Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jan. 31, 2019 | Mar. 01, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Keysight Technologies, Inc. | |
Entity Central Index Key | 1,601,046 | |
Current Fiscal Year End Date | --10-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 187,988,723 | |
Document Fiscal Year Focus | 2,019 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jan. 31, 2019 | |
Trading Symbol | KEYS | |
Entity Emerging Growth Company | false | |
Entity Small Business | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Net revenue: | ||
Revenues | $ 1,006 | $ 837 |
Costs and expenses: | ||
Cost of Goods and Services Sold | 428 | 412 |
Research and development | 173 | 150 |
Selling, general and administrative | 288 | 295 |
Other operating expense (income), net | (4) | (3) |
Total costs and expenses | 885 | 854 |
Income (loss) from operations | 121 | (17) |
Interest income | 4 | 3 |
Interest expense | (20) | (22) |
Other income (expense), net | 15 | 13 |
Income (loss) before taxes | 120 | (23) |
Provision (benefit) for income taxes | 6 | (117) |
Net income | $ 114 | $ 94 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.61 | $ 0.50 |
Diluted (in dollars per share) | $ 0.60 | $ 0.50 |
Weighted average shares used in computing net income per share: | ||
Basic (in shares) | 187 | 187 |
Diluted (in shares) | 190 | 189 |
Products | ||
Net revenue: | ||
Revenues | $ 837 | $ 684 |
Costs and expenses: | ||
Cost of Goods and Services Sold | 347 | 339 |
Services and other | ||
Net revenue: | ||
Revenues | 169 | 153 |
Costs and expenses: | ||
Cost of Goods and Services Sold | $ 81 | $ 73 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Other comprehensive income (loss): | ||
Net income | $ 114 | $ 94 |
Unrealized gain (loss) on investments, net of tax benefit of zero | 0 | (2) |
Unrealized gain (loss) on derivative instruments, net of tax benefit (expense) of zero | (2) | 2 |
Amounts reclassified into earnings related to derivative instruments, net of tax benefit (expense) of zero | 1 | (2) |
Foreign currency translation, net of tax benefit (expense) of zero | 30 | 41 |
Net defined benefit pension cost and post retirement plan costs: | ||
Change in actuarial net loss, net of tax expense of $3 | 13 | 10 |
Change in net prior service credit, net of tax benefit of $1 | (3) | (4) |
Other comprehensive income (loss) | 39 | 45 |
Total comprehensive income | $ 153 | $ 139 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Other comprehensive income (loss), tax, parenthetical disclosures [Abstract] | ||
Unrealized gain (loss) on investments, tax | $ 0 | $ 0 |
Unrealized gain (loss) on derivative instruments, tax | 0 | 0 |
Amounts reclassified into earnings related to derivative instruments, tax | 0 | 0 |
Foreign currency translation, tax | 0 | 0 |
Net defined benefit pension cost and post retirement plan costs, tax [Abstract] | ||
Change in actuarial net loss, tax | 3 | 3 |
Change in net prior service credit, tax | $ 1 | $ 1 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) - USD ($) $ in Millions | Jan. 31, 2019 | Oct. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 1,098 | $ 913 |
Accounts receivable, net | 580 | 624 |
Inventory | 641 | 619 |
Other current assets | 225 | 222 |
Total current assets | 2,544 | 2,378 |
Property, plant and equipment, net | 558 | 555 |
Goodwill | 1,181 | 1,171 |
Other intangible assets, net | 594 | 645 |
Long-term investments | 52 | 46 |
Long-term deferred tax assets | 741 | 750 |
Other assets | 308 | 279 |
Total assets | 5,978 | 5,824 |
Current liabilities: | ||
Short-term debt | 499 | 499 |
Accounts payable | 222 | 242 |
Employee compensation and benefits | 210 | 276 |
Deferred revenue | 317 | 334 |
Income and other taxes payable | 56 | 42 |
Other accrued liabilities | 96 | 69 |
Total current liabilities | 1,400 | 1,462 |
Long-term debt | 1,291 | 1,291 |
Retirement and post-retirement benefits | 219 | 224 |
Long-term deferred revenue | 126 | 127 |
Other long-term liabilities | 284 | 287 |
Total liabilities | 3,320 | 3,391 |
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; 193 million shares at January 31, 2019 and 191 million shares at October 31, 2018 issued | 2 | 2 |
Treasury stock at cost; 5.1 million shares at January 31, 2019 and 4.4 million shares at October 31, 2018 | (222) | (182) |
Additional paid-in-capital | 1,925 | 1,889 |
Retained earnings | 1,402 | 1,212 |
Accumulated other comprehensive loss | (449) | (488) |
Total stockholder's equity | 2,658 | 2,433 |
Total liabilities and equity | $ 5,978 | $ 5,824 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) (Parenthetical) - $ / shares shares in Millions | Jan. 31, 2019 | Oct. 31, 2018 |
Stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100 | 100 |
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 | 1,000 |
Common Stock, Shares, Issued | 193 | 191 |
Treasury Stock, Shares | 5.1 | 4.4 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Cash flows from operating activities: | ||
Net Income | $ 114 | $ 94 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 24 | 26 |
Amortization | 52 | 52 |
Share-based compensation | 27 | 19 |
Deferred tax benefit | (12) | (235) |
Excess and obsolete inventory-related charges | 7 | 6 |
Gain on divestiture | (1) | 0 |
Pension curtailment and settlement loss | 2 | 0 |
Unrealized Gain (Loss) on Investments | (5) | 0 |
Other non-cash expenses, net | 0 | 2 |
Changes in assets and liabilities: | ||
Accounts receivable | 56 | 99 |
Inventory | (26) | (20) |
Accounts payable | (10) | 14 |
Employee compensation and benefits | (68) | (50) |
Retirement and post-retirement benefits | (12) | (12) |
Deferred Revenue | 43 | 61 |
Income taxes payable | 10 | 115 |
Other assets and liabilities | 39 | 0 |
Net cash provided by operating activities | 240 | 171 |
Cash flows from investing activities: | ||
Investments in property, plant and equipment | (31) | (24) |
Proceeds from divestiture | 2 | 0 |
Net cash used in investing activities | (29) | (24) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock under employee stock plans | 30 | 24 |
Payment of taxes related to net share settlement of equity awards | (23) | (15) |
Payment of acquisition-related contingent consideration | 0 | (3) |
Proceeds from revolving credit facility | 0 | 40 |
Repayment of revolving credit facility | 0 | (40) |
Treasury stock repurchases | (40) | 0 |
Net Cash provided (used) by financing activities | (33) | 6 |
Effect of exchange rate movements | 7 | 9 |
Net increase in cash, cash equivalents, and restricted cash | 185 | 162 |
Cash, cash equivalents, and restricted cash at beginning of period | 917 | 820 |
Cash, cash equivalents, and restricted cash at end of period | $ 1,102 | $ 982 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENT OF EQUITY Statement - USD ($) shares in Thousands, $ in Millions | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | AOCI Including Portion Attributable to Noncontrolling Interest [Member] |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 6 | $ 6 | ||||
Common Stock, Shares, Outstanding at Oct. 31, 2017 | 188,310 | |||||
Common Stock, Shares, Outstanding at Jan. 31, 2018 | 189,800 | |||||
Treasury Stock, Shares at Oct. 31, 2017 | (2,289) | |||||
Treasury Stock, Shares at Jan. 31, 2018 | (2,289) | |||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest at Oct. 31, 2017 | 2,310 | $ 2 | $ 1,786 | $ (62) | 1,041 | $ (457) |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest at Jan. 31, 2018 | 2,484 | $ 2 | 1,815 | $ (62) | 1,141 | (412) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 1,490 | |||||
Adjustments to Additional Paid in Capital, Fair Value | 9 | 9 | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | 20 | 20 | ||||
Net Income | 94 | 94 | ||||
Other Comprehensive Income (Loss), Net of Tax | $ 45 | 45 | ||||
Treasury Stock, Shares, Acquired | 0 | 0 | ||||
Treasury Stock, Value, Acquired, Cost Method | $ 0 | $ 0 | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 76 | 76 | ||||
Common Stock, Shares, Outstanding at Oct. 31, 2018 | 191,204 | |||||
Common Stock, Shares, Outstanding at Jan. 31, 2019 | 192,801 | |||||
Treasury Stock, Shares at Oct. 31, 2018 | 4,400 | (4,364) | ||||
Treasury Stock, Shares at Jan. 31, 2019 | 5,100 | (5,050) | ||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest at Oct. 31, 2018 | $ 2,433 | $ 2 | 1,889 | $ (182) | 1,212 | (488) |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest at Jan. 31, 2019 | 2,658 | $ 2 | 1,925 | $ (222) | 1,402 | (449) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 1,597 | |||||
Adjustments to Additional Paid in Capital, Fair Value | 8 | 8 | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | 28 | $ 28 | ||||
Net Income | 114 | $ 114 | ||||
Other Comprehensive Income (Loss), Net of Tax | $ 39 | $ 39 | ||||
Treasury Stock, Shares, Acquired | (686,398,000) | (686) | ||||
Treasury Stock, Value, Acquired, Cost Method | $ (40) | $ (40) |
OVERVIEW, BASIS OF PRESENTATION
OVERVIEW, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Jan. 31, 2019 | |
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 technology company providing electronic design and test solutions that are used in the design, development, manufacture, installation, deployment, validation, optimization and secure operation of electronics systems to communications, networking and electronics industries. We also offer customization, consulting and optimization services throughout the customer's product lifecycle, including start-up assistance, instrument productivity, application services and instrument calibration and repair. 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 financial position as of January 31, 2019 and October 31, 2018 , our results of operations and cash flows for the three months ended January 31, 2019 and 2018 . 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, loss contingencies, restructuring, and accounting for income taxes. Update to Significant Accounting Policies. Except as set forth in Note 2, "New Accounting Pronouncements," there have been no material changes to our significant accounting policies as described in our Annual Report on Form 10-K for the fiscal year ended October 31, 2018 . |
NEW ACCOUNTING PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Jan. 31, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
NEW ACCOUNTING PRONOUNCEMENTS | 2. NEW ACCOUNTING PRONOUNCEMENTS Accounting Standards Update ("ASU") 2014-09, Revenue From Contracts With Customers. In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09 and has since modified the standard with several ASUs (collectively, the “new revenue standard” or "ASC 606"). The new revenue standard requires entities to recognize revenue through the application of a five-step model, which includes: identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligations, and recognition of revenue as the entity satisfies the performance obligations. We adopted the new revenue standard on November 1, 2018, using the modified retrospective method with the cumulative effect of initially applying the guidance recognized at the date of adoption. Comparative information has not been restated and continues to be reported under the standards in effect for the prior periods presented. We have applied the new revenue standard only to contracts not completed as of the date of adoption, referred to as open contracts. We have elected the practical expedient that permits an entity to reflect the aggregate effect of all modifications (on a contract-by-contract basis) that occurred before the date of adoption in determining the transaction price, identifying the satisfied and unsatisfied performance obligations, and allocating the transaction price to the performance obligations. The most significant impact of the new revenue standard was our accounting for software license revenue. Historically, we have deferred revenue for certain types of license arrangements and recognize the revenue ratably over the license term. Under the new revenue standard, we are no longer required to establish vendor-specific objective evidence to recognize software license revenue separately from the other elements, and we are required to recognize software license revenue once the customer obtains control of the license, which will generally occur at the start of each license term. The new revenue standard further requires certain costs, primarily sales-related commissions on contracts, to be capitalized rather than expensed. We reclassified our allowance for sales returns from accounts receivable, net to other accrued liabilities due to the adoption of the new revenue standard. See Note 3, "Revenue." The cumulative effect of initially applying the new revenue standard to all open contracts as of November 1, 2018 was as follows: October 31, Adjustments Due to ASC 606 November 1, (in millions) Assets: Accounts receivable, net $ 624 $ 7 $ 631 Other current assets 222 28 250 Long-term deferred tax assets 750 (15 ) 735 Other assets 279 3 282 Liabilities: Deferred revenue $ 334 $ (53 ) $ 281 Income and other taxes payable 42 1 43 Other accrued liabilities 69 7 76 Long-term deferred revenue 127 (11 ) 116 Other long-term liabilities 287 3 290 Stockholders' equity: Retained earnings $ 1,212 $ 76 $ 1,288 The following tables summarize the impact of ASC 606 on our condensed consolidated financial statements: Three months ended January 31, 2019 As Reported Balances Without Adoption of ASC 606 Effect of Change (in millions) Net revenue: Products $ 837 $ 822 $ 15 Services and other 169 170 (1 ) Total net revenue 1,006 992 14 Costs and expenses: Cost of products 347 346 1 Cost of services and other 81 81 — Total costs 428 427 1 Research and development 173 173 — Selling, general and administrative 288 287 1 Other operating expense (income), net (4 ) (4 ) — Total costs and expenses 885 883 2 Income from operations 121 109 12 Interest income 4 4 — Interest expense (20 ) (20 ) — Other income (expense), net 15 15 — Income before taxes 120 108 12 Provision for income taxes 6 4 2 Net income $ 114 $ 104 $ 10 Net income per share: Basic $ 0.61 $ 0.55 $ 0.06 Diluted $ 0.60 $ 0.55 $ 0.05 January 31, 2019 As Reported Balances Without Adoption of ASC 606 Effect of Change Higher/(Lower) (in millions) Assets: Accounts receivable, net $ 580 $ 572 $ 8 Inventory 641 642 (1 ) Other current assets 225 198 27 Long-term deferred tax assets 741 758 (17 ) Other assets 308 304 4 Liabilities: Deferred revenue $ 317 $ 377 $ (60 ) Income and other taxes payable 56 54 2 Other accrued liabilities 96 89 7 Long-term deferred revenue 126 143 (17 ) Other long-term liabilities 284 281 3 Stockholders' equity: Retained earnings $ 1,402 $ 1,316 $ 86 ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities . In January 2016, the FASB issued guidance related to certain aspects of recognition, measurement, presentation and disclosure of financial instruments. Most prominent among the changes in the standard is the requirement for changes in the fair value of our equity investments, with certain exceptions, to be recognized in net income rather than other comprehensive income. We adopted the standard effective November 1, 2018 using a modified retrospective approach. We elected to prospectively measure equity investments without readily determinable fair values at cost with adjustments for observable changes in price or impairments. The adoption of this guidance did not have a material impact to our condensed consolidated financial statements. ASU 2016-02, Leases. In February 2016, the FASB issued guidance that will require substantially all leases to be reported on the balance sheet as right-of-use assets and lease obligations. We expect our leases designated as operating leases in Note 16 to the consolidated financial statements in our Annual Report on Form 10-K for fiscal year ended October 31, 2018 will be reported in the consolidated balance sheet upon adoption. 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. The standard is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. We expect to adopt the new standard on November 1, 2019 and will elect the transition package of practical expedients, which among other things, allows us to carry forward the historical lease classification. We do not plan to elect the practical expedient to use hindsight in determining the lease term and in assessing impairment of right-of-use assets. The company has selected a leasing software solution and is in the process of identifying changes to our business processes, systems, and controls to support adoption of the new standard. ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments . In August 2016, the FASB issued guidance that adds or clarifies guidance on eight cash flow classification issues that had been creating diversity in practice. We adopted this guidance during the first quarter of 2019 retrospectively to all periods presented, which resulted in the following change to our previously reported condensed consolidated statement of cash flows for the three months ended January 31, 2018 related to the classification of acquisition-related contingent consideration. Three Months Ended January 31, 2018 As Originally Reported As Adjusted Change (in millions) Net cash provided by operating activities $ 171 $ 171 $ — Net cash used in investing activities $ (27 ) $ (24 ) $ 3 Net cash provided by financing activities $ 9 $ 6 $ (3 ) ASU 2016-18, Restricted Cash. In November 2016, the FASB issued guidance that requires an entity to include in its cash and cash equivalent balances in the statement of cash flows those amounts that are deemed to be restricted cash and restricted cash equivalents. We adopted this guidance during the first quarter of 2019 retrospectively to all periods presented. See Note 7, "Supplemental Cash Flow Information." ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-Retirement Benefit Cost. In March 2017, the FASB issued guidance that requires the service cost component of net periodic pension cost and net periodic post-retirement benefit cost to be included in operating expenses (together with other employee compensation costs) and the other components of the cost to be presented in the statement of operations separately from the service cost component and outside of income from operations. We retrospectively adopted this guidance during the first quarter of 2019. The interest cost, expected return on assets, amortization of prior service credits and other costs have been reclassified from cost of products, research and development, selling, general and administrative, and other operating expenses (income) to other income (expense). We elected to apply the practical expedient, which allows us to reclassify amounts disclosed previously in our retirement plans and post-retirement benefit plans note as the basis for applying retrospective presentation for comparative periods as it is impractical to determine the disaggregation of the components for amounts capitalized and reclassified in those periods. On a prospective basis, the service cost component of net periodic pension and post-retirement benefit cost is presented with other current compensation costs in operating income. The remaining components are included in other operating expense (income) and will not be included in amounts capitalized in inventory or property, plant, and equipment. The effect of the retrospective presentation change related to the retirement plans and post-retirement benefit plans to our previously reported condensed consolidated statement of operations for the three months ended January 31, 2018 was as follows: Three Months Ended As Originally Reported As Adjusted Effect of Change (in millions) Cost of products $ 337 $ 339 $ 2 Research and development 146 150 4 Selling, general and administrative 289 295 6 Other income (expense), net 1 13 12 ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities. In August 2017, the FASB issued guidance to enable entities to better portray the economics of their risk management activities in the financial statements and enhance transparency and understandability of hedge results. We adopted this guidance during the first quarter of 2019 and elected to continue to record changes in the fair value of components excluded from the effectiveness assessment of cash flow hedges in earnings. The adoption of this guidance did not have a material impact to our condensed consolidated financial statements. ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. In February 2018, the FASB issued guidance that allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act (the "Tax Act") enacted in December 2017. The standard is effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. We adopted this guidance on November 1, 2018. We elected to retain the income tax effects of the Tax Act as a component of accumulated other comprehensive income. Given this election, the adoption of this guidance did not have a material impact on our condensed consolidated financial statements. ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. In August 2018, the FASB issued guidance that requires a customer in a cloud computing arrangement (i.e., hosting arrangement) that is a service contract to follow the internal-use software guidance to determine which implementation costs to defer and recognize as an asset and aligns the recognition of implementation costs to those incurred in an arrangement that includes an internal-use software license. Further, new disclosures about implementation costs for both internal-use software and hosting arrangements are required. The standard is effective for fiscal years beginning after December 15, 2019 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. 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. |
REVENUE (Notes)
REVENUE (Notes) | 3 Months Ended |
Jan. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | 3. REVENUE Revenue Recognition Revenue is recognized upon transfer of control of the promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. We primarily generate revenue from the sale of products (hardware and/or software), services, or a combination thereof. We enter into contracts that may involve multiple performance obligations, and we allocate the transaction price between each performance obligation on the basis of relative standalone selling price. Revenue is recognized net of allowances for returns and any taxes collected from customers, which are subsequently remitted to governmental authorities. Nature of Goods and Services Product revenues are generated predominantly from the sales of various types of design and test hardware and associated software. Products consist of hardware, generally installed with basic software and software licenses that consist of perpetual and term-based licenses for optional software. Our hardware products generally do not have any substantive acceptance terms that would otherwise preclude the transfer of control. Performance obligations related to our software licenses, including the license portion of our software subscriptions, grant the customer the right to use our software via electronic delivery. Service revenues consist of repair and calibration services, extended warranties, technical support for hardware and software, when-and-if available software updates and upgrades, and professional services, including installation and implementation, consulting, and training. Repair and calibration services for hardware products are sold both as per-incident customer services and as customer agreements to provide such services over the contractual period. Extended warranties are optional to the customer and provide warranty on hardware products for additional years beyond the standard one-year warranty. Technical support for software and when-and-if available software updates and upgrades are sold either together with our software licenses and software subscriptions, or separately as part of our customer support programs. These are considered stand-ready performance obligations where customers benefit from the services evenly throughout the license or service period. These performance obligations provide the customer access evenly over the contract period. Our professional services may be sold on a time and material basis (e.g., consulting) or on a fixed-fee basis (e.g., non-recurring engineering). We also generate revenues from a combination of products and services ("custom solutions"), including combinations of hardware, software, installation or other start-up services, software subscriptions, and/or software support services. Custom solutions provide the customer with a combination of hardware, software and professional services to meet customers' unique specifications. For our contracts with customers, we account for individual performance obligations separately if they are distinct. Our standard payment terms are net 30 to 90 days, and we generally do not offer extended payment terms beyond one year. Our contracts typically contain various forms of variable consideration, including trade discounts, trade-in credits, rebates, and rights of return. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices for a majority of our products and services are estimated based on our established pricing practices and maximize the use of observable inputs. We have elected to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by Keysight from a customer (e.g., sales, use, value added, and some excise taxes). We have also elected to account for shipping and handling activities that occur after control of the related good transfers as fulfillment activities instead of assessing such activities as performance obligations. Our typical performance obligations include the following: Performance Obligation When performance obligation is typically satisfied When payment is typically due How standalone selling price is typically determined Product Revenues Hardware When customer obtains control of the product, typically at delivery (point in time) Within 30-90 days of shipment Estimated based on established pricing practices or observable based on standalone sales for certain hardware products Software licenses Upon electronic delivery of the software, and the applicable license period has begun (point in time) Within 30-90 days of the beginning of license period Estimated based on established pricing practices or observable based on standalone sales for certain software products Threat intelligence solutions Ratably over the subscription period (over time) Within 30-90 days of the beginning of subscription period Estimated based on established pricing practices Service Revenues Calibration contracts Ratably over the service contract period (over time) Within 30-90 days of the beginning of service contract period Estimated based on established pricing practices Repair and calibration (per- incident) As services are performed (point in time) Within 30-90 days of invoicing for services rendered Estimated based on established pricing practices Extended hardware warranty Ratably over the warranty period (over time) Within 30-90 days of the beginning of warranty period Estimated based on established pricing practices or observable based on standalone sales of certain hardware warranty contracts Technical support and when-and-if-available software updates Ratably over the license service contract period (over time) Within 30-90 days of the beginning of license or service contract period Estimated based on established pricing practices or observable based on standalone sales for certain support contracts Professional services As services are performed based on measures of progress (over time) or at a point in time Within 30-90 days invoicing for services rendered Estimated based on established pricing practices Custom Solutions Custom solutions (milestone-based) As milestones are achieved based on transfer of control to customer (over time) Within 30-90 days of milestone achievement Transaction price, as pricing is custom and can vary significantly from contract to contract Custom solutions (point in time) When customer obtains control of the solution, typically at delivery (point in time) Within 30-90 days of delivery of solution Transaction price, as pricing is custom and can vary significantly from contract to contract Significant Judgments Judgment is required to determine the standalone selling price for each distinct performance obligation. As most of our products and services are not sold on a standalone basis, we typically estimate the standalone selling price. In doing so, we consider our internal price list for each product and service, which reflects our desired profitability, based on an expected level of sales, and adjust for factors such as competition, customer relationship, discount provided in the contract, geographic location, and the products and services purchased in the arrangement. We use a range based on actual historical sales to determine whether the calculated standalone selling price for a product or service is a fair representation of the standalone selling price. For capitalized contract costs, we use judgment in determining the capitalized amount. Our products are generally sold with a right of return and we may provide other credits, discounts, or incentives, which are accounted for as variable consideration when estimating the amount of revenue to recognize. Returns, credits, and discounts are estimated at contract inception and updated at the end of each reporting period as additional information becomes available to the extent that it is probable a significant reversal of the cumulative amount of revenue recognized will not occur once the variability is subsequently resolved. Disaggregation of Revenue We disaggregate our revenue from contracts with customers by geographic region, end market, and timing of transfer of products and services to customers, as we believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Disaggregated revenue is presented for each of our three reportable segments. Three Months Ended January 31, 2019 Communications Solutions Group Electronic Industrial Solutions Group Ixia Solutions Group Total (in millions) Region Americas $ 272 $ 57 $ 74 $ 403 Europe 96 63 19 178 Asia Pacific 255 137 33 425 Total net revenue $ 623 $ 257 $ 126 $ 1,006 End Market Aerospace, Defense & Government $ 223 $ — $ — $ 223 Commercial Communications 400 — — 400 Electronic Industrial — 257 — 257 Ixia Solutions — — 126 126 Total net revenue $ 623 $ 257 $ 126 $ 1,006 Timing of Revenue Recognition Revenue recognized at a point in time $ 570 $ 235 $ 82 $ 887 Revenue recognized over time 53 22 44 119 Total net revenue $ 623 $ 257 $ 126 $ 1,006 Contract Balances The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets) and deferred revenue (contract liabilities) on our condensed consolidated balance sheet. In addition, we defer and capitalize certain costs incurred to obtain a contract (contract costs). Contract assets - Contract assets represent unbilled amounts from arrangements for which we have performed by transferring goods or services to the customer in advance of receiving all or partial consideration for such goods and services from the customer. Contract assets arise primarily from service agreements and products delivered pending a formal customer acceptance, which generally occurs within 30 days. The contract assets balance was $19 million at January 31, 2019 and is included in "accounts receivables, net" in our condensed consolidated balance sheet. Contract costs - We recognize an asset for the incremental costs of obtaining a contract with a customer. We have determined that certain employee and third-party representative commissions programs meet the requirements to be capitalized. Employee commissions are based on the achievement of order volume compared to a sales target. Third-party representative commission costs relate directly to a customer contract as the commission is tied to orders contracted through and contracts arranged by our third-party representatives. Without obtaining the contracts, the commissions would not be paid and, as such, are determined to be an incremental cost to obtaining a contract. We only defer these costs when we have determined the commissions are, in fact, incremental and would not have been incurred absent the customer contract. Capitalized incremental costs are allocated to the individual performance obligations in proportion to the transaction price allocated to each performance obligation and amortized based on the pattern of performance for the underlying performance obligation. Contract costs related to initial contracts and renewals are amortized over the same period because the commissions paid on both the initial contract and renewals are commensurate with one another. The following table provides a roll-forward of our capitalized contract costs, current and non-current: Three months ended January 31, 2019 (in millions) Balance at October 31, 2018 $ — Costs capitalized on November 1, 2018 due to ASC 606 adoption 29 Costs capitalized during the period 17 Costs amortized during the period (18 ) Foreign