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March 2016
1
Keysight TechnologiesInvestor Presentation
Page 2
This presentation contains forward-looking statements including, without limitation, statements
regarding trends, seasonality, cyclicality and growth in, and drivers of, the markets we sell into, our
strategic direction, our future effective tax rate and tax valuation allowance, earnings from our foreign
subsidiaries, remediation activities, new product and service introductions, the ability of our products to
meet market needs, changes to our manufacturing processes, the use of contract manufacturers, the
impact of local government regulations on our ability to pay vendors or conduct operations, our liquidity
position, our ability to generate cash from operations, growth in our businesses, our investments, our
stock repurchase program, the potential impact of adopting new accounting pronouncements, our
financial results, our purchase commitments, our contributions to our pension plans, the selection of
discount rates and recognition of any gains or losses for our benefit plans, our cost-control activities,
savings and headcount reduction recognized from our restructuring programs and other cost saving
initiatives, and other regulatory approvals, the integration of our acquisitions and other transactions, our
transition to lower-cost regions, and the existence of economic instability, that involve risks and
uncertainties. Our actual results could differ materially from the results contemplated by these forward-
looking statements due to various factors, including those discussed in our Quarterly Report on Form
10-Q filed with the Securities and Exchange Commission on March 4, 2016.
Safe Harbor
Page 3
Executive Overview
4 Growth Initiatives – Wireless, Modular, Software and Services
Advanced Manufacturing Strategy & Capabilities
Agenda
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KEYSIGHT TODAY:
Market and Technology Leader
4
17%
49%
34%
18%
44%
38%
FY15 Revenue by Geography(1)
~10,250 Headcount
Americas
Europe
Asia Pacific
Europe
Asia Pacific
Americas
~15,500Number of customers(2)
100+Countries served
13Countries with R&D centers
$2.9BFY15 Revenue(1)
19.5%FY15 Operating Margin(1)
Data as of October 31, 2015
(1) Non-GAAP measure
(2) Excludes indirect channels
(3) Sites with greater than 70 manufacturing employees
3Manufacturing sites(3)
$2.52 FY15 EPS(1)
Page
Our Value to Customers - Unmatched in the Industry
5
We help customers bring breakthrough electronic
products to market faster and at a lower cost
Simulate Manufacture OptimizePrototype
RadarAvionics Surveillance Satellites
ComputersAutomotive electronics
Wireless base stations
Cloud devices & interfaces
Smart phones
Customer Lifecycle
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The Keysight AdvantageCommitment to Value Creation
6
Technology and market leader in ever-evolving technology
market
Leader in profitable
market
Target fast growing areas and expand Served
Addressable Market (SAM)
Proven operating performance and cash generation
across cycles
Transform for
growth
Strong business
model
6
Page
• U.S. Cash
Generation
• Appropriate
Leverage
• Strategic
Alignment
• Growth
• Value
Creation
• Cost Structure
Flexibility
• Cost
Reductions
• Margin
Expansion
• R&D
Investment
• SAM
Expansion
• Profit
Leverage
A Strong Framework for Value Creation
7
OrganicGrowth
Business Model
Mergers & Acquisitions
Return of Capital
Page
Building Strong Track Record as Independent Public Company
8
Post-Separation Stabilization Complete
• 6 months ahead of plan
Transforming for Growth
• Organizational realignment to end markets
• Progress on growth initiatives
• Investing prudently
Leveraging the Business Model
• Solid Financial Results FY’15 & Q1’16
• Flexing the cost structure
Executing Strategy and Effectively Deploying Capital
• Anite and Electroservices acquisitions
• Increased R&D investment
• Announced share repurchase
New
New
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• Complete
wireless
ecosystem
• Aerospace &
Defense
• Automotive
• Energy
• Semiconductor
• General
Electronics
• Repair &
Calibration
• Asset
Management
• Professional
Services
• Remarketing
• Americas
• Europe
• Asia
• Japan
• Software
Technology
• Hardware
Technology
Organizing to Grow
9
Communications
Solutions Group
Industrial
Solutions Group
Services
Solutions Group
Mike
Gasparian
Gooi Soon
Chai
John Page
Worldwide Sales
Guy
Séné
Corporate
Planning and
Technology
Jay
Alexander
Aligned with End MarketsFirst to Market Trusted Advisor
New
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Strong Progress on Growth Initiatives
10
Be First in 5G
Wireless
Become #1 in
Modular
Solutions
Expand
Leadership in
T&M Software
Grow Services
Business by 50%
