VIAVI SOLUTIONS INC. 10-Q

Item 1. Financial Statements VIAVI SOLUTIONS INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) (unaudited) Three Months Ended Nine Months Ended March 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Revenues: Product revenue $ 357.0 $ 241.5 $ 931.7 $ 664.7 Service revenue 49.8 43.3 143.5 129.1 Total net revenue 406.8 284.8 1,075.2 793.8 Cost of revenues: Product cost of revenue 141.6 96.7 377.7 265.9 Service cost of revenue 18.1 21.3 51.4 57.6 Amortization of acquired technologies 13.0 6.1 32.4 12.7 Total cost of revenues 172.7 124.1 461.5 336.2 Gross profit 234.1 160.7 613.7 457.6 Operating expenses: Research and development 71.0 50.0 192.9 151.5 Selling, general and administrative 113.6 101.3 344.9 259.7 Amortization of other intangibles 7.4 1.2 15.2 3.3 Restructuring and related charges (benefits) 17.3 ( 0.3 ) 16.9 0.9 Total operating expenses 209.3 152.2 569.9 415.4 Income from operations 24.8 8.5 43.8 42.2 Loss on debt extinguishment (Note 11) ( 3.7 ) — ( 46.2 ) — Interest and other income, net 7.0 2.2 12.2 9.3 Interest expense ( 14.3 ) ( 7.5 ) ( 37.0 ) ( 22.5 ) Income (loss) before income taxes and equity investment earnings 13.8 3.2 ( 27.2 ) 29.0 Provision for (benefit from) income taxes 7.4 ( 16.3 ) 36.1 2.2 Equity investment earnings — — 0.2 — Net income (loss) $ 6.4 $ 19.5 $ ( 63.1 ) $ 26.8 Net income (loss) per share: Basic $ 0.03 $ 0.09 $ ( 0.28 ) $ 0.12 Diluted $ 0.03 $ 0.09 $ ( 0.28 ) $ 0.12 Shares used in per share calculations: Basic 232.0 222.6 226.2 222.2 Diluted 249.5 226.9 226.2 225.2 The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements. 2 Table of Contents VIAVI SOLUTIONS INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (in millions) (unaudited) Three Months Ended Nine Months Ended March 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Net income (loss) $ 6.4 $ 19.5 $ ( 63.1 ) $ 26.8 Other comprehensive (loss) income: Net change in cumulative translation adjustment, net of tax ( 7.5 ) 13.9 ( 6.3 ) 2.9 Amortization of net actuarial losses and other pension adjustments — — 0.1 0.2 Net change in accumulated other comprehensive (loss) income ( 7.5 ) 13.9 ( 6.2 ) 3.1 Comprehensive (loss) income $ ( 1.1 ) $ 33.4 $ ( 69.3 ) $ 29.9 The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements. 3 Table of Contents VIAVI SOLUTIONS INC. CONSOLIDATED BALANCE SHEETS (in millions, except share and par value data) (unaudited) March 28, 2026 June 28, 2025 ASSETS Current assets: Cash and cash equivalents $ 499.0 $ 423.6 Short-term investments 1.8 1.7 Restricted cash 7.2 3.7 Accounts receivable, net 320.3 261.0 Inventories, net 147.9 117.9 Prepayments and other current assets 77.5 77.3 Total current assets 1,053.7 885.2 Property, plant and equipment, net 222.5 231.9 Goodwill, net 701.8 595.7 Intangibles, net 398.0 131.6 Deferred income taxes 79.7 87.2 Other non-current assets 72.1 62.2 Total assets $ 2,527.8 $ 1,993.8 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 81.7 $ 68.8 Accrued payroll and related expenses 72.8 63.6 Deferred revenue 85.2 74.1 Accrued expenses 27.8 28.7 Short-term debt 244.5 246.2 Other current liabilities 140.5 108.3 Total current liabilities 652.5 589.7 Long-term debt 836.3 396.3 Other non-current liabilities 192.5 227.6 Total liabilities 1,681.3 1,213.6 Commitments and contingencies (Note 18) Stockholders’ equity: Preferred stock, $ 0.001 par value; 1 million shares authorized, no shares issued or outstanding at March 28, 2026 and June 28, 2025 — — Common stock, $ 0.001 par value; 1 billion shares authorized; 234 million shares at March 28, 2026 and 223 million shares at June 28, 2025, issued and outstanding 0.2 0.2 Additional paid-in capital 70,683.5 70,517.9 Accumulated deficit ( 69,721.2 ) ( 69,628.1 ) Accumulated other comprehensive loss ( 116.0 ) ( 109.8 ) Total stockholders’ equity 846.5 780.2 Total liabilities and stockholders’ equity $ 2,527.8 $ 1,993.8 The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements. 4 Table of Contents VIAVI SOLUTIONS INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (unaudited) Nine Months Ended March 28, 2026 March 29, 2025 OPERATING ACTIVITIES: Net (loss) income $ ( 63.1 ) $ 26.8 Adjustments to reconcile net (loss) income to net cash provided by operating activities: Depreciation expense 30.1 28.8 Amortization of acquired technologies and other intangibles 47.6 16.0 Stock-based compensation 41.2 40.5 Loss on debt extinguishment 46.2 — Amortization of debt issuance costs 4.9 5.5 Net change in fair value of contingent liabilities 24.3 ( 4.9 ) Deferred taxes, net 9.5 ( 29.9 ) Amortization of inventory step-up 6.1 1.7 Restructuring 16.9 0.9 Other 6.9 ( 4.6 ) Changes in operating assets and liabilities, net of acquisitions: Accounts receivable ( 62.5 ) ( 31.9 ) Inventories ( 37.3 ) ( 0.3 ) Other current and non-current assets ( 5.7 ) ( 1.5 ) Accounts payable 13.4 15.7 Income taxes payable 3.4 5.6 Deferred revenue, current and non-current ( 13.2 ) ( 0.9 ) Accrued payroll and related expenses 9.1 6.8 Accrued expenses and other current and non-current liabilities ( 30.6 ) ( 8.3 ) Net cash provided by operating activities $ 47.2 $ 66.0 INVESTING ACTIVITIES: Purchases of short-term investments $ ( 64.6 ) $ ( 147.7 ) Maturities of short-term investments 64.7 145.5 Capital expenditures ( 20.0 ) ( 22.3 ) Proceeds from the sale of assets 2.6 4.7 Acquisitions, net of acquired cash and holdbacks ( 399.3 ) ( 117.9 ) Purchase price adjustment related to business acquisition ( 0.7 ) — Other investing activities — ( 3.0 ) Net cash used in investing activities $ ( 417.3 ) $ ( 140.7 ) FINANCING ACTIVITIES: Proceeds from issuance of debt $ 749.1 $ — Repayment of debt ( 199.0 ) — Payment of debt issuance costs ( 23.4 ) — Repurchase and retirement of common stock ( 30.0 ) ( 16.4 ) Withholding tax payment on vesting of restricted stock and performance- based awards ( 23.0 ) ( 13.1 ) Cash paid to third parties in convertible note extinguishment ( 1.0 ) — Payment of financing obligations ( 0.2 ) ( 0.2 ) Proceeds from employee stock purchase plan 6.5 6.0 Payment of acquisition related contingent consideration ( 29.8 ) — Other financing activities — 0.2 Net cash provided by (used in) financing activities $ 449.2 $ ( 23.5 ) Effect of exchange rates on cash, cash equivalents and restricted cash $ 0.1 $ ( 0.9 ) Net increase (decrease) in cash, cash equivalents and restricted cash 79.2 ( 99.1 ) Cash, cash equivalents and restricted cash at the beginning of the period (1) 432.1 481.8 Cash, cash equivalents and restricted cash at the end of the period (2) $ 511.3 $ 382.7 (1) These amounts include both current and non-current balances of restricted cash totaling $ 8.5 million and $ 10.5 million as of June 28, 2025 and June 29, 2024, respectively. (2) These amounts include both current and non-current balances of restricted cash totaling $ 12.3 million and $ 8.5 million as of March 28, 2026 and March 29, 2025, respectively. The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements. 5 Table of Contents VIAVI SOLUTIONS INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (in millions) (unaudited) Three Months Ended March 28, 2026 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Shares Amount Balance at December 27, 2025 231.4 $ 0.2 $ 70,670.2 $ ( 69,727.6 ) $ ( 108.5 ) $ 834.3 Net income — — — 6.4 — 6.4 Other comprehensive loss — — — — ( 7.5 ) ( 7.5 ) Shares issued under employee stock plans, net of tax 0.7 — ( 0.7 ) — — ( 0.7 ) Stock-based compensation — — 14.0 — — 14.0 Convertible note extinguishment (Note 11) 1.8 — — — — — Balance at March 28, 2026 233.9 $ 0.2 $ 70,683.5 $ ( 69,721.2 ) $ ( 116.0 ) $ 846.5 Three Months Ended March 29, 2025 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Shares Amount Balance at December 28, 2024 222.1 $ 0.2 $ 70,493.0 $ ( 69,655.6 ) $ ( 154.8 ) $ 682.8 Net income — — — 19.5 — 19.5 Other comprehensive income — — — — 13.9 13.9 Shares issued under employee stock plans, net of tax 1.1 — ( 1.5 ) — — ( 1.5 ) Stock-based compensation — — 14.1 — — 14.1 Balance at March 29, 2025 223.2 $ 0.2 $ 70,505.6 $ ( 69,636.1 ) $ ( 140.9 ) $ 728.8 Nine Months Ended March 28, 2026 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Shares Amount Balance at June 28, 2025 223.2 $ 0.2 $ 70,517.9 $ ( 69,628.1 ) $ ( 109.8 ) $ 780.2 Net loss — — — ( 63.1 ) — ( 63.1 ) Other comprehensive loss — — — — ( 6.2 ) ( 6.2 ) Shares issued under employee stock plans, net of tax 3.7 — ( 16.5 ) — — ( 16.5 ) Stock-based compensation — — 41.4 — — 41.4 Repurchase of common stock ( 2.7 ) — — ( 30.0 ) — ( 30.0 ) Convertible note extinguishment (Note 11) 9.7 — 140.7 — — 140.7 Balance at March 28, 2026 233.9 $ 0.2 $ 70,683.5 $ ( 69,721.2 ) $ ( 116.0 ) $ 846.5 6 Table of Contents Nine Months Ended March 29, 2025 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 income — — — 26.8 — 26.8 Other comprehensive income — — — — 3.1 3.1 Shares issued under employee stock plans, net of tax 3.3 — ( 7.1 ) — — ( 7.1 ) Stock-based compensation — — 40.5 — — 40.5 Repurchase of common stock ( 2.0 ) — 0.3 ( 16.4 ) — ( 16.1 ) Balance at March 29, 2025 223.2 $ 0.2 $ 70,505.6 $ ( 69,636.1 ) $ ( 140.9 ) $ 728.8 The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements. 7 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1. Basis of Presentation 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 28, 2026 and March 29, 2025 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. GAAP) for interim financial information and rules and regulations of the Securities and Exchange Commission (SEC). Accordingly, such information does not include all of the information and footnotes required by U.S. 