Viavi Solutions Insider Selling: Profit-Taking or Warning Sign?

The recent wave of insider selling at Viavi Solutions (NASDAQ: VIAV) has sparked debate among investors about its implications. Over the past month, key executives and directors, including CEO Oleg Khaykin and director Donald Colvin, have offloaded significant portions of their holdings. Colvin, for instance, sold 40,000 shares in November 2025, reducing his direct stake by 21.22% to 148,524 shares, while Khaykin divested 73,842 shares in early December, retaining direct ownership of 1,921,191 shares post-sale according to filings. These transactions occurred against a backdrop of Viavi's stock surging 74.90% year-to-date, reaching five-year highs. The question now is whether these sales represent prudent profit-taking or a subtle warning about the company's future prospects.

Profit-Taking Amid Strong Performance

The timing of these sales aligns with a period of robust stock performance. Viavi's shares traded at a weighted average price of $17.09 during Colvin's November sale, just above the closing price of $16.76 and near the opening price of $17.08. This suggests insiders may be capitalizing on a rally driven by broader market optimism. Indeed, Viavi's fiscal 2025 results underscore this momentum: the company reported $1.08 billion in revenue, an 8.4% year-over-year increase, with Q4 revenue jumping 15.3% to $290.5 million. Its non-GAAP operating margin expanded by 350 basis points year-over-year to 14.4%, reflecting strong execution in data center and aerospace segments.

Moreover, Viavi's strategic focus on AI infrastructure-highlighted by products like the mFVU-3000 FlexLight and 800G Transport Module-positions it to benefit from multi-year upgrade cycles in optical connectivity according to company announcements. With data centers and AI-driven workloads driving demand for 400G, 800G, and 1.6T solutions, the company's revenue growth appears well-supported by industry tailwinds. In this context, insider sales could simply reflect executives monetizing gains after a strong performance, rather than signaling internal pessimism.

Caution: Context Matters

However, investors should not dismiss the sales outright. While Viavi's fundamentals are strong, insider selling-particularly by top executives-can sometimes precede underperformance. For example, Khaykin's December sales included both direct and indirect holdings, totaling 73,842 shares, which is notable given his long-term alignment with the company. Similarly, other directors and executives, including Kevin Siebert and Richard Belluzzo, have sold shares at prices ranging from $10.02 to $12.63 over the past year according to Yahoo Finance. Cumulatively, insiders have sold $1.91 million worth of shares in the last 12 months according to MarketBeat.

That said, the broader context tempers concerns. Viavi's stock has already priced in much of its AI-related potential, with its market capitalization reflecting optimism about future demand. Additionally, insiders may be diversifying their portfolios or meeting personal financial obligations, which are not inherently bearish. The company's recent acquisition of Inertial Labs and its $429 million in cash and short-term investments at quarter-end further reinforce its financial stability.

Balancing the Evidence

The key to interpreting these sales lies in balancing the company's trajectory with insider behavior. Viavi's Q4 results and AI-focused product roadmap suggest it is well-positioned to capitalize on long-term trends, even as insiders take profits. The fact that Colvin's RSUs vest in early 2026 or at the next annual meeting also indicates ongoing alignment with shareholder interests. Meanwhile, the CEO's sales, while significant, occurred after the stock had already achieved a 74.90% annual return, making them consistent with a strategy to lock in gains.

Investors should monitor whether selling continues at an accelerated pace in early 2026, particularly if the stock enters a correction phase. For now, however, the sales appear to reflect a mix of profit-taking and normal portfolio management rather than a lack of confidence in Viavi's strategic direction.

Conclusion

Viavi Solutions' insider selling is best viewed through the lens of a company navigating a high-growth sector with strong near-term results. While the sales are material, they occur in a context of robust revenue growth, expanding margins, and a clear role in the AI infrastructure ecosystem. Investors should remain cautious but not alarmist-using the sales as a data point rather than a definitive signal. As the company moves into fiscal 2026, its ability to sustain momentum in data center and AI markets will ultimately determine whether these transactions are seen as prudent or prescient.