• Grew PXI/AXIe product orders to >$150 million in FY15
• >60% CAGR over past 3 years and gaining market share
• PXI/AXIe modular solutions grew at solid double-digit rate in Q1’16
• Grew wireless R&D business and closed Anite acquisition in FY15
• Collaborating with leading consortiums, universities, and research
institutes to define 5G standards and technologies
• Early 5G R&D solution orders more than doubled YoY in Q1’16
• FY15 was a record year for EDA software platform
• Anite acquisition materially expanded software business
• Strong year-over-year EDA revenue growth in Q1’16
• $401 million in FY15 sales with service centers in 30+ countries
• New opportunities in multi-vendor support, asset management,
test consulting, systems integration and training
• Continuing to win new multi-vendor business in Q1’16
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Superior and Sustainable Financial Performance Throughout the Cycle
11
-10% Baseline* +10%
Revenue ($M) $2,700 $3,000 $3,300
Gross Margin 55%-57% 56-58% 57-59%
R&D 14% 13% 13%
SG&A 25-27% 24%-26% 23-25%
Operating Margin 15-16% 18%-19% 21-22%
Keysight Operating Model
* Baseline includes a full year of Anite financials. Not guidance, shown on a non-GAAP basis
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Long-Term Expectations
12
RevenueGrowth
Op MarginIncremental
ProfitabilityOver the Cycle
Sustainable
4% CAGR
40% on
growth of 4%
or greater
Average
operating margin
of >20%*
Committed Return of Capital
Yields 8-10% EPS* Growth
* Non-GAAP
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A Phased Approach to Return of Capital
13
Completed 3 - 4 Years Beyond
Stabilize as an Independent Company
• Completed April 30, 2015
• 6 months ahead of schedule
Phase 1
Sustained 4% CAGR Over Cycle
• M&A is priority use of cash
• Opportunistic return of capital tied to balance sheet strength, M&A funnel, share price
• Feb 2016, $200M share repurchase authorized
Phase 2
Balanced Returnof Capital
• Return of capital tied to US cash generation
• Appropriate leverage and investment grade credit metrics
• Opportunistic M&A
Phase 3
Return
of
Capital
New
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• Aligns with strategic growth priorities
• Increases proportion of total revenue from R&D market
• Expands Served Addressable Market (SAM)
• Focuses on faster growing market segments
or adds key technology
• ROIC materially above cost of capital (15% by year 5)
• Quickly accretive (within 18 months)
• Valuation aligns with appropriate market multiples
Keysight’s Discipline and Clear Criteria for Acquisitions
14
Strategic
Alignment
Value
Creation
Growth
The Example
Page
Well-Positioned in Our End Markets
15
Communications Aerospace / DefenseIndustrial, Computers,
Semiconductor
Revenue(1) $1B $0.6B $1.3B $2.9B
Rev. Mix(1) 33% 23% 44% 100%
Market Size(2,4) $5B $3B $5.5B $13.5B
Market Share(2) 20% 20% 24% 21%
Market Growth(3) 1-2% 2-3% 2-3% 2-3%
(1) FY15
(2) Per Company estimates
(3) Per Company estimates. Average over 3 years
(4) Includes support and services, and network test. Excludes network assurance
Total
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Why Electronic Design and Test is an Attractive Industry for Keysight
16
New Customer Needs
Deep Experience Required
Large Installed Base
Intellectual Property
Operational Excellence
Strong Profit & Cash Flow
• Drive evolving electronic design and
test solutions
• Technical knowledge gained only through
years of practical experience
• Well-positioned with loyal customers
• Performance advantages from proprietary
semiconductor technologies
• Optimized manufacturing and supply chain
• Delivering 18-19% operating margins over
cycle and strong cash flow
SAM Expansion• Opportunity to expand SAM in adjacent
markets
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Multiple Growth Drivers Provide Diversification
17
Growth Drivers
Communications• Evolving standards
• All data, all the time
• Internet of Things
Aerospace / Defense• World instability
• Defense modernization
Industrial • Electronic content proliferation
Computer• Services, data access
• Cloud computing
Semiconductor • World-wide demand
Services and Support • Customer outsourcing
Page
Core Platforms Market Position(1)
Simulation Software(2) #1
Network Analyzers #1
Signal Analyzers #1
Signal Sources #1
Oscilloscopes #2
One Box Testers #3
Product Leadership is Necessary but Not Sufficient
18(1) Per Prime Data and Company estimates
(2) RF/Microwave design simulation software
Page 19
Executive Overview
4 Growth Initiatives – Wireless, Modular, Software and Services
Advanced Manufacturing Strategy & Capabilities
Agenda
Page
Transforming for Growth
Good progress in FY15
20
Be first in
5G wireless
Growth Strategies
Become #1 in