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 June 28, 2025. There have been no material changes to the Company’s accounting policies during the three and nine months ended March 28, 2026 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 28, 2025 on Form 10-K, filed with the SEC on August 11, 2025. The Consolidated Balance Sheet as of June 28, 2025 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 28, 2026 and March 29, 2025 may not be indicative of results for the fiscal year ending June 27, 2026 or any future periods. Fiscal Years The Company utilizes a 52-53 week fiscal year ending on the Saturday closest to June 30th. The Company’s fiscal 2026 is a 52-week year ending on June 27, 2026. The Company’s fiscal 2025 was a 52-week year ending on June 28, 2025. Principles of Consolidation The Consolidated Financial Statements include the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated. Use of Estimates The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements, the reported amount of net revenue and expense and the disclosure of commitments and contingencies during the reporting periods. Estimates are based on historical factors, current circumstances and the experience and judgment of management. Under changed conditions, the Company’s reported financial position or results of operations may be materially impacted when using different estimates and assumptions, particularly with respect to significant accounting policies. If estimates or assumptions differ from actual results, subsequent periods are adjusted to reflect more readily available information. 8 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 2. Recently Issued Accounting Pronouncements Accounting Standards Issued But Not Yet Adopted In December 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities , which provides guidance for a government grant received by a business entity. This guidance is effective for fiscal years beginning after December 15, 2028 (fiscal 2030 for the Company), and interim periods within those annual reporting periods, with early adoption permitted. The Company is evaluating the impact of adopting this new accounting guidance on its Consolidated Financial Statements. In July 2025, the FASB issued ASU 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets , which provides a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606: Revenue from Contracts with Customers , including those assets acquired in a business combination. The practical expedient permits an entity to assume that current conditions as of the balance sheet date do not change for the remaining life of the current accounts receivable and current contract assets. This guidance is effective for fiscal years beginning after December 15, 2025 (fiscal 2027 for the Company), and interim periods within those annual reporting periods, with early adoption permitted. The Company is evaluating the impact of adopting this new accounting guidance on its Consolidated Financial Statements. In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which requires disaggregated disclosure of income statement expenses for public business entities. The objective of this guidance is to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization and depletion) in commonly presented expense captions such as Cost of revenues, Research and development (R&D) and Selling, general and administrative (SG&A). This guidance is effective for fiscal years beginning after December 15, 2026 (fiscal 2028 for the Company), and interim periods within fiscal years beginning after December 15, 2027, with early and retrospective adoption permitted. The Company is evaluating the impact of adopting this new accounting guidance on its Consolidated Financial Statements. 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. This guidance is effective for annual periods beginning after December 15, 2024 (fiscal 2026 for the Company). The Company expects to adopt the guidance on a prospective basis for the fiscal year ending June 27, 2026, and the adoption is anticipated to result in expanded disclosures in the Company’s annual financial statements. In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements-Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative . The amendments clarify or improve disclosure and presentation requirements on various disclosure areas, including the statement of cash flows, earnings per share, debt, equity and derivatives. The amendments will align the requirements in the FASB Accounting Standards Codification (ASC) with the SEC’s regulations. The amendments in this ASU will be effective on the date the related disclosures are removed from Regulation S-X or Regulation S-K by the SEC, and will not be effective if the SEC has not removed the applicable disclosure requirement by June 30, 2027. This ASU is not expected to have a material impact on our Consolidated Financial Statements or related disclosures. 9 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 3. Earnings Per Share The following table sets forth the computation of basic and diluted net income (loss) per share ( in millions, except per share data ): Three Months Ended Nine Months Ended March 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Numerator: Net income (loss) $ 6.4 $ 19.5 $ ( 63.1 ) $ 26.8 Denominator: Weighted-average shares outstanding: Basic 232.0 222.6 226.2 222.2 Diluted shares - Convertible Notes 9.9 — — — Effect of dilutive securities from stock-based compensation plans 7.6 4.3 — 3.0 Diluted 249.5 226.9 226.2 225.2 Net income (loss) per share: Basic $ 0.03 $ 0.09 $ ( 0.28 ) $ 0.12 Diluted $ 0.03 $ 0.09 $ ( 0.28 ) $ 0.12 In periods where the Company recognized a net loss, the impact of potentially dilutive outstanding stock-based awards and the “in-the money” conversion benefit feature above the conversion price of the 1.625 % Senior Convertible Notes due 2026 (2026 Notes) and 0.625 % Senior Convertible Notes due 2031 (2031 Notes) of $ 13.19 and $ 13.79 per share, respectively, have been excluded from the calculation of diluted loss per share as their inclusion would have an antidilutive effect. The following table represents potential common shares that were not included in the computation of the diluted net income (loss) per share because their effect would have been anti-dilutive ( in millions ): Three Months Ended Nine Months Ended March 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Restricted stock units — — 0.6 1.2 10 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 4. Accumulated Other Comprehensive Loss 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 28, 2026, 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 Change in unrealized components of defined benefit obligations Total Beginning balance as of June 28, 2025 $ ( 5.3 ) $ ( 97.5 ) $ ( 7.0 ) $ ( 109.8 ) Other comprehensive loss — ( 6.3 ) — ( 6.3 ) Amounts reclassified out of accumulated other comprehensive loss — — 0.1 0.1 Net current-period other comprehensive (loss) income — ( 6.3 ) 0.1 ( 6.2 ) Ending balance as of March 28, 2026 $ ( 5.3 ) $ ( 103.8 ) $ ( 6.9 ) $ ( 116.0 ) Note 5. Acquisitions High-speed Ethernet, Network Security and Channel Emulation Testing Business On October 16, 2025, the Company acquired Spirent Communications plc’s (Spirent) high-speed ethernet, network security and channel emulation testing business (collectively, the HSE and CE business) from Keysight Technologies, Inc. (Keysight). The transaction provides a complementary addition to VIAVI’s ethernet testing platform within its Network and Service Enablement (NSE) segment. The cash consideration paid at closing of $ 399.3 million is subject to final net working capital adjustments. The acquisition met the definition of a business and has been accounted for in accordance with the authoritative guidance on business combinations; therefore, the tangible and intangible assets acquired and liabilities assumed were recorded at fair value on the acquisition date. Acquisition related costs incurred were approximately $ 20.6 million, of which $ 11.4 million was incurred in fiscal 2026, and were recorded within SG&A in the Consolidated Statements of Operations. The total purchase consideration was allocated to tangible and intangible assets acquired and liabilities assumed based on the preliminary fair value on the acquisition date. The Company elected to apply both practical expedients permitted under ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, in measuring contract assets and contract liabilities acquired in the acquisition. Specifically, we have elected the practical expedient that permits an entity to reflect the aggregate effect of all modifications (on a contract-by-contract basis) as if they occurred on the acquisition date. In addition, the Company elected to determine the standalone selling prices of performance obligations as of the acquisition date, rather than at contract inception, for purpose of allocating transaction consideration. The Company is in the process of obtaining additional information to refine its preliminary fair value estimates related to certain acquired assets and assumed liabilities. We may revise the preliminary purchase price allocation during the remainder of the measurement period as additional information becomes available. Any such revisions or changes may be material. We expect to finalize the purchase price allocation by the end of fiscal 2026. 