Revenue CAGR Services Sold Upfront CAGR Global Services Centers Overview • Global presence with services operations in 20+ countries • Services designed to help customers achieve business outcomes:
Slide 104: 2018 commitments, results and outlook
What We Said At 2018 Investor Day Actions Taken and Results Future Outlook ✓ 17% services orders CAGR (FY17 - FY19) driven by Grow organically to $600M in services • On track to exceed $600M in services revenue services subscriptions that generate recurring revenue revenue • Increasing contribution
Slide 105: Services evolution to higher value
Higher-Value Services 4 Trusted Partner As the measurement expert, be a partner with higher-level, value-added services, deliver outcomes Digital End-to-End Customer Experience 3 Smart Connected Products Ecosystem Creating an ecosystem of smart connected products that enable entirely new and higher-
Slide 106: Attaching services upfront adds recurring revenue
Market Dynamics Performance Enhanced Assured Increasingly complex Fast, Committed Support Priority Support Proactive, Enterprise Support test solutions Services Orders Attached Upfront Technology integration requires measurement, Attached Upfront instrument and software experts $M Time-to-market Ins
Slide 107: Differentiated digital customer experience
Smart Connected Products, Integrated Data, Analytics, Customer Outcomes Solutions & Systems Customer Interface and Support One-click Calibration Ordering Improved asset utilization “My calibration is due” Consistent, predictable support Return to Loan Pool (Instrument Sharing) Increased measurement
Slide 108: Outcome-based services
Industry Focus Aerospace Defense 5G Autonomous Vehicle / Electric Vehicle Wrapping Services Around Industry Solutions OUTCOME-BASED SERVICES Integrating services early to provide full customer solution • Quality uptime for multiple system installations • Financing to meet 5G/6G OpEx vs. CapEx needs
Slide 109: Case study: outcomes-based services
VAL U E P R O P O S I T I O N C AS E S T U D Y CUSTOMER NEED KEYSIGHT SERVICES SOLUTION CUSTOMER OUTCOMES • Lower cost of test • Over past 2 years, evolved from reactive, ✓ Asset utilization up 29% basic hardware support to: • Improved speed and ✓ Cost of test down 20% quality • Unique uptime soluti
Slide 110: Key takeaways
Services growth and profitability are accelerating 1 Growth: FY20 orders to exceed $600M with revenue tracking current and future order growth 2 Strategic focus: wrapping essential Services around Keysight’s software- centric solutions, while capturing opportunities for recurring revenue 3 New offer
Slide 111: Marie Hattar
Marie Hattar Senior Vice President and Chief Marketing Officer TOC
Slide 112: Marketing transformation
1 2 3 4 Transformed Harnessing our Infusing marketing Enabled significant marketing to support technical leadership data science to revenue growth Keysight software- and world-class measure and while keeping centric solutions reputation to grow implement digital investment flat strategy; now brand v
Slide 113: Marketing priorities
Solutions Leadership Strong Partnership with Sales Marketing Maximization • Reorganized marketing to solution • Implementing digital programs to attract • Shifting people and program mix to campaigns new company logos drive results • Orienting brand to next-generation • Driving low-touch digital sof
Slide 114: Keysight World events
San Francisco Shanghai Taipei Tokyo Penang Largest event with customers, industry thought leaders, academics, and Keysight experts coming together 2017 Started as 1,000-person engineering community event in Japan 2019 Attendees include engineers and new executive track Expanded to 10 countries and g
Slide 115: Industry events and activities
Supporting major growth initiatives through industry events and activities World-Class IoT Innovation Establishing KeysightCare Industry Events Challenge and PathWave Brands Maximize industry tradeshow engagement Design contest for university students to PathWave and KeysightCare integrated to drive
Slide 116: Digital education livestream results