currency translation impact 1 Balance at January 31, 2019 $ 29 Contract liabilities - Our contract liabilities consist of deferred revenue that arises when we receive consideration in advance of providing the goods or services promised in the contract. Contract liabilities are primarily generated from customer deposits received in advance of shipments for products or rendering of services and are recognized as revenue when services are provided to the customer. We classify deferred revenue as current or non-current based on the timing of when we expect to recognize revenue. Contract liabilities are recognized as revenue when services are provided to the customer. Changes in contract liabilities, current and non-current, during the three months ended January 31, 2019 were as follows: Contract Liabilities (in millions) Balance at October 31, 2018 $ 461 Impact of adopting new revenue standard (64 ) Balance at November 1, 2018 397 Deferral of revenue billed in current period, net of recognition 167 Revenue recognized that was deferred as of the beginning of the period (124 ) Foreign currency translation impact 3 Balance at January 31, 2019 $ 443 Remaining Performance Obligations Revenue expected to be recognized in any future period related to remaining performance obligations, excluding revenue pertaining to contracts that have an original expected duration of one year or less, was approximately $260 million as of January 31, 2019, and represents the company’s obligation to deliver products and services and obtain customer acceptance on delivered products. Since we typically invoice customers at contract inception, this amount is included in our current and long-term deferred revenue balances. As of January 31, 2019, we expect to recognize approximately 41 percent of the revenue related to these unsatisfied performance obligations during the remainder of 2019, 32 percent during 2020, and 27 percent thereafter. Practical Expedients As discussed in Note 2, "New Accounting Pronouncements," and previously in this note, we have elected the following practical expedients in accordance with ASC 606: • We do not disclose the value of remaining performance obligations for contracts with an original expected length of one year or less. • We determine incremental costs of obtaining a contract for a portfolio of contracts with similar characteristics as we reasonably expect that the effects on the financial statements of applying this guidance to the portfolio would not differ materially from applying this guidance to the individual contracts within that portfolio. • We exclude from the transaction price certain taxes (e.g., sales, use, value added, and some excise taxes). • We do not adjust the promised amount of consideration for the effects of a significant financing component if we expect, at contract inception, that the period between when we transfer a promised good or service to a customer and when the customer pays for that good or service will be one year or less. • We treat shipping and handling costs associated with outbound freight after control of a product has transferred to a customer as a fulfillment cost, included in cost of products. • We have applied the guidance only to contracts that have not been completed as of the date of adoption (November 1, 2018). • We did not evaluate individual modifications for those periods prior to the adoption date, but rather evaluated the aggregate effect of all modifications as of the adoption date. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 2018 (in millions) Cost of products and services $ 4 $ 3 Research and development 6 4 Selling, general and administrative 17 12 Total share-based compensation expense $ 27 $ 19 Share-based compensation capitalized within inventory was $1 million at both January 31, 2019 and 2018. The following assumptions were used to estimate the fair value of awards granted under the LTP Program that are based on total shareholder return ("TSR"): Three Months Ended January 31, 2019 2018 Volatility of Keysight shares 25 % 25 % Volatility of selected index 12 % 14 % Price-wise correlation with selected peers 57 % 57 % The TSR-based performance awards were valued using a Monte Carlo simulation model, which requires the use of highly subjective and complex assumptions, including the price volatility of the underlying stock. The estimated fair value of restricted stock awards and the financial metrics-based performance awards is determined based on the market price of Keysight’s common stock on the grant date. We did not grant any option awards for the three months ended January 31, 2019 and 2018, respectively. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Jan. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The company’s effective tax rate was 5.2 percent and 515.8 percent for the three months ended January 31, 2019 and 2018, respectively. The income tax expense was $6 million for the three months ended January 31, 2019 and an income tax benefit of $117 million for the three months ended January 31, 2018. The income tax expense for the three months ended January 31, 2019 included a net discrete benefit of $23 million, primarily related to a change in tax reserves resulting from a change in judgment. The income tax benefit for the three months ended January 31, 2018 included a net discrete benefit of $115 million, primarily due to $117 million of benefit resulting from changes in U.S. tax law. Keysight benefits from tax incentives in several jurisdictions, most significantly in Singapore, that 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 Singapore tax incentive is due for renewal in fiscal 2024. The impact of the tax incentives decreased the income tax provision for the three months ended January 31, 2019 by $8 million, resulting in a benefit to net income per share (diluted) of approximately $0.04 for the three months ended January 31, 2019. The open tax years for the IRS and most states are from November 1, 2014 through the current tax year. For the majority of our foreign entities, the open tax years are from August 1, 2014 through the current tax year. For certain foreign entities, the tax years remain open, at most, back to the year 2008 . 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. The company is being audited in Malaysia for the 2008 tax year. Although this tax year pre-dates our spin-off from Agilent, pursuant to the agreement between Agilent and Keysight pertaining to tax matters, as finalized at the time of separation, for certain entities, including Malaysia, any historical tax liability is the responsibility of Keysight. In the fourth quarter of fiscal 2017, Keysight paid income taxes and penalties of $68 million on gains related to intellectual property rights, although we are currently in the process of appealing to the Special Commissioners of Income Tax in Malaysia. The company believes there are numerous defenses to the current assessment; the statute of limitations for the 2008 tax year in Malaysia was closed, and the income in question is exempt from tax in Malaysia. The company is disputing this assessment and pursuing all avenues to resolve this issue favorably for the company. The Tax Act, as enacted by the U.S. government on December 22, 2017, includes significant changes to the U.S. corporate income tax system, including but not limited to: the transition of U.S. international taxation from a worldwide tax system to a modified territorial tax system, which resulted in a one-time U.S. tax liability on those earnings which were not previously repatriated to the U.S. (the “Transition Tax”); creation of new minimum taxes such as the Global Intangible Low Taxed Income (“GILTI”) tax and the base erosion anti-abuse tax; creation of the foreign-derived intangible income (“FDII”) deduction; a federal corporate income tax rate reduction from 35 percent to 21 percent; and limitations on the deductibility of interest expense and executive compensation. The company completed its accounting for the income tax effects of the Tax Act during the first quarter of fiscal 2019, in accordance with the U.S. Securities and Exchange Commission Staff Accounting Bulletin No. 118. Finalizing the provisional adjustments related to the Tax Act did not have a material impact on our consolidated financial statements as of January 31, 2019. Legislation and clarifying guidance is expected to continue to be issued by the U.S. Treasury and various states in 2019, which could result in significant changes to currently computed income tax liabilities for past and current tax periods. The FASB Staff Q&A, Topic 740 No. 5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an accounting policy election to either recognize deferred taxes for temporary differences expected to impact the GILTI tax expense in future years or provide for the tax expense related to GILTI in each year in which the tax is incurred. The company has elected to recognize the tax on GILTI as a period expense in each period in which the tax is incurred. |
NET INCOME PER SHARE
NET INCOME PER SHARE | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 2018 (in millions) Numerator: Net income $ 114 $ 94 Denominator: Basic weighted-average shares 187 187 Potential common shares— stock options and other employee stock plans 3 2 Diluted weighted-average shares 190 189 The dilutive effect of share-based awards is reflected in diluted net income per share by application of the treasury stock method, which includes consideration of unamortized share-based compensation expense and the dilutive effect of in-the-money options and non-vested restricted stock units. Under the treasury stock method, the amount the employee must pay for exercising stock options and unamortized share-based compensation expense are collectively assumed to be used to repurchase hypothetical shares. 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 their effect would be anti-dilutive. For each of the three-month periods ended January 31, 2019 and 2018, we excluded zero options from the calculation of diluted earnings per share. In addition, we also exclude from the calculation of diluted earnings per share, stock options, ESPP, LTP Program and restricted stock awards, whose combined exercise price, unamortized fair value and excess tax benefits collectively were greater than the average market price of our common stock because their effect would also be anti-dilutive. For the three months ended January 31, 2019 and 2018, we excluded approximately 417,400 shares and 668,100 shares, respectively. |
SUPPLEMENT CASH FLOW INFORMATIO
SUPPLEMENT CASH FLOW INFORMATION (Notes) | 3 Months Ended |
Jan. 31, 2019 | |
Other Significant Noncash Transactions [Line Items] | |
Schedule of Cash Flow, Supplemental Disclosures [Table Text Block] | . SUPPLEMENTAL CASH FLOW INFORMATION Net cash paid for income taxes was $1 million for the three months ended January 31, 2019 and 2018. Cash paid for interest was zero and $2 million for the three months ended January 31, 2019 and 2018, 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, 2019 2018 (in millions) Increase (decrease) in unpaid capital expenditures in accounts payable $ 11 $ (3 ) $ 11 $ (3 ) The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet to the amount shown in the condensed consolidated statement of cash flows: Three months ended January 31, 2019 2018 (in millions) Cash and cash equivalents $ 1,098 $ 980 Restricted cash included in other current assets 2 — Restricted cash included in other assets 2 2 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 1,102 $ 982 Restricted cash consisted primarily of deposits held as collateral against bank guarantees. |
INVENTORY
INVENTORY | 3 Months Ended |
Jan. 31, 2019 | |
Inventory, Net [Abstract] | |
INVENTORY | INVENTORY January 31, October 31, (in millions) Finished goods $ 286 $ 283 Purchased parts and fabricated assemblies 355 336 Total inventory $ 641 $ 619 Inventory-related excess and obsolescence charges recorded in total cost of products were $7 million and $6 million for the three months ended January 31, 2019 and January 31, 2018, respectively. We record excess and obsolete inventory charges for inventory at our sites as well as inventory at our contract manufacturers and suppliers, where we have non-cancellable purchase commitments. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Jan. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS The goodwill balances as of January 31, 2019 and October 31, 2018 and the activity for the three months ended January 31, 2019 for each of our reportable operating segments were as follows. Prior period amounts have been reclassified to conform to our organizational change as described in Note 16, "Segment Information." Communications Solutions Group Electronic Industrial Solutions Group Ixia Solutions Group Total (in millions) Balance as of October 31, 2018: Goodwill $ 497 $ 267 $ 1,116 $ 1,880 Accumulated impairment losses — — (709 ) (709 ) Goodwill as reported 497 267 407 1,171 Foreign currency translation impact 9 1 — 10 Balance as of January 31, 2019 $ 506 $ 268 $ 407 $ 1,181 Components of goodwill as of January 31, 2019: Goodwill $ 506 $ 268 $ 1,116 $ 1,890 Accumulated impairment losses — — (709 ) (709 ) Goodwill as reported $ 506 $ 268 $ 407 $ 1,181 The company has not identified any triggering events that indicate an impairment of goodwill in the three months ended January 31, 2019. Other intangible assets as of January 31, 2019 and October 31, 2018 consisted of the following: Other Intangible Assets as of January 31, 2019 Other Intangible Assets as of October 31, 2018 Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value (in millions) Developed technology $ 835 $ 455 $ 380 $ 835 $ 415 $ 420 Backlog 13 13 — 13 13 — Trademark/Tradename 33 16 17 33 14 19 Customer relationships 304 109 195 304 100 204 Non-compete agreements 1 — 1 1 — 1 Total amortizable intangible assets 1,186 593 593 1,186 542 644 In-Process R&D 1 — 1 1 — 1 Total $ 1,187 $ 593 $ 594 $ 1,187 $ 542 $ 645 During the three months ended January 31, 2019 , there was no foreign exchange translation impact to other intangible assets. Amortization of other intangible assets was $51 million for each of the three -month periods ended January 31, 2019 and 2018. Estimated intangible assets amortization expense for each of the five succeeding fiscal years is as follows: Amortization expense (in millions) 2019 (remainder) $ 152 2020 196 2021 128 2022 52 2023 44 Thereafter 21 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 and October 31, 2018 were as follows: Fair Value Measurements at January 31, 2019 October 31, 2018 Total Level 1 Level 2 Level 3 Other Total Level 1 Level 2 Level 3 Other (in millions) Assets: Short-term Cash equivalents Money market funds $ 603 $ 603 $ — $ — $ — $ 484 $ 484 $ — $ — $ — Derivative instruments (foreign exchange contracts) 3 — 3 — — 6 — 6 — — Long-term Equity investments 36 36 — — — 30 30 — — — Equity investments - other 16 — — — 16 16 — — — 16 Total assets measured at fair value $ 658 $ 639 $ 3 $ — $ 16 $ 536 $ 514 $ 6 $ — $ 16 Liabilities: Short-term Derivative instruments (foreign exchange contracts) $ 5 $ — $ 5 $ — $ — $ 6 $ — $ 6 $ — $ — Long-term Deferred compensation liability 13 — 13 — — 13 — 13 — — Total liabilities measured at fair value $ 18 $ — $ 18 $ — $ — $ 19 $ — $ 19 $ — $ — Net recognized gains (losses) on equity investments were as follows: Three Months Ended January 31, 2019 (in millions) Net realized gains on investments sold $ — Net unrealized gains on investments still held 5 Other-than-temporary impairments of investments — Total $ 5 Our money market funds and equity investments with readily determinable fair values are measured at fair value using quoted market prices and, therefore, are classified within Level 1 of the fair value hierarchy. Equity investments without readily determinable fair values that are measured at cost adjusted for observable changes in price or impairments are not categorized in the fair value hierarchy and are presented as "other" in the tables above. Our deferred compensation liability is classified as Level 2 because the inputs used in the calculations are observable, although the values are not directly based on quoted market prices. 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. Equity investments including securities that are earmarked to pay the deferred compensation liability and the deferred compensation liability are reported at fair value, with gains or losses resulting from changes in fair value recognized in earnings. 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, 2019 | |
