What changed in this filing

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Item 1. Financial Statements

2024-11-01 compared with 2024-05-03 · 231 added, 353 removed, 594 unchanged (50% of the section changed)

3 unchanged sentences

(in millions, except per share data)

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

Three Months Ended

September 28, 2024 September 30, 2023

Product revenue $ 197.5 $ 205.6

11 unchanged sentences

Amortization of other intangibles 1.1 2.1

Restructuring and related charges (benefits) 0.1 10.2 ( 0.8 ) 10.2

Restructuring and related benefits — ( 0.8 )

Total operating expenses 124.6 128.4

(Loss) income from operations ( 11.9 ) ( 2.1 ) 26.5 70.6

Loss on convertible note modification (Note 11) — ( 2.2 ) — ( 2.2 )

Income from operations 11.5 16.0

Interest and other income, net 3.2 10.2

Interest expense ( 7.5 ) ( 7.8 )

(Loss) income before income taxes ( 15.6 ) ( 9.4 ) 21.1 54.3

Income before income taxes 7.2 18.4

Provision for income taxes 9.0 8.6

8 unchanged sentences

VIAVI SOLUTIONS INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in millions)

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

Three Months Ended

September 28, 2024 September 30, 2023

Net (loss) income $ ( 1.8 ) $ 9.8

Other comprehensive (loss) income:

Other comprehensive income (loss):

Net change in cumulative translation adjustment, net of tax 30.3 ( 20.4 )

Unrealized holding loss arising during period — ( 0.3 ) — ( 0.3 )

Amortization of net actuarial losses and other pension adjustments

( 0.8 ) — ( 0.9 ) ( 0.3 )

Amortization of net actuarial losses (gains) and other pension adjustments

Net change in accumulated other comprehensive loss 30.4 ( 20.5 )

Comprehensive (loss) income $ ( 37.2 ) $ ( 2.3 ) $ ( 7.5 ) $ 39.1

Comprehensive income (loss) $ 28.6 $ ( 10.7 )

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

2 unchanged sentences

(in millions, except share and par value data)

March 30, 2024 July 1, 2023

September 28, 2024 June 29, 2024

Current assets:

18 unchanged sentences

Accrued expenses 23.8 25.3

Short-term debt — 96.2

Other current liabilities 53.5 57.5

2 unchanged sentences

Other non-current liabilities 165.1 171.6

Total liabilities 1,035.5 1,054.7

Commitments and contingencies (Note 18)

Stockholders’ equity:

1 unchanged sentence

1 million shares authorized,

no shares issued or outstanding at March 30, 2024 and July 1, 2023

no shares issued or outstanding at September 28, 2024 and June 29, 2024

Common stock, $ 0.001 par value;

1 billion shares authorized;

223 million shares at March 30, 2024 and 222 million shares at July 1, 2023, issued and outstanding

222 million shares at September 28, 2024 and June 29, 2024, issued and outstanding

Additional paid-in capital 70,480.2 70,471.9

7 unchanged sentences

(in millions)

Nine Months Ended

March 30, 2024 April 1, 2023

Three Months Ended

September 28, 2024 September 30, 2023

OPERATING ACTIVITIES:

4 unchanged sentences

Stock-based compensation 12.7 11.2

Loss on convertible note modification — 2.2

Amortization of debt issuance costs 1.8 1.9

2 unchanged sentences

Restructuring — ( 0.8 )

Gain on legal settlement — ( 6.7 )

Other ( 0.2 ) 0.2

14 unchanged sentences

Proceeds from the sale of assets 3.5 0.6

Acquisitions, net of cash hold back — ( 64.4 )

Purchase price adjustment related to business acquisition — ( 0.7 )

Other investing activities ( 3.0 ) —

Net cash used in investing activities $ ( 11.5 ) $ ( 12.6 )

FINANCING ACTIVITIES:

Proceeds from issuance of debt $ — $ 118.0

Payment of debt issuance costs — ( 3.9 )

Retirement of convertible notes upon maturity ( 96.4 ) —

Repurchase and retirement of common stock $ ( 16.4 ) $ ( 10.0 )

Withholding tax payment on vesting of restricted stock and performance- based awards ( 7.3 ) ( 9.1 )

Payment of financing obligations ( 0.2 ) ( 0.1 )

Proceeds from employee stock purchase plan 2.7 3.0

Payment of acquisition related contingent considerations and obligations ( 4.0 ) ( 7.3 )

Net cash (used in) provided by financing activities $ ( 115.3 ) $ 29.3

Net cash used in financing activities $ ( 21.0 ) $ ( 16.1 )

Effect of exchange rates on cash, cash equivalents and restricted cash $ 15.3 $ ( 9.3 )

3 unchanged sentences

$ 478.1 $ 527.9

(1) These amounts include both current and non-current balances of restricted cash totaling $ 9.1 million and $ 12.9 million as of July 1, 2023 and July 2, 2022, respectively.

(2) These amounts include both current and non-current balances of restricted cash totaling $ 8.9 million and $ 12.6 million as of March 30, 2024 and April 1, 2023, respectively.

(1) These amounts include both current and non-current balances of restricted cash totaling $ 10.5 million and $ 9.1 million as of June 29, 2024 and July 1, 2023, respectively.

(2) These amounts include both current and non-current balances of restricted cash totaling $ 10.2 million and $ 7.3 million as of September 28, 2024 and September 30, 2023, respectively.

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

2 unchanged sentences

(in millions)

Three Months Ended March 30, 2024

Shares Amount Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total

Balance at December 30, 2023 222.6 $ 0.2 $ 70,444.8 $ ( 69,590.2 ) $ ( 126.8 ) $ 728.0

Net loss — — — ( 24.6 ) — ( 24.6 )

Other comprehensive loss — — — — ( 12.6 ) ( 12.6 )

Shares issued under employee stock plans, net of tax 0.6 — 1.5 — — 1.5

Stock-based compensation — — 12.8 — — 12.8

Balance at March 30, 2024 223.2 $ 0.2 $ 70,459.1 $ ( 69,614.8 ) $ ( 139.4 ) $ 705.1

Three Months Ended April 1, 2023

Additional Paid-In Capital

Accumulated Deficit

Accumulated Other Comprehensive Loss

Balance at December 31, 2022 224.8 $ 0.2 $ 70,388.8 $ ( 69,545.2 ) $ ( 156.0 ) $ 687.8

Three Months Ended September 28, 2024

Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total

Shares Amount

Balance at June 29, 2024 221.9 $ 0.2 $ 70,471.9 $ ( 69,646.5 ) $ ( 144.0 ) $ 681.6

Net loss — — — ( 1.8 ) — ( 1.8 )

3 unchanged sentences

Repurchase of common stock ( 2.0 ) — 0.3 ( 16.4 ) — ( 16.1 )

Convertible note modification (Note 11) — — 10.1 — — 10.1

Balance at April 1, 2023 222.4 $ 0.2 $ 70,415.6 $ ( 69,590.6 ) $ ( 142.9 ) $ 682.3

Nine Months Ended March 30, 2024

Additional Paid-In Capital

Accumulated Deficit

Accumulated Other Comprehensive Loss

Balance at July 1, 2023 221.5 $ 0.2 $ 70,427.3 $ ( 69,600.7 ) $ ( 136.0 ) $ 690.8

Net loss — — — ( 4.1 ) — ( 4.1 )

Other comprehensive loss — — — — ( 3.4 ) ( 3.4 )

Shares issued under employee stock plans, net of tax 2.7 — ( 4.8 ) — — ( 4.8 )

Stock-based compensation — — 36.6 — — 36.6

Repurchase of common stock ( 1.0 ) — — ( 10.0 ) — ( 10.0 )

Balance at March 30, 2024 223.2 $ 0.2 $ 70,459.1 $ ( 69,614.8 ) $ ( 139.4 ) $ 705.1

Nine Months Ended April 1, 2023

Balance at September 28, 2024 221.8 $ 0.2 $ 70,480.2 $ ( 69,664.7 ) $ ( 113.6 ) $ 702.1

Three Months Ended September 30, 2023

Additional Paid-In Capital

3 unchanged sentences

Net income — — — 9.8 — 9.8

Other comprehensive income — — — — 13.5 13.5

Other comprehensive loss — — — — ( 20.5 ) ( 20.5 )

Shares issued under employee stock plans, net of tax 1.9 — ( 6.1 ) — — ( 6.1 )

1 unchanged sentence

Repurchase of common stock ( 1.0 ) — — ( 10.0 ) — ( 10.0 )

Convertible note modification (Note 11) — — 10.1 — — 10.1

Balance at April 1, 2023 222.4 $ 0.2 $ 70,415.6 $ ( 69,590.6 ) $ ( 142.9 ) $ 682.3

Balance at September 30, 2023 222.4 $ 0.2 $ 70,432.4 $ ( 69,600.9 ) $ ( 156.5 ) $ 675.2

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

3 unchanged sentences

The financial information for Viavi Solutions Inc.