Technical education, tutorials and insights from Keysight experts BACKGROUND & APPROACH 2019 RESULTS • 2-week daily livestream insight-driven 2M Video Views education and how-to webinars with giveaways of Keysight gear 85K Registrants • Utilize digital advertising and social media influencers to rea
Slide 117: Brand awareness and media mentions
FY15 Strong Brand Purpose Keysight / Agilent / HP • Establish strong brand purpose and align with strategic business planning 25%1 • Connect our brand with CSR principles BRAND AWARENESS • Be an employer of choice Targeted Advertising • Strong presence in key industries’ physical locations FY18 • Be
Slide 118: Marketing results and ROI
Unaided Keysight Awareness in #1 $143M Marketing Sourced Won Opportunities Test & Measurement1 Early Traction Generating Tradeshow Leads 10X Strong +28% Marketing Qualified Leads ROI Media #1 5,000 New Customers Mentions +15% Added2 Note: Data as of Oct 31, 2019; percentages indicate YoY change. 1 H
Slide 119: Key takeaways
1 Transformed into a world-class marketing organization at no incremental cost 2 Strong partnership with sales and increasing ownership for order generation 3 Aligning and partnering with solutions business groups to drive demand and grow customer base 4 Cultivating culture of ROI measurement for ev
Slide 120: Mark Wallace
Mark Wallace SVP – Global Sales TOC
Slide 121: Global Sales priorities
1 2 3 4 Executed on our Deepening Increasing capability Continuing to grow promises with customer on value pricing and and optimize global positive order relationships with solution-selling to sales capacity with growth and industry leaders and further expand emphasis on increasingly first-to-market
Slide 122: FY19 highlights and global sales footprint
FY19 Highlights 32,000+ 100+ $4.4B 10% >30% End Customers Countries Total Core Orders Software & Services Sales Served Annually1 Served Orders Growth as a % of Total Global Sales Footprint Overview • Large global footprint with 2,800+ customer-facing and customer support resources 20% • 600+ solutio
Slide 123: 2018 commitments, actions and results
What We Said At 2018 Investor Day Actions Taken Great customer relationships, ✓ Deepened and leveraged leading satisfaction and loyalty customer relationships RESULTS ✓ Transformed the organization to increase • Positive order CAGR across all Insufficient growth and reach frontline sellers and digit
Slide 124: Effective sales funnel management
More Marketing Qualified Dynamic Resource Leads (MQLs) Deployment Driving Double-Digit Growth Since Last Investor Day • 400+ account managers and application Sales Qualified Leads (SQLs) 45% larger raw sales funnel engineers onsite at industry-leading customers Deal Velocity Qualifying, progressing,
Slide 125: Keysight sales actions
TIME TO MARKET OPTIMIZING COMMERCIALIZING ADOPTING A DIGITAL PRESSURE WORKFLOW TECHNOLOGY WAVES BUYING JOURNEY • More complexity and Focused on • More companies creating smart, • Spend >50%1 of buying journey competition to get to market • Reduced cost and rework connected devices and online • Requi
Slide 126: Grow, accelerate, expand
1 2 3 Grow Accelerate Expand New Customers to Solutions to Services and Extend Reach Grow Share Software to Increase Recurring Revenue WINNING FORMULA TO SUSTAIN TOP-LINE GROWTH AND EXPAND MARGINS 126 TOC
Slide 127: Expanded sales capacity and capability
1 SALES CAPACITY: FRONTLINE SELLERS SALES CAPABILITY >1,100 Onboarding experts, experienced, and 800 early career sales and application 650 engineers to match solution selling and 550 support skill requirements 500 TOOLS Cloud-based CRM 2016 2017 2018 2019 2020E TRAINING FY20 Objectives Technical an
Slide 128: Digital marketing and e-commerce
1 DIGITAL MARKETING Industry Insight and Lead Generation • Continue successful marketing lead generation + frontline seller program to reach new customers • Demonstrate industry expertise and insight • Reframe customers’ understanding of industry and measurement challenges GUIDED BUYING E-COMMERCE +
Slide 129: Customer engagement across ecosystems
2 ✓ Dedicated Keysight global account teams, focused on Tier 1 industry leaders and their 100% Major 5G test houses1 global ecosystems use Keysight solutions ✓ Customer engagement process harnesses Keysight’s full capability – from sales to R&D 100% to marketing – and aligns to customers’ Top 25 tec
