F5, Inc. (NASDAQ:FFIV) Q1 2022 Earnings Conference Call January 25, 2022 4:30 PM ET Company Participants Suzanne DuLong – Vice President of Investor Relations François Locoh-Donou – President and Chief Executive Officer Frank Pelzer – Executive Vice President and Chief Financial Officer Conference Call Participants James Fish – Piper Sander Sami Badri – Credit Suisse Amit Daryanani – Evercore Alex Henderson – Needham Rod Hall – Goldman Sachs Meta Marshall – Morgan Stanley Samik Chatterjee – JPMorgan Paul Si ...

[Part I](index=4&type=section&id=PART%20I) [Business](index=4&type=section&id=Item%201.%20Business) F5 is a multi-cloud application security and delivery company transitioning to a software and SaaS model, driven by strategic acquisitions and channel partnerships [General and Strategy](index=4&type=section&id=Item%201.%20Business%20-%20General%20and%20Strategy) F5 is transforming into a software and SaaS-driven multi-cloud application security company, leveraging strategic acquisitions to enable adaptive applications - F5 is a multi-cloud application security and delivery company, enabling adaptive applications that automatically adjust to performance, availability, or security changes[12](index=12&type=chunk)[20](index=20&type=chunk) - The company is transforming towards software and SaaS, with product revenue from software sales growing **40%** in fiscal 2021 and comprising **40%** of total product revenue[16](index=16&type=chunk) - Strategic acquisitions, including NGINX (May 2019), Shape Security (Jan 2020), and Volterra (Jan 2021), are central to F5's growth, expanding its portfolio across modern applications, fraud prevention, and edge-as-a-service[14](index=14&type=chunk)[21](index=21&type=chunk) - At the end of fiscal 2021, the company had a product backlog of approximately **$124.9 million**, primarily for systems-based products[17](index=17&type=chunk) [Products and Solutions](index=6&type=section&id=Item%201.%20Business%20-%20Products%20and%20Solutions) F5 offers a diverse product portfolio for traditional and modern applications, including BIG-IP and NGINX technologies, with a strong focus on comprehensive security solutions - **BIG-IP Family** offers application delivery solutions for traditional applications, available as physical appliances (iSeries, VIPRION, VELOS) and software-only Virtual Editions (VEs)[29](index=29&type=chunk)[31](index=31&type=chunk)[33](index=33&type=chunk) - **NGINX Technologies** provide lightweight, agile solutions such as NGINX Plus and NGINX App Protect for modern, container-based applications and microservices environments[34](index=34&type=chunk)[35](index=35&type=chunk) - **Security Solutions** include F5 Advanced WAF, Shape's AI platform for fraud and bot protection, Volterra's ML-based API security, and Silverline for fully-managed security services like WAF and DDoS protection[38](index=38&type=chunk)[40](index=40&type=chunk)[42](index=42&type=chunk)[43](index=43&type=chunk) [Competition](index=8&type=section&id=Item%201.%20Business%20-%20Competition) F5 navigates a diverse competitive landscape across application delivery, modern application management, and security, facing both established players and emerging cloud-native providers - **Application Delivery:** Competes with Citrix Systems, AWS, Microsoft Azure, and VMware[49](index=49&type=chunk) - **Modern Applications (API management, Kubernetes):** Competes with emerging players such as Apogee and Kong[50](index=50&type=chunk) - **Application Security (WAF, bot detection, fraud):** Competes with Akamai, Citrix, Imperva, Juniper, Cloudflare, Fastly (Signal Sciences), and PerimeterX[51](index=51&type=chunk)[52](index=52&type=chunk) [Corporate Functions](index=8&type=section&id=Item%201.%20Business%20-%20Corporate%20Functions) F5's global operations are supported by outsourced manufacturing, a channel-focused sales model, significant R&D investment, and intellectual property protection - Hardware manufacturing is outsourced to Flex Ltd., with facilities in Mexico and China[76](index=76&type=chunk) - The company relies on a channel sales model, with Ingram Micro, Inc. and Synnex Corporation accounting for **19.2%** and **11.1%** of total revenues in fiscal year 2021, respectively[69](index=69&type=chunk)[71](index=71&type=chunk) Research and Development Expenses (in millions) | Fiscal Year | R&D Expense | | :--- | :--- | | 2021 | $512.6 | | 2020 | $441.3 | | 2019 | $408.1 | - F5 holds **433** U.S. patents and **59** international patents to protect its intellectual property[62](index=62&type=chunk) [Human Capital](index=11&type=section&id=Item%201.