Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jan. 31, 2017 | Feb. 27, 2017 | |
Entity Information [Line Items] | ||
Entity Registrant Name | Keysight Technologies, Inc. | |
Entity Central Index Key | 1,601,046 | |
Current Fiscal Year End Date | --10-31 | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 171,543,474 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jan. 31, 2017 | |
Trading Symbol | KEYS |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Net revenue [Abstract] | ||
Products | $ 606 | $ 601 |
Services and other | 120 | 120 |
Total net revenue | 726 | 721 |
Costs and expenses: | ||
Cost of products | 255 | 260 |
Cost of services and other | 67 | 69 |
Total costs | 322 | 329 |
Research and development | 108 | 108 |
Selling, general and administrative | 213 | 200 |
Other Operating Expense (Income), Net | (79) | (14) |
Total costs and expenses | 564 | 623 |
Income from operations | 162 | 98 |
Interest income | 1 | 1 |
Interest expense | (12) | (12) |
Other income (expense), net | 1 | (3) |
Income before taxes, as reported | 152 | 84 |
Provision for income taxes | 43 | 20 |
Net Income | $ 109 | $ 64 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.64 | $ 0.37 |
Diluted (in dollars per share) | $ 0.63 | $ 0.37 |
Weighted average shares used in computing net income per share: | ||
Basic (in shares) | 171 | 171 |
Diluted (in shares) | 173 | 172 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Other comprehensive income (loss): | ||
Net Income | $ 109 | $ 64 |
Unrealized gain (loss) on investments, net of tax benefit (expense) of ($1) and $1 | 4 | (6) |
Unrealized gain on derivative instruments, net of tax expense of $1 and $1 | 2 | 1 |
Amounts reclassified into earnings related to derivative instruments, net of tax expense of zero and $1 | 1 | 3 |
Foreign currency translation, net of tax benefit (expense) of zero | (24) | (25) |
Net defined benefit pension cost and post retirement plan costs: | ||
Change in actuarial net loss, net of tax expense of $13 and $6 | 28 | 12 |
Change in net prior service credit, net of tax benefit of $2 and $3 | (4) | (3) |
Other comprehensive income (loss) | 7 | (18) |
Total comprehensive income | $ 116 | $ 46 |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Other comprehensive income (loss), tax, parenthetical disclosures [Abstract] | ||
Unrealized gain (loss) on investments, tax | $ (1) | $ 1 |
Unrealized gain on derivative instruments, tax | (1) | (1) |
Amounts reclassified into earnings related to derivative instruments, tax | 0 | (1) |
Foreign currency translation, tax | 0 | 0 |
Net defined benefit pension cost and post retirement plan costs, tax [Abstract] | ||
Change in actuarial net loss, tax | (13) | (6) |
Change in net prior service credit, tax | $ 2 | $ 3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) - USD ($) $ in Millions | Jan. 31, 2017 | Oct. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 896 | $ 783 |
Accounts receivable, net | 395 | 437 |
Inventory | 479 | 474 |
Other current assets | 162 | 160 |
Total current assets | 1,932 | 1,854 |
Property, plant and equipment, net | 494 | 512 |
Goodwill | 721 | 736 |
Other intangible assets, net | 197 | 208 |
Long-term investments | 60 | 55 |
Long-term deferred tax assets | 342 | 392 |
Other assets | 123 | 39 |
Total assets | 3,869 | 3,796 |
Current liabilities: | ||
Accounts payable | 172 | 189 |
Employee compensation and benefits | 146 | 183 |
Deferred revenue | 191 | 180 |
Income and other taxes payable | 19 | 41 |
Other accrued liabilities | 68 | 51 |
Total current liabilities | 596 | 644 |
Long-term debt | 1,093 | 1,093 |
Retirement and post-retirement benefits | 384 | 405 |
Long-term deferred revenue | 74 | 72 |
Other long-term liabilities | 74 | 69 |
Total liabilities | 2,221 | 2,283 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity: | ||
Preferred stock; $0.01 par value; 100 million shares authorized; none issued and outstanding | 0 | 0 |
Common stock; $0.01 par value; 1 billion shares authorized; 174 million shares at January 31, 2017 and 172 million shares at October 31, 2016 issued | 2 | 2 |
Treasury stock at cost; 2.3 million shares at January 31, 2017 and at October 31, 2016 | (62) | (62) |
Additional paid-in-capital | 1,271 | 1,242 |
Retained earnings | 1,048 | 949 |
Accumulated other comprehensive loss | (611) | (618) |
Total stockholder's equity | 1,648 | 1,513 |
Total liabilities and equity | $ 3,869 | $ 3,796 |
CONDENSED CONSOLIDATED BALANCE6
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) (Parenthetical) - $ / shares | Jan. 31, 2017 | Oct. 31, 2016 |
Stockholders' Equity Attributable to Parent [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred stock, issued and outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common Stock, Shares, Issued | 174,000,000 | 172,000,000 |
Treasury Stock, Shares | 2,000,000 | 2,000,000 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Cash flows from operating activities: | ||
Net Income | $ 109 | $ 64 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 32 | 33 |
Share-based compensation | 18 | 16 |
Excess tax benefit from share-based plans | (2) | (1) |
Deferred taxes | 40 | 4 |
Excess and obsolete inventory related charges | 3 | 8 |
Gain on sale of land | (8) | (10) |
Other non-cash expenses, net | 0 | 2 |
Changes in assets and liabilities: | ||
Accounts receivable | 40 | 33 |
Inventory | (10) | (4) |
Accounts payable | (12) | (22) |
Employee compensation and benefits | (36) | (29) |
Retirement and post-retirement benefits, net | (71) | (13) |
Income tax payable | (15) | 2 |
Other assets and liabilities | 14 | 9 |
Net cash provided by operating activities | 102 | 92 |
Cash flows from investing activities: | ||
Investments in property, plant and equipment | (16) | (34) |
Proceeds from sale of land | 8 | 10 |
Net cash used in investing activities | (8) | (24) |
Cash flows from financing activities: | ||
Issuance of common stock under employee stock plans | 19 | 24 |
Excess tax benefit from share-based plans | 2 | 1 |
Net Cash provided by financing activities | 21 | 25 |
Effect of exchange rate movements | (2) | (4) |
Net increase in cash and cash equivalents | 113 | 89 |
Cash and cash equivalents at beginning of period | 783 | 483 |
Cash and cash equivalents at end of period | $ 896 | $ 572 |
OVERVIEW, BASIS OF PRESENTATION
OVERVIEW, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Jan. 31, 2017 | |
Accounting Policies [Abstract] | |
OVERVIEW, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. OVERVIEW, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Overview. Keysight Technologies, Inc. ("we," "us," "Keysight" or the "company"), incorporated in Delaware on December 6, 2013, is a measurement company providing electronic design and test solutions to communications and electronics industries. Our fiscal year-end is October 31, and our fiscal quarters end on January 31, April 30 and July 31. Unless otherwise stated, these dates refer to our fiscal year and fiscal quarters. Basis of Presentation. We have prepared the accompanying financial statements pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the U.S. ("GAAP") have been condensed or omitted pursuant to such rules and regulations. The accompanying financial statements and information should be read in conjunction with our Annual Report on Form 10-K. In the opinion of management, the accompanying condensed consolidated financial statements contain all normal and recurring adjustments necessary to state fairly our condensed consolidated balance sheet as of January 31, 2017 and October 31, 2016 , condensed consolidated statement of comprehensive income for the three months ended January 31, 2017 and 2016 , condensed consolidated statement of operations for the three months ended January 31, 2017 and 2016 , and condensed consolidated statement of cash flows for the three months ended January 31, 2017 and 2016 . Use of Estimates. The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and various other assumptions believed to be reasonable. Although these estimates are based on management’s knowledge of current events and actions that may impact the company in the future, actual results may be different from the estimates. Our critical accounting policies are those that affect our financial statements materially and involve difficult, subjective or complex judgments by management. Those policies are revenue recognition, inventory valuation, share-based compensation, retirement and post-retirement plan assumptions, valuation of goodwill and other intangible assets, warranty, restructuring, and accounting for income taxes. Land Sale. On April 30, 2014 we entered into a binding contract to sell land in the United Kingdom ("U.K.") that resulted in the transfer of three separate land tracts in May 2014, November 2015 and November 2016 for £21 million . In the three months ended January 31, 2017 and 2016, we recognized gains of $8 million and $10 million , respectively, on the sale of the land tracts in other operating expense (income). Restricted Cash. As of January 31, 2017 and October 31, 2016, restricted cash of $2 million consisted of approximately $1 million of deposits held as collateral against bank guarantees and approximately $1 million of deposits primarily held as collateral against foreign currency hedging contracts and is classified within other assets and other current assets, respectively, in the condensed consolidated balance sheet. Update to Significant Accounting Policies. There have been no material changes to our significant accounting policies, as compared to the significant accounting policies described in our Annual Report on Form 10-K for the fiscal year ended October 31, 2016. |
NEW ACCOUNTING PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Jan. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
NEW ACCOUNTING PRONOUNCEMENTS | 2. NEW ACCOUNTING PRONOUNCEMENTS In May 2014, the Financial Accounting Standards Board ("FASB") issued an amendment to the accounting guidance related to revenue recognition. The amendment was the result of a joint project between the FASB and the International Accounting Standards Board ("IASB") to clarify the principles for recognizing revenue and to develop common revenue standards for GAAP and International Financial Reporting Standards ("IFRS"). To meet those objectives, the FASB amended the FASB Accounting Standards Codification and created a new Topic 606, Revenue from Contracts with Customers , and the IASB issued IFRS 15, Revenue from Contracts with Customers . On July 9, 2015, the FASB deferred the effective date by one year to December 15, 2017 for annual reporting periods beginning after that date. The FASB also permitted early adoption of the standard, but not before the original effective date of December 15, 2016. In addition, during March, April, May and December 2016 the FASB issued guidance that made technical corrections and improvements and clarified the reporting of revenue as a principal versus agent, identifying performance obligations, accounting for intellectual property licenses, narrow-scope improvements, and practical expedients. We are evaluating the impact of adopting this guidance on our consolidated financial statements. In April 2015, the FASB issued Accounting Standards Update ("ASU") 2015-03, Simplifying the Presentation of Debt Issuance Costs , to simplify the presentation of deferred issuance costs by requiring that they be presented as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. The standard is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted. We adopted this guidance retrospectively during the first quarter of 2017. As a result, $7 million of unamortized debt issuance costs have been reclassified from other assets to long-term debt in the consolidated balance sheet as of January 31, 2017 and October 31, 2016 (see Note 14). In February 2016, the FASB issued guidance that will require organizations that lease assets to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP, which requires only capital leases to be recognized on the balance sheet, the new guidance will require both types of leases to be recognized on the balance sheet. The standard is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. We