Slide 130: KeysightCare adds recurring revenue
3 TOTAL SERVICES ORDERS ATTACHED UPFRONT FY19 RESULTS • Accelerated growth of orders for services attached upfront • Launched KeysightCare in early FY19 $M FY20 PRIORITIES • Grow recurring revenue by expanding renewal sales channel • Grow multi-year KeysightCare • Extend enterprise licensing into in
Slide 131: Case study: semiconductor wafer manufacturer
3 VAL U E P R O P O S I T I O N C AS E S T U D Y CUSTOMER NEED KEYSIGHT SOLUTION CUSTOMER OUTCOMES Hardware + Software + Services ✓ Higher throughput Increased test accuracy, • P9000 Series Parametric Tester: first-to- precision, throughput, ✓ Less floor space market tester to meet test requirements
Slide 132: Key takeaways
1 Sustained, positive order growth, increasingly diversified customer base, on track to doubling frontline sales capacity at lower cost per order dollar 2 Deepening customer relationships, first-to-market-solutions scaled across ecosystem 3 Increasing focus on value pricing and solution selling to e
Slide 133: Neil Dougherty
Neil Dougherty Senior Vice President and Chief Financial Officer TOC
Slide 134: Transformed financial performance
1 2 3 4 5 Dramatically Taking share in a Sustained Increasing Raising the bar: transformed large growing investment for business Increasing operating financial end market: 5 growth: ~$700M resiliency with a margin target to performance with consecutive years of annual R&D flexible cost 26% - 27% by
Slide 135: Financial performance while increasing R&D investment
Revenue ($B)1 Gross Margin %1,2 Operating Margin %1,2 Free Cash Flow1 ($M) EPS1 63.2% $4.72 $4.31 24.0% $878 $3.91 60.4% $3.25 59.8% $3.24 $2.86 $2.93 18.8% $2.52 $2.43 $2.53 57.4% 18.1% 18.4% 17.6% $423 56.5% $329 $296 $256 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
Slide 136: FY19 revenue mix
FY19 Revenue Mix 12% 11% 56% 18% 70% 82% 19% 32% ◼ R&D ◼ Manufacturing ◼ Operations ◼ Hardware ◼ Software ◼ Services ◼ Non-Recurring ◼ Recurring Software and services revenue expected to grow faster than overall Keysight Significant opportunity to convert software sales from perpetual to time-based
Slide 137: Commitments status and progress
COMMITMENT STATUS PROGRESS ✓ Achieved core growth1,2 of 13% in FY18 and 11% FY19 Top-line Growth Sustained 4% - 5% revenue growth ✓ ✓ Five consecutive years of market share gains3 Operating Margin1,4 Deliver 40% OM incremental on 4% core growth Baseline operating margin of 21% - 22% by FY21 ✓ ✓ Reac
Slide 138: Long-term secular growth trends
Favorable Long-term Secular Growth Trends (5G, Next-Generation Auto, IoT) CSG EISG TOTAL1 Commercial Comms2 Aerospace, Defense & Gov’t Electronic Industrial Market Size3 $8.5B $4.2B $4.8B $17.5B Long-term Growth Rates3 4% - 6% 2% - 3% 2% - 3% 3% - 5% Keysight Revenue4 $2.2B $1.0B $1.1B $4.3B Keysigh
Slide 139: Operating leverage at 4% or greater growth
40% Operating Leverage at 4% or Greater Core Revenue Growth 139 TOC
Slide 140: New margin targets by FY23
Prior Target FY19 New Target Increase vs. (2018 Investor Day) Results by FY23 Prior Target Gross Margin1 61% - 63% 63% ✓ 64% - 66% +300 bps Operating Margin %1 21% - 22%2 24% ✓ 26% - 27% +500 bps DRIVERS Improved Market Position • Increased Differentiation (Solutions) • Favorable Mix Shift (SW, R&D)
Slide 141: Operating margin durability scenarios
Revenue -10% BASELINE +10% Scenarios Operating -300 to FY19 FY23 +200 to Margin Durability 400 bps 24% 26% - 27% 300 bps ✓ 100% of employees have a variable pay component Enabled by Flexible Cost Structure ✓ ~50% of production is outsourced ✓ ~25% of sales flow through indirect channels ✓ Strategic
Slide 142: Leverage profile and capital structure
Leverage Profile Capital Structure As of ($M) Q1’20 ($M) • ~$2.1B available liquidity $450M Revolving Credit Facility Undrawn • $1,693M cash, cash equivalents and restricted cash 4.55% Senior Notes due 2024 600 • $450M revolving credit facility 4.60% Senior Notes due 2027 700 3.00% Senior Notes due
Slide 143: Capital allocation: R&D, M&A, return of capital
