Key TakeawaysF5 shares moved sharply higher in pre-market trading Tuesday after the cloud management and security software company announced fiscal second-quarter sales guidance that beat analysts' expectations.Sales growth in the company's Asian and European markets helped offset weakness in its North American market.The F5 share price continues to gain upward momentum, but may encounter resistance near the March 2022 swing high at the $217 level. F5, Inc. Source: TradingView.com.F5, Inc. (FFIV) shares ...

One sign that we’re in a resilient bull market presently is that we’ve strolled into a potentially thorny period of economic and earnings data with market levels up more than a week straight, and we keep climbing further into the green (decidedly as of this afternoon’s trading). Jobs Week, earnings reports from four of the so-called “Magnificent 7” market leaders from 2023, and a fresh Federal Open Market Committee (FOMC) meeting all await market participants from now til Friday, and thus far we haven’t bat ...

F5 Networks (FFIV) came out with quarterly earnings of $3.43 per share, beating the Zacks Consensus Estimate of $3.03 per share. This compares to earnings of $2.47 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 13.20%. A quarter ago, it was expected that this computer networking company would post earnings of $3.22 per share when it actually produced earnings of $3.50, delivering a surprise of 8.70%.Over the last four quarter ...

SEATTLE--(BUSINESS WIRE)--F5, Inc. (NASDAQ: FFIV) today announced financial results for its first quarter ended December 31, 2023. “Our team delivered solid first quarter results, including revenue near the high end and earnings per share above the high end of our guidance ranges,” said François Locoh-Donou, F5’s President and CEO. “As a result of our continued operating discipline we delivered more than 1,000 basis points improvement in GAAP operating margin and more than 900 basis points improvement in ...

F5, Inc. (FFIV) is scheduled to report first-quarter fiscal 2024 results on Jan 29.For the fiscal first quarter, F5 estimates revenues in the range of $675-$695 million ($685 million at the midpoint). The Zacks Consensus Estimate for revenues is pegged at $687.1 million, suggesting a 1.9% decline from the year-ago quarter’s sales of $700.4 million.The company anticipates non-GAAP earnings in the range of $2.97-$3.09 per share ($3.03 at the midpoint). The Zacks Consensus Estimate stands at $3.03 per share, i ...

SEATTLE--(BUSINESS WIRE)--F5, Inc. (NASDAQ: FFIV) will host a strategy and product session for investors and financial analysts from 1:00 p.m. to approximately 3:15 p.m. PT on Thursday, February 8, 2024 in connection with F5’s premier application security and delivery conference, AppWorld 2024. During the event F5 leadership will discuss the hybrid, multi-cloud challenges faced by large organizations worldwide, including the implications of AI on applications and security, and how F5’s portfolio is uniquel ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended September 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission File Number 000-26041 F5, Inc. (Exact name of Registrant as specified in its charter) Washington 91-1714307 (State or other juri ...