11 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table presents the preliminary allocation of the purchase price ( in millions ): Amount Inventory, net $ 7.7 Prepayments and other current assets 1.0 Property, plant and equipment, net 2.9 Goodwill (1) 111.6 Identified intangible assets acquired 314.2 Other non-current assets 1.7 Deferred revenue (2) ( 25.7 ) Accrued payroll and related expenses ( 0.8 ) Other current liabilities ( 3.9 ) Other non-current liabilities (3) ( 9.4 ) Total purchase consideration $ 399.3 (1) Goodwill at acquisition date of $ 111.3 million increased by $ 0.3 million for measurement period adjustments. (2) Represents the current portion of deferred revenue. (3) Includes long-term deferred revenue of $ 8.2 million. The Company valued the customer relationships using the multi-period excess earnings method under the income approach. This method reflects the present value of the projected cash flows that are expected to be generated by the customer relationships. Significant assumptions related to customer relationships included (i) projected revenues, (ii) discount rate, (iii) income tax rate and (iv) customer attrition rate. Developed technology relates to products used for our lab and production and wireless solutions. The Company valued the developed technology using the relief-from-royalty method under the income approach. This method is based on the application of a royalty rate to forecasted revenue from the developed technology. Significant assumptions related to developed technology included (i) royalty rate, (ii) projected revenues, (iii) discount rate, (iv) income tax rate and (v) technology obsolescence rate. The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition ( in millions, except useful life ): Estimated Useful Life Amount Customer relationship 9 years $ 162.3 Developed technology 5 years 134.8 Backlog 2 years 10.1 Trade name 6 years 7.0 Total identifiable assets acquired $ 314.2 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 NSE segment. Goodwill is primarily attributable to expected synergies in the acquired technologies that may be leveraged by the Company in future solution offerings. The goodwill recognized is deductible for U.S. income tax purposes. The Company has included the financial results of Spirent’s HSE and CE business in its Consolidated Financial Statements from the date of acquisition. Pro forma results of operations have not been presented because the effect of the acquisition was not material to the Consolidated Statements of Operations. 12 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Inertial Labs, Inc. On January 28, 2025, the Company acquired all of the equity of Inertial Labs, Inc. (Inertial Labs), a privately held company which specializes in resilient positioning, navigation and timing (PNT) solutions for aerospace, defense and industrial applications. The acquisition enables the Company to further broaden its solutions offering into the rapidly developing PNT landscape. The total purchase consideration included approximately $ 134.4 million paid in cash at closing and additional contingent consideration of up to $ 175.0 million, payable upon the achievement of certain revenue targets over the course of a four-year period beginning in January 2025. As of the acquisition date, the fair value of the contingent consideration was $ 116.2 million. The net cash paid for the acquisition, with purchase price adjustment, was $ 121.6 million, which reflects the cash paid less cash acquired of $ 16.5 million. From the contingent consideration of $ 175.0 million, $ 3.4 million was set aside for the payment of retention bonuses over the four-year earn-out period to key personnel and service providers, contingent on continued service to the Company. Any forfeited amount will be removed from the retention bonus pool and re-distributed to the shareholders of Inertial Labs upon the achievement of the earn-out targets. The portion of the estimated fair value of the earn-out liability allocated to the retention bonuses will be accounted for as post combination expense over the requisite service period. The cash consideration paid at closing included an escrow payment of $ 1.0 million subject to final net working capital adjustments. The Company paid $ 3.7 million in our fourth fiscal quarter of 2025 comprised of the net working capital holdback of $ 3.0 million and $ 0.7 million of the purchase price adjustment of $ 1.4 million. The remainder of the purchase price adjustment of $ 0.7 million was paid in the first quarter of fiscal 2026 and refund of prepaid tax of $ 0.6 million is expected to be paid in calendar 2026. In addition, the Company held back $ 15.0 million for indemnity claims. During the three months ended March 28, 2026, the indemnity holdback amount was reduced by $ 1.1 million from noncash financing activities. The acquisition met the definition of a business and has been accounted for in accordance with the authoritative guidance on business combinations; therefore, the tangible and intangible assets acquired and liabilities assumed were recorded at fair value on the acquisition date. Acquisition related costs incurred in fiscal 2025 were approximately $ 11.7 million and were recorded within SG&A in the Consolidated Statements of Operations. These costs included $ 9.5 million in transaction bonuses that were paid at closing to key personnel and service providers of Inertial Labs. The total purchase consideration was allocated to tangible and intangible assets acquired and liabilities assumed based on the fair value on the acquisition date. The following table presents the allocation of the purchase price ( in millions ): Amount Cash and cash equivalents $ 16.5 Accounts receivable, net 8.1 Inventory, net 26.0 Prepayments and other current assets 1.1 Property, plant and equipment, net 1.9 Goodwill (1) 130.3 Identified intangible assets acquired 117.6 Other non-current assets 1.9 Accounts payable ( 1.4 ) Accrued payroll and related expenses ( 0.5 ) Deferred revenue ( 0.3 ) Accrued expenses ( 3.5 ) Other non-current liabilities (2) ( 27.1 ) Total purchase consideration $ 270.6 (1) Goodwill at acquisition date of $ 129.7 million increased by $ 0.6 million for purchase price and measurement period adjustments. (2) Includes $ 25.0 million of deferred tax liability and $ 0.9 million of liability related to uncertain tax positions. 13 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Developed technology relates to products used for PNT solutions for aerospace, defense and industrial applications. The Company valued the developed technology using the multi-period excess earnings method under the income approach. This method reflects the present value of the projected cash flows that are expected to be generated by the developed technology. Significant assumptions used in the discounted cash flow analysis include (i) projected revenues, (ii) discount rate, and (iii) technology obsolescence rate. The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition ( in millions, except useful life ): Estimated Useful Life Amount Developed technology 4 to 7 years $ 102.0 Customer relationship 6 years 9.6 Tradename 3 years 0.8 Backlog 2 years 5.2 Total identifiable assets acquired $ 117.6 Goodwill represents the excess of the purchase consideration over the fair value of the net tangible and intangible assets acquired and has been allocated to the NSE segment. Goodwill is primarily attributable to expected synergies in the acquired technologies that may be leveraged by the Company in future PNT offerings. None of the goodwill recognized is deductible for U.S. income tax purposes. The Company has included the financial results of Inertial Labs in its Consolidated Financial Statements from the date of acquisition. Pro forma results of operations have not been presented because the effect of the acquisition was not material to the Consolidated Statements of Operations. Jackson Labs Technologies, LLC On October 5, 2022, the Company acquired all of the equity of Jackson Labs Technologies, LLC (Jackson Labs), a privately held company which specializes in PNT solutions for critical infrastructure serving both military and civilian applications. The acquisition enables the Company to broaden its solutions offering into the rapidly developing PNT landscape. The total purchase consideration included approximately $ 49.9 million paid in cash at closing and additional contingent consideration of up to $ 117.0 million. Acquisition related Contingent Consideration Refer to “Note 8. Fair Value Measurements” for information on the contingent consideration activity for the three and nine months ended March 28, 2026. 14 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 6. Balance Sheet and Other Details Contract Balances Gross receivables include both billed and unbilled receivables (including Contract assets). As of March 28, 2026 and June 28, 2025, the Company had total unbilled receivables of $ 17.2 million and $ 14.1 million. 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 28, 2026 Three Months Ended Nine Months Ended Deferred revenue: Balance at beginning of period $ 118.3 $ 102.3 Revenue deferrals for new contracts (1) 43.2 94.8 Acquisition (2) 0.4 33.9 Revenue recognized during the period (3) ( 40.2 ) ( 109.3 ) Balance at end of period $ 121.7 $ 121.7 (1) This amount includes the effect of foreign currency exchange rate fluctuations. (2) This amount includes deferred revenue at acquisition date and measurement period adjustments. Refer to “Note 5. Acquisitions” for more information. (3) Revenue recognized during the period represents releases from the balance at the beginning of the period as well as releases from the current period deferrals including the acquired deferred revenue. 