Viavi Solutions Inc. (NASDAQ:VIAV) Q4 2022 Earnings Conference Call August 11, 2022 4:30 PM ET

Company Participants

Sagar Hebbar - Head of Investor Relations

Henk Derksen - Executive Vice President & Chief Financial Officer

Oleg Khaykin - President & Chief Executive Officer

Conference Call Participants

Alex Henderson - Needham & Company

Tim Savageaux - Northland Capital

Angela Jin - JPMorgan

Mehdi Hosseini - Susquehanna

Meta Marshall - Morgan Stanley

Operator

Good afternoon. My name is David and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Viavi Solutions 4Q 2022 Earnings Call. Today's conference is being recorded. [Operator Instructions]

Sagar Hebbar, Head of Investor Relations. You may begin your conference.

Sagar Hebbar

Thank you, David. Welcome to Viavi Solutions fourth quarter and fiscal year 2022 earnings call. My name is Sagar Hebbar, Head of Investor Relations and Corporate FP&A. Joining me on today's call are Oleg Khaykin, President and CEO; and Henk Derksen, CFO.

Please note, this call will include forward-looking statements about the company's financial performance. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our current expectations and estimations. We encourage you to review our most recent annual report and SEC filings, particularly the risk factors described in those filings. The forward-looking statements, including guidance we provide during this call are valid only as of today. Viavi undertakes no obligation to update these statements. Please also note that unless we state otherwise, all results except revenue are non-GAAP. We reconcile these non-GAAP results into our GAAP preliminary financials and discuss their usefulness and limitations in today's earnings release. The release, plus our supplemental earnings slides which include historical financial tables, are available on Viavi's website.

Finally, we are recording today's call and will make the recording available by 4:30 P.M. Pacific Time this evening on our website.

I would now like to turn the call over to Henk.

Henk Derksen

Thank you, Sagar. Fiscal Q4 2022 set an all-time record for Viavi revenue and a fourth quarter record for non-GAAP profitability. Fourth quarter revenue came in at $335.3 million, up 7.8% year-over-year, exceeding our guidance range of $315 million to $329 million.

Growth was primarily driven by improved demand for our core OSP and 3D sensing products. Viavi's operating profit margin at 21.3% was within our guidance range of 21% to 22%, improving 50 basis points year-over-year. EPS at $0.24 met the high end of our $0.22 to $0.24 guidance range and increased 9.1% from $0.22 in the prior year, a combination of strong operating performance and the impact of an improving capital structure. The fully dilutive shares outstanding at the end of fiscal Q4 2022 of 231.3 million shares decreased from 241.9 million shares in the year ago period, substantially a result of refinancing our convertible debt while continuing to execute on our share repurchase program during fiscal 2022. The outstanding dilution resulting from the remaining convertible notes was 1.6 million shares during the fourth quarter, compared to 10.4 million shares a year ago.