The company also sees opportunities in the 4G/LTE segment in Eastern Europe and Asia Pacific

NetScout Systems expects to see increasing business opportunities from 5G in the next fiscal year, the company’s President and CEO Anil Singhal said during a conference with investors and analysts.

“Longer term, we are very bullish that 5G represents an important catalyst to drive higher spending. We believe that this could benefit us as early as next fiscal year, although visibility remains limited,” the executive said.

“In addition to expanding their monitoring capacity in their core networks to handle initial 5G traffic volumes, we anticipate that carriers will ultimately evolve their infrastructure over the next few years, with greater emphasis on new edge computing capabilities and NFV technology. We are well-positioned to help carriers in these areas and expect that 5G field trials for our monitoring solutions will continue to ramp over the coming quarters,” Singhal added.

NetScout also expects to see solid growth for its service assurance product areas outside the U.S., mainly in Eastern Europe and Asia Pacific, where mobile operators are deploying those tools to monitor new 4G/LTE networks.

“We also anticipate meaningful contribution from our calibration [offerings]that are helping large Tier 1 operators in North America design their new 5G radio access network infrastructure. At the same time, however, we believe that the larger Tier 1 service providers will continue to limit near-term spending on their existing 4G networks,” Singhal said.

The company recently initiated a restructuring of its key operations. As part of this strategic realignment, NetScout combined its previously separate service assurance and security engineering teams, began consolidating certain other facilities and has implemented a voluntary separation program (VSP) and other related measures to reduce its headcount.

“During the second quarter, we took steps to recalibrate our spending by selling our handheld network test (HNT) tools business, and by restructuring and realigning resources across our global operations,” Singhal said. “At the same time, we have continued to fund our most promising growth opportunities spanning our service assurance and security product areas. We remain well-positioned to expand the scope of our engagements with major service provider and enterprise customers.”

Total revenue for the second quarter of fiscal year 2019 was $223.8 million, compared with $256.9 million in the same quarter one year ago.

The company’s loss from operations was $23.1 million in the second quarter of fiscal year 2019 compared with a net loss from operations of $1.2 million in the comparable quarter one year ago. NetScouts’s Q2 loss from operations includes a $9.2 million loss on the divestiture of the HNT tools business.


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