%20Business%20-%20Human%20Capital) F5 prioritizes employee engagement, diversity, and flexible work arrangements for its 6,461 global employees, fostering a strong corporate culture - As of September 30, 2021, the company had **6,461** employees, with **52%** in the U.S. and **48%** internationally[81](index=81&type=chunk) - Employee engagement is high, with a May 2021 survey indicating **81%** feel a sense of belonging, **88%** are proud to work for F5, and **87%** believe F5 has a great culture[88](index=88&type=chunk) - The company fosters diversity and inclusion through **seven** Employee Inclusion Groups (EIGs) and has published its inaugural Diversity and Inclusion Report[90](index=90&type=chunk)[91](index=91&type=chunk)[92](index=92&type=chunk) - The "Freedom to Flex" program, established in 2018, allows employees to choose between office, remote, or hybrid work models[87](index=87&type=chunk) [Environmental, Social & Governance (ESG)](index=13&type=section&id=Item%201.%20Business%20-%20Environmental%2C%20Social%20%26%20Governance%20%28ESG%29) F5 is expanding its ESG commitment with environmental targets, significant social contributions through its Global Good program, and robust governance oversight - **Environmental:** Commits to disclosing science-aligned Scope 1 and 2 targets in FY2022 and declaring 2030 Science-Based Targets with SBTi in FY2023[96](index=96&type=chunk) - **Social:** F5 and its employees donated over **$4.8 million** to over **2,900** non-profits worldwide in fiscal 2021 through the F5 Global Good program[97](index=97&type=chunk) - **Governance:** The Nominating and Governance Committee of the board of directors has expanded its charter to include oversight of ESG programs[98](index=98&type=chunk) [Risk Factors](index=15&type=section&id=Item%201A.%20Risk%20Factors) The company faces diverse risks including market competition, product development, security vulnerabilities, supply chain disruptions, operational complexities, acquisition integration, litigation, and the ongoing impact of the COVID-19 pandemic - **Market and Competition:** Business is dependent on IT spending and faces risks from cloud computing trends, industry consolidation, and intense competition in application delivery and security markets[112](index=112&type=chunk)[114](index=114&type=chunk)[116](index=116&type=chunk) - **Product and Technology:** Success depends on timely new product development, with risks including security vulnerabilities in IT systems or products that could cause significant financial and reputational harm[125](index=125&type=chunk)[128](index=128&type=chunk) - **Supply Chain:** The company relies on a single contract manufacturer for hardware and faces risks from supply interruptions or delays of components from limited sources, exacerbated by global shortages[144](index=144&type=chunk)[146](index=146&type=chunk) - **Operations and Sales:** Risks include an unpredictable sales cycle, reliance on distribution partners, challenges in government sales, and complexities of international commerce[147](index=147&type=chunk)[150](index=150&type=chunk)[169](index=169&type=chunk) - **Acquisitions and Litigation:** The company faces risks in integrating acquired businesses like Volterra and Shape, and is subject to litigation, including intellectual property disputes[178](index=178&type=chunk)[177](index=177&type=chunk) - **COVID-19 Pandemic:** The pandemic could disrupt customer demand, supply chains (leading to delays and shortages), and overall financial performance[191](index=191&type=chunk)[192](index=192&type=chunk) [Unresolved Staff Comments](index=30&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments - Not applicable[196](index=196&type=chunk) [Properties](index=30&type=section&id=Item%202.%20Properties) F5's principal facilities, including its 515,000 square foot Seattle headquarters, are leased globally for various corporate functions - The company's corporate headquarters in Seattle, Washington, consists of approximately **515,000 square feet** of leased space, with the lease expiring in **2033**[197](index=197&type=chunk) [Legal Proceedings](index=30&type=section&id=Item%203.%20Legal%20Proceedings) Information regarding legal proceedings is detailed in Note 13 of the Notes to Financial Statements - Information regarding legal proceedings is detailed in Note 13 - Commitments and Contingencies[199](index=199&type=chunk) [Mine Safety Disclosures](index=30&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is reported as not applicable - Not applicable[200](index=200&type=chunk) [Part II](index=31&type=section&id=PART%20II) [Market For Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=31&type=section&id=Item%205.