are evaluating the impact of adopting this guidance on our consolidated financial statements. In March 2016, the FASB issued guidance that simplifies the accounting for taxes related to share-based compensation, including adjustments to how excess tax benefits and a company's payments for tax withholdings should be classified. The standard is effective for annual and interim periods beginning after December 31, 2016. Early adoption is permitted. We are evaluating the impact of adopting this guidance on our consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory , that removes the requirement under which the income tax consequences of intra-entity transfers are deferred until the assets are ultimately sold to an outside party, except for transfers of inventory. The tax consequences of such transfers would be recognized in tax expense when the transfers occur. The standard is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual periods. Early adoption is permitted. We elected to early adopt this guidance on a modified retrospective basis during the first quarter of 2017. As a result, a $10 million cumulative-effect adjustment was recorded directly to retained earnings as of November 1, 2016, the beginning of the annual period of adoption, with corresponding reductions of $2 million , $6 million and $2 million to other current assets, other assets, and long-term deferred tax assets, respectively. In January 2017, the FASB issued guidance to narrow the definition of a business and provide a framework that gives entities a basis for making reasonable judgments about whether a transaction involves an asset or a business. The standard is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. We do not expect a material impact to our consolidated financial statements due to the adoption of this guidance. In January 2017, the FASB issued guidance that eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. The standard is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. We do not expect a material impact to our consolidated financial statements due to the adoption of this guidance. Other amendments to GAAP that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our consolidated financial statements upon adoption. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Jan. 31, 2017 | |
Share-based Compensation [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Keysight accounts for share-based awards in accordance with the provisions of the authoritative accounting guidance, which requires the measurement and recognition of compensation expense for all share-based payment awards made to our employees and directors, including employee stock option awards, restricted stock units ("RSUs"), employee stock purchases made under our Employee Stock Purchase Plan (“ESPP”) and performance share awards granted to selected members of our senior management under the Long-Term Performance (“LTP”) Program based on estimated fair values. The impact of share-based compensation on our results was as follows: Three Months Ended January 31, 2017 2016 (in millions) Cost of products and services $ 3 $ 3 Research and development 4 3 Selling, general and administrative 11 10 Total share-based compensation expense $ 18 $ 16 At January 31, 2017 and 2016 , share-based compensation capitalized within inventory was $1 million. The income tax benefit realized from the exercised stock options and similar awards recognized was $2 million and $1 million for the three months ended January 31, 2017 and 2016, respectively. The following assumptions were used to estimate the fair value of LTP Program grants. Three Months Ended January 31, 2017 2016 LTP Program: Volatility of Keysight shares 27 % 25 % Volatility of selected index (2017)/peer-company shares (2016) 15 % 14%-54% Price-wise correlation with selected peers 57 % 38 % Shares granted under the LTP Program were valued using a Monte Carlo simulation model. In the first quarter of fiscal 2017, the company began awarding an additional type of performance award based on operating margin performance. These awards were valued based on the market price of Keysight’s common stock on the date of grant. The fair value of employee stock option awards granted before October 31, 2015 was estimated using the Black-Scholes option pricing model. We did not grant any option awards for the three months ended January 31, 2017 and 2016. Both the Black-Scholes and Monte Carlo simulation fair value models require the use of highly subjective and complex assumptions, including the option’s expected life and the price volatility of the underlying stock. The estimated fair value of restricted stock awards is determined based on the market price of Keysight’s common stock on the date of grant. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Jan. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The company’s effective tax rate was 28.3 percent and 23.7 percent for the three months ended January 31, 2017 and 2016, respectively. Income tax expense was $43 million and $20 million for the three months ended January 31, 2017 and 2016, respectively. The income tax provision for the three months ended January 31, 2017 and 2016 included a net discrete expense of $23 million and $1 million, respectively. The increase in the total income tax expense and discrete expense for the three months ended January 31, 2017, is primarily related to $22 million of tax resulting from the transfer of a portion of the Japanese Employees’ Pension Fund (see Note 11). Keysight benefits from tax incentives in several jurisdictions, most significantly in Singapore, and several jurisdictions have granted us tax incentives that require renewal at various times in the future. The tax incentives provide lower rates of taxation on certain classes of income and require thresholds of investments and employment or specific types of income in those jurisdictions. The impact of tax incentives decreased the income tax provision for the three months ended January 31, 2017 and 2016 by $11 million and $8 million , respectively, resulting in a benefit to net income per share (diluted) of approximately $0.07 and $0.05 for the three months ended January 31, 2017 and 2016, respectively. The Singapore tax incentive is due for renewal in fiscal 2024. For the majority of our entities, the open tax years for the IRS, state and most foreign audit authorities are from August 1, 2014 , through the current tax year. For certain foreign entities, the tax years generally remain open back to the year 2006 . Given the number of years and numerous matters that remain subject to examination in various tax jurisdictions, we are unable to estimate the range of possible changes to the balance of our unrecognized tax benefits. |
NET INCOME PER SHARE
NET INCOME PER SHARE | 3 Months Ended |
Jan. 31, 2017 | |
Earnings Per Share [Abstract] | |
NET INCOME PER SHARE | NET INCOME PER SHARE The following is a reconciliation of the numerator and denominator of the basic and diluted net income per share computations for the periods presented below: Three Months Ended January 31, 2017 2016 (in millions) Numerator: Net income $ 109 $ 64 Denominator: Basic weighted-average shares 171 171 Potential common shares— stock options and other employee stock plans 2 1 Diluted weighted-average shares 173 172 The dilutive effect of share-based awards is reflected in diluted net income per share by application of the treasury stock method. We exclude stock options with exercise prices greater than the average market price of our common stock from the calculation of diluted earnings per share because the effect would be anti-dilutive. For the three months ended January 31, 2017 and 2016, we excluded zero and 1.7 million options, respectively, from the calculation of diluted earnings per share. In addition, we excluded stock options, ESPP shares, LTP Program and restricted stock awards, of which the combined exercise price, unamortized fair value and excess tax benefits collectively was greater than the average market price of our common stock because the effect would be anti-dilutive. For the three months ended January 31, 2017 and 2016, we excluded 424,400 and 16,100 shares, respectively. |
SUPPLEMENT CASH FLOW INFORMATIO
SUPPLEMENT CASH FLOW INFORMATION (Notes) | 3 Months Ended |
Jan. 31, 2017 | |
Other Significant Noncash Transactions [Line Items] | |
Schedule of Cash Flow, Supplemental Disclosures [Table Text Block] | 6. SUPPLEMENTAL CASH FLOW INFORMATION Net cash paid for income taxes was $17 million and $8 million for the three months ended January 31, 2017 and 2016, respectively. The following table summarizes our non-cash investing activities that are not reflected in the condensed consolidated statement of cash flows: Three Months Ended January 31, 2017 2016 (in millions) Non-cash investing activities: Capital expenditures in accounts payables $ (5 ) $ (9 ) $ (5 ) $ (9 ) |
INVENTORY
INVENTORY | 3 Months Ended |
Jan. 31, 2017 | |
Inventory, Net [Abstract] | |
INVENTORY | INVENTORY January 31, October 31, (in millions) Finished goods $ 218 $ 218 Purchased parts and fabricated assemblies 261 256 Total inventory $ 479 $ 474 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Jan. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS The following table presents goodwill balances and the movements for each of our reportable segments as of and for the three months ended January 31, 2017 : Communications Solutions Group Electronic Industrial Solutions Group Services Solutions Group Total (in millions) Goodwill as of October 31, 2016 $ 456 $ 216 $ 64 $ 736 Foreign currency translation impact (15 ) — — (15 ) Goodwill as of January 31, 2017 $ 441 $ 216 $ 64 $ 721 The components of other intangible assets as of January 31, 2017 and October 31, 2016 are shown in the table below: Other Intangible Assets as of January 31, 2017 Other Intangible Assets as of October 31, 2016 Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value (in millions) Developed technology $ 314 $ 167 $ 147 $ 309 $ 159 $ 150 Backlog 4 4 — 4 4 — Trademark/Tradename 20 4 16 20 4 16 Customer relationships 65 38 27 65 35 30 Total amortizable intangible assets 403 213 190 398 202 196 In-Process R&D 7 — 7 12 — 12 Total $ 410 $ 213 $ 197 $ 410 $ 202 $ 208 During the three months ended January 31, 2017 , we recorded no additions to goodwill and other intangible assets. During the three months ended January 31, 2017 , there was no foreign exchange translation impact to other intangible assets. During the first quarter of 2017, we transferred $5 million from in-process R&D to developed technology as the project was successfully completed. Amortization of other intangible assets was $11 million and $12 million for the three months ended January 31, 2017 and 2016, respectively. Future amortization expense related to existing finite-lived purchased intangible assets is estimated to be $31 million for the remainder of 2017, $39 million for 2018, $38 million for 2019, $ 38 million for 2020, $30 million for 2021 and $14 million thereafter. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Jan. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The authoritative guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, we consider the principal or most advantageous market and assumptions that market participants would use when pricing the asset or liability. Fair Value Hierarchy The guidance establishes a fair value hierarchy that prioritizes inputs used in valuation techniques into three levels. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. There are three levels of inputs that may be used to measure fair value: Level 1 - applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 - applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly, for the asset or liability such as: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in less active markets; or other inputs that can be derived principally from, or corroborated by, observable market data. Level 3 - applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis Financial assets and liabilities measured at fair value on a recurring basis as of January 31, 2017 and October 31, 2016 were as follows: Fair Value Measurements at January 31, 2017 Fair Value Measurements at October 31, 2016 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 (in millions) Assets: Short-term Cash equivalents (money market funds) $ 572 $ 572 $ — $ — $ 471 $ 471 $ — $ — Derivative instruments (foreign exchange contracts) 7 — 7 — 4 — 4 — Long-term Trading securities 11 11 — — 11 11 — — Available-for-sale investments 34 34 — — 29 29 — — Total assets measured at fair value $ 624 $ 617 $ 7 $ — $ 515 $ 511 $ 4 $ — Liabilities: Short-term Derivative instruments (foreign exchange contracts) $ 6 $ — $ 6 $ — $ 8 $ — $ 8 $ — Long-term Deferred compensation liability 11 — 11 — 11 — 11 — Total liabilities measured at fair value $ 17 $ — $ 17 $ — $ 19 $ — $ 19 $ — Our money market funds, trading securities, and available-for-sale investments are generally valued using quoted market prices and therefore are classified within Level 1 of the fair value hierarchy. Our derivative financial instruments are classified within Level 2, as there is not an active market for each hedge contract, but the inputs used to calculate the value of the instruments are tied to active markets. Our deferred compensation liability is classified as Level 2 because, although the values are not directly based on quoted market prices, the inputs used in the calculations are observable. Trading securities and deferred compensation liability are reported at fair value, with gains or losses resulting from changes in fair value recognized currently in earnings. Investments designated as available-for-sale and certain derivative instruments are reported at fair value, with unrealized gains and losses, net of tax, included in accumulated other comprehensive income (loss). Realized gains and losses from the sale of these instruments are recorded in earnings. |