1 Sustained Investment to Drive Organic Growth 2 Disciplined M&A 3 Return of Capital • Increased R&D investment to • Value creation through M&A is a • $500M share repurchase ~16% of revenue strategic objective authorization; $335M remains • Continued increase in sales • Active M&A funnel development
Slide 144: M&A strategic filters and financial criteria
Strategic Filters Financial Criteria Accelerates near and long-term strategic objectives % ROIC above cost of capital High software content and/or high recurring Accretive to growth and gross margin revenue Expands portfolio of high-value solutions Revenue and cost synergy opportunities Australia Ca
Slide 145: Updated long-term targets
Original Target Prior Target NEW TARGET 2015 Investor Day 2018 Investor Day Core Revenue Sustainable Sustainable Sustainable Growth1,2 4% CAGR 4% - 5% CAGR 4% - 6% CAGR Operating Margin1,3 17% - 18% 21% - 22% 26% - 27% EPS Growth1 8% - 10% ≥10% ≥10% 26% - 27% OPERATING MARGIN EXPECTED BY FY23 1 Non-
Slide 146: Key takeaways
1 A market leader in a large, diverse, and growing end market A diversified global business serving multiple industries and over 2 32,000 customers annually with no customer accounting for more than 5% of FY19 revenue 3 Investing in R&D and Sales to drive continued above-market growth; building upon
Slide 147: Q&A Session
- S, eo. Q&A Session , sl
Slide 148: Ron Nersesian
Ron Nersesian Chairman, President and Chief Executive Officer TOC
Slide 149: Closing remarks
1. Strong leadership team and employees successfully executing to deliver on commitments 2. Delivering first-to-market solutions aligned to key growth areas and end markets 3. Executing on our software-centric solutions strategy to meet customer needs and increase recurring revenue 4. Applying the K
Slide 150: Appendix
cdl e, oe Appendix , sa
Slide 151: 5G/6G technology impact and communications stack
Prior Now 5G Technology Impact 5G/6G Technology Impact Network Core Data Network Core Data Chipsets Devices Chipsets Devices Access Network Centers Access Network Centers Communications “Stack Layers” Drive Test Mobile Network Test Customer Experience Application Network Layer and Management Applica
Slide 152: Market drivers and Keysight opportunities
Keysight Opportunities Chipset R&D Solutions Providers Manufacturing Solutions Device Network Equipment Providers Component Providers Suppliers Phones, Tablets, Other Base Stations, Other * *Opportunistic Test Houses Service ** Providers **Leverage Opportunity ** **Leverage Opportunity MARKET DRIVER
Slide 153: GAAP to non-GAAP revenue
($M) FY19 FY18 FY17 FY16 FY15 GAAP revenue $ 4,303 $ 3,878 $ 3,189 $ 2,918 $ 2,856 Amortization of acquisition-related balances 9 36 60 12 6 Non-GAAP Revenue $ 4,312 $ 3,914 $ 3,249 $ 2,930 $ 2,862 153 TOC
Slide 154: GAAP to non-GAAP income from operations
($M) FY19 FY18 FY17 FY16 FY15 Income (loss) from operations, as reported $ 711 $ (394) $ 148 $ 375 $ 390 Goodwill impairment - 709 - - - Amortization of acquisition-related balances 224 265 256 56 23 Share-based compensation 82 59 56 49 55 Acquisition and integration costs 9 49 57 18 16 Separation a
Slide 155: GAAP to non-GAAP gross profit
($M) FY19 FY18 FY17 FY16 FY15 Gross Profit, as reported $ 2,534 $ 2,111 $ 1,697 $ 1,616 $ 1,576 Amortization of acquisition-related balances 177 219 217 613 21 Share-based compensation expense 14 12 11 37 12 Acquisition and integration costs - 6 4 10 1 Acquisition-related compensation expense - - 1
Slide 156: GAAP to non-GAAP net income
($M, except per share amounts) FY19 FY18 FY17 FY16 FY15 GAAP Net income (loss) $ 621 $ 165 $ 102 $ 335 $ 513 Non-GAAP adjustments: Goodwill impairment - 709 - - - Amortization of acquisition-related balances 224 265 256 56 23 Share-based compensation 82 59 56 49 55 Acquisition and integration costs
Slide 157: Free cash flow reconciliation
($M) FY19 FY18 FY17 FY16 FY15 Net Cash Provided by Operating Activities $ 998 $ 555 $ 328 $ 420 $ 388 Less : Investments in PP&E (120) (132) (72) (91) (92) Free Cash Flow $ 878 $ 423 $ 256 $ 329 $ 296 Non-GAAP Net Income $ 902 $ 618 $ 462 $ 419 $ 432 FCF/NI 97% 68% 55% 79% 69% 157 TOC
Slide 158: Net debt and total capital
($M) As at January 31, 2020 Senior notes, par value $ (1,800) Gross Debt $ (1,800) Less: Cash and cash equivalents $ 1,691 Restricted cash 2 Net Debt $ (107) Gross Debt, as above $ 1,800 Add: Shareholders' equity 3,127 Total Capital $ 4,927 158 TOC
Slide 159: Adjusted EBITDA reconciliation
LTM ($M) January 31, 2020 Net Income $ 670 Add: Provision for income taxes 127 Income before taxes $ 797 Add: Interest Income (25) Interest Expense 79 Depreciation and amortization 312 EBITDA $ 1,163 Add back: Non-GAAP adjustments Amortization of acquisition-related balances 16 Share-based compensat
Slide 160: Revenue by segment
Amortization of GAAP acquisition- Non-GAAP ($M) Revenue related balances Revenue Revenue by Segment FY19 Communications Solutions Group $ 3,168 $ 9 $ 3,177 Electronic Industrial Solutions Group 1,135 - 1,135 Keysight $ 4,303 $ 9 $ 4,312 160 TOC
Slide 161: Non-GAAP financial measures
Non-GAAP Financial Measures Management uses both GAAP and non-GAAP financial measures to analyze and assess the overall performance of the business, to make operating decisions and to forecast and plan for future periods. We believe that our investors benefit from seeing our results “through the eye
Slide 162: Management Biographies
Oo f, S .G" Management Biographies
Slide 163: Ron Nersesian
RON NERSESIAN CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER Ron Nersesian is chairman, president, and chief executive officer of Keysight Technologies. In November 2011, he was named executive vice president and chief operating officer of Agilent Technologies. The following year, in November 2012,
Slide 164: Ingrid Estrada
INGRID ESTRADA SVP – CHIEF ADMINISTRATIVE OFFICER AND CHIEF OF STAFF Ingrid Estrada is chief people and administrative officer at Keysight Technologies, as well as chief of staff. Estrada's responsibilities include directing Keysight's global policies and programs for leadership and talent developme
Slide 165: Jay Alexander
JAY ALEXANDER SVP AND CHIEF TECHNOLOGY OFFICER Jay Alexander is senior vice president and chief technology officer of Keysight Technologies. Alexander leads Keysight's centralized technology development team to focus on addressing top opportunities and market trends. His role is to optimize Keysight
Slide 166: Satish Dhanasekaran
SATISH DHANASEKARAN SVP, PRESIDENT – COMMUNICATIONS SOLUTIONS GROUP Satish Dhanasekaran is senior vice president, Keysight, and president of the Communications Solutions Group (CSG) at Keysight Technologies. Satish leads the $3.1 billion global business that addresses the communications ecosystem in
Slide 167: Gooi Soon Chai
GOOI SOON CHAI SVP, PRESIDENT – ELECTRONIC INDUSTRIAL SOLUTIONS GROUP Gooi Soon Chai is senior vice president, Keysight, and president of the Electronic Industrial Solutions Group (EISG) which addresses the automotive, energy, general electronics, manufacturing, and semiconductor businesses. Gooi is
Slide 168: John Page
JOHN PAGE SVP, PRESIDENT – GLOBAL SERVICES John Page is senior vice president, Keysight, and president of global services. Page, most recently vice president of Keysight's business finance organization, has over 25 years of financial and corporate leadership, including CEO and founder of a cloud- ba
Slide 169: Marie Hattar
MARIE HATTAR SVP – CHIEF MARKETING OFFICER Marie Hattar is chief marketing officer of Keysight Technologies. As CMO, Hattar is responsible for Keysight's brand and global marketing efforts. She drives Keysight's corporate positioning, messaging and communications to both internal and external audien
Slide 170: Mark Wallace
MARK WALLACE SVP – GLOBAL SALES Mark Wallace is senior vice president, global sales for Keysight. As the leader of the company's global sales function, Wallace is responsible for orders and customer satisfaction for the company. Most recently, Wallace was vice president and general manager of the Am
Slide 171: Neil Dougherty
NEIL DOUGHERTY SVP AND CHIEF FINANCIAL OFFICER Neil Dougherty is senior vice president and chief financial officer of Keysight Technologies. As CFO Dougherty leads the company's global finance operations including tax, treasury, and investor relations. Dougherty joined Hewlett-Packard in 1996 as a f