Financial Data and Key Metrics Changes - The company reported Q4 revenue of $707 million, reflecting a 1% year-over-year growth, with global services contributing 54% and product revenue 46% [85] - For FY '23, total revenue grew 4% to $2.8 billion, with global services revenue growing 7% to $1.5 billion and product revenue growing 1% to $1.3 billion [90] - GAAP net income for Q4 was $152 million or $2.55 per share, while non-GAAP net income was $209 million or $3.50 per share, exceeding guidance [88] - The company expects FY '24 revenue to be flat to down low-single-digits from FY '23, factoring in a $180 million revenue headwind from backlog fulfillment [128] Business Line Data and Key Metrics Changes - Software revenue grew 11% year-over-year to $191 million, with subscription-based revenue increasing 27% to $166 million, representing 87% of Q4 total software revenue [57] - Systems revenue declined 25% year-over-year to $134 million, reflecting lower backlog-related shipments and demand stabilization at lower levels [35] - Global services revenue grew 9% to $382 million, driven by high maintenance renewals and price increases [35] Market Data and Key Metrics Changes - Enterprise customers represented 72% of product bookings in Q4, while service providers accounted for 9% and government customers for 19% [58] - The company noted that North America has been more stable compared to Asia and European markets, with early signs of stabilization in enterprise demand [109] Company Strategy and Development Direction - The company is focused on transitioning its SaaS and managed services offerings, with a planned retirement of legacy offerings contributing to a $65 million revenue headwind [127] - The company aims to leverage its unique position in the market to deliver hybrid, multi-cloud solutions that simplify application and API deployment, security, and management [132] - The company expects to return to mid-single-digit revenue growth in FY '25, driven by application and API growth and the need for security solutions [130] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about early signs of stabilization in demand, particularly from enterprise customers, but acknowledged ongoing budget scrutiny [120] - The company anticipates continued customer spending caution into FY '24, with expectations for customers to begin reinvesting in application infrastructure [76] - Management highlighted the importance of their converging portfolio in addressing multi-cloud challenges faced by customers [103] Other Important Information - The company returned 58% of its annual free cash flow to shareholders through share repurchases [45] - The company ended FY '23 with approximately $922 million remaining on its share repurchase program [99] Q&A Session Summary Question: What are the headwinds from the transition in managed services? - The headwind from the transition is approximately $65 million, primarily from the retirement of the legacy Silverline managed services platform, with plans to migrate customers to Distributed Cloud [136] Question: What signs of stabilization are being observed? - Signs of stabilization include customers who have received hardware after delays in 2023 and are now ready to order again, particularly in the enterprise market [111] Question: How does the company view the hardware business moving forward? - The company expects a rebound in the hardware business in 2024, driven by a stronger hardware pipeline and improved close rates [118]

Forward-looking statements 2 ©2023 F5 In addition to financial information prepared in accordance with U.S. GAAP, this presentation also contains adjusted financial measures that we believe provide investors and management with supplemental information relating to operating performance and trends that facilitate comparisons between periods and with respect to projected information. These adjusted financial measures are non-GAAP and should be considered in addition to, but not as a substitute for, the inform ...