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 28, 2026, was $ 533.8 million. The Company expects to recognize approximately 92 % of remaining performance obligations as revenue within the next 12 months, and the remainder thereafter. Accounts receivable allowances - Credit losses The following table presents the activities and balances for allowance for credit losses ( in millions ): June 28, 2025 Charged to Costs and Expenses Deductions (1) March 28, 2026 Allowance for credit losses $ 1.9 $ 1.2 $ ( 0.6 ) $ 2.5 (1) Represents the effect of currency translation adjustments and write-offs of uncollectible accounts, net of recoveries. Inventories, net The following table presents the components of inventories, net ( in millions ): March 28, 2026 June 28, 2025 Finished goods $ 61.2 $ 52.5 Work in process 21.2 18.3 Raw materials 65.5 47.1 Inventories, net $ 147.9 $ 117.9 15 Table of Contents 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 28, 2026 June 28, 2025 Refundable income taxes $ 24.7 $ 32.0 Prepayments 18.3 21.9 Advances to contract manufacturers 15.5 5.8 Fair value of forward contracts 1.4 4.9 Other current assets 17.6 12.7 Prepayments and other current assets $ 77.5 $ 77.3 Other non-current assets The following table presents the components of other non-current assets ( in millions ): March 28, 2026 June 28, 2025 Operating right-of-use (ROU) assets $ 41.9 $ 34.1 Long-term restricted cash 5.1 4.9 Long-term investment (Note 7) 3.0 3.0 Deferred contract cost 2.9 3.0 Debt issuance cost - Revolving Credit Facility 2.7 1.4 Deposits 2.5 2.4 Other 14.0 13.4 Other non-current assets $ 72.1 $ 62.2 Other current liabilities The following table presents the components of other current liabilities ( in millions ): March 28, 2026 June 28, 2025 Fair value of contingent consideration (Note 8) $ 43.0 $ 41.5 Acquisition related holdback and related accruals 16.5 16.5 Restructuring accrual (Note 13) 16.5 3.5 Interest payable 13.4 5.1 Operating lease liabilities 11.5 10.2 Income tax payable 8.0 8.2 Warranty accrual 6.7 5.9 Fair value of forward contracts 2.1 3.1 Other 22.8 14.3 Other current liabilities $ 140.5 $ 108.3 16 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Other non-current liabilities The following table presents components of other non-current liabilities ( in millions ): March 28, 2026 June 28, 2025 Pension and post-employment benefits $ 51.2 $ 54.1 Long-term deferred revenue 36.6 28.2 Operating lease liabilities 30.6 24.1 Fair value of contingent consideration (Note 8) 25.2 75.9 Financing obligation 13.6 15.5 Uncertain tax position 11.9 11.4 Deferred tax liability 10.1 6.0 Asset retirement obligations 3.9 3.5 Warranty accrual — 0.8 Other 9.4 8.1 Other non-current liabilities $ 192.5 $ 227.6 Note 7. Investments and Forward Contracts Short-Term Investments As of March 28, 2026, the Company’s short-term investments of $ 1.8 million were primarily related to the deferred compensation plan, of which $ 1.7 million was invested in equity securities. As of June 28, 2025, the Company’s short-term investments of $ 1.7 million were primarily related to the deferred compensation plan, of which $ 1.6 million was invested in equity 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 fiscal 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 and nine months ended March 28, 2026. Equity Investment The Company acquired an equity interest in Sensorsan Sensor Teknolojileri Anonim Sirketi (Sensorsan), a privately held entity and owns 40 % percent of Sensorsan, through its acquisition of Inertial Labs. The Company accounts for its investment in Sensorsan under the equity method of accounting. Under the equity method, the Company recognizes income or loss from its pro-rata share of Sensorsan’s net income or loss, which changes the carrying value of the Sensorsan investment. The Company’s share of Sensorsan’s net income for the nine months ended March 28, 2026 was $ 0.2 million. As of March 28, 2026 and June 28, 2025, the carrying value of the Company’s investment in Sensorsan was $ 1.4 million and $ 1.3 million, respectively, included in Other non-current assets on the Consolidated Balance Sheets. The Company sells certain products to Sensorsan. During the three and nine months ended March 28, 2026, revenue from sales to Sensorsan was $ 0.9 million and $ 2.1 million, respectively. 17 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Non-Designated Foreign Currency Forward Contracts The Company has foreign subsidiaries that operate and sell the Company’s products in various markets around the world. As a result, the Company is exposed to foreign exchange risks. The Company utilizes foreign exchange forward contracts to manage foreign currency risk associated with foreign currency denominated monetary assets and liabilities, primarily certain short-term intercompany receivables and payables, and to reduce the volatility of earnings and cash flows related to foreign currency transactions. The Company does not use these foreign currency forward contracts for trading purposes. As of March 28, 2026, 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 $ 1.4 million and $ 2.1 million is reflected as Prepayments and other current assets and Other current liabilities on the Consolidated Balance Sheets, respectively. As of June 28, 2025, the fair value of these contracts of $ 4.9 million and $ 3.1 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 28, 2026 and June 28, 2025, the notional amounts of the forward contracts that the Company held to purchase foreign currencies were $ 59.3 million and $ 60.4 million, respectively, and the notional amounts of forward contracts that the Company held to sell foreign currencies were $ 48.4 million and $ 24.1 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 $ 0.7 million and $ 0.3 million for the three and nine months ended March 28, 2026, respectively, and incurred a gain of $ 0.5 million and a loss of $ 2.8 million for the three and nine months ended March 29, 2025. Note 8. Fair Value Measurements Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. There is an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. Observable inputs are inputs which market participants would use in valuing an asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs which reflect the assumptions market participants would use in valuing an asset or liability. The three levels of inputs that may be used to measure fair value are as follows: • Level 1: includes financial instruments for which quoted market prices for identical instruments are available in active markets. Level 1 assets of the Company include money market funds, U.S. Treasury securities and marketable equity securities as they are traded with sufficient volume and frequency of transactions. • Level 2: includes financial instruments for which the valuations are based on quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. Level 2 instruments of the Company include asset-backed securities, foreign currency forward contracts and debt. To estimate their fair value, the Company utilizes pricing models based on market data. The significant inputs for the valuation model usually include benchmark yields, reported trades, broker and dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data, and industry and economic events. 18 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) • Level 3: includes financial instruments for which fair value is derived from valuation-based inputs, that are unobservable and significant to the overall fair value measurement. 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 to fair value only if an observable price change in orderly transactions for an identical or similar investment occurs for the same issuer. The Company’s Level 3 liabilities consist of contingent purchase consideration liabilities related to business acquisitions. The fair value of such earn-out liabilities are generally determined using a Monte Carlo Simulation that includes significant unobservable inputs such as the projected revenues of the acquired business over the earn-out period. 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 SG&A in the Consolidated Statements of Operations. Fair Value Measurements The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis, along with their classification by level of input for the periods presented ( in millions ): March 28, 2026 June 28, 2025 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Assets: Debt available-for-sale securities (1) $ 0.3 $ — $ 0.3 $ — $ 0.3 $ — $ 0.3 $ — Money market funds (2) 272.7 272.7 — — 229.0 229.0 — — Trading securities (3) 1.7 1.7 — — 1.6 1.6 — — Foreign currency forward contracts (4) 1.4 — 1.4 — 4.9 — 4.9 — Total assets $ 276.1 $ 274.4 $ 1.7 $ — $ 235.8 $ 230.6 $ 5.2 $ — Liabilities: Foreign currency forward contracts (5) $ 2.1 $ — $ 2.1 $ — $ 3.1 $ — $ 3.1 $ — Contingent consideration (6) 68.2 — — 68.2 117.4 — — 117.4 Total liabilities $ 70.3 $ — $ 2.1 $ 68.2 $ 120.5 $ — $ 3.1 $ 117.4 (1) Included in Other non-current assets on the Consolidated Balance Sheets. (2) Includes, as of March 28, 2026, $ 263.1 million in Cash and cash equivalents, $ 6.7 million in Restricted cash and $ 2.9 million in Other non-current assets on the Consolidated Balance Sheets. Includes, as of June 28, 2025, $ 222.4 million in Cash and cash equivalents, $ 3.5 million in Restricted cash and $ 3.1 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 Prepayments and other current assets on the Consolidated Balance Sheets. (5) Included in Other current liabilities on the Consolidated Balance Sheets. (6) As of March 28, 2026 and June 28, 2025, includes certain amounts in Other current liabilities and Other non-current liabilities on the Consolidated Balance Sheets. Contingent Consideration As of March 28, 2026, the fair value of the contingent consideration liability for Inertial Labs was $ 68.2 million, compared to $ 139.1 million at December 27, 2025 and $ 117.1 million at June 28, 2025. As of March 28, 2026, $ 43.0 million and $ 25.2 million of the liability are included in Other current liabilities and Other non-current liabilities, respectively, on the Consolidated Balance Sheets. During the three months ended March 28, 2026, the Company made a contingent consideration payment of $ 73.5 million for Inertial Labs, of which acquisition date fair value of $ 29.8 million was classified as a financing outflow and the remaining classified as an operating activity within Accrued expenses and other current and non-current liabilities in the Consolidated Statements of Cash Flows. The earn-out period for Jackson Labs ended on December 31, 2025. The Company was not required to make a contingent consideration payment as the revenue targets were not met. 19 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company recorded charges of $ 2.6 million and $ 24.3 million, respectively, from the change in fair value measurement of the contingent consideration liabilities within SG&A in the Consolidated Statements of Operations for the three and nine months ended March 28, 2026. Instrument Measured at Fair