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. The changes in the value of the derivative instrument included in the assessment of effectiveness are recognized in accumulated other comprehensive income and reclassified into earnings when the forecasted transaction occurs in the same financial statement line item in the consolidated statement of operations where the earnings effect of the hedged item is presented. If it becomes probable that the forecasted transaction will not occur, the hedge relationship will be de-designated and amounts accumulated in other comprehensive income will be reclassified into earnings in the current period. Gains and losses on the derivative instrument representing hedge components excluded from the assessment of effectiveness (forward points) are recognized immediately in earnings and are presented in the same financial statement line of the consolidated statement of operations where the earnings effect of the hedged item is presented. We record the premium paid (time value) of an option on the date of purchase as an asset. For options designated as cash flow hedges, changes in the time value are excluded from the assessment of hedge effectiveness and are recognized in earnings over the life of the option contract. 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, 2019 was $3 million . The credit-risk-related contingent features underlying these agreements had not been triggered as of January 31, 2019 . There were 177 foreign exchange forward contracts open as of January 31, 2019 that were designated as cash flow hedges. There were 66 foreign exchange forward contracts as of January 31, 2019 that were not designated as hedging instruments. The aggregated notional amounts by currency and designation as of January 31, 2019 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 $ 13 $ 48 British Pound — (39 ) Singapore Dollar 16 — Malaysian Ringgit 87 (4 ) Japanese Yen (75 ) (38 ) Other currencies (14 ) (5 ) Total $ 27 $ (38 ) 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, 2019 and October 31, 2018 were as follows: Fair Values of Derivative Instruments Derivative Assets Derivative Liabilities Fair Value Fair Value Balance Sheet Location January 31, October 31, Balance Sheet Location January 31, October 31, (in millions) (in millions) Derivatives designated as hedging instruments: Cash flow hedges Foreign exchange contracts Other current assets $ 2 $ 5 Other accrued liabilities $ 3 $ 4 Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets 1 1 Other accrued liabilities 2 2 Total derivatives $ 3 $ 6 $ 5 $ 6 The effect of derivative instruments for foreign exchange contracts designated as hedging instruments and for those not designated as hedging instruments in our condensed consolidated statement of operations was as follows: Three Months Ended January 31, 2019 2018 (in millions) Derivatives designated as hedging instruments: Cash Flow Hedges Foreign exchange contracts: Gain (loss) recognized in accumulated other comprehensive income $ (2 ) $ 2 Gain (loss) reclassified from accumulated other comprehensive income into earnings: Cost of products $ — $ 2 Selling, general and administrative $ (1 ) $ — Amount excluded from effectiveness testing recognized in earnings based on changes in fair value: Cost of products $ 1 $ — Derivatives not designated as hedging instruments: Gain (loss) recognized in other income (expense), net $ (3 ) $ 1 The estimated amount of existing net loss at January 31, 2019 expected to be reclassified from accumulated other comprehensive income to earnings within the next twelve months is $2 million . |
RETIREMENT PLANS AND POST RETIR
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS | 3 Months Ended |
Jan. 31, 2019 | |
Defined Benefit Plan [Abstract] | |
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS | RETIREMENT PLANS AND POST-RETIREMENT BENEFIT PLANS For the three months ended January 31, 2019 and 2018 , 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 U.S. Post-Retirement Three Months Ended January 31, 2019 2018 2019 2018 2019 2018 (in millions) Service cost—benefits earned during the period $ 5 $ 6 $ 3 $ 3 $ — $ — Interest cost on benefit obligation 7 6 6 6 2 2 Expected return on plan assets (11 ) (9 ) (19 ) (21 ) (3 ) (4 ) Amortization: Net actuarial loss 3 3 7 6 2 4 Prior service credit (1 ) (2 ) — — (3 ) (3 ) Settlement loss — — 2 — — — Net periodic benefit cost (benefit) $ 3 $ 4 $ (1 ) $ (6 ) $ (2 ) $ (1 ) We did not contribute to our U.S. Defined Benefit Plans or U.S. Post-Retirement Benefit Plan during the three months ended January 31, 2019 and 2018 . We contributed $8 million and $9 million to our Non-U.S. Defined Benefit Plans during the three months ended January 31, 2019 and 2018, respectively. For the remainder of 2019 , we do not expect to contribute to our U.S. Defined Benefit Plans, and we expect to contribute $23 million to our Non-U.S. Defined Benefit Plans. On January 1, 2019 , we transferred a portion of the assets and liabilities of our Switzerland defined benefit plan to an insurance company, resulting in the recognition of a settlement loss of $2 million , which is included in other income (expense) in the condensed consolidated statement of operations. |
WARRANTY, COMMITMENTS AND CONTI
WARRANTY, COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Jan. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
WARRANTY, COMMITMENTS AND CONTINGENCIES | WARRANTY, COMMITMENTS AND CONTINGENCIES Standard Warranty The Keysight warranty on products sold through direct sales channel is primarily one year. Warranties for products sold through distribution channels continue to be primarily 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, 2019 2018 (in millions) Beginning balance $ 45 $ 45 Accruals for warranties including change in estimate 8 10 Settlements made during the period (9 ) (8 ) Ending balance $ 44 $ 47 Accruals for warranties due within one year $ 25 $ 26 Accruals for warranties due after one year 19 21 Ending balance $ 44 $ 47 Commitments During the three months ended January 31, 2019, there were no material changes to the operating and capital lease commitments reported in the company’s 2018 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, 2019 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The following table summarizes the components of our long-term debt: January 31, 2019 October 31, 2018 (in millions) 2019 senior unsecured notes at 3.30% (net of unamortized costs of $1 and $1) $ 499 $ 499 2024 senior unsecured notes at 4.55% (net of unamortized costs of $3 and $3) 597 597 2027 senior unsecured notes at 4.60% (net of unamortized costs of $6 and $6) 694 694 Total debt 1,790 1,790 Less: short-term debt 499 499 Total long-term debt $ 1,291 $ 1,291 Short-Term Debt Revolving Credit Facility On February 15, 2017 , we entered into an amended and restated credit agreement (the “Revolving Credit Facility”) that replaced our existing $450 million unsecured credit facility dated September 15, 2014. The Revolving Credit Facility provides for a $450 million , five -year unsecured revolving credit facility that will expire on February 15, 2022 and bears interest at an annual rate of LIBOR + 1.30% . 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. We may use amounts borrowed under the facility for general corporate purposes. As of January 31, 2019, 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, 2019. 2019 Senior Notes There have been no changes to the principal, maturity, interest rates and interest payment terms of the senior notes during the three months ended January 31, 2019 as compared to the senior notes described in our Annual Report on Form 10-K for the fiscal year ended October 31, 2018. Long-Term Debt There have been no changes to the principal, maturity, interest rates and interest payment terms of the senior notes during the three months ended January 31, 2019 as compared to the senior notes described in our Annual Report on Form 10-K for the fiscal year ended October 31, 2018. As of January 31, 2019 and October 31, 2018, we had $31 million and $26 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 $25 million and $3 million as of January 31, 2019 and October 31, 2018, respectively. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Jan. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | |
STOCKHOLDERS EQUITY | STOCKHOLDERS' EQUITY Stock Repurchase Program On March 6, 2018, the Board of Directors approved a new stock repurchase program authorizing the purchase of up to $350 million of the company’s common stock, replacing a previously approved 2016 program authorizing the purchase of up to $200 million of the company’s common stock. Under the new 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, 2019, we repurchased 686,398 shares of common stock for $40 million . For the three months ended January 31, 2018, 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, 2019 and 2018 were as follows: Unrealized gain (loss) on investments 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, 2018 $ — $ (60 ) $ (445 ) $ 19 $ (2 ) $ (488 ) Other comprehensive income (loss) before reclassifications — 30 4 — (2 ) 32 Amounts reclassified out of accumulated other comprehensive loss — — 12 (4 ) 1 9 Tax (expense) benefit — — (3 ) 1 — (2 ) Other comprehensive income (loss) — 30 13 (3 ) (1 ) 39 As of January 31, 2019 $ — $ (30 ) $ (432 ) $ 16 $ (3 ) $ (449 ) As of October 31, 2017 $ 14 $ (39 ) $ (468 ) $ 35 $ 1 $ (457 ) Other comprehensive income (loss) before reclassifications (2 ) 41 — — 2 41 Amounts reclassified out of accumulated other comprehensive loss — — 13 (5 ) (2 ) 6 Tax (expense) benefit — — (3 ) 1 — (2 ) Other comprehensive income (loss) (2 ) 41 10 (4 ) — 45 As of January 31, 2018 $ 12 $ 2 $ (458 ) $ 31 $ 1 $ (412 ) Reclassifications out of accumulated other comprehensive loss for the three months ended January 31, 2019 and 2018 were as follows: Details about Accumulated Other Comprehensive Loss Components Affected Line Item in Statement of Operations Three Months Ended January 31, 2019 2018 Unrealized gain (loss) on derivatives $ — $ 2 Cost of products (1 ) — Selling, general and administrative — — Provision for income taxes (1 ) 2 Net of income tax Net defined benefit pension cost and post retirement plan costs: Actuarial net loss (12 ) (13 ) Prior service credits 4 5 (8 ) (8 ) Total before income tax 3 2 Provision for income taxes (5 ) (6 ) Net of income tax Total reclassifications for the period $ (6 ) $ (4 ) 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 12, "Retirement Plans and Post-Retirement Pension Plans"). |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Jan. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION We provide electronic design and test solutions that are used in the design, development, manufacture, installation, deployment, validation, optimization and secure operation of electronics systems to communications, networking and electronics industries. We also offer customization, consulting and optimization services throughout the customer's product lifecycle, including start-up assistance, instrument productivity, application services and instrument calibration and repair. In the first quarter of fiscal year 2019, in recognition of Keysight’s customer solutions-oriented go-to-market strategy and to fully reflect our services delivery within the markets served and further enable services growth, we completed an organizational change to align our services business with our customers and end markets. With this change, services that were previously reported as the Services Solutions Group are now reported as part of the Communications Solutions Group and Electronic Industrial Solutions Group. As a result, Keysight now has three segments: Communications Solutions Group, Electronic Industrial Solutions Group and Ixia Solutions Group. The new organizational structure continues to include centralized enterprise functions that provide support across the groups. Our 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 operating segments are as follows: The Communications Solutions Group serves customers spanning the worldwide commercial communications and aerospace, defense and government end markets. The group provides electronic design and test software, instruments, systems and related services 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, systems and related services used in the simulation, design, validation, manufacturing, installation and optimization of electronic equipment. The Ixia Solutions Group helps customers worldwide, including enterprises, service providers, network equipment manufacturers, and governments, to validate new products before shipping and secure ongoing operation of their networks with better visibility and security. The test, visibility and security products help organizations and their customers strengthen their physical and virtual networks. The group’s product solutions consist of high-performance hardware platforms, software applications and services, including warranty and maintenance offerings. 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 optimize 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 Ixia Solutions Group was not allocated these shared services and infrastructure charges, with the exception of net periodic benefit costs, until fiscal 2019. 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. Prior period amounts have been revised to conform to the new organizational structure. The profitability of each of the segments is measured after excluding share-based compensation expense, amortization of acquisition-related balances, acquisition and integration costs, northern California wildfire-related costs, interest income, interest expense and other items as noted in the reconciliations below. Communications Solutions Group Electronic Industrial Solutions Group Ixia Solutions Group Total Segments (in millions) Three months ended January 31, 2019: Total net revenue $ 623 $ 257 $ 126 $ 1,006 Amortization of acquisition-related balances — — 3 3 Total segment revenue $ 623 $ 257 $ 129 $ 1,009 Segment income from operations $ 138 $ 54 $ 12 $ 204 Three months ended January 31, 2018: Total net revenue $ 500 $ 229 $ 108 $ 837 Amortization of acquisition-related balances — — 19 19 Total segment revenue $ 500 $ 229 $ 127 $ 856 Segment income from operations $ 63 $ 38 $ 18 $ 119 The following table reconciles reportable operating segments’ income from operations to our total enterprise income before taxes: Three Months Ended January 31, 2019 2018 (in millions) Total reportable operating segments' income from operations $ 204 $ 119 Share-based compensation expense (27 ) (19 ) Amortization of acquisition-related balances (54 ) (89 ) Acquisition and integration costs (2 ) (19 ) Northern California wildfire-related costs — (7 ) Other — (2 ) Income (loss) from operations, as reported 121 (17 ) Interest income 4 3 Interest expense (20 ) (22 ) Other income (expense), net 15 13 Income (loss) before taxes, as reported $ 120 $ (23 ) The following table presents assets directly managed by each segment. Unallocated assets primarily consist of cash and cash equivalents, investments and other assets. Communications Solutions Group Electronic Industrial Solutions Group Ixia Solutions Group Total Segments (in millions) Assets: As of January 31, 2019 $ 2,059 $ 875 $ 1,407 $ 4,341 As of October 31, 2018 $ 2,115 $ 888 $ 1,327 $ 4,330 |
NORTHERN CALIFORNIA WILDFIRES I
NORTHERN CALIFORNIA WILDFIRES IMPACT (Notes) | 3 Months Ended |
Jan. 31, 2019 | |
Unusual or Infrequent Items, or Both [Abstract] | |