(VIAVI, also referred to as the Company, we, our and us) for the three and nine months ended March 30, 2024 and April 1, 2023 is unaudited and includes all normal and recurring adjustments the Company’s management considers necessary for a fair statement of the financial information set forth herein.

(VIAVI, also referred to as the Company, we, our and us) for the three months ended September 28, 2024 and September 30, 2023 is unaudited and includes all normal and recurring adjustments the Company’s management considers necessary for a fair statement of the financial information set forth herein.

The accompanying Consolidated Financial Statements are presented in accordance with accounting principles generally accepted in the United States of America (U.S.

2 unchanged sentences

GAAP for annual Consolidated Financial Statements.

For further information please refer to the Consolidated Financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended July 1, 2023.

There have been no material changes to the Company’s accounting policies during the three and nine months ended March 30, 2024 as compared to the significant accounting policies presented in “Note 1.

Basis of Presentation” of the Notes to the Consolidated Financial Statements included in the Company’s Annual Report for the year ended July 1, 2023 on Form 10-K, filed with the SEC on August 17, 2023.

The Consolidated Balance Sheet as of July 1, 2023 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S.

For further information please refer to the Consolidated Financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 29, 2024.

There have been no material changes to the Company’s accounting policies during the three months ended September 28, 2024 as compared to the significant accounting policies presented in “Note 1.

Basis of Presentation” of the Notes to the Consolidated Financial Statements included in the Company’s Annual Report for the year ended June 29, 2024 on Form 10-K, filed with the SEC on August 16, 2024.

The Consolidated Balance Sheet as of June 29, 2024 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S.

GAAP for complete financial statements.

The results for the three and nine months ended March 30, 2024 and April 1, 2023 may not be indicative of results for the fiscal year ending June 29, 2024 or any future periods.

The results for the three months ended September 28, 2024 and September 30, 2023 may not be indicative of results for the fiscal year ending June 28, 2025 or any future periods.

The Company utilizes a 52-53 week fiscal year ending on the Saturday closest to June 30th.

The Company’s fiscal 2025 is a 52-week year ending on June 28, 2025.

The Company’s fiscal 2023 was a 52-week year ending on July 1, 2023.

The Company’s fiscal 2024 was a 52-week year ending on June 29, 2024.

Principles of Consolidation

1 unchanged sentence

All inter-company accounts and transactions have been eliminated.

Reclassification of Prior Period Balances

Certain reclassifications of prior period balances have been made to conform to current presentation.

Effective for the first quarter of fiscal 2024, management of certain products moved from the SE segment to the NE segment to better align with operational and go-to-market strategies.

As a result, prior period balances have been recast in our operating segment tables for the three and nine months ended April 1, 2023 in “Note 19.

Operating Segments and Geographic Information” and NE and SE goodwill balances as of July 1, 2023 in “Note 9.

Use of Estimates

8 unchanged sentences

SEC Climate Rules

In March 2024, the SEC adopted final rules on the enhancement and standardization of climate-related disclosures for investors.

The final rules require disclosure of, among other things, material climate-related risks and their impact;

activities to mitigate or adapt to material climate-related risks;

governance and oversight of climate-related risks;

material climate-related targets or goals and their financial impact;

and material Scope 1 and/or Scope 2 greenhouse gas emissions with an accompanying assurance report required following an initial transition period, at a limited assurance level, and then following an additional transition period, at a reasonable assurance level.

In addition, the effects of severe weather events and other natural conditions, subject to certain thresholds, and amounts related to carbon offsets and renewable energy credits or certificates are required to be disclosed in the notes to the audited financial statements in certain circumstances.

In March 2024, the SEC issued its final climate disclosure rules, which require the disclosure of climate-related information in annual reports and registration statements.

The rules require disclosure in the audited financial statements of certain effects of severe weather events and other natural conditions above certain financial thresholds, as well as amounts related to carbon offsets and renewable energy credits or certificates, if material.

On April 4, 2024, the SEC voluntarily stayed the implementation of the final rules pending the completion of judicial review of the consolidated challenges to the final rules by the Court of Appeals for the Eighth Circuit.

1 unchanged sentence

Disclosures pursuant to the final rules, as originally issued, would be required prospectively, with information for prior periods required only to the extent it was previously disclosed in an SEC filing.

The Company is currently evaluating the impact of the final rules on its Consolidated Financial Statements and disclosures.

The Company is currently evaluating the impact of the final rules on its Consolidated Financial Statements and disclosures and continue to monitor the status of the related legal challenges.

Accounting Standards Issued But Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740), to enhance the transparency and decision usefulness of income tax disclosures through changes to the rate reconciliation and income taxes paid information.

In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) 2023-09, Improvements to Income Tax Disclosures (Topic 740) , to enhance the transparency and decision usefulness of income tax disclosures through changes to the rate reconciliation and income taxes paid information.

This guidance is effective for fiscal years beginning after December 15, 2024 (fiscal 2026 for the Company), with early and retrospective adoption permitted.

9 unchanged sentences

Early adoption is prohibited.

As we are currently subject to these SEC requirements, this ASU is not expected to have a material impact on our Consolidated Financial Statements or related disclosures.

We reviewed all other accounting pronouncements issued during the nine months ended March 30, 2024 and concluded that they were not applicable to the Company.

This ASU is not expected to have a material impact on our Consolidated Financial Statements or related disclosures.

VIAVI SOLUTIONS INC.

2 unchanged sentences

The following table sets forth the computation of basic and diluted net (loss) income per share ( in millions, except per share data ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

Three Months Ended

September 28, 2024 September 30, 2023

Net (loss) income $ ( 1.8 ) $ 9.8

1 unchanged sentence

Basic 222.0 222.0

Shares issuable assuming conversion of convertible notes (1)

Effect of dilutive securities from stock-based compensation plans — 2.2

3 unchanged sentences

Diluted $ ( 0.01 ) $ 0.04

(1) Represents the dilutive impact for the Company’s 1.75 % Senior Convertible Notes due 2023 (2023 Notes), the 1.00 % Senior Convertible Notes due 2024 (2024 Notes) and the 1.625 % Senior Convertible Notes due 2026 (2026 Notes).

As of March 30, 2024, the if-converted value is less than the outstanding principal of the 2026 Notes and are therefore anti-dilutive.

Refer to “Note 11.

Debt” for more details.

The following table sets forth the weighted-average potentially dilutive securities excluded from the computation of the diluted net (loss) income per share because their effect would have been anti-dilutive ( in millions ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

Three Months Ended

September 28, 2024 (1)

September 30, 2023 (1)(2)

Restricted stock units 2.5 0.5

(1) The Company’s 1.625 % Senior Convertible Notes due 2026 (2026 Notes) are not included in the table above.

The par amount of convertible notes is payable in cash equal to the principal amount of the notes plus any accrued and unpaid interest and then the “in-the-money” conversion benefit feature at the conversion price above $ 13.19 per share is payable in cash, shares of the Company’s common stock or a combination of both at the Company’s election.

Refer to “Note 11.

Debt” for more details.

(2) The Company’s 1.00 % Senior Convertible Notes due 2024 (2024 Notes) are not included in the table above.

The par amount of convertible notes is payable in cash equal to the principal amount of the notes plus any accrued and unpaid interest and then the “in-the-money” conversion benefit feature at the conversion price above $ 13.22 per share is payable in cash, shares of the Company’s common stock or a combination of both at the Company’s election.

Refer to “Note 11.

Debt” for more details.

VIAVI SOLUTIONS INC.

2 unchanged sentences

The Company’s accumulated other comprehensive loss consists of the accumulated net unrealized gains or losses on available-for-sale investments, foreign currency translation adjustments and change in unrealized components of defined benefit obligations.

For the nine months ended March 30, 2024, the changes in accumulated other comprehensive loss, net of tax, by component were as follows ( in millions ):

For the three months ended September 28, 2024, the changes in accumulated other comprehensive loss, net of tax, by component were as follows ( in millions ):

Unrealized losses on available-for sale investments Foreign

currency translation adjustments, net of tax Change in unrealized components of defined benefit obligations (1)

Beginning balance as of July 1, 2023 $ ( 5.3 ) $ ( 125.4 ) $ ( 5.3 ) $ ( 136.0 )

Other comprehensive loss before reclassification — ( 2.5 ) ( 1.0 ) ( 3.5 )

currency translation adjustments Change in unrealized components of defined benefit obligations (1)

Beginning balance as of June 29, 2024 $ ( 5.3 ) $ ( 131.4 ) $ ( 7.3 ) $ ( 144.0 )

Other comprehensive income before reclassification — 30.3 — 30.3

Amounts reclassified out of accumulated other comprehensive loss — — 0.1 0.1

Net current-period other comprehensive loss — ( 2.5 ) ( 0.9 ) ( 3.4 )

Ending balance as of March 30, 2024 $ ( 5.3 ) $ ( 127.9 ) $ ( 6.2 ) $ ( 139.4 )

(1) The amount reclassified out of accumulated other comprehensive loss represents the amortization of actuarial gains included as a component of Cost of revenues, Research and development (R&D) and Selling, general and administrative (SG&A) in the Consolidated Statements of Operations, net of reclassification adjustments, for the nine months ended March 30, 2024.