Value on Non-recurring Basis Our non-marketable equity security accounted for using the Measurement Alternative is measured at fair value on a non-recurring basis and is classified within Level 3 of the fair value hierarchy because we use significant unobservable inputs to estimate its fair value. Refer to “Note 7. Investments and Forward Contracts” for additional information. Other Fair Value Measures Fair Value of Debt: If measured at fair value on the Consolidated Balance Sheets, the Company’s 0.625 % Senior Convertible Notes (2031 Notes), 3.75 % Senior Notes (2029 Notes), 1.625 % Senior Convertible Notes (2026 Notes) and Term Loan B 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 28, 2026 June 28, 2025 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Debt: 0.625 % Senior Convertible Notes $ 648.2 $ — $ 648.2 $ — $ — $ — $ — $ — 3.75 % Senior Notes 370.7 — 370.7 — 373.6 — 373.6 — 1.625 % Senior Convertible Notes (1) — — — — 252.0 — 252.0 — Term Loan B 452.3 — 452.3 — — — — — Total $ 1,471.2 $ — $ 1,471.2 $ — $ 625.6 $ — $ 625.6 $ — (1) The 2026 Notes were settled upon maturity on March 15, 2026. See “Note 11. Debt”, for further discussion of the Company’s debt. Note 9. Goodwill The following table presents changes in goodwill allocated to the Company’s reportable segments (in millions) : Network and Service Enablement Optical Security and Performance Products Total Balance as of June 28, 2025 $ 553.5 $ 42.2 $ 595.7 Acquisition (1) 111.3 — 111.3 Measurement period adjustments (1) 0.3 — 0.3 Currency translation ( 5.5 ) — ( 5.5 ) Balance as of March 28, 2026 $ 659.6 $ 42.2 $ 701.8 (1) Goodwill at acquisition date and adjustments. Refer to “Note 5. Acquisitions” for more information. 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 2025, 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 that triggered an impairment review during the three and nine months ended March 28, 2026. 20 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 10. Intangibles The following tables present details of the Company’s acquired developed technology, customer relationships and other intangibles as of March 28, 2026 and June 28, 2025 ( in millions ): As of March 28, 2026 Weighted-Average Remaining Useful Life Gross Carrying Amount Accumulated Amortization Net Acquired developed technology 4.7 years $ 667.9 $ ( 448.8 ) $ 219.1 Customer relationships 8.3 years 369.3 ( 207.3 ) 162.0 Other (1) 3.0 years 60.6 ( 43.7 ) 16.9 Total intangibles $ 1,097.8 $ ( 699.8 ) $ 398.0 As of June 28, 2025 Weighted-Average Remaining Useful Life Gross Carrying Amount Accumulated Amortization Net Acquired developed technology 5.5 years $ 534.5 $ ( 417.7 ) $ 116.8 Customer relationships 5.2 years 209.0 ( 199.1 ) 9.9 Other (1) 1.7 years 44.1 ( 39.2 ) 4.9 Total intangibles $ 787.6 $ ( 656.0 ) $ 131.6 (1) Other intangibles consist of proprietary know-how and trade secrets, trademarks and trade names. Amortization expense related to intangibles was $ 20.4 million and $ 7.3 million for the three months ended March 28, 2026 and March 29, 2025, respectively, and $ 47.6 million and $ 16.0 million for the nine months ended March 28, 2026 and March 29, 2025, respectively. Based on the carrying amount of acquired developed technology, customer relationships and other intangibles as of March 28, 2026, and assuming no future impairment of the underlying assets, the estimated future amortization is as follows ( in millions ): Fiscal Years Remainder of 2026 $ 20.2 2027 77.7 2028 67.9 2029 63.5 2030 62.4 Thereafter 106.3 Total amortization $ 398.0 21 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 11. Debt As of March 28, 2026 and June 28, 2025, the Company’s debt on the Consolidated Balance Sheets, net of unamortized debt discount and issuance costs, is as follows ( in millions ): March 28, 2026 June 28, 2025 Principal amount of 0.625 % Senior Convertible Notes $ 250.0 $ — Unamortized 0.625 % Senior Convertible Notes debt issuance cost ( 5.5 ) — Principal amount of 1.625 % Senior Convertible Notes — 250.0 Unamortized 1.625 % Senior Convertible Notes debt discount — ( 3.3 ) Unamortized 1.625 % Senior Convertible Notes debt issuance cost — ( 0.5 ) Short-term debt $ 244.5 $ 246.2 Principal amount of 3.75 % Senior Notes $ 400.0 $ 400.0 Unamortized 3.75 % Senior Notes debt issuance cost ( 3.1 ) ( 3.7 ) Principal amount of Term Loan B 450.0 — Unamortized Term Loan B debt issuance cost ( 10.6 ) — Long-term debt $ 836.3 $ 396.3 The Company was in compliance with all debt covenants as of March 28, 2026 and June 28, 2025. Term Loan B On October 16, 2025, concurrent with the closing of the acquisition of Spirent’s HSE and CE business, the Company entered into a $ 600 million senior secured term loan credit agreement (Term Loan Credit Agreement) with Wells Fargo Bank, National Association (Wells Fargo), as administrative agent, and other lenders. The term loans, which mature on October 16, 2032, are secured by substantially all of the assets of the Company and those of its domestic subsidiaries. The proceeds from the term loans were used to finance a portion of the acquisition, acquisition related expenses and will be used for general corporate purposes. In connection with the issuance of the term loans, the Company incurred $ 15.2 million of issuance costs. The debt issuance costs were capitalized in Long-term debt on the Consolidated Balance Sheets and will be amortized to interest expense using the straight-line method until maturity. The term loans bear interest at rates based on Term Secured Overnight Financing Rate (SOFR) or a specified base rate plus applicable margins with interest payment frequency at the Company’s election. The term loans require quarterly principal payments of 1.0 % per annum, commencing on March 31, 2026. The Company may prepay all or part of the term loans early at its option. 22 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The covenants of the Term Loan Credit Agreement include customary restrictive covenants that, among other things, restrict the Company’s ability to incur additional indebtedness, grant liens, make certain acquisitions, investments, asset dispositions and restricted payments, undertake fundamental changes and enter into restrictive agreements, in each case subject to certain exceptions. The Term Loan Credit Agreement includes customary events of default, and customary rights and remedies upon the occurrence of any event of default thereunder, including rights to accelerate the loans and realize upon the collateral securing the obligations under the Term Loan Credit Agreement and any related guarantees thereof. On January 5, 2026, and March 4, 2026, the Company made prepayments of $ 100.0 million and $ 50.0 million, respectively, of the term loans under the Term Loan Credit Agreement. The prepayments were accounted for as partial extinguishments, with the carrying amount of the portion of debt prepaid, including the proportionate unamortized debt issuance costs, derecognized, and any difference between the reacquisition price and the carrying amount recognized as a loss on debt extinguishment. The Company recorded a loss of $ 3.7 million within Loss on debt extinguishment in the Consolidated Statements of Operations. With these prepayments, VIAVI is no longer required to make quarterly principal payments of 1.0 % per annum since the prepayments exceeded the total required amortization over the life of the loan. As of March 28, 2026, the interest rate for the borrowings under the term loans was 6.17 %, which approximated the effective interest rate and the expected remaining term is 6.6 years. 0.625 % Senior Convertible Notes (2031 Notes) On August 20, 2025, the Company issued $ 250.0 million aggregate principal amount of 0.625 % Senior Convertible Notes due 2031 in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The Company issued $ 100.9 million aggregate principal amount of the 2031 Notes to certain holders of the 1.625 % Senior Convertible Notes (2026 Notes) in exchange for $ 97.5 million principal amount of the 2026 Notes (the 2025 Exchange Transaction) and issued and sold $ 149.1 million aggregate principal amount of the 2031 Notes in a private placement to accredited institutional buyers (the 2025 Subscription Transactions). The 2025 Exchange Transaction was accounted for as an extinguishment which resulted in the write-off of unamortized debt discount and issuance costs of $ 1.1 million on the extinguished notes. Accrued interest of $ 0.7 million on the 2026 Notes was included in the exchange for the 2031 Notes. The total loss from the exchange was $ 3.8 million recorded as Loss on debt extinguishment in the Consolidated Statements of Operations. Concurrent with the transactions discussed above, the Company repurchased and subsequently retired 2.7 million shares of its common stock for $ 30.0 million under the 2022 Repurchase Plan. In connection with the issuance of the 2031 Notes, the Company incurred $ 6.1 million of issuance costs. The debt issuance costs were capitalized and will be amortized to interest expense using the straight-line method until maturity. The 2031 Notes are an unsecured obligation of the Company and bear interest at an annual rate of 0.625 %, payable semi-annually in arrears on March 1 and September 1 of each year, beginning March 1, 2026. The 2031 Notes will mature on March 1, 2031 unless earlier converted, redeemed or repurchased. The 2031 Notes may be converted under certain circumstances, based on an initial conversion rate of 72.5295 shares (equivalent to an initial conversion price of approximately $ 13.79 per share) at the option of the holders into cash up to the principal amount, with the remaining amount converted into cash, shares of the Company’s common stock, or a combination of cash and shares of the Company’s common stock at the Company’s election. The initial conversion price represents a 25.0 % premium to the closing price of the Company’s common stock on the pricing date, August 13, 2025, which will be subject to customary anti-dilution adjustments. 