Viavi Solutions Inc (VIAV)

Pretax margin

Jun 30, 2025 Jun 30, 2024 Jun 30, 2023 Jun 30, 2022 Jun 30, 2021
Earnings before tax but after interest (EBT) US$ in thousands 39,200 11,600 60,700 65,100 130,800
Revenue US$ in thousands 1,084,300 1,000,400 1,106,100 1,292,400 1,198,900
Pretax margin 3.62% 1.16% 5.49% 5.04% 10.91%

June 30, 2025 calculation

Pretax margin = EBT ÷ Revenue
= $39,200K ÷ $1,084,300K
= 3.62%

The pretax margin of Viavi Solutions Inc has exhibited significant fluctuations over the analyzed period from June 30, 2021, to June 30, 2025. In the fiscal year ending June 30, 2021, the company reported a pretax margin of 10.91%, indicating a relatively healthy profitability before tax expenses. However, this margin declined sharply to 5.04% by June 30, 2022, reflecting a reduction in profitability, possibly due to increased costs, pricing pressures, or changes in revenue composition.

The downward trend persisted into the fiscal year ending June 30, 2023, with the pretax margin slightly improving to 5.49%, but remaining substantially below the 2021 level. This modest recovery suggests some stabilization but indicates ongoing challenges in maintaining higher profitability margins.

By June 30, 2024, the pretax margin fell markedly to just 1.16%, signaling a significant deterioration in pre-tax profitability. Such a decline could be attributed to continued operational pressures, increased expenses, or competitive factors impacting earnings before tax. This sharp decline indicates a potential concern regarding the company's cost management or revenue generation.

In the most recent period analyzed, ending June 30, 2025, the pretax margin slightly increased to 3.62%. While this represents a modest recovery from the previous year's low, it remains well below the 2021 peak, suggesting some improvement but still reflecting a less favorable profitability position compared to earlier years.

Overall, the pretax margin trend indicates a considerable decline over the analyzed four-year span, with periods of marginal recovery. The sustained reduction from double digits to single digits and below underscores challenges faced by the company in preserving its pre-tax profitability levels amid evolving market and operational conditions.