There was no tax impact for the nine months ended March 30, 2024.

Net current-period other comprehensive income — 30.3 0.1 30.4

Ending balance as of September 28, 2024 $ ( 5.3 ) $ ( 101.1 ) $ ( 7.2 ) $ ( 113.6 )

(1) The amount reclassified out of accumulated other comprehensive loss represents the amortization of actuarial loss included as a component of Cost of revenues, Research and development (R&D) and Selling, general and administrative (SG&A) in the Consolidated Statements of Operations, net of reclassification adjustments, for the three months ended September 28, 2024.

There was no tax impact for the three months ended September 28, 2024.

Refer to “Note 17.

11 unchanged sentences

The acquired developed technology and other intangible assets are being amortized over their estimated useful lives ranging from one to six years .

Acquisition-related costs incurred were approximately $ 0.8 million and have been recorded within SG&A expense in the Consolidated Statements of Operations in fiscal year 2023.

Goodwill represents the excess of the preliminary estimated purchase consideration over the preliminary estimates of the fair value of the net tangible and intangible assets acquired and has been allocated to the Network Enablement segment.

1 unchanged sentence

The goodwill was deductible for U.S.

income tax purposes.

income tax purposes in the year of acquisition.

The Company has included the financial results of Jackson Labs in its Consolidated Financial Statements from the date of acquisition.

2 unchanged sentences

On March 29, 2023, April 21, 2023 and June 8, 2023, the Company completed acquisitions accounted for as asset purchases consisting of an aggregate cash paid at closing of $ 2.9 million and $ 0.2 million of indemnity holdback.

In connection with these acquisitions, the Company recorded developed technology intangibles of $ 2.5 million which are being amortized over their estimated useful life of five years .

In connection with these acquisitions, the Company recorded developed technology intangibles of $ 2.5 million which are being amortized over their estimated useful life of 5 years.

On July 18, 2022, the Company completed an acquisition accounted for as a business combination consisting of cash paid at closing of $ 17.5 million and $ 2.0 million of indemnity holdback.

In connection with this acquisition, the Company recorded approximately $ 11.2 million of goodwill, $ 5.1 million of developed technology and $ 1.8 million of deferred tax liability.

The acquired developed technology asset is being amortized over its estimated useful life of 4 years.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Acquisition-related Contingent Consideration

The following table provides a reconciliation of changes in the fair value of the Company’s earn-out liabilities associated with the Company’s acquisitions for the three and nine months ended March 30, 2024 and April 1, 2023 ( in millions ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

The following table provides a reconciliation of changes in the fair value of the Company’s earn-out liabilities associated with the Company’s acquisitions for the three months ended September 28, 2024 and September 30, 2023 ( in millions ):

Three Months Ended

September 28, 2024 September 30, 2023

Beginning period balance $ 9.5 $ 19.7

Additions to Contingent Consideration — — — 29.4

Payments of Contingent Consideration — ( 6.6 ) ( 0.7 ) ( 7.1 )

Fair value adjustment of earn-out liabilities ( 3.5 ) ( 1.4 )

Currency translation adjustment — ( 0.1 ) — —

Ending period balance $ 6.0 $ 18.3

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Balance Sheet and Other Details

1 unchanged sentence

Gross receivables include both billed and unbilled receivables (including Contract assets).

As of March 30, 2024, and July 1, 2023, the Company had total unbilled receivables of $ 12.0 million and $ 13.7 million, respectively.

As of September 28, 2024, and June 29, 2024, the Company had total unbilled receivables of $ 14.4 million and $ 16.3 million, respectively.

The Company also has short-term and long-term deferred revenues related to undelivered product and professional services, consisting of installations and consulting engagements, which are recognized as the Company's performance obligations under the contract are completed and accepted by the customer.

The following table presents the activity related to deferred revenue ( in millions ):

March 30, 2024

Three Months Ended Nine Months Ended

September 28, 2024

Three Months Ended

Deferred revenue:

2 unchanged sentences

Revenue recognized during the period (2)

( 25.2 ) ( 87.4 )

Balance at end of period $ 88.8

2 unchanged sentences

Remaining performance obligation estimates are subject to change and are affected by several factors, including terminations, changes in the scope of contracts, adjustments for revenue that have not materialized, and currency fluctuations.

The value of the transaction price allocated to remaining performance obligations as of March 30, 2024, was $ 252.7 million.

The value of the transaction price allocated to remaining performance obligations as of September 28, 2024, was $ 258.9 million.

The Company expects to recognize approximately 89 % of remaining performance obligations as revenue within the next 12 months, and the remainder thereafter.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Accounts receivable allowances - Credit losses

The following table presents the activities and balances for allowance for credit losses ( in millions ):

July 1, 2023 Charged to Costs and Expenses Deductions (1)

March 30, 2024

June 29, 2024 Charged to Costs and Expenses Deductions (1)

September 28, 2024

Allowance for credit losses $ 1.6 $ 0.1 $ ( 0.3 ) $ 1.4

2 unchanged sentences

The following table presents the components of inventories, net ( in millions ):

March 30, 2024 July 1, 2023

September 28, 2024 June 29, 2024

Finished goods $ 45.2 $ 44.6

2 unchanged sentences

Inventories, net $ 93.2 $ 96.5

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Prepayments and other current assets

The following table presents the components of prepayments and other current assets ( in millions ):

March 30, 2024 July 1, 2023

September 28, 2024 June 29, 2024

Refundable income taxes $ 29.6 $ 28.5

2 unchanged sentences

Transaction tax receivables 2.1 3.3

Asset held for sale 2.5 2.5

Fair value of forward contracts 4.9 1.7

Other 9.4 7.1

Asset held for sale — 2.5

Other current assets 11.5 10.5

Prepayments and other current assets $ 69.8 $ 70.7

1 unchanged sentence

The following table presents the components of other non-current assets ( in millions ):

March 30, 2024 July 1, 2023

Operating right-of-use (ROU) assets (Note 12) $ 37.7 $ 40.4

September 28, 2024 June 29, 2024

Operating right-of-use (ROU) assets $ 35.4 $ 35.8

Long-term restricted cash 5.4 5.5

Long-term investment (Note 7) 3.0 —

Deposits 2.5 2.4

1 unchanged sentence

Debt issuance cost - Revolving Credit Facility 1.8 1.9

Other 10.2 8.7

Other non-current assets 11.3 9.9

Other non-current assets $ 61.8 $ 58.0

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Other current liabilities

The following table presents the components of other current liabilities ( in millions ):

March 30, 2024 July 1, 2023

Operating lease liabilities (Note 12) $ 9.9 $ 10.1

September 28, 2024 June 29, 2024

Operating lease liabilities $ 9.7 $ 9.8

Interest payable 7.9 5.1

Income tax payable 6.4 5.3

Restructuring accrual 5.7 14.1

Transaction tax payable 4.5 4.0

1 unchanged sentence

Fair value of forward contracts 3.3 1.5

Acquisition related holdback and related accruals 0.9 4.1

Restructuring accrual (Note 13) 0.8 5.8

Fair value of contingent consideration (Note 5) — 1.1

Other 9.2 7.9

Other current liabilities 12.0 14.3

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Other current liabilities $ 53.5 $ 57.5

Other non-current liabilities

The following table presents components of other non-current liabilities ( in millions ):

March 30, 2024 July 1, 2023

September 28, 2024 June 29, 2024

Pension and post-employment benefits $ 53.5 $ 51.2

Operating lease liabilities (Note 12) 27.3 29.4

Operating lease liabilities 25.6 25.7

Long-term deferred revenue 25.1 25.7

3 unchanged sentences

Fair value of contingent consideration (Note 5) 6.0 9.5

Warranty accrual 4.2 4.8

Asset retirement obligations 3.1 3.0

Other 7.9 8.0

Warranty accrual 3.0 4.0

Restructuring accrual 1.1 0.8

Other non-current liabilities 7.2 7.3

Other non-current liabilities $ 165.1 $ 171.6

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Investments and Forward Contracts

Short-Term Investments

As of March 30, 2024, the Company’s short-term investments of $ 28.4 million were comprised of 30-day term deposits of $ 27.0 million and trading securities related to the deferred compensation plan of $ 1.4 million, of which $ 1.3 million was invested in equity securities and $ 0.1 million was invested in debt securities.

As of July 1, 2023, the Company’s short-term investments of $ 14.6 million were comprised of a 30-day term deposit of $ 13.1 million and trading securities related to the deferred compensation plan of $ 1.5 million, of which $ 1.2 million was invested in equity securities, $ 0.2 million was invested in money market instruments and $ 0.1 million was invested in debt securities.