%20Market%20For%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) F5's common stock trades on Nasdaq, the company retains cash and does not pay dividends, and it executed a $500 million Accelerated Share Repurchase in fiscal 2021 - The company has not paid dividends and does not anticipate declaring them in the foreseeable future[206](index=206&type=chunk) - In February 2021, the company entered into Accelerated Share Repurchase (ASR) agreements totaling **$500 million**, repurchasing **2.5 million shares** at an average price of **$199.90 per share**[209](index=209&type=chunk) - As of September 30, 2021, **$773 million** remained authorized for future share repurchases[210](index=210&type=chunk) [Selected Financial Data](index=33&type=section&id=Item%206.%20Selected%20Financial%20Data) This item is no longer required due to amendments to Regulation S-K - Item 6 is no longer required due to the adoption of amendments to Regulation S-K[215](index=215&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In fiscal 2021, total net revenues grew 10.7% to $2.60 billion, driven by strong software revenue growth, while cash and investments decreased due to share repurchases and acquisitions Fiscal Year 2021 Financial Highlights (in thousands, except percentages) | Metric | FY 2021 | FY 2020 | % Change | | :--- | :--- | :--- | :--- | | **Total Net Revenues** | **$2,603,416** | **$2,350,822** | **10.7%** | | Product Revenue | $1,247,084 | $1,025,856 | 21.6% | | Service Revenue | $1,356,332 | $1,324,966 | 2.4% | | Gross Profit | $2,110,270 | $1,942,935 | 8.6% | | Gross Margin | 81.1% | 82.6% | (1.5 p.p.) | | Income from Operations | $394,025 | $392,267 | 0.4% | | Net Income | $331,241 | $307,441 | 7.7% | Product Revenue Breakdown (in thousands) | Product Type | FY 2021 | FY 2020 | % Change | | :--- | :--- | :--- | :--- | | Systems Revenue | $748,192 | $668,313 | 12.0% | | Software Revenue | $498,892 | $357,543 | 39.5% | | **Total Product Revenue** | **$1,247,084** | **$1,025,856** | **21.6%** | - Cash and investments decreased by **$269.4 million** to **$1.04 billion**, primarily due to **$500.0 million** for share repurchases and **$411.3 million** for acquisitions (mainly Volterra), offset by **$645.2 million** in cash from operations[260](index=260&type=chunk) - As of September 30, 2021, the company had **$370.0 million** of principal outstanding under its Term Loan Facility, maturing in January 2023[271](index=271&type=chunk)[440](index=440&type=chunk) [Quantitative and Qualitative Disclosure About Market Risk](index=45&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosure%20About%20Market%20Risk) The company is exposed to interest rate risk, with a hypothetical 100 basis point increase potentially reducing its investment portfolio by $3.4 million, while foreign currency risk is currently not significant - **Interest Rate Risk:** A hypothetical **100 basis point** increase in interest rates at September 30, 2021, could reduce the market value of the investment portfolio by approximately **$3.4 million**[278](index=278&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, and the company does not currently engage in foreign currency hedging[279](index=279&type=chunk) [Financial Statements and Supplementary Data](index=46&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements, an unqualified audit opinion from PricewaterhouseCoopers LLP, and notes detailing business combinations, debt, litigation, and segment information [Report of Independent Registered Public Accounting Firm](index=47&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data%20-%20Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) PricewaterhouseCoopers LLP issued an unqualified audit opinion on the financial statements and internal controls, highlighting the valuation of Volterra's developed technology as a critical audit matter - PricewaterhouseCoopers LLP issued an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting[288](index=288&type=chunk) - A critical audit matter was identified regarding the valuation of the **$59.5 million** developed technology intangible asset from the Volterra, Inc. acquisition, due to significant judgment in estimating its fair value, particularly the royalty rate assumption[297](index=297&type=chunk)[298](index=298&type=chunk) [Notes to Consolidated Financial Statements](index=55&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data%20-%20Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed disclosures on