President and Chief Executive Officer at Keysight Technologies
Thank you, Jason, and thank you all for joining us. Keysight reported strong fourth quarter results, which exceeded the high-end of our guidance and drove a strong finish to the year. Before we get into the quarter, I want to highlight our exceptional performance for fiscal year, which illustrates continued progress we're making in transforming the company to a software-centric solutions provider. We set new records for orders, which grew 12% to $6 billion, a new record for revenue, which was up 10%, and a new record for earnings per share, which increased 22%, all the while returning capital through $849 million in share repurchases or 89% of free cash flow. In addition, we continue to invest in next-generation technologies for long-term differentiation and see a high-level of engagement and activity with our customers around their future needs.
Today, I'll focus my comments on three key headlines. First, we delivered an all-time record revenue and earnings per share in the fourth quarter ahead of expectations enabled by outstanding execution by Keysight teams who successfully navigated supply chain geopolitical and macro-dynamics. Second, we achieved record orders of $1.6 billion, with steady bookings throughout the quarter and the book-to-bill of 1.09. While our customers multi-year roadmaps remain unchanged, they are exercising more caution given the macro backdrop, which we anticipate will moderate demand in the near-term. Third, as we enter fiscal '23, we remain confident in our ability to outperform the market based on the differentiation of our solutions, our strong R&D customer value proposition and the robust backlog position we have entering the year, and as we look longer-term, the secular innovation trends in our end-markets remained strong.
Now, let's take a deeper look at the strength of the fourth quarter. Record orders of $1.6 billion, grew 9% on a core basis. Record revenue grew 15% on a core basis, with solid growth across all regions, as Keysight team successfully navigated challenging dynamics. This resulted in record quarterly earnings of $2.14 per share. The strength and resiliency of our business model is due to our strategic efforts to diversify our industry exposure. This has been best exemplified in the growth of our Electronic Industrial Solutions Group and our ability to leverage our industry-leading first-to-market solutions to enable expansion across the broader communications ecosystem. EISG achieved its ninth consecutive quarter of double-digit order and revenue growth.
Auto, semiconductor solutions and general electronics, all achieved record quarterly revenue. For the year, both orders and revenues set new records as we capitalized on continued investments across all three EISG markets. In automotive, we're pleased with the continued adoption of our solutions portfolio as orders grew double-digits for the seventh consecutive quarter and exceeded $500 million this year. Automotive OEMs and their suppliers continued to focus on strategic new mobility investments, which drove key wins for Keysight. In addition automotive-focused semiconductor companies continued to add capabilities to support EV and AV applications, which we view as a favorable long-term dynamic.
We recently announced the Scienlab DC Emulator, which enables customers to accurately characterize high voltage high-power electric vehicle battery performance under varying real-world charging conditions. And Keysight's PathWave Labs Operation software won 2022 AutoTech Breakthrough Award for Overall Electric Vehicle Technology. In support of AV applications, silicon designers are exploring adoption of commercial standards such as MIPI for automotive and other surround sensor applications, including cameras and in-vehicle infotainment displays. We are now expanding our leading compliance test solutions to offer advanced verification and diagnostic capabilities for automotive designers.
Turning to our semiconductor solutions business, Q4 was the 10th consecutive quarter of double-digit order growth and a record revenue quarter. We saw sustained demand for our wafer test solutions and precision positioning capabilities, which enable the realization of advanced process nodes. In addition, Keysight has continued to partner with industry leaders, Synopsys and ANSYS on RF and millimeter-wave integrated circuit design flows, built for today's wireless communication requirements, including 5G and 6G system-on-chips. Keysight received a Partner of the Year Award from TSMC for joint development design flows in RF and millimeter-wave nodes. In general electronics record orders grew double-digits this quarter as demand remains strong and broad-based across industrial IoT and digital health as well as education and advanced research markets.
Turning to Communications Solutions Group, the business delivered strong orders and record revenue. Annual orders and revenue were all-time highs despite geopolitical headwinds and delays in US defense budget appropriations. Commercial Communications revenue grew 10% this quarter and 11% for the year with growth across all regions. Investments across communications ecosystem continued throughout the year with sustained spending in next-generation wireless and wireline technologies. Ongoing investments in 5G standards, new spectrum, growing deployments around the world and steady evolution from 400 gig to 800 gig to terabit Ethernet drove growth.
We had another record year for 5G orders, as Keysight's market-leading solutions continue to provide the industry with new capabilities needed for development of next-generation devices, as well as wireless and wireline networks. Examples that highlight our portfolio's alignment with key industry priority include a recent partnership with IBM to integrate our Open RAN capabilities into their cloud automation tools to accelerate network deployments. We also completed the validation of our first 5G location-based service use-case from Global Certification Forum, by combining the testing of 5G new radio and Global Navigation Satellite System technologies into a single platform.
Lastly, in collaboration with key silicon and data center partners, we enabled the industry's first 1.6 terabit transmission and data center interconnect, leveraging our high-speed digital solutions. Aerospace, defense and government business revenue grew 4% for the quarter and 3% for the year, setting a new record while navigating geopolitical headwinds. Steady investments in spectrum operations, cyber security and space and satellite drove demand. 5G continued to expand in aerospace and defense end-markets and we saw increasing investment in advanced research. Proposed increases in investment in the US and allied countries for modernization of defense capabilities, a new satellite and space applications, position us well for future opportunities.
As an integral part of our solution strategy, software and services order and revenue growth this year continued to outpace Keysight overall, which has driven our annual recurring revenue to approximately $1.2 billion. Software and services again represented just over one-third of Keysight's total revenue for the year. Keysight's focus on customer success and innovation is driving our development of first-to-market high-value solutions. Our achievements over the years exemplify Keysight's collaborative culture and our talented workforce and we are honored that Keysight has placed 10th on the Fortune's Best Workplaces in Technology List for 2022. We believe our differentiated culture gives us a unique ability to recruit and develop capable talent and will be our sustaining competitive advantage.
In conclusion, I would like to thank our employees for all their contributions, commitment and strong track record of execution. In the midst of an uncertain economic environment, we remain confident in the resilience of our business, the strength of our balance sheet and the flexibility of our operating model.
Now, I'll turn it over to Neil to discuss our financial performance and outlook in more detail.