Tech equipment specialist Viavi Solutions (VIAV 0.99%) might not be a household name to many people, but its stock was hugely popular with investors on Thursday. The company published encouraging fiscal second-quarter of fiscal 2026 figures after market close the day before, and market players rewarded it by pushing its shares up by over 17% across Thursday's trading session.
Time for a double beat
Vivavi's growth rates for the quarter were impressive. Revenue rose by 36% year-over-year to more than $369 million. Better, its net income not in accordance with generally accepted accounting principles (GAAP) zoomed 75% higher to $51.5 million, or $0.22 per share.
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Compounding that, the two metrics came in above the consensus analyst estimates. As a group, those pundits were modeling revenue slightly above $365 million, and a non-GAAP (adjusted) per-share net profit figure of $0.19.
Viavi is doing particularly well on the robustness of two of its target market sectors, data centers and the defense/aerospace industry. The former is particularly lively these days, given the need to build out capability for resource-hungry artificial intelligence (AI) functionalities.
NASDAQ: VIAV
Key Data Points
Rising star?
Viavi also proffered guidance for its current (third) quarter. Management expects revenue of $386 million to $400 million, while adjusted net income should be $0.22 to $0.24 per share. Both are well above the second-quarter fiscal 2025 "actuals," which were just under $271 million on the top line and $0.13 per share on adjusted profitability.
More importantly, they crush average pundit expectations, which stand at $353 million in revenue and only $0.15 per share in adjusted net income.
Increasingly, Viavi feels to me like one of those "right time, right place" companies -- and doubly so as it's opportunistically capitalizing on the long-term growth opportunities presented by clients in the two aforementioned sectors. This typically under-the-radar stock will definitely be a company to watch as this year unfolds.