DERIVATIVES
DERIVATIVES | 3 Months Ended |
Jan. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES | DERIVATIVES We are exposed to foreign currency exchange rate fluctuations and interest rate changes in the normal course of our business. As part of our risk management strategy, we use derivative instruments, primarily forward contracts and purchased options, to hedge economic and/or accounting exposures resulting from changes in foreign currency exchange rates. Cash Flow Hedges We enter into foreign exchange contracts to hedge our forecasted operational cash flow exposures resulting from changes in foreign currency exchange rates. These foreign exchange contracts, carried at fair value, have maturities between one and twelve months. These derivative instruments are designated and qualify as cash flow hedges under the criteria prescribed in the authoritative guidance. Ineffectiveness in the three months ended January 31, 2017 and 2016 was not significant . Other Hedges Additionally, we enter into foreign exchange contracts to hedge monetary assets and liabilities that are denominated in currencies other than the functional currency of our subsidiaries. These foreign exchange contracts are carried at fair value and do not qualify for hedge accounting treatment and are not designated as hedging instruments. Our use of derivative instruments exposes us to credit risk to the extent that the counterparties may be unable to meet the terms of the agreement. We do, however, seek to mitigate such risks by limiting our counterparties to major financial institutions that are selected based on their credit ratings and other factors. We have established policies and procedures for mitigating credit risk that include establishing counterparty credit limits, monitoring credit exposures, and continually assessing the creditworthiness of counterparties. A number of our derivative agreements contain threshold limits to the net liability position with counterparties and are dependent on our corporate credit rating determined by the major credit rating agencies. The counterparties to the derivative instruments may request collateralization, in accordance with derivative agreements, on derivative instruments in net liability positions. The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a net liability position as of January 31, 2017 was $4 million . The credit-risk-related contingent features underlying these agreements had not been triggered as of January 31, 2017 . There were 137 foreign exchange forward contracts open as of January 31, 2017 that were designated as cash flow hedges. There were 60 foreign exchange forward contracts as of January 31, 2017 that were not designated as hedging instruments. The aggregated notional amounts by currency and designation as of January 31, 2017 were as follows: Derivatives in Cash Flow Hedging Relationships Derivatives Not Designated as Hedging Instruments Forward Contracts Forward Contracts Currency Buy/(Sell) Buy/(Sell) (in millions) Euro $ — $ 62 British Pound — 10 Singapore Dollar 10 1 Malaysian Ringgit 70 1 Japanese Yen (82 ) (41 ) Other currencies (15 ) 6 Total $ (17 ) $ 39 Derivative instruments are subject to master netting arrangements and are disclosed gross in the balance sheet in accordance with the authoritative guidance. The gross fair values and balance sheet location of derivative instruments held in the condensed consolidated balance sheet as of January 31, 2017 and October 31, 2016 were as follows: Fair Values of Derivative Instruments Asset Derivatives Liability Derivatives Fair Value Fair Value Balance Sheet Location January 31, October 31, Balance Sheet Location January 31, October 31, (in millions) Derivatives designated as hedging instruments: Cash flow hedges Foreign exchange contracts Other current assets $ 5 $ 2 Other accrued liabilities $ 4 $ 4 Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets 2 2 Other accrued liabilities 2 4 Total derivatives $ 7 $ 4 $ 6 $ 8 The effect of derivative instruments for foreign exchange contracts designated as hedging instruments and not designated as hedging instruments in our condensed consolidated statement of operations were as follows: Three Months Ended January 31, 2017 2016 (in millions) Derivatives designated as hedging instruments: Cash Flow Hedges Foreign exchange contracts: Gain recognized in accumulated other comprehensive income $ 3 $ 2 Loss reclassified from accumulated other comprehensive income into cost of sales $ (1 ) $ (4 ) Derivatives not designated as hedging instruments: Gain (loss) recognized in other income (expense), net $ 2 $ (2 ) The estimated amount of existing net gain at January 31, 2017 expected to be reclassified from accumulated other comprehensive income to cost of sales within the next twelve months is immaterial. |
RETIREMENT PLANS AND POST RETIR
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS | 3 Months Ended |
Jan. 31, 2017 | |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS | RETIREMENT PLANS AND POST-RETIREMENT BENEFIT PLANS For the three months ended January 31, 2017 and 2016 , our net pension and post-retirement benefit cost (benefit) were comprised of the following: Pensions U.S. Defined Benefit Plans Non-U.S. Defined Benefit Plans U.S. Post-Retirement Benefit Plan Three Months Ended January 31, 2017 2016 2017 2016 2017 2016 (in millions) Service cost—benefits earned during the period $ 5 $ 5 $ 4 $ 4 $ — $ — Interest cost on benefit obligation 5 6 6 8 2 2 Expected return on plan assets (8 ) (9 ) (19 ) (19 ) (3 ) (3 ) Amortization: Net actuarial losses 4 2 9 7 5 5 Prior service credit (2 ) (2 ) — — (4 ) (4 ) Settlement gain — — (68 ) — — — Total periodic benefit cost (benefit) $ 4 $ 2 $ (68 ) $ — $ — $ — We did not contribute to our U.S. Defined Benefit Plans and U.S. Post-Retirement Benefit Plan during the three months ended January 31, 2017 and 2016 . We contributed $7 million and $10 million to our Non-U.S. Defined Benefit Plans during the three months ended January 31, 2017 and 2016, respectively. During the remainder of 2017 , we do not expect to contribute to our U.S. Defined Benefit Plans, and we expect to contribute $25 million to our Non-U.S. Defined Benefit Plans. On December 15, 2016, we transferred a portion of the assets and obligations of our Japanese Employees’ Pension Fund ("EPF") to the Japanese government. The remaining portion of the EPF was transferred to a new Keysight Japan corporate defined benefit pension plan. The difference between the obligations settled with the government of $142 million and the assets transferred to the government of $51 million resulted in an increase in the funded status of the new defined benefit pension plan of $91 million . The settlement resulted in a gain of $68 million which is included in other operating expense (income) in the consolidated statement of operations. Previously accrued salary progression of $4 million was derecognized at the time of settlement. |
RESTRUCTURING (Notes)
RESTRUCTURING (Notes) | 3 Months Ended |
Jan. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and Related Activities Disclosure [Text Block] | 12. RESTRUCTURING We initiated a targeted workforce reduction program in November 2016 that is expected to reduce Keysight's total headcount by between 60 to 200 employees. The timing and scope of workforce reductions will vary based on local legal requirements. This targeted workforce management program was designed to support our site consolidation strategy, align with our new industry segment structure and improve efficiency. As of January 31, 2017, approximately 20 employees exited under the workforce reduction program. A summary of balances and restructuring activity is shown in the table below: Workforce reduction (in millions) Balance as of October 31, 2016 $ — Income statement expense 2 Cash payments — Balance as of January 31, 2017 $ 2 The restructuring accrual of $2 million at January 31, 2017 relating to workforce reduction is recorded in other accrued liabilities in the condensed consolidated balance sheet. A summary of the charges in the consolidated statement of operations resulting from all restructuring plans is shown below: Three Months Ended January 31, 2017 2016 (in millions) Cost of products and services $ 1 $ — Research and development — — Selling, general and administrative 1 — Total restructuring and other related costs $ 2 $ — |
WARRANTY, COMMITMENTS AND CONTI
WARRANTY, COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Jan. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
WARRANTY, COMMITMENTS AND CONTINGENCIES | WARRANTY, COMMITMENTS AND CONTINGENCIES Standard Warranty Our standard warranty term for most of our products from the date of delivery is typically three years. We accrue for standard warranty costs based on historical trends in warranty charges. The accrual is reviewed regularly and periodically adjusted to reflect changes in warranty cost estimates. Estimated warranty charges are recorded within cost of products at the time related product revenue is recognized. Activity related to the standard warranty accrual, which is included in other accrued and other long-term liabilities in our condensed consolidated balance sheet, is as follows: Three Months Ended January 31, 2017 2016 (in millions) Beginning balance $ 44 $ 53 Accruals for warranties including change in estimate 7 8 Settlements made during the period (8 ) (8 ) Ending balance $ 43 $ 53 Accruals for warranties due within one year $ 22 $ 34 Accruals for warranties due after one year 21 19 Ending balance $ 43 $ 53 Commitments There were no material changes during the three months ended January 31, 2017 to the operating lease commitments reported in the company’s 2016 Annual Report on Form 10-K. Contingencies We are involved in lawsuits, claims, investigations and proceedings, including, but not limited to, patent, commercial and environmental matters, which arise in the ordinary course of business. There are no matters pending that we currently believe are reasonably possible of having a material impact to our business, consolidated financial condition, results of operations or cash flows. |
DEBT (Notes)
DEBT (Notes) | 3 Months Ended |