Unusual or Infrequent Items, or Both, Disclosure [Text Block] | IMPACT OF NORTHERN CALIFORNIA WILDFIRES During the week of October 8, 2017, wildfires in northern California adversely impacted the Keysight corporate headquarters site in Santa Rosa, CA. Our headquarters was under mandatory evacuation for more than three weeks, and while direct damage to our core facilities was limited, our buildings did experience some smoke and other fire-related impacts. Cleaning and restoration efforts are largely complete, and we have fully re-occupied the site. Keysight is insured for the damage caused by the fire. For the three months ended January 31, 2019 and 2018, we recognized costs of zero and $7 million , net of estimated insurance recoveries of zero and $31 million , respectively. Expenses were primarily for cleaning and restoration activities, write-off of damaged fixed assets and other direct costs related to recovery from this event. A summary of the net charges in the consolidated statement of operations resulting from the impact of the fire is shown below: Three Months Ended January 31, 2019 2018 (in millions) Cost of products and services $ — $ 5 Research and development — 1 Selling, general and administrative — 1 Total $ — $ 7 For the three months ended January 31, 2019 and 2018, we received insurance proceeds of $22 million and $10 million , respectively, for covered expenses incurred. Combined with $68 million received in fiscal 2018, we have received insurance proceeds related to recovery from the northern California wildfires of $90 million to date, which has substantially covered our total fire-related expenses in excess of our $10 million self-insured retention amount. In addition, for the three months ended January 31, 2019 and 2018, we made investments in property, plant and equipment related to fire recovery of $10 million and $3 million , respectively. Combined with capital expenditures of $27 million in fiscal 2018, we have made investments in property, plant and equipment related to fire recovery of $37 million to date that are expected to be covered by insurance. We currently estimate additional insurance proceeds of $30 million to $40 million in fiscal 2019. In certain cases, our insurance coverage exceeds the amount of the covered losses, but no gain contingencies have been recognized as our ability to realize those gains remains uncertain for financial reporting purposes. There may be a difference in timing of costs incurred and the related insurance reimbursement. |
NEW ACCOUNTING PRONOUNCEMENTS N
NEW ACCOUNTING PRONOUNCEMENTS NEW ACCOUNTING PRONOUNCEMENTS ASU 2016-15 (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | Three Months Ended As Originally Reported As Adjusted Effect of Change (in millions) Cost of products $ 337 $ 339 $ 2 Research and development 146 150 4 Selling, general and administrative 289 295 6 Other income (expense), net 1 13 12 Three Months Ended January 31, 2018 As Originally Reported As Adjusted Change (in millions) Net cash provided by operating activities $ 171 $ 171 $ — Net cash used in investing activities $ (27 ) $ (24 ) $ 3 Net cash provided by financing activities $ 9 $ 6 $ (3 ) |
NEW ACCOUNTING PRONOUNCEMENTS_2
NEW ACCOUNTING PRONOUNCEMENTS NEW REVENUE RECOGNITION (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | The cumulative effect of initially applying the new revenue standard to all open contracts as of November 1, 2018 was as follows: October 31, Adjustments Due to ASC 606 November 1, (in millions) Assets: Accounts receivable, net $ 624 $ 7 $ 631 Other current assets 222 28 250 Long-term deferred tax assets 750 (15 ) 735 Other assets 279 3 282 Liabilities: Deferred revenue $ 334 $ (53 ) $ 281 Income and other taxes payable 42 1 43 Other accrued liabilities 69 7 76 Long-term deferred revenue 127 (11 ) 116 Other long-term liabilities 287 3 290 Stockholders' equity: Retained earnings $ 1,212 $ 76 $ 1,288 |
Schedule of Prospective Adoption of New Accounting Pronouncements [Table Text Block] | The following tables summarize the impact of ASC 606 on our condensed consolidated financial statements: Three months ended January 31, 2019 As Reported Balances Without Adoption of ASC 606 Effect of Change (in millions) Net revenue: Products $ 837 $ 822 $ 15 Services and other 169 170 (1 ) Total net revenue 1,006 992 14 Costs and expenses: Cost of products 347 346 1 Cost of services and other 81 81 — Total costs 428 427 1 Research and development 173 173 — Selling, general and administrative 288 287 1 Other operating expense (income), net (4 ) (4 ) — Total costs and expenses 885 883 2 Income from operations 121 109 12 Interest income 4 4 — Interest expense (20 ) (20 ) — Other income (expense), net 15 15 — Income before taxes 120 108 12 Provision for income taxes 6 4 2 Net income $ 114 $ 104 $ 10 Net income per share: Basic $ 0.61 $ 0.55 $ 0.06 Diluted $ 0.60 $ 0.55 $ 0.05 January 31, 2019 As Reported Balances Without Adoption of ASC 606 Effect of Change Higher/(Lower) (in millions) Assets: Accounts receivable, net $ 580 $ 572 $ 8 Inventory 641 642 (1 ) Other current assets 225 198 27 Long-term deferred tax assets 741 758 (17 ) Other assets 308 304 4 Liabilities: Deferred revenue $ 317 $ 377 $ (60 ) Income and other taxes payable 56 54 2 Other accrued liabilities 96 89 7 Long-term deferred revenue 126 143 (17 ) Other long-term liabilities 284 281 3 Stockholders' equity: Retained earnings $ 1,402 $ 1,316 $ 86 |
NEW ACCOUNTING PRONOUNCEMENTS_3
NEW ACCOUNTING PRONOUNCEMENTS NEW ACCOUNTING PRONOUNCEMENTS ASU 2017-07 (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | Three Months Ended As Originally Reported As Adjusted Effect of Change (in millions) Cost of products $ 337 $ 339 $ 2 Research and development 146 150 4 Selling, general and administrative 289 295 6 Other income (expense), net 1 13 12 Three Months Ended January 31, 2018 As Originally Reported As Adjusted Change (in millions) Net cash provided by operating activities $ 171 $ 171 $ — Net cash used in investing activities $ (27 ) $ (24 ) $ 3 Net cash provided by financing activities $ 9 $ 6 $ (3 ) |
REVENUE DISSAGGREGATION OF REVE
REVENUE DISSAGGREGATION OF REVENUE (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Revenue Recognition [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Disaggregation of Revenue We disaggregate our revenue from contracts with customers by geographic region, end market, and timing of transfer of products and services to customers, as we believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Disaggregated revenue is presented for each of our three reportable segments. Three Months Ended January 31, 2019 Communications Solutions Group Electronic Industrial Solutions Group Ixia Solutions Group Total (in millions) Region Americas $ 272 $ 57 $ 74 $ 403 Europe 96 63 19 178 Asia Pacific 255 137 33 425 Total net revenue $ 623 $ 257 $ 126 $ 1,006 End Market Aerospace, Defense & Government $ 223 $ — $ — $ 223 Commercial Communications 400 — — 400 Electronic Industrial — 257 — 257 Ixia Solutions — — 126 126 Total net revenue $ 623 $ 257 $ 126 $ 1,006 Timing of Revenue Recognition Revenue recognized at a point in time $ 570 $ 235 $ 82 $ 887 Revenue recognized over time 53 22 44 119 Total net revenue $ 623 $ 257 $ 126 $ 1,006 |
REVENUE CAPITALIZED CONTRACTUAL
REVENUE CAPITALIZED CONTRACTUAL COST (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Capitalized Contract Cost [Line Items] | |
Capitalized Contract Cost [Abstract] | The following table provides a roll-forward of our capitalized contract costs, current and non-current: Three months ended January 31, 2019 (in millions) Balance at October 31, 2018 $ — Costs capitalized on November 1, 2018 due to ASC 606 adoption 29 Costs capitalized during the period 17 Costs amortized during the period (18 ) Foreign currency translation impact 1 Balance at January 31, 2019 $ 29 |
REVENUE CONTRACT LIABILITIES (T
REVENUE CONTRACT LIABILITIES (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Contract with Customer, Asset and Liability [Table Text Block] | Changes in contract liabilities, current and non-current, during the three months ended January 31, 2019 were as follows: Contract Liabilities (in millions) Balance at October 31, 2018 $ 461 Impact of adopting new revenue standard (64 ) Balance at November 1, 2018 397 Deferral of revenue billed in current period, net of recognition 167 Revenue recognized that was deferred as of the beginning of the period (124 ) Foreign currency translation impact 3 Balance at January 31, 2019 $ 443 |
REVENUE Remaning Performace Obl
REVENUE Remaning Performace Obligations (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block] | Revenue expected to be recognized in any future period related to remaining performance obligations, excluding revenue pertaining to contracts that have an original expected duration of one year or less, was approximately $260 million as of January 31, 2019, and represents the company’s obligation to deliver products and services and obtain customer acceptance on delivered products. Since we typically invoice customers at contract inception, this amount is included in our current and long-term deferred revenue balances. As of January 31, 2019, we expect to recognize approximately 41 percent of the revenue related to these unsatisfied performance obligations during the remainder of 2019, 32 percent during 2020, and 27 percent thereafter. |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 2018 (in millions) Cost of products and services $ 4 $ 3 Research and development 6 4 Selling, general and administrative 17 12 Total share-based compensation expense $ 27 $ 19 |
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 awards granted under the LTP Program that are based on total shareholder return ("TSR"): Three Months Ended January 31, 2019 2018 Volatility of Keysight shares 25 % 25 % Volatility of selected index 12 % 14 % Price-wise correlation with selected peers 57 % 57 % |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 2018 (in millions) Numerator: Net income $ 114 $ 94 Denominator: Basic weighted-average shares 187 187 Potential common shares— stock options and other employee stock plans 3 2 Diluted weighted-average shares 190 189 |
SUPPLEMENT CASH FLOW INFORMAT_2
SUPPLEMENT CASH FLOW INFORMATION (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Other Significant Noncash Transactions [Line Items] | |
Cash Flow, Supplemental Disclosures [Text Block] | Three months ended January 31, 2019 2018 (in millions) Increase (decrease) in unpaid capital expenditures in accounts payable $ 11 $ (3 ) $ 11 $ (3 ) The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet to the amount shown in the condensed consolidated statement of cash flows: Three months ended January 31, 2019 2018 (in millions) Cash and cash equivalents $ 1,098 $ 980 Restricted cash included in other current assets 2 — Restricted cash included in other assets 2 2 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 1,102 $ 982 Restricted cash consisted primarily of deposits held as collateral against bank guarantees. |
INVENTORY (Tables)
INVENTORY (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Inventory, Net [Abstract] | |
INVENTORY | January 31, October 31, (in millions) Finished goods $ 286 $ 283 Purchased parts and fabricated assemblies 355 336 Total inventory $ 641 $ 619 Inventory-related excess and obsolescence charges recorded in total cost of products were $7 million and $6 million for the three months ended January 31, 2019 and January 31, 2018, respectively. We record excess and obsolete inventory charges for inventory at our sites as well as inventory at our contract manufacturers and suppliers, where we have non-cancellable purchase commitments. |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill balances and movements for each reportable segments during the period | oodwill balances as of January 31, 2019 and October 31, 2018 and the activity for the three months ended January 31, 2019 for each of our reportable operating segments were as follows. Prior period amounts have been reclassified to conform to our organizational change as described in Note 16, "Segment Information." Communications Solutions Group Electronic Industrial Solutions Group Ixia Solutions Group Total (in millions) Balance as of October 31, 2018: Goodwill $ 497 $ 267 $ 1,116 $ 1,880 Accumulated impairment losses — — (709 ) (709 ) Goodwill as reported 497 267 407 1,171 Foreign currency translation impact 9 1 — 10 Balance as of January 31, 2019 $ 506 $ 268 $ 407 $ 1,181 Components of goodwill as of January 31, 2019: Goodwill $ 506 $ 268 $ 1,116 $ 1,890 Accumulated impairment losses — — (709 ) (709 ) Goodwill as reported $ 506 $ 268 $ 407 $ 1,181 |
Components of other intangibles during the period | The company has not identified any triggering events that indicate an impairment of goodwill in the three months ended January 31, 2019. Other intangible assets as of January 31, 2019 and October 31, 2018 consisted of the following: Other Intangible Assets as of January 31, 2019 Other Intangible Assets as of October 31, 2018 Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value Gross Carrying Amount Accumulated Amortization and Impairments Net Book Value (in millions) Developed technology $ 835 $ 455 $ 380 $ 835 $ 415 $ 420 Backlog 13 13 — 13 13 — Trademark/Tradename 33 16 17 33 14 19 Customer relationships 304 109 195 304 100 204 Non-compete agreements 1 — 1 1 — 1 Total amortizable intangible assets 1,186 593 593 1,186 542 644 In-Process R&D 1 — 1 1 — 1 Total $ 1,187 $ 593 $ 594 $ 1,187 $ 542 $ 645 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 and October 31, 2018 were as follows: Fair Value Measurements at January 31, 2019 October 31, 2018 Total Level 1 Level 2 Level 3 Other Total Level 1 Level 2 Level 3 Other (in millions) Assets: Short-term Cash equivalents Money market funds $ 603 $ 603 $ — $ — $ — $ 484 $ 484 $ — $ — $ — Derivative instruments (foreign exchange contracts) 3 — 3 — — 6 — 6 — — Long-term Equity investments 36 36 — — — 30 30 — — — Equity investments - other 16 — — — 16 16 — — — 16 Total assets measured at fair value $ 658 $ 639 $ 3 $ — $ 16 $ 536 $ 514 $ 6 $ — $ 16 Liabilities: Short-term Derivative instruments (foreign exchange contracts) $ 5 $ — $ 5 $ — $ — $ 6 $ — $ 6 $ — $ — Long-term Deferred compensation liability 13 — 13 — — 13 — 13 — — Total liabilities measured at fair value $ 18 $ — $ 18 $ — $ — $ 19 $ — $ 19 $ — $ — Net recognized gains (losses) on equity investments were as follows: |
FAIR VALUE MEASUREMENTS FAIR VA
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS (Net recognized gains losses on equity securities) (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Gain (Loss) on Securities [Table Text Block] | Net recognized gains (losses) on equity investments were as follows: Three Months Ended January 31, 2019 (in millions) Net realized gains on investments sold $ — Net unrealized gains on investments still held 5 Other-than-temporary impairments of investments — Total $ 5 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 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 $ 13 $ 48 British Pound — (39 ) Singapore Dollar 16 — Malaysian Ringgit 87 (4 ) Japanese Yen (75 ) (38 ) Other currencies (14 ) (5 ) Total $ 27 $ (38 ) |
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, 2019 and October 31, 2018 were as follows: Fair Values of Derivative Instruments Derivative Assets Derivative Liabilities Fair Value Fair Value Balance Sheet Location January 31, October 31, Balance Sheet Location January 31, October 31, (in millions) (in millions) Derivatives designated as hedging instruments: Cash flow hedges Foreign exchange contracts Other current assets $ 2 $ 5 Other accrued liabilities $ 3 $ 4 Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets 1 1 Other accrued liabilities 2 2 Total derivatives $ 3 $ 6 $ 5 $ 6 |
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 for those not designated as hedging instruments in our condensed consolidated statement of operations was as follows: Three Months Ended January 31, 2019 2018 (in millions) Derivatives designated as hedging instruments: Cash Flow Hedges Foreign exchange contracts: Gain (loss) recognized in accumulated other comprehensive income $ (2 ) $ 2 Gain (loss) reclassified from accumulated other comprehensive income into earnings: Cost of products $ — $ 2 Selling, general and administrative $ (1 ) $ — Amount excluded from effectiveness testing recognized in earnings based on changes in fair value: Cost of products $ 1 $ — Derivatives not designated as hedging instruments: Gain (loss) recognized in other income (expense), net $ (3 ) $ 1 |
RETIREMENT PLANS AND POST RET_2
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Defined Benefit Plan [Abstract] | |
Schedule of net pension and post-retirement benefit costs | For the three months ended January 31, 2019 and 2018 , 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 U.S. Post-Retirement Three Months Ended January 31, 2019 2018 2019 2018 2019 2018 (in millions) Service cost—benefits earned during the period $ 5 $ 6 $ 3 $ 3 $ — $ — Interest cost on benefit obligation 7 6 6 6 2 2 Expected return on plan assets (11 ) (9 ) (19 ) (21 ) (3 ) (4 ) Amortization: Net actuarial loss 3 3 7 6 2 4 Prior service credit (1 ) (2 ) — — (3 ) (3 ) Settlement loss — — 2 — — — Net periodic benefit cost (benefit) $ 3 $ 4 $ (1 ) $ (6 ) $ (2 ) $ (1 ) Pensions U.S. Defined Benefit Plans Non-U.S. Defined Benefit U.S. Post-Retirement Three Months Ended January 31, 2019 2018 2019 2018 2019 2018 (in millions) Service cost—benefits earned during the period $ 5 $ 6 $ 3 $ 3 $ — $ — Interest cost on benefit obligation 7 6 6 6 2 2 Expected return on plan assets (11 ) (9 ) (19 ) (21 ) (3 ) (4 ) Amortization: Net actuarial loss 3 3 7 6 2 4 Prior service credit (1 ) (2 ) — — (3 ) (3 ) Settlement loss — — 2 — — — Net periodic benefit cost (benefit) $ 3 $ 4 $ (1 ) $ (6 ) $ (2 ) $ (1 ) |
