Many smartphone users will have access to 5G next generation mobile networks, particularly if you’re in one of the UK’s cities. This shows up as a 5G symbol in your notifications bar and you should notice faster streaming of music or video, for example.

Yet we remain years away from 5G delivering fully on its long-term potential and testing group Spirent (SPT) is one of the best ways to invest in what is increasingly being seen as a structural technological shift.

5G promises exponentially faster mobile download and upload speeds, much greater bandwidth to send the explosion of data volumes, and latency (time lag) all but eradicated. It will help enable self-driving cars in the future, robotic medical procedures performed by surgeons miles away from the patient and countless other consumer, industrial and security/military applications.

Analysts estimate barely 30% of all telecom network operators globally have deployed initial 5G networks, and only 3% have deployed the first of many major technology upgrades. As one analyst told Shares, because 5G networks are built on software from multiple vendors and dispersed across several owned and third-party sites, the job of testing and providing assurance of components and entire networks is ‘never finished’.

5G will become increasingly mission critical to how consumers, industry and governments operate, and Spirent has spent years earning its reputation as a trusted technology testing services supplier. This is a company with a global engineering and operational footprint of the highest possible standard.

Spirent has a very strong balance sheet and is thought to have exited 2022 with more than $200 million of net cash on its books, providing a healthy safety net through uncertainty, and flexibility to meet emerging opportunities head-on. It’s worth noting that key customers like AT&T (T:NYSE) and Verizon (VZ:NYSE) have said multiple times that current macro headwinds will not delay their respective capex plans, not least because of savage competition between carriers.

Since joining as chief executive in May 2019, chief executive Eric Updyke has steered Spirent towards greater recurring revenue streams. This will help smooth out what has historically been unpredictable, project-based revenue, one of the risks that investors have previously associated with the business.

At 73% or so, Spirent has some of the highest gross margins in its industry, while operating margins have gone from 15% in 2018 to the rough 21% level anticipated for 2022. Return on equity and on investment, two important business quality metrics, are impressively running above 20%.

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