As of September 28, 2024, the Company’s short-term investments of $ 25.2 million were comprised of 30-day term deposits of $ 23.6 million and trading securities related to the deferred compensation plan of $ 1.6 million, of which $ 1.4 million was invested in equity securities, $ 0.1 million was invested in money market instruments and $ 0.1 million was invested in debt securities.

As of June 29, 2024, the Company’s short-term investments of $ 19.9 million were comprised of 30-day term deposits of $ 18.4 million and trading securities related to the deferred compensation plan of $ 1.5 million, of which $ 1.4 million was invested in equity securities and $ 0.1 million was invested in debt securities.

Trading securities are reported at fair value, with unrealized gains or losses resulting from changes in fair value recognized in the Consolidated Statements of Operations as a component of Interest and other income, net.

Strategic Investment

During the first fiscal quarter of 2025, the Company invested $ 3.0 million in a non-marketable equity security in a privately held company.

The investment is included in Other non-current assets on our Consolidated Balance Sheets and is classified as Level 3 within the fair value hierarchy.

This investment is carried at cost and because the investment does not have a readily determinable fair value it will be adjusted for changes resulting from observable price changes under the Measurement Alternative methodology.

There were no impairments or adjustments to the carrying value for the three months ended September 28, 2024.

Non-Designated Foreign Currency Forward Contracts

3 unchanged sentences

The Company does not use these foreign currency forward contracts for trading purposes.

As of March 30, 2024, the Company had forward contracts that were effectively closed but not settled with the counterparties as of the balance sheet date.

As of September 28, 2024, the Company had forward contracts that were effectively closed but not settled with the counterparties as of the balance sheet date.

Therefore, the fair value of these contracts of $ 4.9 million and $ 3.3 million is reflected as Prepayments and other current assets and Other current liabilities on the Consolidated Balance Sheets, respectively.

As of July 1, 2023, the fair value of these contracts of $ 3.5 million and $ 2.4 million is reflected as Prepayments and other current assets and Other current liabilities on the Consolidated Balance Sheets, respectively.

As of June 29, 2024, the fair value of these contracts of $ 1.7 million and $ 1.5 million is reflected as Prepayments and other current assets and Other current liabilities on the Consolidated Balance Sheets, respectively.

The forward contracts outstanding and not effectively closed, with a term of less than 120 days, were transacted near quarter end;

therefore, the fair value of the contracts is not significant.

As of March 30, 2024 and July 1, 2023, the notional amounts of the forward contracts that the Company held to purchase foreign currencies were $ 76.1 million and $ 87.5 million, respectively, and the notional amounts of forward contracts that the Company held to sell foreign currencies were $ 20.1 million and $ 19.3 million, respectively.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

As of September 28, 2024 and June 29, 2024, the notional amounts of the forward contracts that the Company held to purchase foreign currencies were $ 91.2 million and $ 81.9 million, respectively, and the notional amounts of forward contracts that the Company held to sell foreign currencies were $ 23.9 million and $ 26.8 million, respectively.

The change in the fair value of these foreign currency forward contracts is recorded as gain or loss in the Consolidated Statements of Operations as a component of Interest and other income, net.

The cash flows related to the settlement of foreign currency forward contracts are classified as operating activities.

The foreign exchange forward contracts incurred losses of $ 0.8 million and $ 0.9 million for the three and nine months ended March 30, 2024, respectively, and gains of $ 0.8 million and less than $ 0.1 million for the three and nine months ended April 1, 2023, respectively.

The foreign exchange forward contracts incurred a gain of $ 1.4 million for the three months ended September 28, 2024 and a loss of $ 3.6 million for the three months ended September 30, 2023, respectively.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Fair Value Measurements

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includes financial instruments for which fair value is derived from valuation-based inputs, that are unobservable and significant to the overall fair value measurement.

As of March 30, 2024 and July 1, 2023, the Company did not hold any Level 3 investment securities.

The Company’s Level 3 assets consist of an investment in a non-marketable equity security in a privately held company.

We measure the non-marketable equity security under the Measurement Alternative at cost minus impairment, if any, adjusted for observable price changes in orderly transactions for an identical or similar investment in the same issuer.

The Company’s Level 3 liabilities consist of contingent purchase consideration liabilities related to business acquisitions.

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The fair value of certain earn-out liabilities is derived using the estimated probability of success of achieving the earn-out milestones discounted to present value.

The fair value of contingent consideration liabilities is remeasured at each reporting period at the estimated fair value based on the inputs on the date of remeasurement, with the change in fair value recognized as a component of Selling, general and administrative (SG&A) expense in the Consolidated Statements of Operations.

The fair value of contingent consideration liabilities is remeasured at each reporting period at the estimated fair value based on the inputs on the date of remeasurement, with the change in fair value recognized as a component of SG&A expense in the Consolidated Statements of Operations.

VIAVI SOLUTIONS INC.

2 unchanged sentences

The Company’s assets and liabilities measured at fair value for the periods presented are as follows ( in millions ):

March 30, 2024 July 1, 2023

September 28, 2024 June 29, 2024

Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3

9 unchanged sentences

4.9 — 4.9 — 1.7 — 1.7 —

Non-marketable equity security (5)

3.0 — — 3.0 — — — —

Total assets $ 299.2 $ 291.0 $ 5.2 $ 3.0 $ 298.8 $ 296.8 $ 2.0 $ —

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(1) Included in Other non-current assets on the Consolidated Balance Sheets.

(2) Includes, as of March 30, 2024, $ 239.0 million in Cash and cash equivalents, $ 3.4 million in Restricted cash and $ 3.6 million in Other non-current assets on the Consolidated Balance Sheets.

Includes, as of July 1, 2023, $ 336.5 million in Cash and cash equivalents, $ 4.3 million in Restricted cash and $ 4.0 million in Other non-current assets on the Consolidated Balance Sheets.

(2) Includes, as of September 28, 2024, $ 281.0 million in Cash and cash equivalents, $ 4.7 million in Restricted cash and $ 3.7 million in Other non-current assets on the Consolidated Balance Sheets.

Includes, as of June 29, 2024, $ 286.7 million in Cash and cash equivalents, $ 4.9 million in Restricted cash and $ 3.7 million in Other non-current assets on the Consolidated Balance Sheets.

(3) Included in Short-term investments on the Consolidated Balance Sheets.

(4) Included in Other current assets on the Consolidated Balance Sheets.

(4) Included in Prepayments and other current assets on the Consolidated Balance Sheets.

(5) Included in Other non-current assets on the Consolidated Balance Sheets.

(6) Included in Other current liabilities on the Consolidated Balance Sheets.

(6) As of March 30, 2024, included in Other non-current liabilities on the Consolidated Balance Sheets.

As of July 1, 2023, includes certain amounts in Other current liabilities and Other non-current liabilities on the Consolidated Balance Sheets.

(7) Included in Other non-current liabilities on the Consolidated Balance Sheets.

Other Fair Value Measures

Fair Value of Debt:

If measured at fair value on the Consolidated Balance Sheets, the Company’s 3.75 % Senior Notes (2029 Notes), 1.625 % Senior Convertible Notes (2026 Notes) and 1.00 % Senior Convertible Notes (2024 Notes) would be classified in Level 2 of the fair value hierarchy as they are not actively traded in the markets.

If measured at fair value on the Consolidated Balance Sheets, the Company’s 3.75 % Senior Notes (2029 Notes) and 1.625 % Senior Convertible Notes (2026 Notes) would be classified in Level 2 of the fair value hierarchy as they are not actively traded in the markets.

The Company’s debt measured at fair value for the periods presented is as follows ( in millions ):

March 30, 2024 July 1, 2023

September 28, 2024 June 29, 2024

Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3

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248.5 — 248.5 — 238.1 — 238.1 —

1.00 % Senior Convertible Notes (1)

— — — — 95.6 — 95.6 —

Total $ 612.2 $ — $ 612.2 $ — $ 577.0 $ — $ 577.0 $ —

(1) The 2024 Notes were retired upon maturity on March 1, 2024.

See “Note 11.

Debt”, for further discussion of the Company’s debt.

VIAVI SOLUTIONS INC.

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and Performance

Balance as of July 1, 2023 $ 399.2 $ 13.8 $ 42.2 $ 455.2

Balance as of June 29, 2024 $ 398.1 $ 12.6 $ 42.2 $ 452.9

Currency translation 8.0 0.3 — 8.3

Other adjustment (1)

— ( 1.0 ) — ( 1.0 )

Balance as of March 30, 2024 $ 398.3 $ 12.7 $ 42.2 $ 453.2

(1) Adjustment related to Goodwill acquired as part of a prior acquisition.

Balance as of September 28, 2024 $ 406.1 $ 12.9 $ 42.2 $ 461.2

The Company tests goodwill for impairment at the reporting unit level annually during the fourth quarter of each fiscal year, or more frequently if events or circumstances indicate that the asset may be impaired.

In the fourth quarter of fiscal 2023, the Company performed a quantitative assessment of goodwill impairment and concluded the fair value of each of the Company’s reporting units was at least two times the carrying value, and therefore no impairment was identified.