business combinations including Volterra, Shape, and NGINX acquisitions, debt facilities, share repurchases, ongoing litigation, and segment information - **Business Combinations (Note 3):** Details the acquisition of Volterra, Inc. on January 22, 2021, for a total purchase price of **$427.2 million**, including **$59.5 million** for developed technology[386](index=386&type=chunk)[389](index=389&type=chunk) - **Debt Facilities (Note 7):** As of September 30, 2021, **$370.0 million** of principal was outstanding under the Term Loan Facility for the Shape acquisition, maturing in January 2023[435](index=435&type=chunk)[440](index=440&type=chunk) - **Shareholders' Equity (Note 10):** On February 3, 2021, the company initiated a **$500 million** Accelerated Share Repurchase (ASR), buying back **2.5 million shares**, with **$773 million** remaining authorized as of September 30, 2021[463](index=463&type=chunk)[466](index=466&type=chunk) - **Litigation (Note 13):** The company is a defendant in a lawsuit by Lynwood Investment CY Limited regarding NGINX intellectual property and is defending three separate patent infringement actions filed by Proven Networks LLC[489](index=489&type=chunk)[493](index=493&type=chunk) [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=86&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with accountants on accounting and financial disclosure - None[511](index=511&type=chunk) [Controls and Procedures](index=86&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of September 30, 2021, with no material changes during the fourth fiscal quarter - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of September 30, 2021[514](index=514&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of September 30, 2021, based on the COSO framework, a conclusion audited by PricewaterhouseCoopers LLP[516](index=516&type=chunk)[517](index=517&type=chunk) - No material changes were made to the company's internal control over financial reporting during the fourth fiscal quarter[518](index=518&type=chunk) [Other Information](index=87&type=section&id=Item%209B.%20Other%20Information) The company reports no other information to disclose for this item - None[519](index=519&type=chunk) [Part III](index=88&type=section&id=PART%20III) [Directors, Executive Officers and Corporate Governance](index=88&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the definitive Proxy Statement - Information regarding directors, executive officers, and corporate governance is incorporated by reference from the company's definitive Proxy Statement[522](index=522&type=chunk) [Executive Compensation](index=88&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive compensation is incorporated by reference from the definitive Proxy Statement - The required information is incorporated by reference from the "Executive Compensation" and related sections in the Proxy Statement[523](index=523&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=88&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information regarding security ownership of certain beneficial owners and management is incorporated by reference from the definitive Proxy Statement - The required information is incorporated by reference from the "Security Ownership of Certain Beneficial Owners and Management" section in the Proxy Statement[524](index=524&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=88&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding certain relationships, related transactions, and director independence is incorporated by reference from the definitive Proxy Statement - The required information is incorporated by reference from the sections concerning director independence and related person transactions in the Proxy Statement[525](index=525&type=chunk) [Principal Accountant Fees and Services](index=88&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information regarding principal accountant fees and services is incorporated by reference from the definitive Proxy Statement - The required information is incorporated by reference from the sections concerning fees paid to PricewaterhouseCoopers LLP and audit committee procedures in the Proxy Statement[526](index=526&type=chunk) [Part IV](index=89&type=section&id=PART%20IV) [Exhibits and Financial Statement Schedules](index=89&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the Consolidated Financial Statements and various exhibits filed as part of the Form 10-K report - Lists the Consolidated Financial Statements and Exhibits filed with the report; financial statement schedules were omitted as not applicable, material, or included elsewhere[529](index=529&type=chunk) [Form 10-K Summary](index=89&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is reported as not applicable - Not applicable[530](index=530&type=chunk)