WARRANTY, COMMITMENTS AND CON_2
WARRANTY, COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 2018 (in millions) Beginning balance $ 45 $ 45 Accruals for warranties including change in estimate 8 10 Settlements made during the period (9 ) (8 ) Ending balance $ 44 $ 47 Accruals for warranties due within one year $ 25 $ 26 Accruals for warranties due after one year 19 21 Ending balance $ 44 $ 47 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The following table summarizes the components of our long-term debt: January 31, 2019 October 31, 2018 (in millions) 2019 senior unsecured notes at 3.30% (net of unamortized costs of $1 and $1) $ 499 $ 499 2024 senior unsecured notes at 4.55% (net of unamortized costs of $3 and $3) 597 597 2027 senior unsecured notes at 4.60% (net of unamortized costs of $6 and $6) 694 694 Total debt 1,790 1,790 Less: short-term debt 499 499 Total long-term debt $ 1,291 $ 1,291 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
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, 2019 and 2018 were as follows: Unrealized gain (loss) on investments 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, 2018 $ — $ (60 ) $ (445 ) $ 19 $ (2 ) $ (488 ) Other comprehensive income (loss) before reclassifications — 30 4 — (2 ) 32 Amounts reclassified out of accumulated other comprehensive loss — — 12 (4 ) 1 9 Tax (expense) benefit — — (3 ) 1 — (2 ) Other comprehensive income (loss) — 30 13 (3 ) (1 ) 39 As of January 31, 2019 $ — $ (30 ) $ (432 ) $ 16 $ (3 ) $ (449 ) As of October 31, 2017 $ 14 $ (39 ) $ (468 ) $ 35 $ 1 $ (457 ) Other comprehensive income (loss) before reclassifications (2 ) 41 — — 2 41 Amounts reclassified out of accumulated other comprehensive loss — — 13 (5 ) (2 ) 6 Tax (expense) benefit — — (3 ) 1 — (2 ) Other comprehensive income (loss) (2 ) 41 10 (4 ) — 45 As of January 31, 2018 $ 12 $ 2 $ (458 ) $ 31 $ 1 $ (412 ) |
Reclassification out of Accumulated Other Comprehensive Income | Reclassifications out of accumulated other comprehensive loss for the three months ended January 31, 2019 and 2018 were as follows: Details about Accumulated Other Comprehensive Loss Components Affected Line Item in Statement of Operations Three Months Ended January 31, 2019 2018 Unrealized gain (loss) on derivatives $ — $ 2 Cost of products (1 ) — Selling, general and administrative — — Provision for income taxes (1 ) 2 Net of income tax Net defined benefit pension cost and post retirement plan costs: Actuarial net loss (12 ) (13 ) Prior service credits 4 5 (8 ) (8 ) Total before income tax 3 2 Provision for income taxes (5 ) (6 ) Net of income tax Total reclassifications for the period $ (6 ) $ (4 ) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting, Description of All Other Segments | Communications Solutions Group Electronic Industrial Solutions Group Ixia Solutions Group Total Segments (in millions) Three months ended January 31, 2019: Total net revenue $ 623 $ 257 $ 126 $ 1,006 Amortization of acquisition-related balances — — 3 3 Total segment revenue $ 623 $ 257 $ 129 $ 1,009 Segment income from operations $ 138 $ 54 $ 12 $ 204 Three months ended January 31, 2018: Total net revenue $ 500 $ 229 $ 108 $ 837 Amortization of acquisition-related balances — — 19 19 Total segment revenue $ 500 $ 229 $ 127 $ 856 Segment income from operations $ 63 $ 38 $ 18 $ 119 |
SEGMENT INFORMATION Segment Pro
SEGMENT INFORMATION Segment Profitability (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Table Text Block] | The following table reconciles reportable operating segments’ income from operations to our total enterprise income before taxes: Three Months Ended January 31, 2019 2018 (in millions) Total reportable operating segments' income from operations $ 204 $ 119 Share-based compensation expense (27 ) (19 ) Amortization of acquisition-related balances (54 ) (89 ) Acquisition and integration costs (2 ) (19 ) Northern California wildfire-related costs — (7 ) Other — (2 ) Income (loss) from operations, as reported 121 (17 ) Interest income 4 3 Interest expense (20 ) (22 ) Other income (expense), net 15 13 Income (loss) before taxes, as reported $ 120 $ (23 ) |
NORTHERN CALIFORNIA WILDFIRES_2
NORTHERN CALIFORNIA WILDFIRES IMPACT (Tables) | 3 Months Ended |
Jan. 31, 2019 | |
Unusual or Infrequent Item, or Both [Line Items] | |
Schedule of Unusual or Infrequent Items, or Both [Table Text Block] | A summary of the net charges in the consolidated statement of operations resulting from the impact of the fire is shown below: Three Months Ended January 31, 2019 2018 (in millions) Cost of products and services $ — $ 5 Research and development — 1 Selling, general and administrative — 1 Total $ — $ 7 |
NEW ACCOUNTING PRONOUNCEMENTS E
NEW ACCOUNTING PRONOUNCEMENTS Effect of ASU 2016-15 adoption - Adjustments in Cash flow (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Net cash provided by operating activities | $ 240 | $ 171 |
Net cash used in investing activities | (29) | (24) |
Net cash provided by financing activities | $ (33) | 6 |
As originally reported | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Net cash provided by operating activities | 171 | |
Net cash used in investing activities | (27) | |
Net cash provided by financing activities | 9 | |
Change | Accounting Standards Update 2016-15 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Net cash provided by operating activities | 0 | |
Net cash used in investing activities | 3 | |
Net cash provided by financing activities | $ (3) |
NEW ACCOUNTING PRONOUNCEMENTS_4
NEW ACCOUNTING PRONOUNCEMENTS Effect of ASC 606 adoption on income statement (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |||
Jan. 31, 2019 | Jan. 31, 2018 | Nov. 01, 2018 | Oct. 31, 2018 | |
Net revenue: | ||||
Revenues | $ 1,006 | $ 837 | ||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 428 | 412 | ||
Research and development | 173 | 150 | ||
Selling, general and administrative | 288 | 295 | ||
Other operating expense (income), net | (4) | (3) | ||
Total costs and expenses | 885 | 854 | ||
Income from operations | 121 | (17) | ||
Interest income | 4 | 3 | ||
Interest expense | (20) | (22) | ||
Other income (expense), net | 15 | 13 | ||
Income before taxes | 120 | (23) | ||
Provision for income taxes | 6 | (117) | ||
Net income | $ 114 | $ 94 | ||
Net income per share: | ||||
Earnings Per Share, Basic | $ 0.61 | $ 0.50 | ||
Earnings Per Share, Diluted | $ 0.60 | $ 0.50 | ||
Assets: | ||||
Accounts receivable, net | $ 580 | $ 631 | $ 624 | |
Inventory | 641 | 619 | ||
Other current assets | 225 | 250 | 222 | |
Long-term deferred tax assets | 741 | 735 | 750 | |
Other assets | 308 | 282 | 279 | |
Liabilities: | ||||
Deferred revenue | 317 | 281 | 334 | |
Income and other taxes payable | 56 | 43 | 42 | |
Other accrued liabilities | 96 | 76 | 69 | |
Long-term deferred revenue | 126 | 116 | 127 | |
Other long-term liabilities | 284 | 290 | 287 | |
Stockholders' equity: | ||||
Retained earnings | 1,402 | 1,288 | 1,212 | |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||
Net revenue: | ||||
Revenues | 992 | |||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 427 | |||
Research and development | 173 | |||
Selling, general and administrative | 287 | |||
Other operating expense (income), net | (4) | |||
Total costs and expenses | 883 | |||
Income from operations | 109 | |||
Interest income | 4 | |||
Interest expense | (20) | |||
Other income (expense), net | 15 | |||
Income before taxes | 108 | |||
Provision for income taxes | 4 | |||
Net income | $ 104 | |||
Net income per share: | ||||
Earnings Per Share, Basic | $ 0.55 | |||
Earnings Per Share, Diluted | $ 0.55 | |||
Assets: | ||||
Accounts receivable, net | $ 572 | 624 | ||
Inventory | 642 | |||
Other current assets | 198 | 222 | ||
Long-term deferred tax assets | 758 | 750 | ||
Other assets | 304 | 279 | ||
Liabilities: | ||||
Deferred revenue | 377 | 334 | ||
Income and other taxes payable | 54 | 42 | ||
Other accrued liabilities | 89 | 69 | ||
Long-term deferred revenue | 143 | 127 | ||
Other long-term liabilities | 281 | 287 | ||
Stockholders' equity: | ||||
Retained earnings | 1,316 | $ 1,212 | ||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Net revenue: | ||||
Revenues | 14 | |||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 1 | |||
Research and development | 0 | |||
Selling, general and administrative | 1 | |||
Other operating expense (income), net | 0 | |||
Total costs and expenses | 2 | |||
Income from operations | 12 | |||
Interest income | 0 | |||
Interest expense | 0 | |||
Other income (expense), net | 0 | |||
Income before taxes | 12 | |||
Provision for income taxes | 2 | |||
Net income | $ 10 | |||
Net income per share: | ||||
Earnings Per Share, Basic | $ 0.06 | |||
Earnings Per Share, Diluted | $ 0.05 | |||
Assets: | ||||
Accounts receivable, net | $ 8 | 7 | ||
Inventory | (1) | |||
Other current assets | 27 | 28 | ||
Long-term deferred tax assets | (17) | (15) | ||
Other assets | 4 | 3 | ||
Liabilities: | ||||
Deferred revenue | (60) | (53) | ||
Income and other taxes payable | 2 | 1 | ||
Other accrued liabilities | 7 | 7 | ||
Long-term deferred revenue | (17) | (11) | ||
Other long-term liabilities | 3 | 3 | ||
Stockholders' equity: | ||||
Retained earnings | 86 | $ 76 | ||
Products | ||||
Net revenue: | ||||
Revenues | 837 | $ 684 | ||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 347 | 339 | ||
Products | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||
Net revenue: | ||||
Revenues | 822 | |||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 346 | |||
Products | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Net revenue: | ||||
Revenues | 15 | |||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 1 | |||
Services and other | ||||
Net revenue: | ||||
Revenues | 169 | 153 | ||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 81 | $ 73 | ||
Services and other | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||
Net revenue: | ||||
Revenues | 170 | |||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | 81 | |||
Services and other | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Net revenue: | ||||
Revenues | (1) | |||
Costs and Expenses [Abstract] | ||||
Cost of Goods and Services Sold | $ 0 |
NEW ACCOUNTING PRONOUNCEMENTS C
NEW ACCOUNTING PRONOUNCEMENTS Cumulative effect adjustment from adoption of Topic 606 (Details) - USD ($) $ in Millions | Jan. 31, 2019 | Nov. 01, 2018 | Oct. 31, 2018 |
Assets: | |||
Accounts receivable, net | $ 580 | $ 631 | $ 624 |
Other current assets | 225 | 250 | 222 |
Long-term deferred tax assets | 741 | 735 | 750 |
Other assets | 308 | 282 | 279 |
Liabilities: | |||
Deferred revenue | 317 | 281 | 334 |
Income and other taxes payable | 56 | 43 | 42 |
Other accrued liabilities | 96 | 76 | 69 |
Long-term deferred revenue | 126 | 116 | 127 |
Other long-term liabilities | 284 | 290 | 287 |
Stockholders' equity: | |||
Retained earnings | 1,402 | 1,288 | 1,212 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||
Assets: | |||
Accounts receivable, net | 572 | 624 | |
Other current assets | 198 | 222 | |
Long-term deferred tax assets | 758 | 750 | |
Other assets | 304 | 279 | |
Liabilities: | |||
Deferred revenue | 377 | 334 | |
Income and other taxes payable | 54 | 42 | |
Other accrued liabilities | 89 | 69 | |
Long-term deferred revenue | 143 | 127 | |
Other long-term liabilities | 281 | 287 | |
Stockholders' equity: | |||
Retained earnings | 1,316 | $ 1,212 | |
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | |||
Assets: | |||
Accounts receivable, net | 8 | 7 | |
Other current assets | 27 | 28 | |
Long-term deferred tax assets | (17) | (15) | |
Other assets | 4 | 3 | |
Liabilities: | |||
Deferred revenue | (60) | (53) | |
Income and other taxes payable | 2 | 1 | |
Other accrued liabilities | 7 | 7 | |
Long-term deferred revenue | (17) | (11) | |
Other long-term liabilities | 3 | 3 | |
Stockholders' equity: | |||
Retained earnings | $ 86 | $ 76 |
NEW ACCOUNTING PRONOUNCEMENTS_5
NEW ACCOUNTING PRONOUNCEMENTS Effect of ASU 2017-07 adoption - Adjustments in Income statement (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cost of Goods and Services Sold | $ 428 | $ 412 |
Research and development | 173 | 150 |
Selling, general and administrative | 288 | 295 |
Other income (expense), net | 15 | 13 |
Change | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Research and development | 4 | |
Selling, general and administrative | 6 | |
Other income (expense), net | 12 | |
As originally reported | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Research and development | 146 | |
Selling, general and administrative | 289 | |
Other income (expense), net | 1 | |
Products | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cost of Goods and Services Sold | $ 347 | 339 |
Products | Change | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cost of Goods and Services Sold | 2 | |
Products | As originally reported | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cost of Goods and Services Sold | $ 337 |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 1,006 | $ 837 |
Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 623 | |
Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 257 | |
Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 126 | $ 108 |
Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 403 | |
Americas | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 272 | |
Americas | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 57 | |
Americas | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 74 | |
Europe | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 178 | |
Europe | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 96 | |
Europe | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 63 | |
Europe | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 19 | |
Asia Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 425 | |
Asia Pacific | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 255 | |
Asia Pacific | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 137 | |
Asia Pacific | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 33 | |
Transferred at Point in Time | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 887 | |
Transferred at Point in Time | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 570 | |
Transferred at Point in Time | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 235 | |
Transferred at Point in Time | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 82 | |
Transferred over Time | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 119 | |
Transferred over Time | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 53 | |
Transferred over Time | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 22 | |
Transferred over Time | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 44 | |
Aerospace, defense and government | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 223 | |
Aerospace, defense and government | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 223 | |
Aerospace, defense and government | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Aerospace, defense and government | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Commercial Communications | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 400 | |
Commercial Communications | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 400 | |
Commercial Communications | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Commercial Communications | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Electronic Industrial | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 257 | |
Electronic Industrial | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Electronic Industrial | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 257 | |
Electronic Industrial | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Ixia Solutions | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 126 | |
Ixia Solutions | Communications Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Ixia Solutions | Electronic Industrial Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | |
Ixia Solutions | Ixia Solutions Group | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 126 |
REVENUE Capitalized Contractu_2
REVENUE Capitalized Contractual Cost (Details) - USD ($) | 3 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Nov. 01, 2018 | |
Capitalized Contract Cost [Line Items] | |||
Capitalized Contract Cost, Judgment | Capitalized incremental costs are allocated to the individual performance obligations in proportion to the transaction price allocated to each performance obligation and amortized based on the pattern of performance for the underlying performance obligation. Contract costs related to initial contracts and renewals are amortized over the same period because the commissions paid on both the initial contract and renewals are commensurate with one another. | ||
Balance at October 31, 2018 | $ 0 | ||
Cost capitalized on day1 due to ASC 606 adoption | $ 29 | ||
Costs capitalized during the period | 17 | ||
Costs amortized during the period | (18) | ||
Foreign currency translation impact | 1 | ||
Balance at January 31, 2019 | $ 29 |
REVENUE CONTRACT LIABILITIES RO
REVENUE CONTRACT LIABILITIES ROLL FORWARD (Details) - USD ($) | 3 Months Ended | |
Jan. 31, 2019 | Nov. 01, 2018 | |
Contract with Customer, Liability [Abstract] | ||
Balance at October 31, 2018 | $ 461 | |
Impact of adopting new revenue standard | (64) | |
Balance at November 1, 2018 | 461 | $ 397 |
Deferral of revenue billed in current period, net of recognition | 167 | |
Revenue recognized that was deferred as of the beginning of the period | (124) | |
Foreign currency translation impact | 3 | |
Balance at January 31, 2019 | $ 443 |
REVENUE Remaining performance o
REVENUE Remaining performance obligations (Details) $ in Millions | Jan. 31, 2019USD ($) |
Revenue from Contract with Customer [Abstract] | |
Revenue, Remaining Performance Obligation, Amount | $ 260 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-02-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Percentage | 41.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-11-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Percentage | 32.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-11-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Percentage | 27.00% |
SHARE-BASED COMPENSATION Alloca
SHARE-BASED COMPENSATION Allocated Share-based compensation expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Allocated Share-based Compensation Expense | $ 27 | $ 19 |
Share-based Compensation Capitalized within inventory | 1 | 1 |
Cost of products and services | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Allocated Share-based Compensation Expense | 4 | 3 |
Research and development | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Allocated Share-based Compensation Expense | 6 | 4 |
Selling, general and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Allocated Share-based Compensation Expense | $ 17 | $ 12 |
SHARE-BASED COMPENSATION Fair V
SHARE-BASED COMPENSATION Fair Value Assumptions (Details) - shares shares in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
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 |
LTPP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Volatility of Keysight shares (in hundredths) | 25.00% | 25.00% |
Volatility of selected index | 12.00% | 14.00% |
Price-wise correlation with selected peers (in hundredths) | 57.00% | 57.00% |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Income Tax Examination [Line Items] | ||
Provision for income taxes | $ 6 | $ (117) |
Certain foreign entities [Member] | ||
Income Tax Examination [Line Items] | ||
Open Tax Year | 2,008 | |
Malaysia Tax Authority [Member] | ||
Income Tax Examination [Line Items] | ||
Income Tax Examination, Description | The company is being audited in Malaysia for the 2008 tax year. Although this tax year pre-dates our spin-off from Agilent, pursuant to the agreement between Agilent and Keysight pertaining to tax matters, as finalized at the time of separation, for certain entities, including Malaysia, any historical tax liability is the responsibility of Keysight. In the fourth quarter of fiscal 2017, Keysight paid income taxes and penalties of $68 million on gains related to intellectual property rights, although we are currently in the process of appealing to the Special Commissioners of Income Tax in Malaysia. The company believes there are numerous defenses to the current assessment; the statute of limitations for the 2008 tax year in Malaysia was closed, and the income in question is exempt from tax in Malaysia. The company is disputing this assessment and pursuing all avenues to resolve this issue favorably for the company. | |
Internal Revenue Service (IRS) [Member] | ||
Income Tax Examination [Line Items] | ||
Effective Income Tax Rate, Percent | 5.20% | (515.80%) |
Provision for income taxes | $ 6 | $ (117) |
Net Discrete Tax expense (Benefit) | $ (23) | $ (115) |
Open tax year, from date | Nov. 1, 2014 | |
Foreign Tax Authority [Member] | Majority of company's entities [Member] | ||
Income Tax Examination [Line Items] | ||
Open tax year, from date | Aug. 1, 2014 |
INCOME TAXES INCOME TAXES (Tax
INCOME TAXES INCOME TAXES (Tax incentives) (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Jan. 31, 2019USD ($)$ / shares | |
Income Tax Disclosure [Abstract] | |
Income Tax Holiday, Aggregate Dollar Amount | $ | $ 8 |
Income Tax Holiday, Income Tax Benefits Per Share | $ / shares | $ 0.04 |
Income Tax Holiday, Termination Date | The Singapore tax incentive is due for renewal in fiscal 2024. |
Income Tax Holiday, Description | Keysight benefits from tax incentives in several jurisdictions, most significantly in Singapore, that 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 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, 2019 | Jan. 31, 2018 | |
Numerator: | ||
Net income | $ 114 | $ 94 |
Denominator: | ||
Basic weighted-average shares | 187 | 187 |
Potential common shares— stock options and other employee stock plans | 3 | 2 |
Diluted weighted-average shares | 190 | 189 |
NET INCOME PER SHARE (Details)
NET INCOME PER SHARE (Details) - shares | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Stock Options [Member] | ||
Antidilutive Securities Excluded from EPS Computation | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Number | 0 | 0 |
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 | 417,400 | 668,100 |
SUPPLEMENT CASH FLOW INFORMAT_3
SUPPLEMENT CASH FLOW INFORMATION Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Income Taxes Paid, Net [Abstract] | ||
Income Taxes Paid, Net | $ 1 | $ 1 |
SUPPLEMENT CASH FLOW INFORMAT_4
SUPPLEMENT CASH FLOW INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Other Significant Noncash Transactions [Line Items] | ||
Increase (decrease) in capital expenditure incurred but not yet paid | $ 11 | $ (3) |
Accounts Payable [Member] | ||
Other Significant Noncash Transactions [Line Items] | ||
Increase (decrease) in capital expenditure incurred but not yet paid | $ 11 | $ (3) |
SUPPLEMENT CASH FLOW INFORMAT_5
SUPPLEMENT CASH FLOW INFORMATION Interest paid (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | ||
Cash paid for interest | $ 0 | $ 2 |
SUPPLEMENT CASH FLOW INFORMAT_6
SUPPLEMENT CASH FLOW INFORMATION SUPPLEMENTAL CASH FLOW (Cash, cash equivalents an restricted cash reconciliation) (Details) - USD ($) $ in Millions | Jan. 31, 2019 | Oct. 31, 2018 | Jan. 31, 2018 | Oct. 31, 2017 |
Cash and cash equivalents | $ 1,098 | $ 913 | $ 980 | |
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | 1,102 | $ 917 | 982 | $ 820 |
Other Current Assets [Member] | ||||
Restricted cash included in other current assets | 2 | 0 | ||
Other Assets [Member] | ||||
Restricted cash included in other assets | $ 2 | $ 2 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Oct. 31, 2018 | |
Inventory, Net [Abstract] | |||
Finished goods | $ 286 | $ 283 | |
Purchased parts and fabricated assemblies | 355 | 336 | |
Total inventory | 641 | $ 619 | |
Excess and obsolete inventory-related charges | $ 7 | $ 6 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Roll forward (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Oct. 31, 2018 | |
Goodwill [Roll Forward] | ||
Goodwill, Gross | $ 1,890 | $ 1,880 |
Goodwill, Impaired, Accumulated Impairment Loss | (709) | (709) |
Goodwill, Beginning balance | 1,171 | |
Foreign currency translation impact | 10 | |
Balance as of January 31, 2019 | 1,181 | |
Communications Solutions Group | ||
Goodwill [Roll Forward] | ||
Goodwill, Gross | 506 | 497 |
Goodwill, Impaired, Accumulated Impairment Loss | 0 | 0 |
Goodwill, Beginning balance | 497 | |
Foreign currency translation impact | 9 | |
Balance as of January 31, 2019 | 506 | |
Electronic Industrial Solutions Group | ||
Goodwill [Roll Forward] | ||
Goodwill, Gross | 268 | 267 |
Goodwill, Impaired, Accumulated Impairment Loss | 0 | 0 |
Goodwill, Beginning balance | 267 | |
Foreign currency translation impact | 1 | |
Balance as of January 31, 2019 | 268 | |
Ixia Solutions Group | ||
Goodwill [Roll Forward] | ||
Goodwill, Gross | 1,116 | 1,116 |
Goodwill, Impaired, Accumulated Impairment Loss | (709) | $ (709) |
Goodwill, Beginning balance | 407 | |
Foreign currency translation impact | 0 | |
Balance as of January 31, 2019 | $ 407 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS Disclosures and Components of Purchased Other Intangibles (Details) - USD ($) $ in Millions | Jan. 31, 2019 | Oct. 31, 2018 |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, Gross carrying amount | $ 1,186 | $ 1,186 |
Accumulated Amortization and impairments | 593 | 542 |
Amortizable intangible assets, Net book value | 593 | 644 |
In-Process R&D | 1 | 1 |
Intangible Assets, Gross (Excluding Goodwill) | 1,187 | 1,187 |
Intangible Assets, Net (Excluding Goodwill) | 594 | 645 |
Developed technology | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, Gross carrying amount | 835 | 835 |
Accumulated Amortization and impairments | 455 | 415 |
Intangible Assets, Net (Excluding Goodwill) | 380 | 420 |
Backlog | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, Gross carrying amount | 13 | 13 |
Accumulated Amortization and impairments | 13 | 13 |
Intangible Assets, Net (Excluding Goodwill) | 0 | 0 |
Trademark/Tradename | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, Gross carrying amount | 33 | 33 |
Accumulated Amortization and impairments | 16 | 14 |
Intangible Assets, Net (Excluding Goodwill) | 17 | 19 |
Customer relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, Gross carrying amount | 304 | 304 |
Accumulated Amortization and impairments | 109 | 100 |
Intangible Assets, Net (Excluding Goodwill) | 195 | 204 |
Noncompete Agreements [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, Gross carrying amount | 1 | 1 |
Accumulated Amortization and impairments | 0 | 0 |
Intangible Assets, Net (Excluding Goodwill) | $ 1 | $ 1 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL AND OTHER INTANGIBLE ASSETS Textuals (Details) $ in Millions | 3 Months Ended |
Jan. 31, 2019USD ($) | |
Goodwill [Line Items] | |
Document Period End Date | Jan. 31, 2019 |
Additions to other intangible assets | $ 0 |
Amortization of intangible assets | $ 51 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS Finite-Lived Assets Future Amortization Expense (Details) | Jan. 31, 2019USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
Finite-Lived Intangible Assets, Amortization Expense, Remainder of 2019 | $ 152 |
Finite-Lived Intangible Assets, Amortization Expense, 2020 | 196 |
Finite-Lived Intangible Assets, Amortization Expense, 2021 | 128 |
Finite-Lived Intangible Assets, Amortization Expense, 2022 | 52 |
Finite-Lived Intangible Assets, Amortization Expense, 2023 | 44 |
Finite-Lived Intangible Assets, Amortization Expense, thereafter | $ 21 |
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, 2019 | Oct. 31, 2018 |
Assets Short - term [Abstract] | ||
Money market funds | $ 603 | $ 484 |
Derivative instruments (foreign exchange contracts) | 3 | 6 |
Assets, Long-term [Abstract] | ||
Equity investments | 36 | 30 |
Equity investments - other | 16 | 16 |
Total assets measured at fair value | 658 | 536 |
Liabilities, Short-term [Abstract] | ||
Derivative instruments (foreign exchange contracts) | 5 | 6 |
Liabilities Long-term [Abstract] | ||
Deferred compensation liability | 13 | 13 |
Total liabilities measured at fair value | 18 | 19 |
Level 1 | ||
Assets Short - term [Abstract] | ||
Money market funds | 603 | 484 |
Derivative instruments (foreign exchange contracts) | 0 | 0 |
Assets, Long-term [Abstract] | ||
Equity investments | 36 | 30 |
Equity investments - other | 0 | 0 |
Total assets measured at fair value | 639 | 514 |
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] | ||
Money market funds | 0 | 0 |
Derivative instruments (foreign exchange contracts) | 3 | 6 |
Assets, Long-term [Abstract] | ||
Equity investments | 0 | 0 |
Equity investments - other | 0 | 0 |
Total assets measured at fair value | 3 | 6 |
Liabilities, Short-term [Abstract] | ||
Derivative instruments (foreign exchange contracts) | 5 | 6 |
Liabilities Long-term [Abstract] | ||
Deferred compensation liability | 13 | 13 |
Total liabilities measured at fair value | 18 | 19 |
Level 3 | ||
Assets Short - term [Abstract] | ||
Money market funds | 0 | 0 |
Derivative instruments (foreign exchange contracts) | 0 | 0 |
Assets, Long-term [Abstract] | ||
Equity investments | 0 | 0 |
Equity investments - other | 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 |
FAIR VALUE MEASUREMENTS FAIR _2
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS (Net recognized gains losses on equity securities) (Details) $ in Millions | 3 Months Ended |
Jan. 31, 2019USD ($) | |
Debt and Equity Securities, Gain (Loss) [Abstract] | |
Net realized gains on investments sold | $ 0 |
Net unrealized gains on investments still held | 5 |
Other-than-temporary impairments of investments | 0 |
Total | $ 5 |
DERIVATIVES, Disclosures and de
DERIVATIVES, Disclosures and derivative instrument aggregated notional amounts by currency and designations (Details) $ in Millions | Jan. 31, 2019USD ($)contracts |
Derivative [Line Items] | |
Derivative, Net Liability Position, Aggregate Fair Value | $ 3 |
Foreign Exchange Forward [Member] | Cash Flow Hedging | |
Derivative [Line Items] | |
Number of Foreign Currency Derivatives Held | contracts | 177 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | |
Derivative [Line Items] | |
Number of Foreign Currency Derivatives Held | contracts | 66 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Sell | |
Derivative [Line Items] | |
Total notional amount | $ 38 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Sell | British Pound | |
Derivative [Line Items] | |
Total notional amount | 39 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Sell | Malaysian Ringgit | |
Derivative [Line Items] | |
Total notional amount | 4 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Sell | Japanese Yen | |
Derivative [Line Items] | |
Total notional amount | 38 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Sell | Other Currency [Member] | |
Derivative [Line Items] | |
Total notional amount | 5 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | Euro | |
Derivative [Line Items] | |
Total notional amount | 48 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Buy | Singapore Dollar | |
Derivative [Line Items] | |
Total notional amount | 0 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Sell | Japanese Yen | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 75 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Sell | Other Currency [Member] | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 14 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Buy | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 27 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Buy | Euro | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | 13 |
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 | 16 |
Foreign Exchange Forward [Member] | Designated as Hedging Instruments | Buy | Malaysian Ringgit | Cash Flow Hedging | |
Derivative [Line Items] | |
Total notional amount | $ 87 |
DERIVATIVES, Fair value of deri
DERIVATIVES, Fair value of derivative instruments and Consolidated Balance Sheet location (Details) - USD ($) $ in Millions | Jan. 31, 2019 | Oct. 31, 2018 |
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Asset | $ 3 | $ 6 |
Total derivatives Liabilities | 5 | 6 |
Designated as Hedging Instruments | Cash Flow Hedging | Foreign Exchange Contracts | Other Current Assets [Member] | ||