Jan. 31, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Short-Term Debt On January 30, 2017 , we entered into a commitment letter, pursuant to which certain lenders have agreed to provide a senior unsecured 364 -day bridge loan facility of up to $1.684 billion (“the Bridge Facility”) for the purpose of providing the financing to support Keysight's acquisition of Ixia. The company incurred issuance costs of $8 million in connection with the Bridge Facility. These costs are included in other current assets in the condensed consolidated balance sheet and are being amortized to interest expense over the term of the Bridge Facility. In connection with entering into the term credit agreement (described below), on February 15, 2017, the unsecured commitments under the Bridge Facility were automatically reduced in an aggregate principal amount of $400 million . On February 15, 2017 , we entered into an amended and restated credit agreement (the “Revolving Credit Facility”) that provides for a $450 million five-year unsecured revolving credit facility that will expire on February 15, 2022 . In addition, the Revolving Credit Facility permits us to increase the total commitments under this credit facility by up to $150 million in the aggregate on one or more occasions upon request. The Revolving Credit Facility replaced our existing $450 million unsecured credit facility, dated as of September 15, 2014. The company may use amounts borrowed under the facility for general corporate purposes, including to finance, in part, the acquisition of Ixia, the payment of fees and expenses related thereto and the repayment in full of all third-party indebtedness of Ixia and its subsidiaries that becomes due or otherwise defaults upon the consummation of the Ixia acquisition. As of January 31, 2017, we had no borrowings outstanding under the Revolving Credit Facility. We were in compliance with the covenants of the Revolving Credit Facility during the three months ended January 31, 2017. Long-Term Debt The following table summarizes the components of our long-term debt: January 31, 2017 October 31, 2016 (in millions) 3.30% Senior Notes due 2019 $ 497 $ 497 4.55% Senior Notes due 2024 596 596 Total $ 1,093 $ 1,093 The notes issued are unsecured and rank equally in right of payment with all of our other senior unsecured indebtedness. There were no changes to the principal, maturity, interest rates and interest payment terms of the senior notes during the three months ended January 31, 2017 . On February 15, 2017 , we entered into a term credit agreement, which provides for a three -year $400 million delayed draw senior unsecured term loan facility. The term loans will be available to us upon the closing of the Ixia acquisition. The term loan is intended to be used to finance, in part, the Ixia acquisition, the payment of fees and expenses related thereto and the repayment in full of all third-party indebtedness of Ixia and its subsidiaries that becomes due or otherwise defaults upon the consummation of the Ixia acquisition. The commitments under the term credit agreement automatically terminate on the first to occur of (a) the consummation of the Ixia acquisition without the borrowing of any loans under the term credit agreement, (b) the termination of the Merger Agreement to acquire Ixia in accordance with its terms or (c) on October 30, 2017. See Note 17 for further details regarding the pending acquisition. As of January 31, 2017 and October 31, 2016, we had $19 million and $18 million , respectively, of outstanding letters of credit unrelated to the credit facility that were issued by various lenders. The fair value of our long-term debt, calculated from quoted prices that are primarily Level 1 inputs under the accounting guidance fair value hierarchy, was above the carrying value by approximately $12 million and $30 million as of January 31, 2017 and October 31, 2016, respectively. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Jan. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |
STOCKHOLDERS EQUITY | STOCKHOLDERS' EQUITY Stock Repurchase Program On February 18, 2016, the Board of Directors approved a stock repurchase program authorizing the purchase of up to $200 million of the company’s common stock. Under the program, shares may be purchased from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases, privately negotiated transactions or other means. All such shares and related costs are held as treasury stock and accounted for at trade date using the cost method. The stock repurchase program may be commenced, suspended or discontinued at any time at the company’s discretion and does not have an expiration date. For the three months ended January 31, 2017, we did not repurchase any shares of common stock under the stock repurchase program. Accumulated Other Comprehensive Loss Changes in accumulated other comprehensive loss by component and related tax effects for the three months ended January 31, 2017 and 2016 were as follows: Unrealized gain on equity securities Foreign currency translation Net defined benefit pension cost and post retirement plan costs Unrealized gains (losses) on derivatives Total Actuarial losses Prior service credits (in millions) As of October 31, 2016 $ 10 $ (29 ) $ (646 ) $ 50 $ (3 ) $ (618 ) Other comprehensive income (loss) before reclassifications 5 (24 ) 24 — 3 8 Amounts reclassified out of accumulated other comprehensive loss — — 17 (6 ) 1 12 Tax (expense) benefit (1 ) — (13 ) 2 (1 ) (13 ) Other comprehensive income (loss) 4 (24 ) 28 (4 ) 3 7 As of January 31, 2017 $ 14 $ (53 ) $ (618 ) $ 46 $ — $ (611 ) As of October 31, 2015 $ 21 $ (48 ) $ (511 ) $ 65 $ (6 ) $ (479 ) Other comprehensive income (loss) before reclassifications (7 ) (25 ) 4 — 2 (26 ) Amounts reclassified out of accumulated other comprehensive loss — — 14 (6 ) 4 12 Tax (expense) benefit 1 — (6 ) 3 (2 ) (4 ) Other comprehensive income (loss) (6 ) (25 ) 12 (3 ) 4 (18 ) As of January 31, 2016 $ 15 $ (73 ) $ (499 ) $ 62 $ (2 ) $ (497 ) Reclassifications out of accumulated other comprehensive loss for the three months ended January 31, 2017 and 2016 were as follows: Details about Accumulated Other Comprehensive Loss Components Amounts Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in Statement of Operations Three Months Ended January 31, 2017 2016 (in millions) Unrealized gain (loss) on derivatives $ (1 ) $ (4 ) Cost of sales — 1 Provision for income taxes (1 ) (3 ) Net of income tax Net defined benefit pension cost and post retirement plan costs: Actuarial net loss (17 ) (14 ) Prior service credits 6 6 (11 ) (8 ) Total before income tax 3 3 Provision for income taxes (8 ) (5 ) Net of income tax Total reclassifications for the period $ (9 ) $ (8 ) An amount in parentheses indicates a reduction to income and an increase to the accumulated other comprehensive loss. Reclassifications of prior service benefit and actuarial net loss in respect of retirement plans and post retirement pension plans are included in the computation of net periodic cost (see Note 11, "Retirement Plans and Post-Retirement Pension Plans"). |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Jan. 31, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION We provide electronic design and test instruments and systems and related software, software design tools, and related services that are used in the design, development, manufacture, installation, deployment and operation of electronics equipment. Related services include start-up assistance, instrument productivity and application services and instrument calibration and repair. We also offer customization, consulting and optimization services throughout the customer's product lifecycle. In fiscal 2016, we completed an organizational change to align our organization with the industries we serve. As a result of this organizational realignment, we have three reportable operating segments, Communications Solutions Group (“CSG”), Electronic Industrial Solutions Group (“EISG”), and Services Solutions Group (“SSG”). CSG and EISG are from our previous Measurement Solutions segment, while SSG was formerly reported as the company's Customer Support and Services segment. The new organizational structure continues to include centralized enterprise functions that provide support across the groups. Prior period amounts were revised to conform to the current presentation. Our three operating segments were determined based primarily on how the chief operating decision maker views and evaluates our operations. Segment operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to each segment and to assess performance. Other factors, including market separation and customer specific applications, go-to-market channels, products and services and manufacturing are considered in determining the formation of these operating segments. Descriptions of our three reportable segments are as follows: The Communications Solutions Group serves customers spanning the worldwide commercial communications end market, which includes internet infrastructure, and the aerospace, defense and government end market. The group provides electronic design and test software, instruments, and systems used in the simulation, design, validation, manufacturing, installation and optimization of electronic equipment. The Electronic Industrial Solutions Group provides test and measurement solutions across a broad set of electronic industrial end markets, focusing on high-growth applications in the automotive and energy industry and measurement solutions for semiconductor design and manufacturing, consumer electronics, education and general electronics manufacturing. The group provides electronic design and test software, instruments, and systems used in the simulation, design, validation, manufacturing, installation and optimization of electronic equipment. The Services Solutions Group provides repair, calibration and consulting services, and remarkets used Keysight equipment. In addition to providing repair and calibration support for Keysight equipment, we also calibrate non-Keysight equipment. The group serves the same markets as Keysight’s Communications Solutions and Electronic Industrial Solutions Groups, providing industry-specific services to deliver complete Keysight solutions and help customers reduce their total cost of ownership for their design and test equipment. A significant portion of the segments' expenses arise from shared services and infrastructure that we have historically provided to the segments in order to realize economies of scale and to efficiently use resources. These expenses, collectively called corporate charges, include costs of centralized research and development, legal, accounting, real estate, insurance services, information technology services, treasury and other corporate infrastructure expenses. Charges are allocated to the segments, and the allocations have been determined on a basis that we consider to be a reasonable reflection of the utilization of services provided to or benefits received by the segments. The following tables reflect the results of our reportable segments under our management reporting system. These results are not necessarily in conformity with GAAP. The performance of each segment is measured based on several metrics, including income from operations. These results are used, in part, by the chief operating decision maker in evaluating the performance of, and in allocating resources to, each of the segments. The profitability of each of the segments is measured after excluding share-based compensation expense, restructuring and asset impairment charges, investment gains and losses, interest income, interest expense, acquisition and integration costs, separation and related costs, acquisition-related fair value adjustments, non-cash amortization and other items as noted in the reconciliations below. Communications Solutions Group Electronic Industrial Solutions Group Services Solutions Group Total Segments (in millions) Three Months Ended January 31, 2017: Total segment revenue $ 434 $ 192 $ 100 $ 726 Acquisition-related fair value adjustments — — — — Total net revenue $ 434 $ 192 $ 100 $ 726 Segment income from operations $ 72 $ 42 $ 14 $ 128 Three Months Ended January 31, 2016: Total segment revenue $ 440 $ 191 $ 95 $ 726 Acquisition-related fair value adjustments (5 ) — — (5 ) Total net revenue $ 435 $ 191 $ 95 $ 721 Segment income from operations $ 78 $ 38 $ 13 $ 129 The following table reconciles reportable segments’ income from operations to our total enterprise income before taxes: Three Months Ended January 31, 2017 2016 (in millions) Total reportable segments' income from operations $ 128 $ 129 Share-based compensation expense (18 ) (16 ) Restructuring and related costs (2 ) — Amortization of intangibles (10 ) (11 ) Acquisition and integration costs (6 ) (2 ) Separation and related costs (6 ) (5 ) Acquisition-related fair value adjustments — (5 ) Japan pension settlement gain 68 — Other 8 8 Income from operations, as reported 162 98 Interest income 1 1 Interest expense (12 ) (12 ) Other income (expense), net 1 (3 ) Income before taxes, as reported $ 152 $ 84 There has been no material change in total assets by segment since October 31, 2016. |
PENDING ACQUISITION (Notes)
PENDING ACQUISITION (Notes) | 3 Months Ended |
Jan. 31, 2017 | |
Business Combinations [Abstract] | |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | 17. PENDING ACQUISITION On January 30, 2017, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Ixia, a leading provider of network testing, visibility, and security solutions, and, by a joinder executed on February 2, 2017, Keysight Acquisition, Inc., a wholly-owned subsidiary of ours (“Merger Sub”), to acquire Ixia in an all-cash transaction totaling approximately $1.6 billion in consideration, net of cash acquired. Pursuant to the Merger Agreement, and subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into Ixia with Ixia surviving the merger and becoming our wholly-owned subsidiary. Our board of directors and Ixia’s board of directors have both unanimously approved the transaction, which is anticipated to close no later than the end of October 2017 and is subject to approval by Ixia shareholders, regulatory approvals, and customary closing conditions and approvals. Under the terms of the Merger Agreement, Ixia shareholders will receive $19.65 per share in cash. The combination of Keysight and Ixia brings together two highly complementary companies to create an innovative force in leading-edge technologies that spans electronic design, device and network validation, and application and security performance. The description of the Merger Agreement herein does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which is attached as Exhibit 2.1 to our Current Report on Form 8-K filed on February 1, 2017. |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Share-based Compensation [Abstract] | |
Allocated Share-based compensation expense disclosure | The impact of share-based compensation on our results was as follows: Three Months Ended January 31, 2017 2016 (in millions) Cost of products and services $ 3 $ 3 Research and development 4 3 Selling, general and administrative 11 10 Total share-based compensation expense $ 18 $ 16 |
Share-based compensation arrangement by share-based payment award fair value assumptions and methodology schedule | The following assumptions were used to estimate the fair value of LTP Program grants. Three Months Ended January 31, 2017 2016 LTP Program: Volatility of Keysight shares 27 % 25 % Volatility of selected index (2017)/peer-company shares (2016) 15 % 14%-54% Price-wise correlation with selected peers 57 % 38 % |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of the numerators and denominators of the basic and diluted net income per share | The following is a reconciliation of the numerator and denominator of the basic and diluted net income per share computations for the periods presented below: Three Months Ended January 31, 2017 2016 (in millions) Numerator: Net income $ 109 $ 64 Denominator: Basic weighted-average shares 171 171 Potential common shares— stock options and other employee stock plans 2 1 Diluted weighted-average shares 173 172 |
SUPPLEMENT CASH FLOW INFORMAT27
SUPPLEMENT CASH FLOW INFORMATION (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Other Significant Noncash Transactions [Line Items] | |
Cash Flow, Supplemental Disclosures [Text Block] | Three Months Ended January 31, 2017 2016 (in millions) Non-cash investing activities: Capital expenditures in accounts payables $ (5 ) $ (9 ) $ (5 ) $ (9 ) |
INVENTORY (Tables)
INVENTORY (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Inventory, Net [Abstract] | |
INVENTORY | January 31, October 31, (in millions) Finished goods $ 218 $ 218 Purchased parts and fabricated assemblies 261 256 Total inventory $ 479 $ 474 |
GOODWILL AND OTHER INTANGIBLE29
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill balances and movements for each reportable segments during the period | The following table presents goodwill balances and the movements for each of our reportable segments as of and for the three months ended January 31, 2017 : Communications Solutions Group Electronic Industrial Solutions Group Services Solutions Group Total (in millions) Goodwill as of October 31, 2016 $ 456 $ 216 $ 64 $ 736 Foreign currency translation impact (15 ) — — (15 ) Goodwill as of January 31, 2017 $ 441 $ 216 $ 64 $ 721 |
Components of other intangibles during the period | The components of other intangible assets as of January 31, 2017 and October 31, 2016 are shown in the table below: Other Intangible Assets as of January 31, 2017 Other Intangible Assets as of October 31, 2016 Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value (in millions) Developed technology $ 314 $ 167 $ 147 $ 309 $ 159 $ 150 Backlog 4 4 — 4 4 — Trademark/Tradename 20 4 16 20 4 16 Customer relationships 65 38 27 65 35 30 Total amortizable intangible assets 403 213 190 398 202 196 In-Process R&D 7 — 7 12 — 12 Total $ 410 $ 213 $ 197 $ 410 $ 202 $ 208 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Assets And Liabilities Measured On Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis as of January 31, 2017 and October 31, 2016 were as follows: Fair Value Measurements at January 31, 2017 Fair Value Measurements at October 31, 2016 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 (in millions) Assets: Short-term Cash equivalents (money market funds) $ 572 $ 572 $ — $ — $ 471 $ 471 $ — $ — Derivative instruments (foreign exchange contracts) 7 — 7 — 4 — 4 — Long-term Trading securities 11 11 — — 11 11 — — Available-for-sale investments 34 34 — — 29 29 — — Total assets measured at fair value $ 624 $ 617 $ 7 $ — $ 515 $ 511 $ 4 $ — Liabilities: Short-term Derivative instruments (foreign exchange contracts) $ 6 $ — $ 6 $ — $ 8 $ — $ 8 $ — Long-term Deferred compensation liability 11 — 11 — 11 — 11 — Total liabilities measured at fair value $ 17 $ — $ 17 $ — $ 19 $ — $ 19 $ — |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Aggregated notional amounts by currency and designation | The aggregated notional amounts by currency and designation as of January 31, 2017 were as follows: Derivatives in Cash Flow Hedging Relationships Derivatives Not Designated as Hedging Instruments Forward Contracts Forward Contracts Currency Buy/(Sell) Buy/(Sell) (in millions) Euro $ — $ 62 British Pound — 10 Singapore Dollar 10 1 Malaysian Ringgit 70 1 Japanese Yen (82 ) (41 ) Other currencies (15 ) 6 Total $ (17 ) $ 39 |
Gross fair values and balance sheet location of derivative instruments held in the consolidated balance sheet | Derivative instruments are subject to master netting arrangements and are disclosed gross in the balance sheet in accordance with the authoritative guidance. The gross fair values and balance sheet location of derivative instruments held in the condensed consolidated balance sheet as of January 31, 2017 and October 31, 2016 were as follows: Fair Values of Derivative Instruments Asset Derivatives Liability Derivatives Fair Value Fair Value Balance Sheet Location January 31, October 31, Balance Sheet Location January 31, October 31, (in millions) Derivatives designated as hedging instruments: Cash flow hedges Foreign exchange contracts Other current assets $ 5 $ 2 Other accrued liabilities $ 4 $ 4 Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets 2 2 Other accrued liabilities 2 4 Total derivatives $ 7 $ 4 $ 6 $ 8 |
Effect of derivative instruments for foreign exchange contracts in the consolidated statement of operations | The effect of derivative instruments for foreign exchange contracts designated as hedging instruments and not designated as hedging instruments in our condensed consolidated statement of operations were as follows: Three Months Ended January 31, 2017 2016 (in millions) Derivatives designated as hedging instruments: Cash Flow Hedges Foreign exchange contracts: Gain recognized in accumulated other comprehensive income $ 3 $ 2 Loss reclassified from accumulated other comprehensive income into cost of sales $ (1 ) $ (4 ) Derivatives not designated as hedging instruments: Gain (loss) recognized in other income (expense), net $ 2 $ (2 ) |
RETIREMENT PLANS AND POST RET32
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
Schedule of net pension and post-retirement benefit costs | For the three months ended January 31, 2017 and 2016 , our net pension and post-retirement benefit cost (benefit) were comprised of the following: Pensions U.S. Defined Benefit Plans Non-U.S. Defined Benefit Plans U.S. Post-Retirement Benefit Plan Three Months Ended January 31, 2017 2016 2017 2016 2017 2016 (in millions) Service cost—benefits earned during the period $ 5 $ 5 $ 4 $ 4 $ — $ — Interest cost on benefit obligation 5 6 6 8 2 2 Expected return on plan assets (8 ) (9 ) (19 ) (19 ) (3 ) (3 ) Amortization: Net actuarial losses 4 2 9 7 5 5 Prior service credit (2 ) (2 ) — — (4 ) (4 ) Settlement gain — — (68 ) — — — Total periodic benefit cost (benefit) $ 4 $ 2 $ (68 ) $ — $ — $ — |
RESTRUCTURING (Tables)
RESTRUCTURING (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and Related Costs [Table Text Block] | A summary of balances and restructuring activity is shown in the table below: Workforce reduction (in millions) Balance as of October 31, 2016 $ — Income statement expense 2 Cash payments — Balance as of January 31, 2017 $ 2 |
Restructuring And Related Charges By Statement Of Operations Caption [Table Text Block] | A summary of the charges in the consolidated statement of operations resulting from all restructuring plans is shown below: Three Months Ended January 31, 2017 2016 (in millions) Cost of products and services $ 1 $ — Research and development — — Selling, general and administrative 1 — Total restructuring and other related costs $ 2 $ — |
WARRANTY, COMMITMENTS AND CON34
WARRANTY, COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Standard warranty | Activity related to the standard warranty accrual, which is included in other accrued and other long-term liabilities in our condensed consolidated balance sheet, is as follows: Three Months Ended January 31, 2017 2016 (in millions) Beginning balance $ 44 $ 53 Accruals for warranties including change in estimate 7 8 Settlements made during the period (8 ) (8 ) Ending balance $ 43 $ 53 Accruals for warranties due within one year $ 22 $ 34 Accruals for warranties due after one year 21 19 Ending balance $ 43 $ 53 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The following table summarizes the components of our long-term debt: January 31, 2017 October 31, 2016 (in millions) 3.30% Senior Notes due 2019 $ 497 $ 497 4.55% Senior Notes due 2024 596 596 Total $ 1,093 $ 1,093 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in accumulated other comprehensive loss by component and related tax effects for the three months ended January 31, 2017 and 2016 were as follows: Unrealized gain on equity securities Foreign currency translation Net defined benefit pension cost and post retirement plan costs Unrealized gains (losses) on derivatives Total Actuarial losses Prior service credits (in millions) As of October 31, 2016 $ 10 $ (29 ) $ (646 ) $ 50 $ (3 ) $ (618 ) Other comprehensive income (loss) before reclassifications 5 (24 ) 24 — 3 8 Amounts reclassified out of accumulated other comprehensive loss — — 17 (6 ) 1 12 Tax (expense) benefit (1 ) — (13 ) 2 (1 ) (13 ) Other comprehensive income (loss) 4 (24 ) 28 (4 ) 3 7 As of January 31, 2017 $ 14 $ (53 ) $ (618 ) $ 46 $ — $ (611 ) As of October 31, 2015 $ 21 $ (48 ) $ (511 ) $ 65 $ (6 ) $ (479 ) Other comprehensive income (loss) before reclassifications (7 ) (25 ) 4 — 2 (26 ) Amounts reclassified out of accumulated other comprehensive loss — — 14 (6 ) 4 12 Tax (expense) benefit 1 — (6 ) 3 (2 ) (4 ) Other comprehensive income (loss) (6 ) (25 ) 12 (3 ) 4 (18 ) As of January 31, 2016 $ 15 $ (73 ) $ (499 ) $ 62 $ (2 ) $ (497 ) |
Reclassification out of Accumulated Other Comprehensive Income | Reclassifications out of accumulated other comprehensive loss for the three months ended January 31, 2017 and 2016 were as follows: Details about Accumulated Other Comprehensive Loss Components Amounts Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in Statement of Operations Three Months Ended January 31, 2017 2016 (in millions) Unrealized gain (loss) on derivatives $ (1 ) $ (4 ) Cost of sales — 1 Provision for income taxes (1 ) (3 ) Net of income tax Net defined benefit pension cost and post retirement plan costs: Actuarial net loss (17 ) (14 ) Prior service credits 6 6 (11 ) (8 ) Total before income tax 3 3 Provision for income taxes (8 ) (5 ) Net of income tax Total reclassifications for the period $ (9 ) $ (8 ) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Jan. 31, 2017 | |
Segment Reporting Information [Line Items] | |
Reconciliation of segment results to total enterprise results | The following table reconciles reportable segments’ income from operations to our total enterprise income before taxes: Three Months Ended January 31, 2017 2016 (in millions) Total reportable segments' income from operations $ 128 $ 129 Share-based compensation expense (18 ) (16 ) Restructuring and related costs (2 ) — Amortization of intangibles (10 ) (11 ) Acquisition and integration costs (6 ) (2 ) Separation and related costs (6 ) (5 ) Acquisition-related fair value adjustments — (5 ) Japan pension settlement gain 68 — Other 8 8 Income from operations, as reported 162 98 Interest income 1 1 Interest expense (12 ) (12 ) Other income (expense), net 1 (3 ) Income before taxes, as reported $ 152 $ 84 |
Segment Assets | Communications Solutions Group Electronic Industrial Solutions Group Services Solutions Group Total Segments (in millions) Three Months Ended January 31, 2017: Total segment revenue $ 434 $ 192 $ 100 $ 726 Acquisition-related fair value adjustments — — — — Total net revenue $ 434 $ 192 $ 100 $ 726 Segment income from operations $ 72 $ 42 $ 14 $ 128 Three Months Ended January 31, 2016: Total segment revenue $ 440 $ 191 $ 95 $ 726 Acquisition-related fair value adjustments (5 ) — — (5 ) Total net revenue $ 435 $ 191 $ 95 $ 721 Segment income from operations $ 78 $ 38 $ 13 $ 129 |
OVERVIEW, BASIS OF PRESENTATI38
OVERVIEW, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Land Sale (Details) £ in Millions, $ in Millions | 3 Months Ended | ||
Jan. 31, 2017USD ($) | Jan. 31, 2016USD ($) | Apr. 30, 2014GBP (£) | |
Property, Plant and Equipment [Line Items] | |||
Document Period End Date | Jan. 31, 2017 | ||
Date of Land Sale Agreeement | Apr. 30, 2014 | ||
Binding contract to sell land | £ | £ 21 | ||
Gain (Loss) on Disposition of Property Plant Equipment | $ | $ 8 | $ 10 |
OVERVIEW, BASIS OF PRESENTATI39
OVERVIEW, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Restricted Cash (Details) $ in Millions | Jan. 31, 2017USD ($) |
Restricted Cash and Cash Equivalents Items [Line Items] | |
Restricted Cash and Cash Equivalents | $ 2 |
Restricted Cash and Cash Equivalents, Current | 1 |
Restricted Cash and Cash Equivalents, Noncurrent | $ 1 |
NEW ACCOUNTING PRONOUNCEMENTS A
NEW ACCOUNTING PRONOUNCEMENTS ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs (Details) | Oct. 31, 2016USD ($) |
Long-term Debt [Member] | |
New Accounting Pronouncement, Early Adoption [Line Items] | |
Debt Instrument, Unamortized Debt Issuance Costs, Net | $ 7,000,000 |
Other Assets [Member] | |
New Accounting Pronouncement, Early Adoption [Line Items] | |
Debt Instrument, Unamortized Debt Issuance Costs, Net | $ (7,000,000) |
NEW ACCOUNTING PRONOUNCEMENTS41
NEW ACCOUNTING PRONOUNCEMENTS ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory (Details) | Nov. 01, 2016USD ($) |
New Accounting Pronouncement, Early Adoption [Line Items] | |
Increase (Decrease) in Other Current Assets | $ (2,000,000) |
Increase (Decrease) in Other Noncurrent Assets | (6,000,000) |
Increase (Decrease) in Deferred Tax Asset, Non-Current | (2,000,000) |
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets | $ 10,000,000 |
SHARE-BASED COMPENSATION Alloca
SHARE-BASED COMPENSATION Allocated Share-based compensation expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based Compensation Capitalized within inventory | $ 1 | $ 1 |
Income tax benefit realized from exercised stock options and similar awards | 2 | 1 |
Allocated Share-based Compensation Expense | 18 | 16 |
Cost of products and services | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Allocated Share-based Compensation Expense | 3 | 3 |
Research and development | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Allocated Share-based Compensation Expense | 4 | 3 |
Selling, general and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Allocated Share-based Compensation Expense | $ 11 | $ 10 |
SHARE-BASED COMPENSATION Fair V
SHARE-BASED COMPENSATION Fair Value Assumptions (Details) - shares shares in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | The fair value of employee stock option awards granted before October 31, 2015 was estimated using the Black-Scholes option pricing model. | |
LTPP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | Shares granted under the LTP Program were valued using a Monte Carlo simulation model. In the first quarter of fiscal 2017, the company began awarding an additional type of performance award based on operating margin performance. These awards were valued based on the market price of Keysight’s common stock on the date of grant. | |
Volatility of Keysight shares (in hundredths) | 27.00% | 25.00% |
Volatility of selected index (2017)/peer-company shares(2016) minimum (in hundredths) | 15.00% | 14.00% |
Volatility of selected index (2017)/peer-company shares (2016) maximum (in hundredths) | 15.00% | 54.00% |
Price-wise correlation with selected peers (in hundredths) | 57.00% | 38.00% |
Restricted Stock Units (RSUs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | The estimated fair value of restricted stock awards is determined based on the market price of Keysight’s common stock on the date of grant. |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Income Tax Examination [Line Items] | ||
Income Tax Expense (Benefit) | $ 43 | $ 20 |
Increase in tax resulting from transfer of a portion of Japanese employees pension fund | 22 | |
Income Tax Holiday, Aggregate Dollar Amount | $ 11 | $ 8 |
Income Tax Holiday, Income Tax Benefits Per Share | $ 0.07 | $ 0.05 |
Majority of company's entities [Member] | ||
Income Tax Examination [Line Items] | ||
Open Tax Year | 2,014 | |
Certain foreign entities [Member] | ||
Income Tax Examination [Line Items] | ||
Open Tax Year | 2,006 | |
Internal Revenue Service (IRS) [Member] | ||
Income Tax Examination [Line Items] | ||
Effective Income Tax Rate, Percent | 28.30% | 23.70% |
Income Tax Expense (Benefit) | $ 43 | $ 20 |
Net Discrete Tax expense (Benefit) | $ 23 | $ 1 |
Foreign Tax Authority [Member] | ||
Income Tax Examination [Line Items] | ||
Income Tax Holiday, Description | Keysight benefits from tax incentives in several jurisdictions, most significantly in Singapore, and several jurisdictions have granted us tax incentives that require renewal at various times in the future. The tax incentives provide lower rates of taxation on certain classes of income and require thresholds of investments and employment or specific types of income in those jurisdictions. | |
Income Tax Holiday, Termination Date | The Singapore tax incentive is due for renewal in fiscal 2024. |
NET INCOME PER SHARE NET INCOME
NET INCOME PER SHARE NET INCOME PER SHARE - COMPUTATIONS (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Numerator: | ||
Net Income | $ 109 | $ 64 |
Denominators: | ||
Basic weighted-average shares (in shares) | 171 | 171 |
Potentially dilutive common shares equivalents - stock options and other employee stock plans (in shares) | 2 | 1 |
Diluted weighted average shares (in shares) | 173 | 172 |
NET INCOME PER SHARE (Details)
NET INCOME PER SHARE (Details) - shares | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Stock Options [Member] | ||
Antidilutive Securities Excluded from EPS Computation | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Number | 0 | 1,700,000 |
Stock Options, ESPP, LTPP and restricted stock combined exercise price, unamortized fair value, excess tax benefits or shortfalls greater than average market price [Member] [Member] | ||
Antidilutive Securities Excluded from EPS Computation | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Number | 424,400 | 16,100 |
SUPPLEMENT CASH FLOW INFORMAT47
SUPPLEMENT CASH FLOW INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Other Significant Noncash Transactions [Line Items] | ||
Capital Expenditures Incurred but Not yet Paid | $ (5) | $ (9) |
SUPPLEMENT CASH FLOW INFORMAT48
SUPPLEMENT CASH FLOW INFORMATION Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Income Taxes Paid, Net [Abstract] | ||
Income Taxes Paid, Net | $ 17 | $ 8 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Millions | Jan. 31, 2017 | Oct. 31, 2016 |
Inventory, Net [Abstract] | ||
Finished goods | $ 218 | $ 218 |
Purchased parts and fabricated assemblies | 261 | 256 |
Inventory | $ 479 | $ 474 |
GOODWILL AND OTHER INTANGIBLE50
GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Roll forward (Details) $ in Millions | 3 Months Ended |
Jan. 31, 2017USD ($) | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | $ 736 |
Foreign currency translation impact | (15) |
Goodwill ending balance | 721 |
Communications Solutions Group [Member] | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | 456 |
Foreign currency translation impact | (15) |
Goodwill ending balance | 441 |
Electronic Industrial Solutions Group [Member] | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | 216 |
Foreign currency translation impact | 0 |
Goodwill ending balance | 216 |
Services Solutions Group [Member] | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | 64 |
Foreign currency translation impact | 0 |
Goodwill ending balance | $ 64 |
GOODWILL AND OTHER INTANGIBLE51
GOODWILL AND OTHER INTANGIBLE ASSETS Disclosures and Components of Purchased Other Intangibles (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Oct. 31, 2016 | |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-Lived Intangible Assets, Gross | $ 403 | $ 398 |
Finite-Lived Intangible Assets, Accumulated Amortization | 213 | 202 |
Finite-Lived Intangible Assets, Net | 190 | 196 |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 7 | 12 |
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | 0 | 0 |
Intangible Assets, Gross (Excluding Goodwill) | 410 | 410 |
Intangible Assets, Net (Excluding Goodwill) | 197 | 208 |
Developed technology | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-Lived Intangible Assets, Gross | 314 | 309 |
Finite-Lived Intangible Assets, Accumulated Amortization | 167 | 159 |
Intangible Assets, Net (Excluding Goodwill) | 147 | 150 |
Backlog | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-Lived Intangible Assets, Gross | 4 | 4 |
Finite-Lived Intangible Assets, Accumulated Amortization | 4 | 4 |
Intangible Assets, Net (Excluding Goodwill) | 0 | 0 |
Trademark/Tradename | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-Lived Intangible Assets, Gross | 20 | 20 |
Finite-Lived Intangible Assets, Accumulated Amortization | 4 | 4 |
Intangible Assets, Net (Excluding Goodwill) | 16 | 16 |
Customer relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-Lived Intangible Assets, Gross | 65 | 65 |
Finite-Lived Intangible Assets, Accumulated Amortization | 38 | 35 |
Intangible Assets, Net (Excluding Goodwill) | $ 27 | $ 30 |
GOODWILL AND OTHER INTANGIBLE52
GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL AND OTHER INTANGIBLE ASSETS Textuals (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill arising from acquisitions and other adjustments | $ 0 | |
