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Core Viewpoint - F5, Inc. (FFIV) has reached a significant support level and is considered a potential investment opportunity due to a recent "golden cross" technical pattern, indicating a bullish breakout [1][2] Technical Analysis - FFIV's 50-day simple moving average has recently crossed above its 200-day moving average, forming a "golden cross," which is a bullish signal [1] - The golden cross pattern consists of three stages: a downtrend followed by a bottom, a crossover of the short-term moving average above the long-term moving average, and an upward price trend [1] - In contrast, a "death cross" indicates potential bearish momentum [1] Recent Performance - FFIV shares have increased by 14.1% over the past four weeks, suggesting positive momentum [1] - The company currently holds a 3 (Hold) rating on the Zacks Rank, indicating potential for further gains [1] Earnings Expectations - There have been 8 upward revisions in earnings expectations for the current quarter over the past 60 days, with no downward revisions, which supports the bullish outlook [2] - The Zacks Consensus Estimate for FFIV has also increased, reinforcing the positive sentiment among investors [2]

Have you evaluated the performance of F5 Networks' (FFIV) international operations for the quarter ending June 2024? Given the extensive global presence of this computer networking company, analyzing the patterns in international revenues is crucial for understanding its financial strength and potential for growth. In the current era of a tightly interconnected global economy, the proficiency of a company to penetrate international markets significantly influences its financial health and trajectory of grow ...

Core Insights - F5's revenues for the fiscal third quarter reached $695 million, exceeding the consensus estimate of $686.6 million but reflecting a year-over-year decline of 1.1% [1] - The company reported non-GAAP earnings of $3.36 per share, surpassing the Zacks Consensus Estimate of $2.97 and increasing 4.7% from the previous year's $3.21 [3][15] Revenue Breakdown - Product revenues, accounting for 44.4% of total revenues, decreased by 6% year-over-year to $308.5 million, primarily due to lower Systems sales, although Software sales increased [4] - Global Service revenues, which represent 55.6% of total revenues, grew by 3.4% to $387 million, driven by price increases implemented in fiscal 2022 [5] Operating Expenses and Margins - GAAP operating expenses declined by 13.4% to $396 million, while non-GAAP operating expenses slightly decreased from $346 million to $345.5 million [2] - GAAP operating profit increased by 56.7% to $163 million, with the margin expanding by 870 basis points to 23.4%. Non-GAAP operating profit remained flat at $233 million, with a margin improvement of 20 basis points to 33.4% [10] Cash Flow and Shareholder Returns - F5 ended the quarter with cash and short-term investments of $935.6 million, up from $903.4 million in the previous quarter, and generated an operating cash flow of $546 million [7] - The company repurchased shares worth $150 million during the fiscal third quarter and plans to return at least 50% of free cash flow to shareholders through buybacks [20][23] Guidance and Future Projections - For the fiscal fourth quarter, F5 expects non-GAAP revenues in the range of $720-$740 million and non-GAAP EPS between $3.38 and $3.50 [21] - The company anticipates revenue growth for fiscal 2024 to be in the mid to high single-digit percentage range [22]

Financial Data and Key Metrics Changes - The company reported Q3 revenue of $695 million, which is at the top end of the revenue guidance range, with non-GAAP EPS of $3.36, exceeding expectations [23][30][75] - Global services revenue grew 3% to $387 million, while product revenue decreased 6% year-over-year to $308 million [24][25] - Software revenue totaled $179 million, representing a 3% year-over-year growth and a 13% sequential growth [25][30] - Non-GAAP gross margin improved to 83.1%, and non-GAAP operating margin was 33.4%, reflecting operational discipline [29][35] Business Line Data and Key Metrics Changes - Subscription-based revenue contributed $155 million to software revenue, showing a 2% year-over-year growth [25] - Systems revenue was $130 million, down 16% year-over-year, indicating a slowing decline [24] - Recurring revenue accounted for 77% of Q3's revenue, up from 75% a year ago, highlighting strong subscription renewals [27] Market Data and Key Metrics Changes - Revenue from the Americas declined 4% year-over-year, representing 55% of total revenue, while EMEA grew 5% to represent 27% of revenue [64] - APAC revenue declined 1%, accounting for 18% of total revenue [64] Company Strategy and Development Direction - The company is focused on simplifying hybrid multi-cloud environments for customers, addressing operational complexity and security risks [48][62] - There is a strategic shift towards a hybrid SaaS platform that covers all application security and delivery needs [20][42] - The company is investing in API security, with a tripling of API security customers year-on-year, anticipating AI to be a catalyst for growth in this area [3][19] Management's Comments on Operating Environment and Future Outlook - Management noted improving demand signals and strong bookings growth in Q3, expecting Q4 revenue in the range of $720 million to $740 million [12][33] - The company anticipates mid-to-high single-digit software revenue growth for FY '24, up from previous expectations of flat to modest growth [13][34] - Management expressed confidence in capturing market share as customers modernize their IT infrastructures and develop AI strategies [20][42] Other Important Information - The company plans to transition to a more software-led business model, with software revenue expected to be the majority of product revenue for the third consecutive year [37] - The CFO announced retirement plans, with a successor already identified to ensure a smooth transition [36][39] Q&A Session Summary Question: What drove the strong sequential growth in software revenue? - Management indicated that strong new business activity and solid subscription renewals contributed to the growth [44][96] Question: How is the company addressing challenges in the Bot Manager business? - The company is integrating advanced Bot technology into the F5 Distributed Cloud platform to enhance its offerings [88][104] Question: What is the outlook for FY '25? - Management expects more growth to come in the back half of FY '25, with a focus on subscription renewals and new business activity [132][134] Question: How is the company managing its sales staffing levels? - The company reported low attrition rates in sales, indicating a strong culture and leadership within the sales organization [116] Question: What is the impact of the transition away from multi-year maintenance agreements? - The company is moving away from incentivizing multi-year agreements as it has a strong attach rate and does not require upfront cash [111]

The first trading day of the week was flat. It didn't look like it was starting out that way, with pre-market futures well into the green — continuing Friday's rally for the full trading day. But around lunchtime, three of the four major indices went to zero and the small-cap Russell 2000 sank below it and never recovered. The Dow was down -0.12% today, while the S&P 500 and Nasdaq were up +0.08% and +0.07%, respectively. The Russell dove -1.02% by the closing bell. We're now getting to a key point in the F ...

Core Viewpoint - F5 Networks has shown mixed performance in the market, with a recent earnings report indicating a positive surprise, but overall stock performance has lagged behind the S&P 500 index this year [1][12]. Company Performance - F5 reported quarterly earnings of $3.36 per share, exceeding the Zacks Consensus Estimate of $2.97 per share, and up from $3.21 per share a year ago [9]. - The company posted revenues of $695.5 million for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 1.30%, although this represents a decline from year-ago revenues of $702.64 million [4]. - Over the last four quarters, F5 has surpassed consensus EPS estimates four times [10]. Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $3.32 on revenues of $715.21 million, and for the current fiscal year, it is $12.63 on revenues of $2.78 billion [6]. - The earnings surprise for the latest quarter was 13.13%, with a previous expectation of $2.88 per share compared to the actual $2.91 per share [3]. Industry Context - F5 belongs to the Zacks Internet - Software industry, which is currently ranked in the top 39% of over 250 Zacks industries, indicating a favorable industry outlook [13]. - The performance of F5's stock may be influenced by the overall industry trends and the upcoming earnings report from HubSpot, another company in the same sector, which is expected to show a 17% revenue increase year-over-year [8][7]. Future Expectations - The sustainability of F5's stock price movement will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [11][5]. - The current status of estimate revisions for F5 is mixed, leading to a Zacks Rank of 3 (Hold), suggesting that the stock is expected to perform in line with the market in the near future [12].

Financial Performance - Third quarter fiscal year 2024 revenue totaled $695 million, a decrease of 1.1% compared to $703 million in the third quarter of fiscal year 2023[1] - Software revenue was $179 million, reflecting a 3% increase year-over-year, while systems revenue declined by 16% to $130 million[1] - Global services revenue grew by 3% to $387 million compared to the prior year[1] - GAAP gross profit was $559 million with a gross margin of 80.4%, up from 79.8% in the same period last year[1] - Non-GAAP gross profit was $578 million, resulting in a non-GAAP gross margin of 83.1%, compared to 82.5% in the prior year[1] - GAAP operating profit increased to $163 million, representing a GAAP operating margin of 23.4%, compared to 14.7% in the year-ago period[1] - Non-GAAP operating profit remained stable at $233 million, with a slight increase in non-GAAP operating margin to 33.4% from 33.2%[1] - GAAP net income for the third quarter was $144 million, or $2.44 per diluted share, compared to $89 million, or $1.48 per diluted share, in the same quarter last year[1] - Non-GAAP net income was $199 million, or $3.36 per diluted share, up from $194 million, or $3.21 per diluted share, in the prior year[1] - Total net revenues for the three months ended June 30, 2024, were $695.5 million, a slight decrease from $702.6 million in the same period of 2023[14] - Net income for the three months ended June 30, 2024, was $144.1 million, compared to $89.0 million for the same period in 2023, representing a 62% increase[14] - Earnings per share (EPS) for the three months ended June 30, 2024, were $2.46 (basic) and $2.44 (diluted), up from $1.48 (basic) for the same period in 2023[14] - Gross profit for the three months ended June 30, 2024, was $559.1 million, slightly down from $561.0 million in the same period of 2023[14] - Operating expenses for the three months ended June 30, 2024, totaled $396.0 million, down from $457.4 million in the same period of 2023[14] Cash Flow and Assets - Cash provided by operating activities for the nine months ended June 30, 2024, was $545.9 million, compared to $463.6 million for the same period in 2023[15] - Cash, cash equivalents, and restricted cash at the end of the period were $938.5 million, up from $681.6 million at the end of the same period in 2023[15] - The company reported stock-based compensation expense of $165.3 million for the nine months ended June 30, 2024, compared to $183.4 million for the same period in 2023[15] Future Outlook - The company expects fiscal year 2024 revenue to be approximately $2.8 billion, driven by software strength and raised earnings growth outlook[4] - For Q4 FY 2024, F5 expects revenue between $720 million and $740 million, with non-GAAP earnings per diluted share ranging from $3.38 to $3.50[19] - F5 anticipates FY 2024 revenue to be approximately $2.8 billion, which is roughly flat compared to the previous year[19] - The company is raising its earnings growth expectations for FY 2024 to approximately 12% non-GAAP earnings per share growth compared to FY 2023[19] - F5's forward-looking statements indicate strong visibility to software demand in Q4[20] Management Insights - F5's President and CEO highlighted that revenue growth was driven by software and global services offerings, indicating strong demand for IT infrastructure modernization[16] - The company is focusing on enhancing automation and operational efficiencies in hybrid and multicloud environments, as well as preparing IT infrastructure for AI integration[16] Non-GAAP Measures - Non-GAAP measures exclude various items such as amortization of intangible assets and acquisition-related charges, which can significantly affect guidance and future GAAP results[19][22] - The company emphasizes that non-GAAP net income per share provides useful supplemental information for evaluating core business performance[22] - F5's management uses both GAAP and non-GAAP measures to assess business performance, acknowledging that non-GAAP measures may not fully capture financial performance[22] - Investors are encouraged to consider GAAP results as the best measure of financial performance while also reviewing non-GAAP measures for additional insights[22] Costs and Charges - F5 incurred $1,264 million in facility-exit costs across various categories, including cost of net revenues and sales and marketing[25] - Acquisition-related charges totaled $656 million, impacting cost of net revenues, sales and marketing, and general and administrative expenses[25]

Under the agreement, Carahsoft will facilitate access to cybersecurity software products, which include software licenses, subscriptions, maintenance, support, and services from F5 to support Information Technology (IT) operations across the DoD enterprise. The BPA aligns with the Federal Acquisition Streamlining Act and with IT Category Management best practices, with the aim of minimizing the costs associated with traditional procurement processes. These processes include sourcing, technical document and ...

Core Viewpoint - Analysts expect F5 Networks (FFIV) to report quarterly earnings of $2.97 per share, reflecting a year-over-year decline of 7.5%, with revenues projected at $686.58 million, down 2.3% from the previous year [1] Earnings Projections - Changes in earnings projections are crucial for predicting investor reactions, with empirical studies showing a strong correlation between earnings estimate trends and short-term stock price movements [2] Revenue Estimates - The consensus for 'Revenues- Services' is $384.82 million, indicating a year-over-year increase of 2.8% [4] - 'Revenues- Products' are estimated at $301.76 million, reflecting a decline of 8.1% from the prior year [4] - 'Net product revenues- Software' are projected to be $165.72 million, down 4.8% year-over-year [4] - 'Net product revenues- Systems' are expected to reach $135.52 million, indicating a decrease of 12.6% from the previous year [5] Stock Performance - Over the past month, F5 shares have gained 0.7%, contrasting with a decline of 0.3% in the Zacks S&P 500 composite, suggesting that FFIV may perform in line with the overall market in the near term [6]