PART I. FINANCIAL INFORMATION [Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) Unaudited Q3 2023 financial statements reflect increased revenues and net income, alongside shifts in assets, liabilities, and cash flow activities [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2023, total assets decreased to $5.12 billion, liabilities fell to $2.46 billion due to debt repayment, and shareholders' equity rose to $2.66 billion Consolidated Balance Sheets Highlights (in thousands) | Account | June 30, 2023 | September 30, 2022 | Change | | :--- | :--- | :--- | :--- | | **Total current assets** | $1,713,784 | $1,912,224 | ($198,440) | | Cash and cash equivalents | $677,498 | $758,012 | ($80,514) | | **Total assets** | **$5,119,156** | **$5,276,194** | **($157,038)** | | **Total current liabilities** | $1,489,541 | $1,839,951 | ($350,410) | | Current portion of long-term debt | $— | $349,772 | ($349,772) | | **Total liabilities** | **$2,461,653** | **$2,807,216** | **($345,563)** | | **Total shareholders' equity** | **$2,657,503** | **$2,468,978** | **$188,525** | [Consolidated Income Statements](index=5&type=section&id=Consolidated%20Income%20Statements) Q3 2023 saw total revenues increase 4.2% to $702.6 million and net income rise 7.2% to $89.0 million, despite a $56.6 million restructuring charge Income Statement Summary (in thousands, except per share data) | Metric | Q3 2023 | Q3 2022 | YoY Change | 9 Months 2023 | 9 Months 2022 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Net Revenues** | **$702,642** | **$674,488** | **+4.2%** | **$2,106,195** | **$1,995,812** | **+5.5%** | | Products | $328,175 | $326,482 | +0.5% | $1,009,314 | $967,149 | +4.4% | | Services | $374,467 | $348,006 | +7.6% | $1,096,881 | $1,028,663 | +6.6% | | **Gross Profit** | **$560,959** | **$543,755** | **+3.2%** | **$1,653,851** | **$1,603,647** | **+3.1%** | | **Income from Operations** | **$103,569** | **$107,464** | **-3.6%** | **$300,827** | **$296,262** | **+1.5%** | | Restructuring charges | $56,648 | $— | N/A | $65,388 | $7,909 | +726.8% | | **Net Income** | **$88,976** | **$83,019** | **+7.2%** | **$242,814** | **$232,814** | **+4.3%** | | **Diluted EPS** | **$1.48** | **$1.37** | **+8.0%** | **$4.02** | **$3.80** | **+5.8%** | [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Comprehensive income for Q3 2023 increased to $90.0 million, driven by higher net income and positive foreign currency translation adjustments Comprehensive Income (in thousands) | Metric | Q3 2023 | Q3 2022 | 9 Months 2023 | 9 Months 2022 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $88,976 | $83,019 | $242,814 | $232,814 | | Other comprehensive income (loss) | $1,041 | ($1,998) | $4,240 | ($4,553) | | **Comprehensive Income** | **$90,017** | **$81,021** | **$247,054** | **$228,261** | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders%27%20Equity) Shareholders' equity increased to $2.66 billion by June 30, 2023, primarily due to net income, partially offset by $290.0 million in stock repurchases - For the nine months ended June 30, 2023, the company repurchased **2,075 thousand shares** of common stock for **$290.0 million**[20](index=20&type=chunk) - Net income of **$242.8 million** and stock-based compensation of **$183.4 million** were the primary contributors to the increase in shareholders' equity during the nine months ended June 30, 2023[20](index=20&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations significantly increased to $463.6 million, while financing activities used $591.9 million for debt repayment and stock repurchases, resulting in an $84.3 million net cash decrease Cash Flow Summary (in thousands) | Activity | Nine months ended June 30, 2023 | Nine months ended June 30, 2022 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | **$463,608** | **$288,276** | | **Net cash provided by investing activities** | **$43,958** | **$147,394** | | **Net cash used in financing activities** | **($591,913)** | **($470,249)** | | Repurchase of common stock | ($290,041) | ($500,023) | | Payments on term debt agreement | ($350,000) | ($15,000) | | **Net decrease in cash** | **($84,347)** | **($34,579)** | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, revenue, debt, and restructuring, highlighting the Lilac Cloud acquisition, Term Loan repayment, and Q3 2023 restructuring plan - F5 provides multi-cloud application security and delivery solutions, available as cloud-based, software-as-a-service (SaaS), and software-only solutions, along with professional services[26](index=26&type=chunk) - On February 1, 2023, the Company acquired Lilac Cloud, Inc., a provider of Content Delivery Network (CDN) technologies[51](index=51&type=chunk) - On December 15, 2022, the Company fully prepaid its Term Loan Facility, including the outstanding principal of **$350.0 million**[66](index=66&type=chunk) - In Q3 2023, the Company initiated a restructuring plan, including a **9% workforce reduction**, incurring **$56.7 million** in costs[99](index=99&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses revenue growth driven by services, softer product demand due to macroeconomic uncertainty, increased operating expenses from restructuring, and strong liquidity after debt repayment and stock repurchases - Management noted changes in customer