VIAVI SOLUTIONS INC. (VIAV)

VIAVI Solutions Inc. is a global provider of network test, monitoring, and assurance solutions for communications service providers (CSPs), hyperscalers, network equipment manufacturers (NEMs), original equipment manufacturers (OEMs), government and avionics. Its offerings combine instruments, automation, intelligence and virtualization. VIAVI is also a leader in light management technologies used in anti-counterfeiting, 3D sensing, consumer electronics, industrial, automotive, government and aerospace applications. Its strategy focuses on organic and inorganic growth, leveraging secular trends in 5G wireless, fiber and 3D sensing, and on capital allocation that includes share buybacks and synergistic acquisitions.

The company operates in two broad categories, Network and Service Enablement (NSE) and Optical Security and Performance Products (OSP), which together comprise three segments. The Network Enablement (NE) segment offers instruments, software and services to design, build, turn up, certify, troubleshoot and optimize wireline and wireless networks, including computing and storage networks. Its products include field instruments (access and cable, avionics, fiber, metro, RF and radio test) and lab instruments (fiber optic production, optical transport, computing and storage network test, and wireless), plus the AvComm line of test equipment and Positioning, Navigation and Timing solutions for government, aerospace and military users. The Service Enablement (SE) segment provides embedded systems, microprobes and software for network and enterprise performance management, including data center monitoring tools (Apex, GigaStor, Observer) and assurance products (Nitro Geo, NITRO Mobile, AI Ops). The OSP segment makes optical coatings and light management products: Optical Variable Pigment (OVP) and Optical Variable Magnetic Pigment (OVMP) for banknote security, ChromaFlair and SpectraFlair color-shifting pigments for automotive uses, optical filters and Engineered Diffusers for 3D sensing and automotive sensing such as LiDAR, near-infrared spectrometers, and optics for government and aerospace uses.

CSPs account for the majority of NSE revenue. NE and SE customers also include NEMs, data center providers, government organizations, utilities, military contractors and large enterprises. Named customers include América Móvil, AT&T, Lumen Technologies, Cisco, Nokia, British Telecom Openreach, Deutsche Telekom and Verizon. OSP serves banknote issuers and security printers, consumer electronics, industrial, government and automotive customers. Its technologies are deployed on the banknotes of more than 100 countries, and named customers include SICPA, Lockheed Martin and Seiko Epson. The company has a strategic alliance with SICPA to market and sell OVP and OVMP worldwide. Sales are made through dedicated direct sales forces, supported by a worldwide channel community that includes Velocity Solution Partners for NSE.

As of June 29, 2024, VIAVI had significant manufacturing facilities in China, France, Germany, Mexico, the United Kingdom and the United States, with its most significant contract manufacturers in China and Mexico. It uses various suppliers and contract manufacturers and seeks at least two sources for materials, though some components come from sole or limited sources. NE competitors include Anritsu, EXFO, Keysight, Rohde & Schwarz, VeEX and Spirent. SE competitors include NetScout, Riverbed and Spirent. OSP competitors include Giesecke & Devrient, De La Rue, Merck KGaA, Nidek, Toppan, Toray, Materion, II-VI and AMS. The company has product development centers in Asia, Europe and North America. It owns 994 U.S. patents and 1,969 foreign patents and has 1,195 patent applications pending worldwide.