23 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) During the third quarter of fiscal 2026, the closing price of the Company’s common stock exceeded 130 % of the applicable conversion price of the 2031 Notes, on at least 20 of the last 30 consecutive trading days of the calendar quarter, causing the 2031 Notes to be convertible by their holders for the period April 1, 2026 to June 30, 2026. While the last two trading days of the calendar quarter ending March 31, 2026 were after the Balance Sheet date, the pricing trigger was met for the calendar quarter. As a result, the $ 244.5 million carrying value of the 2031 Notes has been reclassified to short-term debt. As of March 28, 2026, the expected remaining term of the 2031 Notes is 4.9 years. 1.625 % Senior Convertible Notes (2026 Notes) On March 6, 2023, the Company issued $ 250.0 million aggregate principal amount of 1.625 % Senior Convertible Notes due 2026 in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The Company issued $ 132.0 million aggregate principal amount of the 2026 Notes to certain holders of the 1.00 % Senior Convertible Notes due 2024 (2024 Notes) in exchange for $ 127.5 million principal amount of the 2024 Notes (the 2023 Exchange Transaction) and issued and sold $ 118.0 million aggregate principal amount of the 2026 Notes in a private placement to accredited institutional buyers (the 2023 Subscription Transactions). The 2023 Exchange Transaction was accounted for as a modification. The $ 127.5 million principal of the 2024 Notes was reduced by $ 10.1 million, with offsetting increase to additional paid-in capital, to account for the increase in the fair value of the embedded conversion option in the modification. The increase in principal and coupon interest, along with the increased option value, totaled $ 14.6 million and is a direct reduction from the carrying amount of the debt on the Consolidated Balance Sheets. This amount has been accreted as an adjustment to interest expense on a straight-line basis up to the full face value of the 2026 Notes through maturity on March 15, 2026. The proceeds of the 2023 Subscription Transactions amounted to $ 113.8 million after issuance costs of $ 4.2 million. 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 within Long-term debt (as a contra-balance) on the Consolidated Balance Sheets and were amortized to interest expense using the straight-line method until maturity on March 15, 2026. On August 20, 2025, as part of the 2025 Exchange Transaction, the Company exchanged $ 97.5 million aggregate principal amount of the 2026 Notes for $ 100.9 million aggregate principal amount of the 2031 Notes. On December 15, 2025, the Company entered into separate privately-negotiated agreements with certain holders of the 2026 Notes. On December 22, 2025, the Company settled $ 103.5 million principal amount of 2026 Notes in exchange for an aggregate of 7.9 million shares of its common stock, par value $ 0.001 per share. Accrued interest was paid in cash. The transaction was accounted for as a debt extinguishment. The exchange did not qualify as an induced conversion. The Company recorded a loss on debt extinguishment of $ 38.7 million, representing the excess of the fair value of the shares issued over the carrying amount of the notes extinguished and transaction costs associated with the settlement. The loss is presented as Loss on debt extinguishment in the Company’s Consolidated Statements of Operations. On March 15, 2026, the outstanding $ 49.0 million principal amount of the 2026 Notes matured. Nearly all holders of the 2026 Notes chose to convert and the settlement of the conversion resulted in a cash payment of $ 49.4 million, including $ 49.0 million in principal and $ 0.4 million in accrued interest, and the issuance of 1.8 million shares of its common stock for conversion value above par. 24 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 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. 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. The 2029 Notes are an unsecured obligation of the Company and bear annual interest of 3.75 %, payable semi-annually in arrears on April 1 and October 1 of each year, beginning April 1, 2022. The 2029 Notes will mature on October 1, 2029 unless earlier redeemed or repurchased. As of March 28, 2026, the expected remaining term of the 2029 Notes is 3.5 years. 1.00 % Senior Convertible Notes (2024 Notes) On March 3, 2017, the Company issued $ 400.0 million aggregate principal amount of 1.00 % Senior Convertible Notes due 2024 in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. On March 22, 2017, the Company issued an additional $ 60.0 million upon exercise of the over-allotment option of the initial purchasers. The total proceeds from the 2024 Notes amounted to $ 451.1 million after issuance costs of $ 8.9 million. 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. 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. The 2023 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 Secured Asset-Based Revolving Credit Facility On December 30, 2021, we entered into a credit agreement (the Credit Agreement) with Wells Fargo as administrative agent, and other lender related parties. On October 16, 2025, the Company entered into an agreement with Wells Fargo to amend and extend the Credit Agreement. The Credit Agreement, as amended, provides for a senior secured asset-based revolving credit facility in a maximum aggregate amount of $ 200 million and matures on October 16, 2030. The Credit Agreement also provides that, under certain circumstances, the Company may increase the aggregate amount of revolving commitments thereunder by an aggregate amount of up to $ 100 million so long as certain conditions are met. The proceeds from the credit facility established under the Credit Agreement will be used for working capital and other general corporate purposes. The obligations under the Credit Agreement are secured by substantially all of the assets of the Company and those of its subsidiaries that are borrowers and guarantors under the Credit Agreement. Amounts outstanding under the Credit Agreement accrue interest as follows: (i) if the amounts outstanding are denominated in U.S. Dollars, at a per annum rate equal to either, at the Company’s election, SOFR plus a margin of 1.50 % to 2.00 % per annum, or a specified base rate plus a margin of 0.50 % to 1.00 %, 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 1.50 % to 2.00 %, 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 1.50 % to 2.00 %, 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 1.50 % to 2.00 %, or a specified base rate plus a margin of 0.50 % to 1.00 %, 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 $ 13.3 million. 25 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) As of March 28, 2026, we had no borrowings under this facility and our available borrowing capacity was approximately $ 182.7 million, net of outstanding standby letters of credit of $ 3.8 million. Interest Expense 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 Nine Months Ended March 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Interest expense-contractual interest $ 12.1 $ 4.8 $ 29.4 $ 14.3 Amortization of debt issuance cost 1.1 0.6 3.0 1.8 Accretion of debt discount 0.2 1.2 1.9 3.6 Other 0.9 0.9 2.7 2.8 Total interest expense $ 14.3 $ 7.5 $ 37.0 $ 22.5 Note 12. Leases The Company is a lessee in several operating leases, primarily real estate facilities for office space. The Company's lease arrangements are comprised of operating leases with various expiration dates through March 31, 2042. The Company's leases do not contain any material residual value guarantees. Lease expense and cash flow information related to our operating leases is as follows ( in millions ): Three Months Ended Nine Months Ended March 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Operating lease costs (1) $ 3.7 $ 3.4 $ 10.6 $ 9.8 Cash paid for amounts included in the measurement of operating lease liabilities $ 3.8 $ 3.5 $ 11.1 $ 9.7 Operating ROU assets obtained in exchange for operating lease obligations $ 6.0 $ 4.4 $ 16.6 $ 7.1 (1) Total variable lease costs were immaterial during the three and nine months ended March 28, 2026 and March 29, 2025. The total operating lease costs were included in Cost of revenues, R&D, and SG&A in the Consolidated Statements of Operations. As of March 28, 2026 and March 29, 2025, the weighted-average remaining lease term was 5.6 years and 6.0 years, respectively, and the weighted-average discount rate was 6.3 % and 5.8 %, respectively. Future minimum operating lease payments as of March 28, 2026 are as follows ( in millions ): Operating Leases Remainder of fiscal 2026 $ 2.1 Fiscal 2027 13.4 Fiscal 2028 10.7 Fiscal 2029 7.6 Fiscal 2030 5.2 Thereafter 11.5 Total lease payments 50.5 Less: Interest ( 8.4 ) Present value of lease liabilities $ 42.1 26 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 13. 