There were no events or changes in circumstances which triggered an impairment review during the three and nine months ended March 30, 2024.

In the fourth quarter of fiscal 2024, the Company performed a qualitative assessment of goodwill impairment and concluded that it was more likely than not that the fair value of each reporting unit exceeded its carrying amount and that no indication of impairment existed.

There were no events or changes in circumstances which triggered an impairment review during the three months ended September 28, 2024.

Acquired Developed Technology and Other Intangibles

The following tables present details of the Company’s acquired developed technology, customer relationships and other intangibles ( in millions ):

As of March 30, 2024 Gross Carrying Amount Accumulated Amortization Net

The following tables present details of the Company’s acquired developed technology, customer relationships and other intangibles as of September 28, 2024 and June 29, 2024 ( in millions ):

As of September 28, 2024 Gross Carrying Amount Accumulated Amortization Net

Acquired developed technology $ 438.3 $ ( 407.2 ) $ 31.1

2 unchanged sentences

Total intangibles $ 674.1 $ ( 640.1 ) $ 34.0

As of July 1, 2023 Gross Carrying Amount Accumulated Amortization Net

As of June 29, 2024 Gross Carrying Amount Accumulated Amortization Net

Acquired developed technology $ 436.2 $ ( 401.9 ) $ 34.3

2 unchanged sentences

Total intangibles $ 667.7 $ ( 629.5 ) $ 38.2

(1) Other intangibles consist of customer backlog, patents, proprietary know-how and trade secrets, trademarks and trade names.

(1) Other intangibles consist primarily of patents, proprietary know-how and trade secrets, trademarks and trade names.

VIAVI SOLUTIONS INC.

1 unchanged sentence

The following table presents the amortization recorded relating to acquired developed technology, customer relationships and other intangibles ( in millions ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

Three Months Ended

September 28, 2024 September 30, 2023

Cost of revenues $ 3.3 $ 3.5

1 unchanged sentence

Total amortization of intangible assets $ 4.4 $ 5.6

Based on the carrying amount of acquired developed technology, customer relationships and other intangibles as of March 30, 2024, and assuming no future impairment of the underlying assets, the estimated future amortization is as follows ( in millions ):

Based on the carrying amount of acquired developed technology, customer relationships and other intangibles as of September 28, 2024, and assuming no future impairment of the underlying assets, the estimated future amortization is as follows ( in millions ):

Remainder of 2025 $ 11.5

Thereafter 0.6

Total amortization $ 34.0

The acquired developed technology, customer relationships and other intangible balances are adjusted quarterly to record the effect of currency translation adjustments.

As of March 30, 2024 and July 1, 2023, the Company’s debt on the Consolidated Balance Sheets represented the carrying amount of the Senior Convertible and Senior Notes, net of unamortized debt discount and issuance costs.

The following table presents the carrying amounts of the Company’s debt ( in millions ):

March 30, 2024 July 1, 2023

Principal amount of 1.00 % Senior Convertible Notes

Unamortized 1.00 % Senior Convertible Notes debt issuance cost

Short-term debt $ — $ 96.2

The acquired developed technology, customer relationships and other intangibles balances are adjusted quarterly to record the effect of currency translation adjustments.

As of September 28, 2024 and June 29, 2024, the Company’s debt on the Consolidated Balance Sheets represented the carrying amount of the Senior Convertible and Senior Notes, net of unamortized debt discount and issuance costs, as follows ( in millions ):

September 28, 2024 June 29, 2024

Principal amount of 3.75 % Senior Notes

8 unchanged sentences

Long-term debt $ 637.6 $ 636.0

The Company was in compliance with all debt covenants as of March 30, 2024 and July 1, 2023.

The Company was in compliance with all debt covenants as of September 28, 2024 and June 29, 2024.

VIAVI SOLUTIONS INC.

9 unchanged sentences

The exchange resulted in $ 2.2 million of the issuance costs recorded as Loss on convertible note modification in the Consolidated Statements of Operations.

The remaining issuance costs of $ 2.0 million as well as $ 0.3 million of unamortized costs carried over from the 2024 Notes at the exchange date were capitalized and will be amortized to interest expense using the straight-line method until maturity.

The 2026 Notes are an unsecured obligation of the Company and bear annual interest of 1.625 %, payable semi-annually in arrears on March 15 and September 15 of each year, beginning September 15, 2023.

The remaining issuance costs of $ 2.0 million, as well as $ 0.3 million of unamortized costs carried over from the 2024 Notes at the exchange date were capitalized within Long-term debt (as a contra-balance) on the Consolidated Balance Sheets and will be amortized to interest expense using the straight-line method until maturity.

The 2026 Notes are an unsecured obligation of the Company and bear interest at an annual rate of 1.625 %, payable semi-annually in arrears on March 15 and September 15 of each year, beginning September 15, 2023.

The 2026 Notes mature on March 15, 2026 unless earlier converted, redeemed or repurchased.

As of March 30, 2024, the expected remaining term of the 2026 Notes is 2.0 years.

As of September 28, 2024, the expected remaining term of the 2026 Notes is 1.5 years.

3.75 % Senior Notes (2029 Notes)

On September 29, 2021, the Company issued $ 400.0 million aggregate principal amount of 3.75 % Senior Notes due 2029 in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended.

Proceeds of the 2029 Notes amounted to $ 393.0 million after issuance costs of $ 7.0 million.

In connection with the issuance of the 2029 Notes, the Company incurred $ 7.0 million of issuance costs.

The debt issuance costs were capitalized and will be amortized to interest expense using the straight-line method until maturity.

1 unchanged sentence

The 2029 Notes mature on October 1, 2029 unless earlier redeemed or repurchased.

As of March 30, 2024, the expected remaining term of the 2029 Notes is 5.5 years.

As of September 28, 2024, the expected remaining term of the 2029 Notes is 5.0 years.

1.75 % Senior Convertible Notes (2023 Notes)

3 unchanged sentences

The debt issuance costs were capitalized and amortized to interest expense using the straight-line method from the issuance date through maturity on June 1, 2023.

See Senior Convertible Notes Settlement section below for details of the 2023 Notes exchange transactions during fiscal 2022.

During fiscal 2022, the Company entered into separate privately-negotiated agreements with certain holders of the 2023 Notes, settling $ 156.9 million principal in exchange for an aggregate of 2.0 million shares of its common stock, par value $ 0.001 per share, and $ 168.5 million in cash.

On June 1, 2023, the remaining 2023 Notes principal of $ 68.1 million was retired upon maturity.

6 unchanged sentences

The debt issuance costs were capitalized and amortized to interest expense using the straight-line method from the issuance date through maturity on March 1, 2024.

See Senior Convertible Notes Settlement section below for details of the 2024 Notes exchange transactions during fiscal 2022.

During fiscal 2022, the Company entered into separate privately-negotiated agreements with certain holders of the 2024 Notes, settling $ 236.1 million principal in exchange for an aggregate of 8.6 million shares of its common stock, par value $ 0.001 per share, and $ 178.8 million in cash.

During fiscal 2023 the Exchange Transaction resulted in the reduction of $ 127.5 million principal of the 2024 Notes.

On March 1, 2024, the Company converted two notes at the request of the respective note-holders and retired the remaining 2024 Notes principal of $ 96.4 million upon maturity.

Senior Convertible Notes Settlement

On September 2, 2021, the Company entered into separate privately-negotiated agreements with certain holders of its 2023 and 2024 Notes.

The Company settled $ 93.8 million principal amount of the 2023 Notes and $ 181.2 million principal amount of the 2024 Notes in exchange for an aggregate of 10.6 million shares of its common stock, par value $ 0.001 per share, and $ 196.5 million in cash.

The Company recorded a loss of $ 85.9 million in connection with the settlement transactions which is presented as Loss on convertible note settlement in the Consolidated Statements of Operations.

On November 17, 2021 and November 22, 2021, the Company entered into separate privately-negotiated agreements with certain holders of its 2023 and 2024 Notes.

The Company settled $ 20.6 million principal amount of the 2023 Notes and $ 25.0 million principal amount of the 2024 Notes in exchange for $ 59.0 million in cash.

The Company recorded a loss of $ 6.4 million in connection with the settlement transactions which is presented as Loss on convertible note settlement in the Consolidated Statements of Operations.

On March 2, 2022, the Company entered into separate privately-negotiated agreements with certain holders of its 2023 and 2024 Notes.

The Company settled $ 23.2 million principal amount of the 2023 Notes and $ 26.8 million principal amount of the 2024 Notes in exchange for $ 64.7 million in cash.

The Company recorded a loss of $ 6.4 million in connection with the settlement transactions which is presented as Loss on convertible note settlement in the Consolidated Statements of Operations.

On June 3, 2022, the Company entered into separate privately-negotiated agreements with certain holders of its 2023 and 2024 Notes.

