Keysight Technologies stock (US49338L1035): record Q2 earnings, strong AI momentum and upbeat outlook

Keysight Technologies has posted record fiscal Q2 2026 results with strong AI-related revenue growth and issued an upbeat outlook for Q3, while the share price reacted positively and major banks raised their targets.

Keysight Technologies has reported its strongest quarter in company history for fiscal Q2 2026, with revenue and earnings ahead of expectations and a bullish outlook for AI-related demand, according to a detailed review by TIKR published on 05/20/2026 and a news update from Zacks on 05/20/2026 TIKR as of 05/20/2026 and Zacks as of 05/20/2026.

On May 20, 2026, the company also highlighted that AI-related revenue in the first half of fiscal 2026 already exceeded the full-year 2025 contribution, underlining the importance of this growth driver, according to a report from GuruFocus dated 05/20/2026 GuruFocus as of 05/20/2026.

As of: 21.05.2026

By the editorial team – specialized in equity coverage.

At a glance

• Name: Keysight Technologies
• Sector/industry: Electronic design, test and measurement solutions
• Headquarters/country: Santa Rosa, United States
• Core markets: Communications, electronics, automotive, aerospace and defense
• Key revenue drivers: Test and measurement equipment, software and services for communications and electronics
• Home exchange/listing venue: NYSE (ticker: KEYS)
• Trading currency: US dollar (USD)

Keysight Technologies: core business model

Keysight Technologies focuses on electronic design, test and measurement solutions that are used across communications networks, semiconductor design, automotive electronics and aerospace and defense systems, positioning the company as a key enabler of complex electronic ecosystems worldwide, as summarized by MarketScreener on 05/20/2026 MarketScreener as of 05/20/2026.

The company offers instruments, software and services that help engineers validate, simulate and optimize electronic designs, ranging from 5G and future 6G wireless systems to data center networking gear and high-speed digital interfaces, allowing customers to accelerate time-to-market and improve product performance for sophisticated hardware platforms.

According to a company profile reproduced by MarketScreener on 05/20/2026, Keysight’s business is organized around providing integrated solutions rather than only standalone instruments, combining hardware, software analytics and services to create recurring revenue opportunities and deeper customer relationships MarketScreener profile as of 05/20/2026.

Historically, the firm has roots in Hewlett-Packard’s test and measurement operations, but its current strategy focuses on serving fast-growing electronics segments such as cloud infrastructure, advanced semiconductors and electric vehicle ecosystems, where demand for reliable testing capabilities continues to increase with each new technology generation.

Main revenue and product drivers for Keysight Technologies

Net sales are broadly diversified across end markets: commercial communications accounted for about 46.3% of sales, while automotive, semiconductor, energy and consumer electronics represented roughly 30.7% and other segments made up the remainder, according to a breakdown on MarketScreener citing the company’s recent filings as of 05/20/2026 MarketScreener segment data as of 05/20/2026.

In fiscal Q2 2026, Keysight generated revenue of about 1.717 billion USD, up around 31% year over year, and reported adjusted earnings per share of 2.87 USD, up roughly 69%, which management and external observers described as the best quarter in the company’s history, according to TIKR’s analysis dated 05/20/2026 TIKR as of 05/20/2026.

For the third quarter of fiscal 2026, the company guided for revenue between 1.73 billion and 1.75 billion USD and projected non-GAAP earnings per share between 2.43 USD and 2.49 USD, signaling expectations for continued solid demand, according to a report from Zacks distributed via TradingView on 05/20/2026 Zacks as of 05/20/2026.

AI-related demand has become a crucial pillar: on May 20, 2026, Keysight reported that AI-related revenue for the first half of fiscal 2026 had already surpassed the total AI-related sales for the entire fiscal year 2025, illustrating the steep acceleration in this subsegment, as highlighted by GuruFocus in a news item dated 05/20/2026 GuruFocus as of 05/20/2026.

In particular, the build-out of AI data centers and specialized accelerators such as high-end GPUs and custom ASICs requires high-speed networking, signal integrity and power integrity testing, areas where Keysight offers solutions that allow customers to validate system performance under demanding workloads and evolving standards, supporting sustained demand as AI infrastructure scales.