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 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 2026 Plan During the third quarter of fiscal 2026, management approved a restructuring and workforce reduction plan (the Fiscal 2026 Plan) across our NSE and Optical Security and Performance Products (OSP) segments and Corporate (Corp) functions intended to improve operational efficiencies, better align the Company’s workforce with current business needs and strategic growth opportunities and includes integration of recently acquired businesses. The Fiscal 2026 Plan includes a global workforce reduction, facilities rationalization and asset write-offs. The Company anticipates the Fiscal 2026 Plan to be substantially complete by the end of calendar year 2026. During the three months ended March 28, 2026 , the Company recognized restructuring charges of $ 17.4 million of employee severance, benefits and outplacement costs recorded within Restructuring and related charges (benefits) in the Consolidated Statements of Operations. In addition, the Company recognized Fiscal 2026 Plan charges of $ 3.6 million and $ 0.3 million related to property, plant and equipment recorded within Cost of revenues and SG&A, respectively, and $ 0.3 million of accelerated depreciation recorded within SG&A, each in the Consolidated Statements of Operations. Fiscal 2024 Plan During the fourth quarter of fiscal 2024, management approved a restructuring and workforce reduction plan (the Fiscal 2024 Plan) across our NSE and OSP segments and Corp functions intended to improve operational efficiencies and better align the Company’s workforce with current business needs. Restructuring activity related to the OSP segment was complete during fiscal 2025. The Company anticipates the Fiscal 2024 Plan will be complete by the end of fiscal 2026. A summary of the activity in the restructuring accrual is outlined below (in millions) : Balance as of June 28, 2025 (1) Restructuring and related charges (benefits) Cash settlements Foreign currency translation adjustments Balance as of March 28, 2026 (1) Fiscal 2026 Plan NSE/Corp $ — $ 15.6 $ ( 0.7 ) $ ( 0.2 ) $ 14.7 OSP — 1.8 ( 0.2 ) — 1.6 Fiscal 2026 Plan — 17.4 ( 0.9 ) ( 0.2 ) 16.3 Fiscal 2024 Plan NSE/Corp 3.5 ( 0.5 ) ( 2.7 ) ( 0.1 ) 0.2 Fiscal 2024 Plan 3.5 ( 0.5 ) ( 2.7 ) ( 0.1 ) 0.2 Total $ 3.5 $ 16.9 $ ( 3.6 ) $ ( 0.3 ) $ 16.5 (1) Included in Other current liabilities on the Consolidated Balance Sheets as of March 28, 2026 and June 28, 2025. 27 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 14. Income Taxes The Company recorded an income tax provision of $ 7.4 million and $ 36.1 million for the three and nine months ended March 28, 2026, respectively. The Company recorded an income tax benefit of $ 16.3 million and an income tax provision of $ 2.2 million for the three and nine months ended March 29, 2025, respectively. The income tax provision for the three and nine months ended March 28, 2026 primarily relates to income tax in certain foreign jurisdictions based on the Company’s forecasted pre-tax income or loss and revaluation of the Company’s German deferred tax assets. The income tax benefit for the three months and the income tax provision for the nine months ended March 29, 2025 primarily relates to the release of valuation allowance related to the acquisition of Inertial labs and 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 and the revaluation of the German deferred tax assets. As of March 28, 2026 and June 28, 2025, the Company’s unrecognized tax benefits (net of Federal benefits) totaled $ 42.9 million and $ 42.4 million, respectively, and are included in deferred taxes and other non-current tax liabilities. The Company had $ 3.5 million accrued for the payment of interest and penalties as of March 28, 2026. 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. Note 15. Stockholders' Equity Issuance of Common Stock During the three months ended March 28, 2026, the Company issued approximately 1.8 million shares of its common stock in connection with the settlement of the remaining 2026 Notes. During the nine months ended March 28, 2026, the Company issued approximately 9.7 million shares of its common stock related to the settlement of the 2026 Notes, including 7.9 million shares issued in December 2025 and 1.8 million shares issued in March 2026. Repurchase of Common Stock In September 2022 the Board of Directors authorized a stock repurchase plan (2022 Repurchase Plan) of up to $ 300 million effective October 1, 2022, which will remain in effect until the amount authorized has been fully repurchased or until suspension or termination of the program. Under the 2022 Repurchase Plan, the Company is authorized to repurchase shares through a variety of methods, including open market purchases, privately-negotiated transactions or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 trading plans. The timing of repurchases under the plan will depend upon business and financial market conditions. During the nine months ended March 28, 2026, the Company repurchased and subsequently retired 2.7 million shares of its common stock for $ 30.0 million under the 2022 Repurchase Plan. As of March 28, 2026, the Company had remaining authorization of $ 168.4 million for future share repurchases under the 2022 Repurchase Plan. 28 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 16. Stock-Based Compensation The Company's stock-based compensation includes a combination of time-based restricted stock awards and performance-based awards. Restricted stock awards are granted without an exercise price and are converted to shares immediately upon vesting. When converted into shares upon vesting, shares equivalent in value to the minimum withholding taxes liability on the vested shares are withheld by the Company for the payment of such taxes. The Company generally estimates the fair value of stock-based awards based on the closing market price of the Company’s common stock on the grant date. In the case of performance-based awards that include a market condition, the Company estimates the fair value of the award using a combination of the closing market price of the Company’s common stock on the grant date and the Monte Carlo simulation model. For performance-based awards, shares attained over target upon vesting are reflected as awards granted during the period. Time-based restricted stock awards granted to eligible employees will generally vest in annual installments over a period of three to four years subject to the employees’ continuing service to the Company and do not have an expiration date. The Company's performance-based awards may include performance conditions, market conditions, time-based service conditions or a combination thereof and are generally expected to vest in annual installments over a period of three to four years . 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 28, 2026 and March 29, 2025, the Company granted 3.9 million and 4.5 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 28, 2026 and March 29, 2025 were estimated to be $ 47.8 million and $ 39.5 million, respectively. During the nine months ended March 28, 2026 and March 29, 2025, the Company granted 1.2 million and 1.5 million performance-based awards, respectively. There were less than 0.1 million and no performance-based shares attained over target during the nine months ended March 28, 2026 and March 29, 2025, respectively. The aggregate grant-date fair value of performance-based awards granted during the nine months ended March 28, 2026 and March 29, 2025 were estimated to be $ 16.3 million and $ 15.1 million, respectively. As of March 28, 2026, $ 77.6 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 and nine months ended March 28, 2026 and March 29, 2025, is as follows (in millions) : Three Months Ended Nine Months Ended March 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Cost of revenues $ 1.1 $ 2.0 $ 3.2 $ 4.5 Research and development 2.5 2.3 7.3 6.7 Selling, general and administrative 10.3 9.8 30.7 29.3 Total stock-based compensation expense $ 13.9 $ 14.1 $ 41.2 $ 40.5 Approximately $ 1.2 million and $ 1.3 million of stock-based compensation was capitalized to inventory as of March 28, 2026 and March 29, 2025, respectively. 29 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 17. Employee Pension and Other Benefit Plans The Company sponsors significant qualified and non-qualified pension plans for certain past and present employees in the United Kingdom (U.K.) and Germany. The Company also is responsible for a defined benefit plan comprising of gratuity payments for present employees in India and non-pension post-retirement benefit obligation assumed from a past acquisition. These pension plans, with the exception of India, have been closed to new participants and no additional service costs are being accrued, except for certain plans in Germany assumed in connection with an acquisition in fiscal 2010. Benefits are generally based upon years of service and compensation or stated amounts for each year of service. As of March 28, 2026, the U.K. and India plans were fully funded while the other plans were unfunded. The Company’s policy for funded plans is to make contributions equal to or greater than the requirements prescribed by law or regulation. For unfunded plans, the Company pays the post-retirement benefits when due. During the nine months ended March 28, 2026, the Company contributed $ 1.0 million to the U.K. plan and $ 4.8 million to the other plans. The funded plan assets consist primarily of managed investments. 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 28, 2026 March 29, 2025 March 28, 2026 March 29, 2025 Interest cost $ 0.8 $ 0.8 $ 2.4 $ 2.4 Expected return on plan assets ( 0.3 ) ( 0.4 ) ( 1.1 ) ( 1.3 ) Amortization of net actuarial losses — — 0.1 0.2 Net periodic benefit cost $ 0.5 $ 0.4 $ 1.4 $ 1.3 The components of net periodic pension cost, other than the service cost component, are included in Cost of revenues, R&D and SG&A in the Consolidated Statements of Operations. Both the calculation of the projected benefit obligation and net periodic cost are based upon actuarial valuations. These valuations use participant-specific information such as salary, age, years of service, and assumptions about interest rates, compensation increases and other factors. At a minimum, the Company evaluates these assumptions annually and makes changes as necessary. Based on actuarial assumptions, the Company expects to incur cash outlays of approximately $ 7.6 million related to its defined benefit pension plans during fiscal 2026 to make current benefit payments and fund future obligations. As of March 28, 2026, approximately $ 5.8 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 28, 2025. 