The Company settled $ 19.3 million principal amount of the 2023 Notes and $ 3.1 million principal amount of the 2024 Notes in exchange for $ 27.1 million in cash.

The Company recorded a loss of $ 3.1 million in connection with the settlement transactions which is presented as Loss on convertible note settlement in the Consolidated Statements of Operations.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Senior Secured Asset-Based Revolving Credit Facility

6 unchanged sentences

(i) if the amounts outstanding are denominated in U.S.

Dollars, at a per annum rate equal to either, at the Company’s election, Term Secured Overnight Financing Rate (SOFR) plus a margin of 1.35 % to 1.85 % per annum, or a specified base rate plus a margin of 0.25 % to 0.75 %, in each case, depending on the average excess availability under the facility, (ii) if the amounts outstanding are denominated in Sterling, at a per annum rate equal to the Sterling Overnight Interbank Average Rate (SONIA) plus a margin of 1.2825 % to 1.7825 %, depending on the average excess availability under the facility, (iii) if the amounts outstanding are denominated in Euros, at a per annum rate equal to the Euro Interbank Offered Rate plus a margin of 1.25 % to 1.75 %, depending on the average excess availability under the facility, or (iv) if the amounts outstanding are denominated in Canadian Dollars, at a per annum rate equal to either, at the Company’s election, the Canadian Dollar Offered Rate plus a margin of 1.25 % to 1.75 %, or a specified base rate plus a margin of 0.25 % to 0.75 %, in each case, depending on the average excess availability under the facility.

Dollars, at a per annum rate equal to either, at the Company’s election, Term Secured Overnight Financing Rate (SOFR) plus a margin of 1.35 % to 1.85 % per annum, or a specified base rate plus a margin of 0.25 % to 0.75 %, in each case, depending on the average excess availability under the facility, (ii) if the amounts outstanding are denominated in Sterling, at a per annum rate equal to the Sterling Overnight Interbank Average Rate (SONIA) plus a margin of 1.2825 % to 1.7825 %, depending on the average excess availability under the facility, (iii) if the amounts outstanding are denominated in Euros, at a per annum rate equal to the Euro Interbank Offered Rate plus a margin of 1.25 % to 1.75 %, depending on the average excess availability under the facility, or (iv) if the amounts outstanding are denominated in Canadian Dollars, at a per annum rate equal to either, at the Company’s election, the adjusted Term Canadian Overnight Repo Rate Average (CORRA) plus a margin of 1.25 % to 1.75 %, or a specified base rate plus a margin of 0.25 % to 0.75 %, in each case, depending on the average excess availability under the facility.

The covenants of the Credit Agreement include customary restrictive covenants that, among other things, restrict the Company’s ability to incur additional indebtedness, grant liens and make certain acquisitions, investments, asset dispositions and restricted payments.

In addition, the Credit Agreement contains certain financial covenants that require the Company to maintain a fixed charge coverage ratio of at least 1.00 to 1.00 if excess availability under the facility is less than the greater of 10 % of the lesser of maximum revolver amount and borrowing base and $ 20 million.

As of March 30, 2024, we had no borrowings under this facility and our available borrowing capacity was approximately $ 147.5 million, net of outstanding standby letters of credit of $ 4.1 million.

Revolving Credit Facility

On May 5, 2020, the Company entered into a credit agreement with Wells Fargo as administrative agent, and other lender related parties.

The Company borrowed $ 150 million and repaid $ 150 million under this Credit Agreement during the first quarter of fiscal 2022.

In connection with the entry into the Senior Secured Asset-Based Revolving Credit Facility noted above, the Company terminated this facility.

As of September 28, 2024, we had no borrowings under this facility and our available borrowing capacity was approximately $ 143.7 million, net of outstanding standby letters of credit of $ 4.2 million.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Interest Expense

The following table presents the interest expense for contractual interest, amortization of debt issuance costs, accretion of debt discount and other ( in millions ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

The following table presents the interest expense for contractual interest, amortization of debt issuance cost, accretion of debt discount and other ( in millions ):

Three Months Ended

September 28, 2024 September 30, 2023

Interest expense-contractual interest $ 4.8 $ 5.0

3 unchanged sentences

Total interest expense $ 7.5 $ 7.8

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

The Company is a lessee in several operating leases, primarily real estate facilities for office space.

1 unchanged sentence

The Company's leases do not contain any material residual value guarantees.

Lease expense and cash flow information are as follows ( in millions ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

Lease expense and cash flow information related to our operating leases is as follows ( in millions ):

Three Months Ended

September 28, 2024 September 30, 2023

Operating lease costs (1)

$ 3.1 $ 3.2 $ 9.7 $ 9.7

Cash paid for amounts included in the measurement of operating lease liabilities $ 4.7 $ 4.6

Operating ROU assets obtained in exchange for operating lease obligations $ 1.7 $ 0.9

(1) Total variable lease costs were immaterial during the three and nine months ended March 30, 2024 and April 1, 2023.

The total operating costs were included in Cost of revenues, R&D, and SG&A in the Consolidated Statements of Operations.

Balance sheet information related to our operating leases is as follows ( in millions ):

March 30, 2024 July 1, 2023

Operating ROU assets (Other non-current assets) $ 37.7 $ 40.4

Other current liabilities $ 9.9 $ 10.1

Other non-current liabilities 27.3 29.4

Total operating lease liabilities $ 37.2 $ 39.5

Weighted-average remaining lease term 6.1 years 6.7 years

Weighted-average discount rate 5.7 % 4.8 %

Future minimum operating lease payments as of March 30, 2024 are as follows ( in millions ):

(1) Total variable lease costs were immaterial during the three months ended September 28, 2024 and September 30, 2023.

The total operating costs were included in Cost of revenues, R&D, and SG&A in the Consolidated Statements of Operations.

Future minimum operating lease payments as of September 28, 2024 are as follows ( in millions ):

Operating Leases

10 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Restructuring and Related Charges

Restructuring

The Company’s restructuring events are primarily intended to reduce costs, consolidate operations, integrate various acquisitions, streamline product manufacturing and address market conditions.

Restructuring charges primarily include severance, benefits and outplacement costs to eliminate a specified number of positions.

Restructuring charges include severance, benefits and outplacement costs to eliminate a specified number of positions.

The timing of associated cash payments is dependent upon the jurisdiction of the affected employees and can extend over multiple periods.

Fiscal 2024 Plan

During the second quarter of fiscal 2023, Management approved a restructuring and workforce reduction plan (the Fiscal 2023 Plan) to better align the Company’s workforce with current business needs and strategic growth opportunities.

During the fourth quarter of fiscal 2024, management approved a restructuring and workforce reduction plan (the Fiscal 2024 Plan) across our Network and Service Enablement (NSE) and Optical Security and Performance Products (OSP) segments and Corporate (Corp) functions intended to improve operational efficiencies and better align the Company’s workforce with current business needs.

The Company expects approximately 6 % of its global workforce to be affected.

The first phase of the Fiscal 2023 Plan impacted our Network and Service Enablement (NSE) and Optical Security and Performance Products (OSP) segments and Corporate (Corp) functions and was substantially complete as of March 30, 2024.

The second phase of the Fiscal 2023 Plan is primarily focused on reducing costs in our Service Enablement (SE) segment and the Company anticipates this phase to be substantially complete by the end of fiscal 2024.

The Company anticipates the Fiscal 2024 Plan to be substantially complete by the end of fiscal 2025.

Fiscal 2023 Plan

The restructuring and workforce reduction plan initiated in the second quarter of fiscal 2023 (the Fiscal 2023 Plan) across various functions to better align the Company’s workforce with current business needs and strategic growth opportunities was completed in the first quarter of fiscal 2025.

The Fiscal 2023 Plan impacted approximately 5 % of the Company’s global workforce.

A summary of the activity in the restructuring accrual is outlined below (in millions) :

Balance as of

July 1, 2023 Restructuring and related (benefits) charges Cash Settlements Balance as of March 30, 2024

June 29, 2024 Restructuring and related charges (benefits) Non-cash settlements and other adjustments (1)

Cash settlements Balance as of September 28, 2024

Fiscal 2024 Plan

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OSP 1.2 0.1 — ( 0.7 ) 0.6

Fiscal 2023 Plan Phase I 4.1 ( 0.7 ) ( 3.2 ) 0.2

NSE/Corp 1.7 ( 0.1 ) ( 1.0 ) 0.6

Fiscal 2023 Plan Phase II 1.7 ( 0.1 ) ( 1.0 ) 0.6

Fiscal 2024 Plan 14.6 0.2 0.3 ( 8.3 ) 6.8

Fiscal 2023 Plan

NSE 0.3 ( 0.2 ) — ( 0.1 ) —

Fiscal 2023 Plan 0.3 ( 0.2 ) — ( 0.1 ) —

$ 14.9 $ — $ 0.3 $ ( 8.4 ) $ 6.8

(1) Included in Other current liabilities on the Consolidated Balance Sheets as of March 30, 2024 and July 1, 2023.