Financial Data and Key Metrics Changes - Fourth quarter revenue reached $682 million, an 11% year-over-year increase, exceeding guidance [10] - Product revenue for Q4 was $340 million, up 21% year-over-year, a significant acceleration from 6% in the same period last year [10] - Software revenue grew 35% to $152 million, representing 45% of product revenue, up from 40% in the previous year [10][11] - GAAP net income for Q4 was $111 million or $1.80 per share, while non-GAAP net income was $185 million or $3.01 per share [16] - For the fiscal year 2021, total revenue grew 10% to $2.6 billion, with product revenue of $1.25 billion growing 21% [18][19] Business Line Data and Key Metrics Changes - Software growth was 35%, systems growth was 12%, and global services growth was 2% in Q4 [8] - Subscription-based revenue represented 80% of total software revenue in Q4, up from 76% in the previous year [11] - The deal volume of multi-year subscriptions more than doubled year-over-year, approaching 500 in total [12] Market Data and Key Metrics Changes - In Q4, the Americas delivered 11% revenue growth, representing 59% of total revenue, while EMEA and APAC delivered 11% and 9% growth, accounting for 24% and 17% of revenue, respectively [15] - Enterprise customers represented 69% of product bookings in Q4, with service providers at 13% and government customers at 18% [15] Company Strategy and Development Direction - The company is focused on application security, anticipating it to be a significant area of investment over the next decade [38] - F5 aims to achieve the Rule of 40, combining revenue growth and non-GAAP operating margins totaling 40, which was achieved in FY '21 [29][30] - The integration of Volterra is a priority, enhancing security offerings and enabling critical application services at the edge [57] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing pressures related to global supply chain challenges, which may increase costs [28] - The company expects revenue growth of 8% to 9% for FY '22, with software growth projected between 35% and 40% [25] - Management expressed confidence in the demand for BIG-IP, citing both transient and secular factors driving growth [78][89] Other Important Information - The company ended FY '21 with approximately $125 million in backlog, primarily system-based [23] - The acquisition of Threat Stack is expected to enhance F5's cloud security capabilities [59] Q&A Session Summary Question: Can you provide more details on the backlog composition? - The backlog primarily consists of system-based orders, with a significant portion from service provider customers [62] Question: Are you expecting elevated levels of U.S. federal activity in the upcoming quarters? - No significant changes are expected in the federal business, which follows regular seasonality [63] Question: What is the impact of supply chain challenges on gross margins? - Supply chain challenges have impacted gross margins due to increased prices and expedite fees, but the company is managing the situation well [68] Question: How should we think about the growth rate of NGINX? - NGINX continues to grow well, with over 50% of multi-year subscriptions including NGINX [72] Question: What gives you confidence that 2021 wasn't an anomaly for systems revenue? - Demand for BIG-IP is expected to grow due to increasing reliance on traditional applications, despite some transient factors in 2021 [78][89] Question: How is the cloud vertical performing? - The cloud vertical continues to grow faster than overall software growth, with significant traction in private offers on marketplaces [84]

Table of Contents Title of each class Trading Symbol(s) Name of each exchange on which registered Common stock, no par value FFIV NASDAQ Global Select Market Emerging Growth Company ☐ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transitio ...

F5 Networks, Inc. (NASDAQ:FFIV) Q3 2021 Earnings Conference Call July 26, 2021 4:30 PM ET Company Participants Suzanne DuLong - Vice President of Investor Relations François Locoh-Donou - President & Chief Executive Officer Frank Pelzer - Executive Vice President & Chief Financial Officer Kara Sprague - Executive Vice President & General Manager of BIG-IP Conference Call Participants Tim Long - Barclays Samik Chatterjee - JP Morgan Rod Hall - Goldman Sachs James Fish - Piper Sandler Meta Marshall - Morgan S ...