modular solutions
Expand leadership in
T&M software
Grow services
business by 50%
• Software-centric solutions
• Organic R&D investments
• Strategic M&A
5G
Page
Wireless & Software Growth Initiatives
21
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Persistent Growth in Data Drives Wireless Investment
22
– Desire for instantaneous data
in all devices
– IoT significantly increases number
of connected devices
– Adjacent markets such as
Automotive and Medical add
to data growth
– Public service sectors such as fire
and police adopt 4G technologies
30B+
Mobile Data Traffic*
15B
Drivers Results
• 57% CAGR 2014-19
• 10x increase next 5 years
Today 2020
Connected Devices*
* Per Company estimates and Cisco Visual Networking Index (VNI) forecast
Page
5G Collaborations Underway
23
Keysight collaborates with industry leaders and influencers
– Consortia write the 5G standard
5GPPP, mmMAGIC, METIS II (Europe); FutureForum (China)…
– Major universities conduct 5G research
University of Surrey 5GIC, New York University Wireless, Bristol University
– Commercial customers implement 5G
China Mobile, Korea Telecom, NTT DOCOMO (Japan)…
5G Timeline
2010-2015
Early Research
2016-2018
Develop
Standards
2018-2020
Trials
2020+
Commercialize,
Deploy
Examples of Keysight collaborations
Page
Delivering First-to-Market Solutions for 5G
24
Keysight introduced 10 targeted 5G
solutions in the past year
Simulate Prototype Manufacture Optimize
Ramping in 1-3 years
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Advances Keysight’s position in 5G and supports transformationto software-oriented solutions company
Strengthening Wireless and Software Portfolio with Anite
25
Anite Profile
• A leader in R&D software
solutions for wireless handsets
(~70% of revenue(1))
• A leader in network test
applications (~30% of revenue(1))
Software layer
design and test
Network test
solutions
Simulate Prototype Manufacture Optimize
(1) Per Anite annual FY2015 report for period ending April 30, 2015. In USD converted at
average rate for the respective year. Presented on IFRS basis.
Page
Simulate Prototype Manufacture Optimize
Simulation Software Measurement Software
Keysight’s Software Business Today –Well-Positioned and Growing
26
– Revenues over $400M*
– $2B market for electronic test software, ~7% CAGR*
– Gross margins ~30 points above Keysight aggregate
– Growth opportunities across all end markets
* FY15. Per Company estimates. Includes full year of Anite
Page
Anite Expands Keysight’s Software Revenue Mix
27
Anite’s revenue mix advances the shift toward software
Anite Revenue Mix(2)Keysight Revenue Mix(1)
SW
Services
HW
HW
SW
(1) FY15
(2) Per Anite 2015 annual report ending April 30, 2015. Includes product software and IP licenses,
plus software maintenance and support.
Page
Software Growth Strategy
28
Expand simulation business− to address growth opportunities in High-Speed
Digital and Power design
Deliver solutions focused on growth segments− deliver R&D (prototype test) solutions focused on
growth segments such as 5G Communications,
Power, and Automotive
Pursue selective acquisitions − like Anite to increase our overall software content
Grow subscriptions and services− implement software capabilities to enable revenue
growth from subscriptions and from services
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Modular Solutions Growth Initiative
29
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Keysight Intends to be #1 in Modular Solutions
30
Keysight is growing much faster than
overall modular solutions market
Keysight has a highly differentiated position
Keysight is the trusted advisor for customers’
application needs
Page
43%Other
Modular
57%PXI/AXIe
Modular
Fast Growing ModularStill Small Portion of Total Market
31
2014 Modular Solutions
$1.1 Billion*
2015 Total Market
$13.5 Billion*
* Per Company estimates
0
2
4
6
8
10
12
14
16
18
2015 2016 2017 2018 2019 2020
$B$625M*
PXI/AXIe
Modular
15% CAGR*
to 2020
PXI/AXIe
Modular
15% CAGR*
Keysight’s double-digit growth
continued in Q1 FY16
Page
$59M
$93M
FY13 FY14 FY15
Strong Keysight Growth in PXI/AXIe Modular Solutions
32
− Growing core catalog: Now >150 modular products and solutions
− Introducing state-of-the-art modules that are winning new business and taking share
− Winning systems deals in large accounts with high performance, smaller footprint, fast test speed, high reliability, and expert application support
Key Initiatives
* Excludes ~$50M in FY15 non-PXI/AXIe modular orders
Keysight PXI/AXIe Orders
*
59%CAGR
>$150M
Page
Keysight Modular: PXI and AXIeIndustry Standards for Test and Measurement
33
PXIPCI eXtensions for Instrumentation
AXIeATCA* eXtensions for Instrumentation
− Maintained by PXI Systems Alliance
− High-performance for measurement and automation applications