The Company recorded an income tax provision of $ 9.0 million and $ 25.2 million for the three and nine months ended March 30, 2024, respectively.

The Company recorded an income tax provision of $ 6.0 million and $ 28.7 million for the three and nine months ended April 1, 2023, respectively.

The income tax provision for the three and nine months ended March 30, 2024 and April 1, 2023 primarily relates to income tax in certain foreign and state jurisdictions based on the Company’s forecasted pre-tax income or loss.

(1) Includes currency translation adjustments.

(2) Includes certain amounts in Other current liabilities and Other non-current liabilities on the Consolidated Balance Sheets as of September 28, 2024 and June 29, 2024.

The Company recorded an income tax provision of $ 9.0 million and $ 8.6 million for the three months ended September 28, 2024 and September 30, 2023, respectively.

The income tax provision for the three months ended September 28, 2024 and September 30, 2023 primarily relates to income tax in certain foreign and state jurisdictions based on the Company’s forecasted pre-tax income or loss.

The income tax provision recorded differs from the expected tax provision that would be calculated by applying the federal statutory rate to the Company’s income from continuing operations before taxes primarily due to the changes in valuation allowance for deferred tax assets attributable to the Company’s domestic and foreign income from continuing operations.

As of March 30, 2024 and July 1, 2023, the Company’s unrecognized tax benefits totaled $ 51.1 million and are included in deferred taxes and other non-current tax liabilities, net.

The Company had $ 3.4 million accrued for the payment of interest and penalties as of March 30, 2024.

The timing and resolution of income tax examinations is uncertain, and the amounts ultimately paid, if any, upon resolution of issues raised by the taxing authorities may differ from the amounts accrued for each year.

Although the Company does not expect that our balance of gross unrecognized tax benefits will change materially in the next 12 months, given the uncertainty in the development of ongoing income tax examinations, the Company is unable to estimate the full range of possible adjustments to this balance.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

As of September 28, 2024 and June 29, 2024, the Company’s unrecognized tax benefits (net of Federal benefits) totaled $ 50.8 million and $ 50.7 million, respectively, and are included in deferred taxes and other non-current tax liabilities.

The Company had $ 4.0 million accrued for the payment of interest and penalties as of September 28, 2024.

Stockholders' Equity

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The timing of repurchases under the plan will depend upon business and financial market conditions.

During the nine months ended March 30, 2024, the Company repurchased 1.0 million shares of its common stock for $ 10.0 million under the 2022 Repurchase Plan.

As of March 30, 2024, the Company had remaining authorization of $ 224.8 million for future share repurchases under the 2022 Repurchase Plan.

During the three months ended September 28, 2024, the Company repurchased 2.0 million shares of its common stock for $ 16.4 million under the 2022 Repurchase Plan.

As of September 28, 2024, the Company had remaining authorization of $ 198.4 million for future share repurchases under the 2022 Repurchase Plan.

Stock-Based Compensation

8 unchanged sentences

In addition, the actual number of shares awarded upon vesting of performance-based grants may vary from the target shares depending upon the achievement of the relevant performance or market-based conditions.

During the nine months ended March 30, 2024 and April 1, 2023, the Company granted 3.6 million and 3.1 million time-based restricted stock awards, respectively.

The aggregate grant-date fair value of time-based restricted stock awards granted during the nine months ended March 30, 2024 and April 1, 2023 were estimated to be $ 35.1 million and $ 42.1 million, respectively.

During the nine months ended March 30, 2024 and April 1, 2023, the Company granted 1.2 million and 0.7 million performance-based awards, respectively.

There were no performance-based shares attained over target during the nine months ended March 30, 2024.

There were 0.1 million performance-based shares attained over target during the nine months ended April 1, 2023.

The aggregate grant-date fair value of performance-based awards granted during the nine months ended March 30, 2024 and April 1, 2023 were estimated to be $ 13.4 million and $ 11.5 million, respectively.

As of March 30, 2024, $ 67.3 million of unrecognized stock-based compensation costs remain to be amortized.

During the three months ended September 28, 2024 and September 30, 2023, the Company granted 4.2 million and 2.9 million time-based restricted stock awards, respectively.

The aggregate grant-date fair value of time-based restricted stock awards granted during the three months ended September 28, 2024 and September 30, 2023 were estimated to be $ 35.3 million and $ 30.0 million, respectively.

During the three months ended September 28, 2024 and September 30, 2023, the Company granted 1.5 million and 0.8 million performance-based awards, respectively.

There were no performance-based shares attained over target during the three months ended September 28, 2024 and September 30, 2023.

The aggregate grant-date fair value of performance-based awards granted during the three months ended September 28, 2024 and September 30, 2023 were estimated to be $ 15.1 million and $ 9.7 million, respectively.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

The impact on the Company’s results of operations of recording stock-based compensation by function for the three and nine months ended March 30, 2024 and April 1, 2023, is as follows (in millions) :

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

As of September 28, 2024, $ 90.9 million of unrecognized stock-based compensation costs remain to be amortized.

The impact on the Company’s results of operations of recording stock-based compensation by function for the three months ended September 28, 2024 and September 30, 2023, is as follows (in millions) :

Three Months Ended

September 28, 2024 September 30, 2023

Cost of revenues $ 1.2 $ 1.2

2 unchanged sentences

Total stock-based compensation expense $ 12.7 $ 11.2

Approximately $ 1.2 million of stock-based compensation was capitalized to inventory as of March 30, 2024 and April 1, 2023.

Approximately $ 1.2 million of stock-based compensation was capitalized to inventory as of September 28, 2024 and September 30, 2023.

Employee Pension and Other Benefit Plans

3 unchanged sentences

Benefits are generally based upon years of service and compensation or stated amounts for each year of service.

As of March 30, 2024, the U.K.

As of September 28, 2024, the U.K.

plan was fully funded while the other plans were unfunded.

1 unchanged sentence

For unfunded plans, the Company pays the post-retirement benefits when due.

During the nine months ended March 30, 2024, the Company contributed $ 0.7 million to the U.K.

During the three months ended September 28, 2024, the Company contributed $ 0.3 million to the U.K.

plan and $ 0.9 million to the other plans.

1 unchanged sentence

The following table presents the components of net periodic cost for the pension and benefits plans ( in millions ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

Three Months Ended

September 28, 2024 September 30, 2023

Interest cost $ 0.8 $ 0.9

Expected return on plan assets ( 0.4 ) ( 0.5 )

Amortization of net actuarial losses 0.2 — 0.1 —

Amortization of net actuarial losses (gains) 0.1 ( 0.1 )

Net periodic benefit cost $ 0.5 $ 0.3

3 unchanged sentences

Based on actuarial assumptions, the Company expects to incur cash outlays of approximately $ 9.3 million related to its defined benefit pension plans during fiscal 2025 to make current benefit payments and fund future obligations.

As of March 30, 2024, approximately $ 5.3 million had been incurred.

These payments have been estimated based on the same assumptions used to measure the Company’s projected benefit obligation at July 1, 2023.

As of September 28, 2024, approximately $ 1.2 million had been incurred.

These payments have been estimated based on the same assumptions used to measure the Company’s projected benefit obligation at June 29, 2024.

VIAVI SOLUTIONS INC.

2 unchanged sentences

Legal Proceedings

The Company is subject to a variety of claims and suits that arise from time to time in the ordinary course of its business.

While management currently believes that resolving claims against the Company, individually or in aggregate, will not have a material adverse impact on its financial position, results of operations or statement of cash flows, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future.

Were an unfavorable final outcome to occur, there exists the possibility of a material adverse impact on the Company’s financial position, results of operations or cash flows for the period in which the effect becomes reasonably estimable.

Tel-Instruments Electronics Corp.

13 unchanged sentences

In March 2018, the appellate court affirmed the decision of the lower court.

The Company pursued a motion for summary judgement on the deed of rectification claim and continued to pursue a claim against the U.K.

law firm responsible for the error.

The Company pursued a motion for summary judgement on the deed of rectification claim.

As of July 2, 2022, the related accrued pension liability of £ 5.4 million or $ 6.5 million was included in pension and post-employment benefits within Other non-current liabilities on the Consolidated Balance Sheets.

In September 2022, the Company received a favorable court decision which removed completely and definitively the obligation to fund the increased pension benefit with retrospective effect to 1999.

As a result of the judgment, and in accordance with authoritative guidance on contingencies, the Company reversed the liability and recorded a gain (reduction to SG&A expense in the Consolidated Statements of Operations) of £ 5.7 million or $ 6.7 million during the three months ended October 1, 2022.

The Company is subject to a variety of claims and suits that arise from time to time in the ordinary course of its business.

Outstanding Letters of Credit, Performance Bonds and Other Claims

As of March 30, 2024, the Company had standby letters of credit of $ 7.0 million and performance bonds and other claims of $ 1.9 million collateralized by restricted cash.

As of September 28, 2024, the Company had standby letters of credit of $ 8.3 million and performance bonds and other claims of $ 1.9 million collateralized by restricted cash.

