Test and Measurement: Test companies report strong revenue growth

Test companies are reporting a generally strong quarter in financial results thus far, with test-related revenues showing significant growth.
Keysight Technologies’ revenues were up 7% year-over-year to $715 million, with net income up to $91 million from $70 million during the same period last year. Keysight said that its Communications Solution Group revenues made up the bulk of its business, accounting for $424 million for the quarter and growing 9% year-over-year, including additional revenues from the purchase of Anite.
MTS reported revenues of $158 million, up 18% year-over-year. The company said that it was a strong quarter for test services revenues, which came in at more than $20 million and reflected four consecutive quarters of double-digit growth, according to MTS. Net income was down from $10.8 million during the same period last year to $7.1 million; MTS noted that it did see some impact from its $580 million acquisition of PCB Group during the quarter.
Teradyne was also among the test companies that recently reported results. Teradyne saw record revenue growth buoyed by semiconductor testing — but profits impacted by weakness in wireless testing. Teradyne reported revenues of $532 million for the most recent quarter, up from $513 million in the same period last year. CEO and President Mark Jagiela said in a statement that the growth was driven by demand for semiconductor testing which “drove second quarter revenue to the highest level in 4 years and contributed to our highest first half revenue in 15 years.”
Teradyne reported that of its revenues, $435 million was in semiconductor testing, $49 million in system testing, $25 million in industrial automation, and $22 million came from wireless testing operations. The company said it had seen “a significant decline in the projected size of the wireless production test market served by our wireless test segment.” That prompted the company to take a major write-down on the segment that impacted its profits, resulting in a net loss for hte quarter of $223.5 million.
In other test news this week:
-A new report from Frost & Sullivan concludes that increased connectivity will drive the need for advanced calibration and repair of test equipment, and that “as quality and safety standards continue to evolve, manufacturers across industries will be compelled to calibrate items they had not previously considered.”
–Cobham plc, parent company of Cobham Wireless, will soon have a new CEO. The aerospace, defense and communications company said that current CEO Bob Murphy will step down by the end of this year to pursue other opportunities, and he will be be replaced by David Lockwood, currently CEO of Laird, which produces solutions designed for shielding components from electromagnetic interference and also does radio frequency engineering. Laird’s CFO, Tony Quinlan, will take over as CEO of Laird as of Sept. 5th.
Lockwood has spent four years in his current position and also has experience in the area of defense; he previously served as VP of global defense and security at BT Global Services, among other roles.
The Financial Times reported that Murphy’s diversification strategy for Cobham, including purchases such as the acquisition of test and wireless components company Aeroflex in 2014, may have contributed to his departure because of such acquisitions’ contribution to lagging profits at the company.
–Ixia has launched a high-density, in-line network bypass switch for security and network monitoring and says that the new solution offers features that increase security infrastructure up-time for ongoing network monitoring.
–Teledyne LeCroy has launched a new, automated compliance test suite for USB-Type C connectors. The test suite is integrated with Teledyne LeCroy’s Voyager M310C USB 3.1 test platform and relies on standard USB Type-C cabling for connecting the device under test; the company said that the test suite can be initiated with one click, automatically run and generate pass/fail reports. Mike Micheletti, USB Product Manager at Teledyne LeCroy’s Protocol Solutions Group, said in a statement that the new test suite “expands the coverage for specific test cases that require both USB traffic and USB Type-C logical state changes.”
–Sprint reported that it achieved speeds of 295 Mbps using three-component carrier aggregation (three 20-megahertz channels at 2.5 GHz) with an HTC 10 device. Read RCR’s full story here.