Additions to other intangible assets | 0 | |
Impact to other intangibles due to Translation | 0 | |
Finite-Lived Intangible Assets, Period Increase (Decrease) | 5 | |
Amortization of intangible assets | $ 11 | $ 12 |
GOODWILL AND OTHER INTANGIBLE53
GOODWILL AND OTHER INTANGIBLE ASSETS Finite-Lived Assets Future Amortization Expense (Details) $ in Millions | Jan. 31, 2017USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
Finite-Lived Intangible Assets, Amortization Expense, Remainder of 2017 | $ 31 |
Finite-Lived Intangible Assets, Amortization Expense, 2018 | 39 |
Finite-Lived Intangible Assets, Amortization Expense, 2019 | 38 |
Finite-Lived Intangible Assets, Amortization Expense, 2020 | 38 |
Finite-Lived Intangible Assets, Amortization Expense, 2021 | 30 |
Finite-Lived Intangible Assets, Amortization Expense, 2022 and thereafter | $ 14 |
FAIR VALUE MEASUREMENTS, Fair v
FAIR VALUE MEASUREMENTS, Fair value of assets and liabilities measured on a recurring basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions | Jan. 31, 2017 | Oct. 31, 2016 |
Assets Short - term [Abstract] | ||
Cash equivalents (money market funds) | $ 572 | $ 471 |
Derivative instruments (foreign exchange contracts) | 7 | 4 |
Assets, Long-term [Abstract] | ||
Trading securities | 11 | 11 |
Available-for-sale investments | 34 | 29 |
Total assets measured at fair value | 624 | 515 |
Liabilities, Short-term [Abstract] | ||
Derivative instruments (foreign exchange contracts) | 6 | 8 |
Liabilities Long-term [Abstract] | ||
Deferred compensation liability | 11 | 11 |
Total liabilities measured at fair value | 17 | 19 |
Level 1 | ||
Assets Short - term [Abstract] | ||
Cash equivalents (money market funds) | 572 | 471 |
Derivative instruments (foreign exchange contracts) | 0 | 0 |
Assets, Long-term [Abstract] | ||
Trading securities | 11 | 11 |
Available-for-sale investments | 34 | 29 |
Total assets measured at fair value | 617 | 511 |
Liabilities, Short-term [Abstract] | ||
Derivative instruments (foreign exchange contracts) | 0 | 0 |
Liabilities Long-term [Abstract] | ||
Deferred compensation liability | 0 | 0 |
Total liabilities measured at fair value | 0 | 0 |
Level 2 | ||
Assets Short - term [Abstract] | ||
Cash equivalents (money market funds) | 0 | 0 |
Derivative instruments (foreign exchange contracts) | 7 | 4 |
Assets, Long-term [Abstract] | ||
Trading securities | 0 | 0 |
Available-for-sale investments | 0 | 0 |
Total assets measured at fair value | 7 | 4 |
Liabilities, Short-term [Abstract] | ||
Derivative instruments (foreign exchange contracts) | 6 | 8 |
Liabilities Long-term [Abstract] | ||
Deferred compensation liability | 11 | 11 |
Total liabilities measured at fair value | 17 | 19 |
Level 3 | ||
Assets Short - term [Abstract] | ||
Cash equivalents (money market funds) | 0 | 0 |
Derivative instruments (foreign exchange contracts) | 0 | 0 |
Assets, Long-term [Abstract] | ||
Trading securities | 0 | 0 |
Available-for-sale investments | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Liabilities, Short-term [Abstract] | ||
Derivative instruments (foreign exchange contracts) | 0 | 0 |
Liabilities Long-term [Abstract] | ||
Deferred compensation liability | 0 | 0 |
Total liabilities measured at fair value | $ 0 | $ 0 |
DERIVATIVES, Disclosures and de
DERIVATIVES, Disclosures and derivative instrument aggregated notional amounts by currency and designations (Details) $ in Millions | 3 Months Ended |
Jan. 31, 2017USD ($)contracts | |
Derivative [Line Items] | |
Cash Flow Hedge Ineffectiveness is Immaterial | not significant |
Derivative, Net Liability Position, Aggregate Fair Value | $ 4 |
Cash Flow Hedging | |
Derivative [Line Items] | |
Number of Foreign Currency Derivatives Held | contracts | 137 |
Not Designated as Hedging Instrument [Member] | |
Derivative [Line Items] | |
Number of Foreign Currency Derivatives Held | contracts | 60 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Sell | Japanese Yen | |
Derivative [Line Items] | |
Total notional amount | $ 41 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | |
Derivative [Line Items] | |
Total notional amount | 39 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | Euro | |
Derivative [Line Items] | |
Total notional amount | 62 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | British Pound | |
Derivative [Line Items] | |
Total notional amount | 10 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | Singapore Dollar | |
Derivative [Line Items] | |
Total notional amount | 1 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | Malaysian Ringgit | |
Derivative [Line Items] | |
Total notional amount | 1 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | Other Currency [Member] | |
Derivative [Line Items] | |
Total notional amount | 6 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Sell | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 17 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Sell | Japanese Yen | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 82 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Sell | Other Currency [Member] | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 15 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Buy | Euro | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 0 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Buy | British Pound | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 0 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Buy | Singapore Dollar | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 10 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Buy | Malaysian Ringgit | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | $ 70 |
DERIVATIVES, Fair value of deri
DERIVATIVES, Fair value of derivative instruments and Consolidated Balance Sheet location (Details) - USD ($) $ in Millions | Jan. 31, 2017 | Oct. 31, 2016 |
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Asset | $ 7 | $ 4 |
Total derivatives Liabilities | 6 | 8 |
Designated as Hedging Instruments | Cash Flow Hedging | Foreign Exchange Contracts | Other Current Assets | ||
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Asset | 5 | 2 |
Designated as Hedging Instruments | Cash Flow Hedging | Foreign Exchange Contracts | Other Current Liabilities [Member] | ||
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Liabilities | 4 | 4 |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contracts | Other Current Assets | ||
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Asset | 2 | 2 |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contracts | Other Current Liabilities [Member] | ||
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Liabilities | $ 2 | $ 4 |
DERIVATIVES, Effect of derivati
DERIVATIVES, Effect of derivative instruments on Consolidated Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Derivative [Line Items] | ||
Cash Flow Hedge (Gain) Loss to be Reclassified within Twelve Months | $ 0 | |
Designated as Hedging Instruments | Cash Flow Hedging | Foreign Exchange Contracts | Accumulated Other Comprehensive Income (Loss) | ||
Derivative [Line Items] | ||
Gain (loss) recognized in accumulated other comprehensive income | 3 | $ 2 |
Designated as Hedging Instruments | Cash Flow Hedging | Foreign Exchange Contracts | Cost of products and services | ||
Derivative [Line Items] | ||
Gain (loss) reclassified from accumulated other comprehensive income into cost of sales | (1) | (4) |
Not Designated as Hedging Instrument [Member] | Other (income) expense, net | ||
Derivative [Line Items] | ||
Gain (loss) recognized in other income (expense),net | $ 2 | $ (2) |
RETIREMENT PLANS AND POST RET58
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
U.S. Defined Benefit Plans | ||
Defined Benefit Plan, Net Periodic Benefit Cost | ||
Service cost—benefits earned during the period | $ 5 | $ 5 |
Interest cost on benefit obligation | 5 | 6 |
Expected return on plan assets | (8) | (9) |
Amortization: | ||
Net actuarial losses | 4 | 2 |
Prior service credit | (2) | (2) |
Settlement gain | 0 | 0 |
Total periodic benefit cost (benefit) | 4 | 2 |
Non-U.S. Defined Benefit Plans | ||
Defined Benefit Plan, Net Periodic Benefit Cost | ||
Service cost—benefits earned during the period | 4 | 4 |
Interest cost on benefit obligation | 6 | 8 |
Expected return on plan assets | (19) | (19) |
Amortization: | ||
Net actuarial losses | 9 | 7 |
Prior service credit | 0 | 0 |
Settlement gain | (68) | 0 |
Total periodic benefit cost (benefit) | (68) | 0 |
U.S. Post-Retirement Benefit Plan | ||
Defined Benefit Plan, Net Periodic Benefit Cost | ||
Service cost—benefits earned during the period | 0 | 0 |
Interest cost on benefit obligation | 2 | 2 |
Expected return on plan assets | (3) | (3) |
Amortization: | ||
Net actuarial losses | 5 | 5 |
Prior service credit | (4) | (4) |
Settlement gain | 0 | 0 |
Total periodic benefit cost (benefit) | $ 0 | $ 0 |
RETIREMENT PLANS AND POST RET59
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS (Details) (Textual) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Document Period End Date | Jan. 31, 2017 | |
U.S. Defined Benefit Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | $ 0 | $ 0 |
Estimated future employer contributions in remainder of current fiscal year | 0 | |
Non-U.S. Defined Benefit Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | 7 | $ 10 |
Estimated future employer contributions in remainder of current fiscal year | $ 25 |
RETIREMENT PLANS AND POST RET60
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS JAPAN PENSION FUND SETTLEMENT (Details) $ in Millions | Dec. 15, 2016USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
Decrease in Pension Plan Obligations due to transfer of substitutional portion to Japanese government | $ (142) |
Assets (substitutional portion) Transferred to Japanese government | (51) |
Increase in funded status | 91 |
Japanese Welfare Pension Insurance Law, Previously Accrued Salary Progression Derecognition | 4 |
Other Operating Income (Expense) [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Settlement gain | $ 68 |
RESTRUCTURING (Details)
RESTRUCTURING (Details) $ in Millions | 3 Months Ended | ||
Jan. 31, 2017USD ($) | Jan. 31, 2016USD ($) | Oct. 31, 2016USD ($) | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and Related Activities, Description | We initiated a targeted workforce reduction program in November 2016 that is expected to reduce Keysight's total headcount by between 60 to 200 employees. The timing and scope of workforce reductions will vary based on local legal requirements. This targeted workforce management program was designed to support our site consolidation strategy, align with our new industry segment structure and improve efficiency. | ||
Restructuring and Related Cost Expected Number of Positions Eliminated Minimum | 60 | ||
Restructuring And Related Cost Expected Number Of Positions Eliminated Maximum | 200 | ||
Restructuring and Related Cost, Number of Positions Eliminated | 20 | ||
Restructuring Reserve | $ 2 | $ 0 | |
Payments for Restructuring | 0 | ||
Restructuring Charges | 2 | $ 0 | |
Cost of products and services | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges | 1 | 0 | |
Research and development | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges | 0 | 0 | |
Selling, general and administrative | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges | $ 1 | $ 0 | |
WORKFORCE REDUCTION [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and Related Activities, Initiation Date | Nov. 30, 2016 | ||
Other accrued liabilities [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Reserve | $ 2 |
WARRANTIES AND CONTINGENCIES (D
WARRANTIES AND CONTINGENCIES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning balance at beginning of period | $ 44 | $ 53 |
Accruals for warranties including change in estimate | 7 | 8 |
Settlements made during the period | (8) | (8) |
Ending balance at end of period | 43 | 53 |
Standard Product Warranty Disclosure [Abstract] | ||
Accruals for warranties due within one year | 22 | 34 |
Accruals for warranties due after one year | 21 | 19 |
Ending balance at end of period | $ 43 | $ 53 |
DEBT Facility (Details)
DEBT Facility (Details) - USD ($) | Feb. 15, 2017 | Jan. 31, 2017 |
Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Facility, Maximum Borrowing Capacity | $ 450,000,000 | |
Additional drawings on credit facility | 150,000,000 | |
Facility, Outstanding | $ 0 | |
Facility, Covenant Compliance | We were in compliance with the covenants of the Revolving Credit Facility during the three months ended January 31, 2017. | |
Bridge Loan [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt Instrument, Term | 364 days | |
Facility, Initiation Date | Jan. 30, 2017 | |
Facility, Maximum Borrowing Capacity | $ 1,684,000,000 | |
Debt Issuance Costs, Gross, Current | $ 8,000,000 | |
Subsequent Event [Member] | Bridge Loan [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Increase (Decrease), Other, Net | $ (400,000,000) | |
Subsequent Event [Member] | Revolving Credit Facility - 2 [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt Instrument, Term | 5 years | |
Facility, Description | The Revolving Credit Facility replaced our existing $450 million unsecured credit facility, dated as of September 15, 2014. The company may use amounts borrowed under the facility for general corporate purposes, including to finance, in part, the acquisition of Ixia, the payment of fees and expenses related thereto and the repayment in full of all third-party indebtedness of Ixia and its subsidiaries that becomes due or otherwise defaults upon the consummation of the Ixia acquisition. | |
Facility, Initiation Date | Feb. 15, 2017 | |
Facility, Maximum Borrowing Capacity | $ 450,000,000 | |
Facility, Expiration Date | Feb. 15, 2022 |
DEBT Long Term Debt (Details)
DEBT Long Term Debt (Details) - USD ($) $ in Millions | Feb. 15, 2017 | Jan. 31, 2017 | Oct. 31, 2016 |
Debt Instrument [Line Items] | |||
Long-term Debt, Excluding Current Maturities | $ 1,093 | $ 1,093 | |
Letters of Credit Outstanding, Amount | 19 | 18 | |
Long Term Debt Fair Value above carrying Value | 12 | 30 | |
3.30% Senior Notes due 2019 | |||
Debt Instrument [Line Items] | |||
Long-term Debt, Excluding Current Maturities | 497 | 497 | |
4.55% Senior Notes due 2024 | |||
Debt Instrument [Line Items] | |||
Long-term Debt, Excluding Current Maturities | $ 596 | $ 596 | |
Subsequent Event [Member] | Long-term Debt [Member] | |||
Debt Instrument [Line Items] | |||
Line of Credit Facility, Initiation Date | Feb. 15, 2017 | ||
Debt Instrument, Term | 3 years | ||
Long-term Line of Credit | $ 400 | ||
Line of Credit Facility, Description | The term loans will be available to us upon the closing of the Ixia acquisition. The term loan is intended to be used to finance, in part, the Ixia acquisition, the payment of fees and expenses related thereto and the repayment in full of all third-party indebtedness of Ixia and its subsidiaries that becomes due or otherwise defaults upon the consummation of the Ixia acquisition. The commitments under the term credit agreement automatically terminate on the first to occur of (a) the consummation of the Ixia acquisition without the borrowing of any loans under the term credit agreement, (b) the termination of the Merger Agreement to acquire Ixia in accordance with its terms or (c) on October 30, 2017. |
STOCKHOLDER'S EQUITY - Accumula
STOCKHOLDER'S EQUITY - Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ (618) | $ (479) |
OCI, before Reclassifications, before Tax, Attributable to Parent | 8 | (26) |
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 12 | 12 |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | (13) | (4) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 7 | (18) |
Ending balance | (611) | (497) |
Unrealized gain on equity securities [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 10 | 21 |
OCI, before Reclassifications, before Tax, Attributable to Parent | 5 | (7) |
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 0 | 0 |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | (1) | 1 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 4 | (6) |
Ending balance | 14 | 15 |
Foreign currency translation [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (29) | (48) |
OCI, before Reclassifications, before Tax, Attributable to Parent | (24) | (25) |
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 0 | 0 |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | 0 | 0 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (24) | (25) |
Ending balance | (53) | (73) |
Net defined benefit pension cost and post retirement plan costs, actuarial losses [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (646) | (511) |
OCI, before Reclassifications, before Tax, Attributable to Parent | 24 | 4 |
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 17 | 14 |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | (13) | (6) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 28 | 12 |
Ending balance | (618) | (499) |
Net defined benefit pension cost and post retirement plan costs, prior service credits [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 50 | 65 |
OCI, before Reclassifications, before Tax, Attributable to Parent | 0 | 0 |
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | (6) | (6) |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | 2 | 3 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (4) | (3) |
Ending balance | 46 | 62 |
Unrealized gain (losses) on derivatives [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (3) | (6) |
OCI, before Reclassifications, before Tax, Attributable to Parent | 3 | 2 |
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 1 | 4 |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | (1) | (2) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 3 | 4 |
Ending balance | $ 0 | $ (2) |
STOCKHOLDERS' EQUITY - Reclassi
STOCKHOLDERS' EQUITY - Reclassifications out of accumulated comprehensive income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of Goods Sold | $ 255 | $ 260 |
Income Tax Expense (Benefit) | (43) | (20) |
Net Income | 109 | 64 |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | 152 | 84 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Net Income | (9) | (8) |
Unrealized gain (losses) on derivatives [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of Goods Sold | (1) | (4) |
Income Tax Expense (Benefit) | 0 | 1 |
Net Income | (1) | (3) |
Net defined benefit pension cost and post retirement plan costs, actuarial losses [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | (17) | (14) |
Net defined benefit pension cost and post retirement plan costs, prior service credits [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | 6 | 6 |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Income Tax Expense (Benefit) | 3 | 3 |
Net Income | (8) | (5) |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | $ (11) | $ (8) |
STOCKHOLDERS' EQUITY Stock Repu
STOCKHOLDERS' EQUITY Stock Repurchase (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Feb. 18, 2016 | |
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | ||
Stock Repurchased During Period, Shares | 0 | |
Stock Repurchase Program, Authorized Amount | $ 200 |
SEGMENT INFORMATION Profitabili
SEGMENT INFORMATION Profitability (Details) $ in Millions | 3 Months Ended | |
Jan. 31, 2017USD ($) | Jan. 31, 2016USD ($) | |
Segment Reporting Information [Line Items] | ||
Segment Reporting, Factors Used to Identify Entity's Reportable Segments | Our three operating segments were determined based primarily on how the chief operating decision maker views and evaluates our operations. Segment operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to each segment and to assess performance. Other factors, including market separation and customer specific applications, go-to-market channels, products and services and manufacturing are considered in determining the formation of these operating segments. | |
Segment Reporting, Additional Information about Entity's Reportable Segments | Descriptions of our three reportable segments are as follows: The Communications Solutions Group serves customers spanning the worldwide commercial communications end market, which includes internet infrastructure, and the aerospace, defense and government end market. The group provides electronic design and test software, instruments, and systems used in the simulation, design, validation, manufacturing, installation and optimization of electronic equipment. The Electronic Industrial Solutions Group provides test and measurement solutions across a broad set of industries within the electronic industrial end market, focusing on high-growth applications in the automotive and energy industry and measurement solutions for semiconductor design and manufacturing, consumer electronics, education and general electronics manufacturing. The group provides electronic design and test software, instruments, and systems used in the simulation, design, validation, manufacturing, installation and optimization of electronic equipment. The Services Solutions Group provides repair, calibration and consulting services, and remarkets used Keysight equipment. In addition to providing repair and calibration support for Keysight equipment, we also calibrate non-Keysight equipment. The group serves the same markets as Keysight’s Communications Solutions and Electronic Industrial Solutions Groups, providing industry-specific services to deliver complete Keysight solutions and help customers reduce their total cost of ownership for their design and test equipment. | |
Number of Operating Segments | 3 | |
Number of Reportable Segments | 3 | |
Revenues | $ 726 | $ 726 |
Business Combination Acquisition Related Fair Value Adjustments | 0 | (5) |
Total net revenue | 726 | 721 |
Segment income from operations | 162 | 98 |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 128 | 129 |
Communications Solutions Group [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 434 | 440 |
Business Combination Acquisition Related Fair Value Adjustments | 0 | (5) |
Total net revenue | 434 | 435 |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 72 | 78 |
Electronic Industrial Solutions Group [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 192 | 191 |
Business Combination Acquisition Related Fair Value Adjustments | 0 | 0 |
Total net revenue | 192 | 191 |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 42 | 38 |
Services Solutions Group [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 100 | 95 |
Business Combination Acquisition Related Fair Value Adjustments | 0 | 0 |
Total net revenue | 100 | 95 |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | $ 14 | $ 13 |
SEGMENT INFORMATION Reconciliat
SEGMENT INFORMATION Reconciliation of Reportable Results (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||
Total reportable segments' income from operations | $ 128 | $ 129 |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | (18) | (16) |
Restructuring Charges | (2) | 0 |
Business Combination Acquisition Related Fair Value Adjustments | 0 | (5) |
Defined Benefit Plan, Recognized Net Gain (Loss) Due to Settlements | 68 | 0 |
Amortization of Intangibles | (10) | (11) |
Acquisition and integration costs | (6) | (2) |
Separation and related costs | (6) | (5) |
Segment Reporting Other reconciling items for operating profit loss segment to consolidated | 8 | 8 |
Income from operations | 162 | 98 |
Investment Income, Nonoperating | 1 | 1 |
Interest expense | (12) | (12) |
Other Nonoperating Gains (Losses) | 1 | (3) |
Income before taxes, as reported | $ 152 | $ 84 |
SEGMENT INFORMATION Segment Ass
SEGMENT INFORMATION Segment Assets (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2017 | Oct. 31, 2016 | |
Segment Reporting Information [Line Items] | ||
Disclosure on Geographic Areas, Long-Lived Assets | There has been no material change in total assets by segment since October 31, 2016. | |
Assets | $ 3,869 | $ 3,796 |
PENDING ACQUISITION (Details)
PENDING ACQUISITION (Details) - USD ($) $ / shares in Units, $ in Billions | 3 Months Ended | |
Jan. 31, 2017 | Jan. 30, 2017 | |
Pending business acquisition [Abstract] | ||
Payment to acquire business, agreement | $ 1.6 | |
Business Acquisition, Share Price | $ 19.65 |