VIAVI SOLUTIONS INC.

1 unchanged sentence

Product Warranties

The following table presents the changes in the Company’s warranty reserve during the three and nine months ended March 30, 2024 and April 1, 2023 ( in millions ):

Three Months Ended Nine Months Ended

March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023

The following table presents the changes in the Company’s warranty reserve during the three months ended September 28, 2024 and September 30, 2023 ( in millions ):

Three Months Ended

September 28, 2024 September 30, 2023

Balance as of beginning of period $ 7.5 $ 9.0

10 unchanged sentences

These solutions include instruments, software and services to design, build, turn-up, certify, troubleshoot and optimize networks.

The Company also offers a range of product support and professional services such as repair, calibration, software support and technical assistance for its products.

NE also offers a range of product support and professional services such as repair, calibration, software support and technical assistance for its products.

NE’s avionics products provide test and measuring solutions for aviation, aerospace, government, defense, communications and public safety.

15 unchanged sentences

Additionally, the Company does not specifically identify and allocate all assets by operating segment.

The following tables present information on the Company’s reportable segments for the three months ended March 30, 2024 and April 1, 2023 ( in millions ):

Three Months Ended March 30, 2024

The following tables present information on the Company’s reportable segments for the three months ended September 28, 2024 and September 30, 2023 ( in millions ):

Three Months Ended September 28, 2024

Network and Service Enablement

8 unchanged sentences

Operating margin ( 4.6 ) % 39.6 % 4.8 %

Three Months Ended April 1, 2023

Three Months Ended September 30, 2023

Network and Service Enablement

8 unchanged sentences

Gross margin 63.1 % 67.2 % 63.6 % 52.5 % 58.2 %

Operating income (loss) $ 2.5 $ 25.8 $ ( 30.4 ) $ ( 2.1 )

Operating income $ 1.5 $ 29.3 $ ( 14.8 ) $ 16.0

Operating margin 0.9 % 37.8 % 6.5 %

(1) Other Items include charges (benefits) unrelated to core operating performance primarily consisting of stock-based compensation, amortization of acquisition-related intangibles, restructuring, changes in fair value of contingent consideration liabilities and other charges unrelated to core operating performance.

During the three months ended March 30, 2024, Other Items include expenses related to the proposed acquisition of Spirent Communications plc (Spirent).

(1) See below table for details of reconciling items impacting gross profit and operating income.

VIAVI SOLUTIONS INC.

1 unchanged sentence

Three Months Ended

March 30, 2024 April 1, 2023

September 28, 2024 September 30, 2023

Corporate reconciling items impacting gross profit:

2 unchanged sentences

Amortization of intangibles ( 3.3 ) ( 3.5 )

Other benefits unrelated to core operating performance (1)

Other (charges) benefits unrelated to core operating performance (1)

Total reconciling items ( 4.6 ) ( 4.6 )

GAAP gross profit $ 136.1 $ 144.4

4 unchanged sentences

Change in fair value of contingent liability 3.5 1.4

Other charges unrelated to core operating performance (1)

( 16.4 ) ( 1.4 )

Restructuring and related charges ( 0.1 ) ( 10.2 )

GAAP operating loss from continuing operations $ ( 11.9 ) $ ( 2.1 )

(1) During the three months ended March 30, 2024 and April 1, 2023, Other benefits (charges) unrelated to core operating performance primarily consisting of certain acquisition and integration related charges, accretion of debt discount and loss on disposal of long-lived assets.

During the three months ended March 30, 2024, Other charges include expenses related to the proposed acquisition of Spirent.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Nine Months Ended March 30, 2024

Network and Service Enablement

Network Enablement Service Enablement Network and Service Enablement Optical Security and Performance Products Other Items (1)

Consolidated GAAP Measures

Product revenue $ 369.6 $ 25.6 $ 395.2 $ 228.6 $ — $ 623.8

Service revenue 87.6 37.0 124.6 — — 124.6

Net revenue $ 457.2 $ 62.6 $ 519.8 $ 228.6 $ — $ 748.4

Gross profit $ 285.1 $ 41.3 $ 326.4 $ 117.9 $ ( 14.0 ) $ 430.3

Gross margin 62.4 % 66.0 % 62.8 % 51.6 % 57.5 %

Operating income $ 4.8 $ 82.7 $ ( 61.0 ) $ 26.5

Operating margin 0.9 % 36.2 % 3.5 %

Nine Months Ended April 1, 2023

Network and Service Enablement

Network Enablement Service Enablement Network and Service Enablement Optical Security and Performance Products Other Items (1)

Consolidated GAAP Measures

Product revenue $ 441.7 $ 33.6 $ 475.3 $ 239.1 $ — $ 714.4

Service revenue

90.0 38.0 128.0 0.1 — 128.1

Net revenue $ 531.7 $ 71.6 $ 603.3 $ 239.2 $ — $ 842.5

Gross profit $ 339.4 $ 47.9 $ 387.3 $ 128.0 $ ( 22.5 ) $ 492.8

Gross margin 63.8 % 66.9 % 64.2 % 53.5 % 58.5 %

Operating income $ 49.8 $ 91.9 $ ( 71.1 ) $ 70.6

Operating margin 8.3 % 38.4 % 8.4 %

During the nine months ended March 30, 2024, Other Items include expenses related to the proposed acquisition of Spirent.

VIAVI SOLUTIONS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Nine Months Ended

March 30, 2024 April 1, 2023

Corporate reconciling items impacting gross profit:

Total segment gross profit $ 444.3 $ 515.3

Stock-based compensation ( 3.7 ) ( 3.6 )

Amortization of intangibles ( 10.4 ) ( 18.7 )

Acquisition and integration related charges ( 0.6 ) —

Other benefits (charges) unrelated to core operating performance (1)(2)

GAAP gross profit $ 430.3 $ 492.8

Corporate reconciling items impacting operating income:

Total segment operating income $ 87.5 $ 141.7

Stock-based compensation ( 36.6 ) ( 38.8 )

Amortization of intangibles ( 15.4 ) ( 25.2 )

Change in fair value of contingent liability 7.8 0.1

Other (charges) benefits unrelated to core operating performance (1)

Restructuring and related benefits (charges) 0.8 ( 10.2 )

Litigation settlement 1.3 —

Restructuring and related benefits — 0.8

Total reconciling items ( 12.4 ) ( 14.8 )

GAAP operating income from continuing operations $ 11.5 $ 16.0

(1) During the nine months ended March 30, 2024 and April 1, 2023, Other benefits (charges) unrelated to core operating performance primarily consisting of certain acquisition and integration related charges, accretion of debt discount and loss on disposal of long-lived assets.

During the nine months ended March 30, 2024, Other charges include expenses related to the proposed acquisition of Spirent.

(1) Other items include (charges) benefits unrelated to core operating performance primarily consisting of transformational initiatives such as site consolidations, intangible impairment and gain or loss on disposal of long-lived assets.

(2) Included in the three months ended September 28, 2024 is a gain of $ 0.9 million on the sale of assets previously classified as held for sale.

VIAVI SOLUTIONS INC.

4 unchanged sentences

For example, certain customers may request shipment of the Company’s product to a contract manufacturer in one country, which may differ from the location of their end customers.

The following table presents net revenue by the three geographic regions in which the Company operates and net revenue from countries that exceeded 10% of the Company’s total net revenue for the three and nine months ended March 30, 2024 and April 1, 2023 (in millions):

The following table presents net revenue by the three geographic regions in which the Company operates and net revenue from countries that exceeded 10% of the Company’s total net revenue for the three months ended September 28, 2024 and September 30, 2023 (in millions):

Three Months Ended

March 30, 2024 April 1, 2023

September 28, 2024 September 30, 2023

Product Revenue Service Revenue Total Product Revenue Service Revenue Total

8 unchanged sentences

Total net revenue $ 197.5 $ 40.7 $ 238.2 $ 205.6 $ 42.3 $ 247.9

Nine Months Ended

March 30, 2024 April 1, 2023

Product Revenue Service Revenue Total Product Revenue Service Revenue Total

United States $ 198.5 $ 45.3 $ 243.8 $ 227.0 $ 44.6 $ 271.6

Other Americas 37.1 11.0 48.1 47.4 10.8 58.2

Total Americas $ 235.6 $ 56.3 $ 291.9 $ 274.4 $ 55.4 $ 329.8

Asia-Pacific:

Greater China $ 141.0 $ 4.5 $ 145.5 $ 165.9 $ 5.7 $ 171.6

Other Asia 89.7 19.9 109.6 100.8 19.8 120.6

Total Asia-Pacific $ 230.7 $ 24.4 $ 255.1 $ 266.7 $ 25.5 $ 292.2

$ 157.5 $ 43.9 $ 201.4 $ 173.3 $ 47.2 $ 220.5

Total net revenue $ 623.8 $ 124.6 $ 748.4 $ 714.4 $ 128.1 $ 842.5

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements