VIAVI Solutions (VIAV)
NASDAQInformation TechnologyCommunication EquipmentSnapshot 2026-09-04
$34.86+3.66%
Close 2026-09-04 · 1-day change
NASDAQInformation TechnologyCommunication EquipmentSnapshot 2026-09-04
Intact: The reason to own it still holds.
Viavi Solutions is growing revenue fast, with a 42.8% increase last quarter. Profit margins are improving, with gross profit rising $70.6M from late 2025 to early 2026. Operating income also grew by $9.5M, showing better cost control. The company is on track to meet management's growth and margin goals.
The stock is selling off sharply, down 27% from its high. The company is still loss making and faces elevated risk. Revenue growth and margin improvements may stall, hurting profits and cash flow.
The market expects about 32% revenue growth next year, which is high. Our fair value is $16.64, reflecting this growth, but the recent selloff suggests investors doubt the pace or durability of gains.
Breaks if: Gross profit falls below $163.5M
Focus on enhancing gross profit margins through operational efficiencies and product mix improvements.
Stated as a priority in 3 of last 3 quarters. GAAP gross margin improved from 56.3% in 2025-Q4 to 59.1% in 2026-Q4 (+280 bps); Non-GAAP gross margin rose from 60.1% to 62.3% (+220 bps). Management's focus on operational efficiencies and product mix is reflected in consistent margin improvement, indicating delivering progress.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This is a turnaround investment with a focus on improving financial metrics. The current thesis state is intact, supported by recent strong revenue growth and margin improvements.
The market seems to expect continued improvement in financial performance, but there is a fragility due to the high valuation despite the company's loss-making status. The expectations gap indicates that the market may not fully appreciate the risks involved.
Management is on track to increase revenue growth and improve profit margins, as evidenced by strong recent results. However, there is a near-term risk of missing earnings estimates, although the probability is relatively low.
The long-term thesis hinges on maintaining revenue growth and margin improvements, as well as external factors like potential Fed rate cuts and performance from sector leaders. A negative guidance cut could significantly impact sentiment.
The most important moves since the prior daily snapshot.
Mixed, the news cuts both ways. The latest earnings beat supports the read on VIAV. However, concerns about increasing revenue growth and guidance threaten the overall outlook.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
“GAAP gross margin of 59.1%, up 280 bps year-over-year; Non-GAAP gross margin of 62.3%, up 220 bps year-over-year.”
“Gross margin 57.5% GAAP, 62.2% Non-GAAP, up 110 bps and 220 bps year-over-year respectively.”
“Gross margin 57.0% GAAP, 61.8% Non-GAAP.”
Breaks if: Operating income falls below $15.3M
Focus on enhancing operating income through strategic cost management and revenue growth.
Breaks if: Revenue falls below $393M next quarter
Continue driving revenue growth through diversification into datacenter, aerospace, and defense markets.
Stated as a priority in 3 of last 3 quarters. Net revenue grew from $290.5M in 2025-Q4 to $443.1M in 2026-Q4, a 52.5% year-over-year increase; fiscal year 2026 revenue was $1.518B, up 40.0% from fiscal 2025. Management consistently attributes growth to diversification into datacenter, aerospace, and defense markets, indicating delivering trajectory.
“Our diversification strategy into datacenter ecosystem and aerospace and defense end markets has been a key growth driver for us during FY26.”
“VIAVI's financial performance... driven by strong growth in the data center and aerospace and defense end markets.”
“VIAVI is a global leader in test and measurement and optical technologies... enabling critical infrastructure including data center ecosystems and aerospace.”
Over the next 1 to 3 years, VIAV's performance will depend on its ability to sustain growth and manage risks effectively. Not investment advice.