− Members include: ADLINK, Cobham Wireless, Keysight, Marvin Test Solutions, National Instruments, Pickering, Teradyne…
− Maintained by AXIe Consortium
− “Big brother to PXI”
− More power, more performance per rack inch
− Members include: ADLINK, Anritsu, Cobham, Elma Electronic, Giga-tronics, Guzik Technical Enterprises, Keysight, Modular Methods, Test Evolution…
* Advanced Telecom Computing Architecture
Page 34
“X-Chips” Analog Chipset
• Highly integrated
• High performance
• Low power
Handheld
N9918A FieldFox
Microwave Analyzer
Feature Rich Box
N9030A
Signal Analyzer
Modular
M9375A
Network Analyzer
Proprietary intellectual property
developed by central Keysight Labs,
manufactured at in-house
semiconductor fab, and deployed
into all three form factors
Leveraged Investments into Multiple Form Factors for Competitive Differentiation
Page
Unique Value: Keysight Offers All Form Factors Meeting the Needs of Customer Applications
35
Feature Rich Box Modular Handheld
• R&D
• Validation
• Complex device manufacturing
• Full measurement set
• One-button measurements
• Shared equipment in lab
• Manufacturing
• R&D
• Validation
• Small footprint
• Flexible configuration
• Multi-channel applications
• Installation
• Maintenance
• Portability
• Harsh environments
Customer
Best For
Page
Highly Differentiated Position:A Trusted Advisor with >75 Years of Expertise
36
– Only supplier that offers all form factors to provide complete solutions
that best fit customer needs
– Leverage leading-performance technologies into multiple form factors
– Use common measurement software across all form factors to ensure
measurement accuracy and consistency
– Provide global support network
– Deliver world-class product reliability
Page
Services Growth Initiative
37
Page
Keysight Services is Ideal Growth Opportunity
38
Adds $1B* in new
addressable services
opportunities
Aligns with Keysight
solutions strategy
StrategyAlignment
Customer Needs Alignment
ExpandsAddressable Market
$1B Services
$0.5B Anite
Network Test
$12B Total
$13.5B
Outsource
Reduce costs
Asset utilization
Expertise &
consulting
COST
* Per Company estimates
Page
Today: Strong Customer Services Foundation
39
– Calibration
– Repair
– Used equipment
– Global footprint
• Service centers in 30
countries
• Affiliated with 35 calibration
standards bodies in 17
countries
$401M FY15 Services Revenue
– Third-party maintainers
– Original equipment manufacturers
Competitors
Business Focus
Used
Equipment Calibration
Repair
Page
Goal: Increase Services Revenue 50% by 2020
40
2015
$401M Revenue
2020
$600M Revenue
8%CAGR
CalibrationUsed
Equipment
Repair
Used
Equipment
Calibration
“Plus”
Repair
Page
Grow by Expanding Technology Management Services
41
Multi-Vendor,
Extended SupportKeysight Repair and
Calibration
Traditional Offerings
Technology
RefreshUsed Equipment
Instrument & Asset
ManagementInstrument Tracking
Pre-Sales ConsultingProfessional Services
Business
Expanded Offerings
Page
Moving Up the Customer Value Chain Drives Growth
42
Calibration
Asset mgmt. and technology refresh
Professional services
Repair
Multi-vendor calibration
Page
Attractive Characteristics of the Services Business
43
– Immediate opportunities large installed base
– Increases served addressable market access new dollars
– Greater account control strategic selling
– Stable revenue stream less cyclicality,
multi-year contracts
Page 44
Executive Overview
4 Growth Initiatives – Wireless, Modular, Software and Services
Advanced Manufacturing Strategy & Capabilities
Agenda
Page
Manufacturing Strategy
45
• Relentless focus on cost savings− Manufacturing in a low cost region
− LEAN at Keysight
• Develop new technologies capability− new materials / new manufacturing process
• Design for supply chain − rapid launch and ramp-to-volume of new products
• Continued commitment to quality− culture of quality, customer satisfaction
− compliance regulatory requirements
Cost savings to maintain favorable
margins
Page
• Global sourcing
• Outsourcing
• World’s largest
Test & Measurement
facility in Asia
• State of the art
technology centers
providing performance
differentiation in
products / solutions
• Multi discipline
competencies
• Value Engineering
Strengths We Are Building On
46
Total Quality Management
Low Cost Region
Manufacturing
Unique Engineering
Capability
Advanced Technology
Capability
Flexible
Supply Base
Page
Key Messages
47
Technology and market leader in
ever-evolving technology market
4% revenue CAGR
Deliver >20% operating margin
8-10% EPS growth
Transformation
Objectives
Over the CycleLeader in profitable
market
Target fast growing areas
and expand Served Addressable
Market (SAM)
Proven operating performance
and cash generation across cycles
Transform for
growth
Strong business
model