buying patterns due to the uncertain macroeconomic environment, leading to softer demand for both software and systems products[105](index=105&type=chunk) - This is viewed as temporary, with stronger maintenance renewals signaling purchase delays rather than competitive losses[105](index=105&type=chunk) Revenue Performance (in thousands) | Revenue Type | Q3 2023 | Q3 2022 | YoY Change | 9 Months 2023 | 9 Months 2022 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Net Revenues** | **$702,642** | **$674,488** | **+4.2%** | **$2,106,195** | **$1,995,812** | **+5.5%** | | Product Revenues | $328,175 | $326,482 | +0.5% | $1,009,314 | $967,149 | +4.4% | | Service Revenues | $374,467 | $348,006 | +7.6% | $1,096,881 | $1,028,663 | +6.6% | - Gross margin decreased to **79.8%** in Q3 2023 from **80.6%** in Q3 2022, and to **78.5%** for the nine-month period from **80.4%** a year ago, primarily due to higher product costs including component cost increases and expedite fees[113](index=113&type=chunk) - The company's liquidity remains strong, with cash and investments totaling **$696.5 million**[124](index=124&type=chunk) - The decrease from the prior year-end was mainly due to a **$350.0 million** debt prepayment and **$290.0 million** in stock repurchases, offset by **$463.6 million** in cash from operations[124](index=124&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company identifies interest rate, inflation, and foreign currency as primary market risks, with no material changes noted and most transactions in U.S. dollars - Interest Rate Risk: A sharp rise in market interest rates could adversely impact the fair value of the company's fixed income investment portfolio[135](index=135&type=chunk) - Inflation Risk: While being monitored, inflation has not had a material effect[136](index=136&type=chunk) - However, significant inflationary pressure could increase costs, and a constrained customer spending environment could harm business[136](index=136&type=chunk) - Foreign Currency Risk: The majority of sales and expenses are denominated in U.S. dollars, so foreign currency transaction gains and losses have not been significant[137](index=137&type=chunk) [Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2023, with no material changes in internal control over financial reporting during the quarter - Based on an evaluation as of June 30, 2023, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective[140](index=140&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2023, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[141](index=141&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in a legal dispute with Lynwood Investment CY Limited over NGINX software, where F5 won dismissal and attorneys' fees, both of which Lynwood has appealed - In the case of Lynwood Investment CY Limited v. F5, the court granted F5's motion to dismiss without leave to amend on August 16, 2022, and entered final judgment against Lynwood[82](index=82&type=chunk) - Lynwood has appealed this decision to the Ninth Circuit Court of Appeals[82](index=82&type=chunk) - The court subsequently granted F5 attorneys' fees of over **$0.8 million**, which Lynwood has also appealed[83](index=83&type=chunk) [Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) Adverse macroeconomic conditions, including inflation and supply chain disruptions, continue to soften customer demand, impacting business, revenues, and profitability - Adverse global macroeconomic conditions have softened customer demand and purchase decisions, which may limit the company's ability to forecast future business activities[144](index=144&type=chunk) - Continued worsening of macroeconomic conditions could adversely affect business through softer demand for products and services, as well as unfavorable increases to operating costs, which could negatively impact profitability[144](index=144&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased approximately 1.8 million shares for $250 million in Q3 2023, with $982 million remaining authorized under its common stock repurchase program - On July 25, 2022, the Board of Directors authorized an additional **$1.0 billion** for the common stock share repurchase program[145](index=145&type=chunk) - As of June 30, 2023, **$982 million** remained available for repurchase[145](index=145&type=chunk) Share Repurchases for Q3 2023 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2023 | 76,271 | $131.13 | | May 2023 | 1,611,454 | $137.48 | | June 2023 | 135,811 | $147.50 | [Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - Not applicable[148](index=148&type=chunk) [Other Information](index=32&type=section&id=Item%205.%20Other%20Information) Two company executives adopted Rule 10b5-1 trading plans for future share sales during Q3 2023 - On May 1, 2023, Scot Rogers, EVP, General Counsel, adopted a Rule 10b5-1 plan for the sale of **4,500 shares**[149](index=149&type=chunk) - On May 1, 2023, Chad Whalen, EVP, Worldwide Sales, adopted a Rule 10b5-1 plan for the sale of **5,585 shares**[150](index=150&type=chunk) [Exhibits](index=32&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents - Exhibits filed include Certifications Pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2002, and various XBRL data files[151](index=151&type=chunk)