Beyond AI, 5G and upcoming 6G development, cloud hyperscaler networks, automotive advanced driver-assistance systems and electric vehicle power electronics are all markets that rely heavily on precise measurement tools, and Keysight positions itself as a cross-industry supplier that can address these intertwined technology trends with modular platforms and software upgrades.

Recent share price performance and analyst signals

Keysight shares have reacted positively to the strong Q2 2026 earnings and AI commentary, with the stock trading around 344 USD on May 19, 2026 according to TIKR, and closing at approximately 342.13 USD on May 20, 2026 on the New York Stock Exchange, as reported by MarketBeat on 05/20/2026 TIKR as of 05/20/2026 and MarketBeat as of 05/20/2026.

In premarket trading on May 20, 2026, Keysight stock was up about 2.29% at 352 USD, reflecting investor enthusiasm for the earnings beat and upbeat guidance, according to a brief update from Benzinga on 05/20/2026 Benzinga as of 05/20/2026.

On the analyst side, Wells Fargo recently raised its price target on Keysight from 300 USD to 390 USD while maintaining an Overweight rating, citing growth in AI infrastructure-related demand and the company’s positioning within that ecosystem, according to a report on Investing.com dated 05/20/2026 and a matching note summarized by The Fly on 05/20/2026 Investing.com as of 05/20/2026.

Across Wall Street, 14 analysts covering the stock over the last 12 months have assigned a consensus rating of “Moderate Buy”, with an average 12-month price target of 357.58 USD, implying a forecast upside of around 4.52% from the 342.13 USD closing level on May 20, 2026, as compiled by MarketBeat on 05/20/2026 MarketBeat as of 05/20/2026.

These external assessments suggest that the market recognizes Keysight’s leverage to AI, cloud and advanced electronics trends, but also reflects the fact that the shares already price in a significant portion of anticipated growth, leading to varied views on the near-term risk-reward balance among institutional investors.

Industry trends and competitive position

The test and measurement industry is experiencing structural growth driven by ongoing technological complexity, as every new generation of wireless, computing and automotive technology requires higher performance, tighter tolerances and robust interoperability, resulting in growing demand for sophisticated test solutions across the value chain, especially in the United States and other major technology hubs.

Keysight competes with several global players in electronic testing, including firms with strong positions in oscilloscopes, spectrum analyzers and network test equipment, but differentiates itself by emphasizing complete solutions that span design simulation, validation and compliance testing, creating opportunities for cross-selling software and services alongside core instruments.

From an industry perspective, AI data centers and next-generation connectivity infrastructure are expected to remain high-investment areas for years, implying a steady need for validation of high-speed links, optical interconnects and power delivery systems, and Keysight aims to capture this demand by offering tools tailored to the development, deployment and scaling phases of these technologies.

Why Keysight Technologies matters for US investors

Keysight is listed on the New York Stock Exchange under the ticker KEYS, making it directly accessible to US retail and institutional investors, and the company’s market capitalization in the upper tens of billions of dollars places it firmly among large-cap technology-related names, as indicated by GuruFocus data showing a market cap of about 57.78 billion USD on 05/20/2026 GuruFocus as of 05/20/2026.

For US investors, Keysight represents an indirect way to gain exposure to multiple secular themes such as AI infrastructure, 5G, advanced semiconductors and electric vehicles, without relying on a single device or chip design, because the company sells testing solutions used by a wide range of OEMs, chipmakers and network operators in the US and abroad.

Additionally, Keysight’s US base and strong presence among American technology customers means its financial performance is closely linked to capital expenditure cycles in the US tech industry, making the stock sensitive to shifts in enterprise and hyperscaler investment plans, interest-rate conditions and broader sentiment towards high-growth technology spending.

Conclusion

Keysight Technologies has delivered a standout fiscal Q2 2026 with strong year-over-year revenue and earnings growth, supported by rapidly expanding AI-related demand and resilient orders in other electronic test markets, while guidance for Q3 points to continued solid performance. The stock has responded positively, and analysts such as Wells Fargo have raised targets, although the consensus implies only moderate upside from recent trading levels, suggesting that part of the growth story may already be reflected in the price. For US investors monitoring AI infrastructure, advanced semiconductors and next-generation communications, Keysight offers insight into broader capital expenditure trends, but future results will depend on the sustainability of current demand, competitive dynamics in test and measurement, and macroeconomic conditions influencing technology investment cycles.

Disclaimer: This article does not constitute investment advice. Stocks are volatile financial instruments.