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Asset | 2 | 5 |
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 | 3 | 4 |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contracts | Other Current Assets [Member] | ||
Derivative Fair Value by Balance Sheet Location [Abstract] | ||
Total derivatives Asset | 1 | 1 |
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 | $ 2 |
DERIVATIVES, Effect of derivati
DERIVATIVES, Effect of derivative instruments on Consolidated Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Derivative [Line Items] | ||
Cash Flow Hedge Gain (Loss) to be Reclassified within next Twelve Months | $ 2 | |
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 | (2) | $ 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 | 0 | 2 |
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net | 1 | 0 |
Designated as Hedging Instruments | Cash Flow Hedging | Foreign Exchange Contracts | Selling, general and administrative | ||
Derivative [Line Items] | ||
Gain (loss) reclassified from accumulated other comprehensive income into cost of sales | (1) | 0 |
Not Designated as Hedging Instrument [Member] | Other (income) expense, net | ||
Derivative [Line Items] | ||
Gain (loss) recognized in other income (expense),net | $ (3) | $ 1 |
RETIREMENT PLANS AND POST RET_3
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS RETIREMENT AND POST RETIREMENT PENSION PLANS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Defined benefit plan | US | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost—benefits earned during the period | $ 5 | $ 6 |
Interest cost on benefit obligation | 7 | 6 |
Expected return on plan assets | (11) | (9) |
Net actuarial loss | 3 | 3 |
Prior service credit | (1) | (2) |
Settlement loss | 0 | 0 |
Net periodic benefit cost (benefit) | 3 | 4 |
Defined benefit plan | Non-US | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost—benefits earned during the period | 3 | 3 |
Interest cost on benefit obligation | 6 | 6 |
Expected return on plan assets | (19) | (21) |
Net actuarial loss | 7 | 6 |
Prior service credit | 0 | 0 |
Settlement loss | 2 | 0 |
Net periodic benefit cost (benefit) | (1) | (6) |
Post-retirement Benefits Plan | US | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost—benefits earned during the period | 0 | 0 |
Interest cost on benefit obligation | 2 | 2 |
Expected return on plan assets | (3) | (4) |
Net actuarial loss | 2 | 4 |
Prior service credit | (3) | (3) |
Settlement loss | 0 | 0 |
Net periodic benefit cost (benefit) | $ (2) | $ (1) |
RETIREMENT PLANS AND POST RET_4
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS (Details) (Textual) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
US | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | $ 0 | $ 0 |
Estimated future employer contributions in remainder of current fiscal year | 0 | |
US | Post-retirement Benefits Plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | 0 | 0 |
Non-US | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | 8 | $ 9 |
Estimated future employer contributions in remainder of current fiscal year | $ 23 |
RETIREMENT PLANS AND POST RET_5
RETIREMENT PLANS AND POST RETIREMENT PENSION PLANS RETIREMENT AND POST RETIREMENT PENSION PLANS (Details) (Switzerland defined benefit plan settlement) - Defined benefit plan - Non-US - USD ($) $ in Millions | Jan. 01, 2019 | Jan. 31, 2019 | Jan. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | |||
Settlement loss | $ 2 | $ 0 | |
Switzerland Defined Benefit Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Date of transfer of defined benefit plan assets | Jan. 1, 2019 | ||
Settlement loss | $ 2 |
WARRANTIES AND CONTINGENCIES (D
WARRANTIES AND CONTINGENCIES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Guarantees [Abstract] | ||
Standard Product Warranty Description | The Keysight warranty on products sold through direct sales channel is primarily one year. Warranties for products sold through distribution channels continue to be primarily three years. | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning balance at beginning of period | $ 45 | $ 45 |
Accruals for warranties including change in estimate | 8 | 10 |
Settlements made during the period | (9) | (8) |
Ending balance at end of period | 44 | 47 |
Standard Product Warranty Disclosure [Abstract] | ||
Accruals for warranties due within one year | 25 | 26 |
Accruals for warranties due after one year | 19 | 21 |
Ending balance at end of period | $ 44 | $ 47 |
DEBT Facility (Details)
DEBT Facility (Details) - Revolving Credit Facility [Member] $ in Millions | 3 Months Ended |
Jan. 31, 2019USD ($) | |
Line of Credit Facility [Line Items] | |
Facility, Description | On February 15, 2017, we entered into an amended and restated credit agreement (the “Revolving Credit Facility”) that replaced our existing $450 million unsecured credit facility dated September 15, 2014. The Revolving Credit Facility provides for a $450 million, five-year unsecured revolving credit facility that will expire on February 15, 2022 and bears interest at an annual rate of LIBOR + 1.30%. 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. We may use amounts borrowed under the facility for general corporate purposes. As of January 31, 2019, 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, 2019. |
Debt Instrument, Term | 5 years |
Facility, Initiation Date | Feb. 15, 2017 |
Facility, Maximum Borrowing Capacity | $ 450 |
Facility, Expiration Date | Feb. 15, 2022 |
Debt Instrument, Description of Variable Rate Basis | LIBOR + 1.30% |
Additional drawings on credit facility | $ 150 |
Facility, Outstanding | $ 0 |
London Interbank Offered Rate (LIBOR) [Member] | |
Line of Credit Facility [Line Items] | |
Debt Instrument, Basis Spread on Variable Rate | 1.30% |
DEBT Long Term Debt (Details)
DEBT Long Term Debt (Details) - USD ($) $ in Millions | Jan. 31, 2019 | Oct. 31, 2018 |
Debt Instrument [Line Items] | ||
Total debt | $ 1,790 | $ 1,790 |
Short-term debt | 499 | 499 |
Long-term debt | 1,291 | 1,291 |
Senior Notes 2019 | ||
Debt Instrument [Line Items] | ||
Total debt | 499 | 499 |
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 1 | 1 |
Senior Notes 2024 | ||
Debt Instrument [Line Items] | ||
Total debt | 597 | 597 |
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 3 | 3 |
Senior Notes 2027 | ||
Debt Instrument [Line Items] | ||
Total debt | 694 | 694 |
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | $ 6 | $ 6 |
DEBT Debt (Textuals) (Details)
DEBT Debt (Textuals) (Details) - USD ($) $ in Millions | Jan. 31, 2019 | Oct. 31, 2018 |
Debt Disclosure [Abstract] | ||
Letters of Credit Outstanding, Amount | $ 31 | $ 26 |
Long Term Debt Fair Value Over Carrying Value | $ 25 | $ 3 |
STOCKHOLDERS' EQUITY STOCKHOLDE
STOCKHOLDERS' EQUITY STOCKHOLDES' EQUITY - Stock Repurchase (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |||
Jan. 31, 2019 | Jan. 31, 2018 | Mar. 16, 2018 | Oct. 31, 2016 | |
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | ||||
Stock Repurchase Program, Authorized Amount | $ 350 | $ 200 | ||
Treasury Stock, Shares, Acquired | 686,398 | 0 | ||
Treasury Stock, Value, Acquired, Cost Method | $ 40 | $ 0 |
STOCKHOLDER'S EQUITY - Accumula
STOCKHOLDER'S EQUITY - Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ (488) | $ (457) |
Other comprehensive income (loss) before reclassifications | 32 | 41 |
Amounts reclassified out of accumulated other comprehensive loss | 9 | 6 |
Tax (expense) benefit | (2) | (2) |
Other comprehensive income (loss) | 39 | 45 |
Ending balance | (449) | (412) |
Unrealized gain on equity securities [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 0 | 14 |
Other comprehensive income (loss) before reclassifications | 0 | (2) |
Amounts reclassified out of accumulated other comprehensive loss | 0 | 0 |
Tax (expense) benefit | 0 | 0 |
Other comprehensive income (loss) | 0 | (2) |
Ending balance | 0 | 12 |
Foreign currency translation [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (60) | (39) |
Other comprehensive income (loss) before reclassifications | 30 | 41 |
Amounts reclassified out of accumulated other comprehensive loss | 0 | 0 |
Tax (expense) benefit | 0 | 0 |
Other comprehensive income (loss) | 30 | 41 |
Ending balance | (30) | 2 |
Net defined benefit pension cost and post retirement plan costs, actuarial losses [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (445) | (468) |
Other comprehensive income (loss) before reclassifications | 4 | 0 |
Amounts reclassified out of accumulated other comprehensive loss | 12 | 13 |
Tax (expense) benefit | (3) | (3) |
Other comprehensive income (loss) | 13 | 10 |
Ending balance | (432) | (458) |
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 | 19 | 35 |
Other comprehensive income (loss) before reclassifications | 0 | 0 |
Amounts reclassified out of accumulated other comprehensive loss | (4) | (5) |
Tax (expense) benefit | 1 | 1 |
Other comprehensive income (loss) | (3) | (4) |
Ending balance | 16 | 31 |
Unrealized gain (losses) on derivatives [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (2) | 1 |
Other comprehensive income (loss) before reclassifications | (2) | 2 |
Amounts reclassified out of accumulated other comprehensive loss | 1 | (2) |
Tax (expense) benefit | 0 | 0 |
Other comprehensive income (loss) | (1) | 0 |
Ending balance | $ (3) | $ 1 |
STOCKHOLDERS' EQUITY - Reclassi
STOCKHOLDERS' EQUITY - Reclassifications out of accumulated comprehensive income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of Goods and Services Sold | $ (428) | $ (412) |
Selling, general and administrative | (288) | (295) |
Income Tax Expense (Benefit) | (6) | 117 |
Net income | 114 | 94 |
Income before taxes | 120 | (23) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Net income | (6) | (4) |
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 and Services Sold | 0 | 2 |
Selling, general and administrative | (1) | 0 |
Income Tax Expense (Benefit) | 0 | 0 |
Net income | (1) | 2 |
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 before taxes | (12) | (13) |
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 before taxes | 4 | 5 |
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 | 2 |
Net income | (5) | (6) |
Income before taxes | $ (8) | $ (8) |
SEGMENT INFORMATION Profitabili
SEGMENT INFORMATION Profitability (Details) $ in Millions | 3 Months Ended | |
Jan. 31, 2019USD ($) | Jan. 31, 2018USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of Reportable Segments | 3 | |
Number of Operating Segments | 3 | |
Segment Reporting, Factors Used to Identify Entity's Reportable Segments | Our 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 | The Communications Solutions Group serves customers spanning the worldwide commercial communications and aerospace, defense and government end markets. The group provides electronic design and test software, instruments, systems and related services 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, systems and related services used in the simulation, design, validation, manufacturing, installation and optimization of electronic equipment. The Ixia Solutions Group helps customers validate the performance and security resilience of their networks and associated applications. The test, visibility and security products help organizations and their customers strengthen their physical and virtual networks. Enterprises, service providers, network equipment manufacturers, and governments worldwide rely on the group's solutions to validate new products before shipping and secure ongoing operation of their networks with better visibility and security. The group’s product solutions consist of high-performance hardware platforms, software applications and services, including warranty and maintenance offerings. | |
Amortization of acquisition-related balances | $ 3 | $ 19 |
Total segment revenue | 1,006 | 837 |
Income from operations | 121 | (17) |
Communications Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Amortization of acquisition-related balances | 0 | 0 |
Total segment revenue | 623 | 500 |
Electronic Industrial Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Amortization of acquisition-related balances | 0 | 0 |
Total segment revenue | 257 | 229 |
Ixia Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Amortization of acquisition-related balances | 3 | 19 |
Total segment revenue | 126 | 108 |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Total segment revenue | 1,009 | 856 |
Income from operations | 204 | 119 |
Operating Segments [Member] | Communications Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Total segment revenue | 623 | 500 |
Income from operations | 138 | 63 |
Operating Segments [Member] | Electronic Industrial Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Total segment revenue | 257 | 229 |
Income from operations | 54 | 38 |
Operating Segments [Member] | Ixia Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Total segment revenue | 129 | 127 |
Income from operations | $ 12 | $ 18 |
SEGMENT INFORMATION Reconciliat
SEGMENT INFORMATION Reconciliation of Reportable Results (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||
Total reportable operating segments' income from operations | $ 121 | $ (17) |
Share-based compensation expense | (27) | (19) |
Amortization of acquisition-related balances | (54) | (89) |
Acquisition and integration costs | (2) | (19) |
Northern California wildfire-related costs | 0 | (7) |
Other | 0 | (2) |
Income (loss) from operations | 121 | (17) |
Interest income | 4 | 3 |
Interest expense | (20) | (22) |
Other income (expense), net | 15 | 13 |
Income (loss) before taxes | 120 | (23) |
Operating Segments [Member] | ||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||
Total reportable operating segments' income from operations | 204 | 119 |
Income (loss) from operations | $ 204 | $ 119 |
SEGMENT INFORMATION Segment Ass
SEGMENT INFORMATION Segment Assets (Details) - USD ($) $ in Millions | Jan. 31, 2019 | Oct. 31, 2018 |
Segment Reporting Information [Line Items] | ||
Assets | $ 5,978 | $ 5,824 |
Communications Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Assets | 2,059 | 2,115 |
Electronic Industrial Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Assets | 875 | 888 |
Ixia Solutions Group | ||
Segment Reporting Information [Line Items] | ||
Assets | 1,407 | 1,327 |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 4,341 | $ 4,330 |
NORTHERN CALIFORNIA WILDFIRES_3
NORTHERN CALIFORNIA WILDFIRES IMPACT (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 15 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | Oct. 31, 2018 | Jan. 31, 2019 | |
Unusual or Infrequent Item, or Both [Line Items] | ||||
Document Period End Date | Jan. 31, 2019 | |||
Loss from Catastrophes | $ 0 | $ 7 | ||
Northern California Wildfires [Member] | ||||
Unusual or Infrequent Item, or Both [Line Items] | ||||
Loss from Catastrophes | 0 | 7 | ||
Insurance Settlements Receivable | 0 | 31 | $ 0 | |
Insurance Recoveries | 22 | 10 | $ 68 | 90 |
Property, Plant and Equipment [Member] | Northern California Wildfires [Member] | ||||
Unusual or Infrequent Item, or Both [Line Items] | ||||
Property, Plant and Equipment purchases | 10 | $ 3 | $ 27 | 37 |
Uninsured Risk [Member] | ||||
Unusual or Infrequent Item, or Both [Line Items] | ||||
Loss from Catastrophes | 10 | |||
Minimum | Northern California Wildfires [Member] | ||||
Unusual or Infrequent Item, or Both [Line Items] | ||||
Insurance Settlements Receivable, Current | 30 | 30 | ||
Maximum | Northern California Wildfires [Member] | ||||
Unusual or Infrequent Item, or Both [Line Items] | ||||
Insurance Settlements Receivable, Current | $ 40 | $ 40 |
NORTHERN CALIFORNIA WILDFIRES_4
NORTHERN CALIFORNIA WILDFIRES IMPACT Charges in consolidated statement of operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Unusual or Infrequent Item, or Both [Line Items] | ||
Loss from Catastrophes | $ 0 | $ 7 |
Northern California Wildfires [Member] | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Loss from Catastrophes | 0 | 7 |
Cost of products and services | Northern California Wildfires [Member] | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Loss from Catastrophes | 0 | 5 |
Research and development | Northern California Wildfires [Member] | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Loss from Catastrophes | 0 | 1 |
Selling, general and administrative | Northern California Wildfires [Member] | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Loss from Catastrophes | $ 0 | $ 1 |