30 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 18. Commitments and Contingencies 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. Settlement In July 2023, the Court of Appeals in the State of Kansas affirmed a lower court decision in a case filed by Aeroflex Wichita (Aeroflex), a VIAVI subsidiary, against Tel-Instrument Electronics Corp. (TIC) and two of its employees with total damages of $ 7.3 million owed to VIAVI. The lower court case, filed by Aeroflex prior to the acquisition by VIAVI and affirmed by the Kansas Court of Appeals, awarded damages caused by tortious interference and improper use and disclosure of Aeroflex’s confidential and proprietary business information used by the defendants to win a competitive U.S. Army contract. TIC did not file a petition to appeal the decision and acknowledged its obligation to pay damages in full. VIAVI subsequently received total payments of $ 7.3 million from TIC and the two former employees and recorded a gain to Interest and other income, net in the Consolidated Statements of Operations for the three months ended September 30, 2023. Guarantees Outstanding Letters of Credit, Performance Bonds and Other Claims As of March 28, 2026, the Company had standby letters of credit of $ 10.3 million and performance bonds and other claims of $ 2.0 million collateralized by restricted cash. Product Warranties The following table presents the changes in the Company’s warranty reserve during the three and nine months ended March 28, 2026 ( in millions ): March 28, 2026 Three Months Ended Nine Months Ended Balance as of beginning of period $ 7.0 $ 6.7 Provision for warranty 0.4 1.1 Utilization of reserve ( 0.6 ) ( 1.6 ) Adjustments to pre-existing warranties (includes changes in estimates) ( 0.1 ) ( 0.1 ) Acquisition — 0.6 Balance as of end of period $ 6.7 $ 6.7 31 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Note 19. Operating Segments and Geographic Information The Company evaluates its operating segments in accordance with the authoritative guidance on segment reporting. The Company’s Chief Executive Officer as the Company’s Chief Operating Decision Maker (CODM) uses operating segment financial information to evaluate segment performance and to allocate resources. The Company’s operating and reportable segments are: (i) Network and Service Enablement (NSE): NSE provides an integrated portfolio of testing, monitoring, assurance and security solutions to help build, maintain, and optimize telecom and datacom networks . Our solutions address lab and production environments, network management, service assurance and AIOps for any kind of network, including wireless, wireline, cloud, satellite, public safety, military and critical infrastructure. NSE also offers a range of product support and professional services such as repair, calibration, software support and technical assistance for its products. (ii) Optical Security and Performance Products (OSP): OSP leverages its core optical coating technologies and volume manufacturing capability to design, manufacture, and sell technologies for the anti-counterfeiting, 3D sensing, government and aerospace, automotive and industrial markets . Segment Reporting The CODM manages the Company in two broad business categories: NSE and OSP. The CODM evaluates segment performance of the NSE and OSP business based on segment operating margins. The CODM uses segment operating margin to make budgeting and forecasting decisions and to assess the performance of our segments, primarily by monitoring actual results versus the prior year, the annual budget and forecasted results. In addition, the CODM reviews inventory levels and certain other current assets by segment. The Company allocates corporate-level operating expenses to its segment results, except for certain non-core operating and non-operating activities as discussed below. The Company does not allocate stock-based compensation, acquisition and integrated related charges, amortization of acquisition related intangibles, amortization of acquisition related inventory step-up, legal settlements, restructuring, changes in fair value of contingent consideration liabilities, non-operating income and expenses, or other charges unrelated to core operating performance to its segments because management does not include this information in its measurement of the performance of the operating segments. These items are presented as “Unallocated other expenses” in the table below. Additionally, the Company does not specifically identify and allocate all assets by operating segment. 32 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following tables present information on the Company’s reportable segments for the three and nine months ended March 28, 2026 and March 29, 2025 ( in millions ): Three Months Ended March 28, 2026 Network and Service Enablement Optical Security and Performance Products Total Product revenue $ 271.7 $ 85.3 $ 357.0 Service revenue 49.8 — 49.8 Net revenue $ 321.5 $ 85.3 $ 406.8 Cost of revenues 111.5 42.4 Research and development 64.2 3.3 Selling, general and administrative 58.8 6.1 Other segment items (1) 31.6 3.4 Total operating expense 154.6 12.8 Segment operating income $ 55.4 $ 30.1 $ 85.5 Segment operating margin 17.2 % 35.3 % Unallocated other expenses ( 60.7 ) Loss on debt extinguishment ( 3.7 ) Interest and other income, net 7.0 Interest expense ( 14.3 ) Income before income taxes and equity investment earnings $ 13.8 (1) Other segment items represents allocation of corporate level operating expenses. Three Months Ended March 29, 2025 Network and Service Enablement Optical Security and Performance Products Total Product revenue $ 164.9 $ 76.6 $ 241.5 Service revenue 43.3 — 43.3 Net revenue $ 208.2 $ 76.6 $ 284.8 Cost of revenues 76.9 37.1 Research and development 42.6 4.1 Selling, general and administrative 42.1 6.4 Other segment items (1) 24.9 3.0 Total operating expense 109.6 13.5 Segment operating income $ 21.7 $ 26.0 $ 47.7 Segment operating margin 10.4 % 33.9 % Unallocated other expenses ( 39.2 ) Interest and other income, net 2.2 Interest expense ( 7.5 ) Income before income taxes and equity investment earnings $ 3.2 (1) Other segment items represents allocation of corporate level operating expenses. 33 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Nine Months Ended March 28, 2026 Network and Service Enablement Optical Security and Performance Products Total Product revenue $ 685.5 $ 246.2 $ 931.7 Service revenue 143.5 — 143.5 Net revenue $ 829.0 $ 246.2 $ 1,075.2 Cost of revenues 294.3 120.3 Research and development 170.0 10.5 Selling, general and administrative 157.9 19.3 Other segment items (1) 89.7 9.2 Total operating expense 417.6 39.0 Segment operating income $ 117.1 $ 86.9 $ 204.0 Segment operating margin 14.1 % 35.3 % Unallocated other expenses ( 160.2 ) Loss on debt extinguishment ( 46.2 ) Interest and other income, net 12.2 Interest expense ( 37.0 ) Loss before income taxes and equity investment earnings $ ( 27.2 ) (1) Other segment items represents allocation of corporate level operating expenses. Nine Months Ended March 29, 2025 Network and Service Enablement Optical Security and Performance Products Total Product revenue $ 438.4 $ 226.3 $ 664.7 Service revenue 129.1 — 129.1 Net revenue $ 567.5 $ 226.3 $ 793.8 Cost of revenues 209.6 107.3 Research and development 129.7 13.0 Selling, general and administrative 121.2 18.0 Other segment items (1) 75.2 7.8 Total operating expense 326.1 38.8 Segment operating income $ 31.8 $ 80.2 $ 112.0 Segment operating margin 5.6 % 35.4 % Unallocated other expenses ( 69.8 ) Interest and other income, net 9.3 Interest expense ( 22.5 ) Income before income taxes and equity investment earnings $ 29.0 (1) Other segment items represents allocation of corporate level operating expenses. 34 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table presents information on the assets of the Company’s reportable segments at March 28, 2026 and June 28, 2025 ( in millions ): March 28, 2026 June 28, 2025 Assets: Inventories: NSE $ 107.9 $ 74.4 OSP 40.0 43.5 Total inventories, net 147.9 117.9 Prepayments and other current assets - NSE (1) 15.4 5.8 Assets not attributed to segments 2,364.5 1,870.1 Total assets $ 2,527.8 $ 1,993.8 (1) The amount presented represents the prepayments and other current assets attributed to NSE that are reviewed by the CODM. Other NSE related prepayments and current assets are not included as they are not part of the CODM’s measure of segment assets. 35 Table of Contents VIAVI SOLUTIONS INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company operates primarily in three geographic regions: Americas, Asia-Pacific, and Europe, Middle East and Africa (EMEA). Net revenue is assigned to the geographic region and country where the Company’s product is initially shipped. 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 28, 2026 and March 29, 2025 (in millions): Three Months Ended March 28, 2026 March 29, 2025 Product Revenue Service Revenue Total Product Revenue Service Revenue Total Americas: United States $ 134.2 $ 19.8 $ 154.0 $ 75.2 $ 14.7 $ 89.9 Other Americas 24.6 4.2 28.8 12.3 5.9 18.2 Total Americas $ 158.8 $ 24.0 $ 182.8 $ 87.5 $ 20.6 $ 108.1 Asia-Pacific: Greater China $ 61.6 $ 2.6 $ 64.2 $ 50.8 $ 1.1 $ 51.9 Other Asia-Pacific 55.9 8.1 64.0 41.8 7.0 48.8 Total Asia-Pacific $ 117.5 $ 10.7 $ 128.2 $ 92.6 $ 8.1 $ 100.7 EMEA: $ 80.7 $ 15.1 $ 95.8 $ 61.4 $ 14.6 $ 76.0 Total net revenue $ 357.0 $ 49.8 $ 406.8 $ 241.5 $ 43.3 $ 284.8 Nine Months Ended March 28, 2026 March 29, 2025 Product Revenue Service Revenue Total Product Revenue Service Revenue Total Americas: United States $ 351.4 $ 53.9 $ 405.3 $ 217.2 $ 44.2 $ 261.4 Other Americas 64.2 13.0 77.2 37.7 13.8 51.5 Total Americas $ 415.6 $ 66.9 $ 482.5 $ 254.9 $ 58.0 $ 312.9 Asia-Pacific: Greater China $ 178.0 $ 5.9 $ 183.9 $ 151.1 $ 5.0 $ 156.1 Other Asia 123.4 21.1 144.5 102.8 21.3 124.1 Total Asia-Pacific $ 301.4 $ 27.0 $ 328.4 $ 253.9 $ 26.3 $ 280.2 EMEA: $ 214.7 $ 49.6 $ 264.3 $ 155.9 $ 44.8 $ 200.7 Total net revenue $ 931.7 $ 143.5 $ 1,075.2 $ 664.7 $ 129.1 $ 793.8 36 Table of Contents