| --- | --- | --- | |--------------------------------------------|-------|-------| | | | | | Q3FY21 Results PERIOD ENDING JUNE 30, 2021 | | | | Published July 26, 2021 | | | Forward-looking statements This presentation and associated commentary forward-looking statements including, among other things, statements regarding the continuing strength and momentum of F5's business, past and future financial performance including revenue, operating targets, earnings and earnings per share ranges, demand for applic ...

Table of Contents Title of each class Trading Symbol(s) Name of each exchange on which registered Common stock, no par value FFIV NASDAQ Global Select Market Emerging Growth Company ☐ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transiti ...

Financial Performance - F5's Q2FY21 revenue increased to $645.3 million, compared to $583.4 million in Q2FY20[7] - Software revenue grew by 20%[8, 10] - Systems revenue increased by 17%[8, 10] - Global Services revenue increased by 4%[8] - Non-GAAP gross margin was 83.4% in Q2FY21, compared to 84.9% in Q2FY20[15, 27] - Non-GAAP operating margin was 30.3% in Q2FY21, compared to 29.1% in Q2FY20[15, 28] - Non-GAAP diluted EPS was $2.50 in Q2FY21, compared to $2.23 in Q2FY20[17, 28] Revenue Mix and Geography - Software accounted for 21% of revenue in Q2FY21, with subscriptions making up 79% of that software revenue[11] - North America contributed 54% of total revenue with $346 million, EMEA 27% with $172 million, and APAC 20% with $127 million[12] - Revenue growth in North America was 15%, EMEA 16%, and APAC 6%[12] Capital Allocation - F5 initiated a $500 million accelerated share repurchase (ASR) program in Q2FY21[22] - Approximately $400 million of shares were retired during Q2FY21 under the ASR program[22]

Financial Data and Key Metrics Changes - Q2 revenue reached $645 million, a 10% year-over-year increase, at the top end of guidance range [10] - Non-GAAP net income was $155 million or $2.50 per share, while GAAP net income was $43 million or $0.70 per share [19] - GAAP gross margin was 80.1%, and non-GAAP gross margin was 83.4% [18] Business Line Data and Key Metrics Changes - Product revenue was $309 million, up 18% year-over-year, accounting for approximately 48% of total revenue [11] - Systems revenue increased by 17% to $201 million, while software revenue grew by 20% to $108 million [13][14] - Global services revenue was $336 million, up 4% year-over-year, representing 52% of total revenue [15] Market Data and Key Metrics Changes - Americas revenue grew by 6%, EMEA by 16%, and APAC by 15% [16] - Enterprise customers represented 68% of product bookings, with service providers and government customers each at 16% [17] Company Strategy and Development Direction - The company is focused on a multi-cloud approach and is benefiting from strong macro growth drivers powered by application growth [8][9] - There is a strong emphasis on application security and delivery solutions, with a notable shift towards subscription-based models [14][42] - The integration of F5 and Volterra aims to enhance application security offerings in a SaaS model [53][56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in future growth driven by increasing application traffic and demand for application security [27][52] - There are concerns about supply chain tightening, but the company has mitigation efforts in place [22][24] - The guidance for Q3 revenue is projected between $620 million to $650 million, reflecting a cautious outlook due to supply chain challenges [23] Other Important Information - The company generated $128.5 million in cash flow from operations in Q2 [20] - Deferred revenue increased by 7% year-over-year to $1.4 billion [21] - The company is experiencing a notable shift in customer preferences towards hardware solutions due to urgent capacity needs [39][40] Q&A Session Summary Question: Near-term benefits on systems and software bookings - Management confirmed a strong pipeline of software deals for NGINX and BIG-IP expected to materialize in the second half of the year [59] Question: Impact of security breaches on WAF pipeline - There is good traction in web application firewalls, with demand seen in both hardware and modern application environments [66] Question: Organic software growth excluding Volterra - Management stated that Volterra's impact is immaterial for the current quarter, but it is a critical asset for future growth [71] Question: Update on US federal demand - Demand trends for US federal business remain strong and are expected to follow normal patterns [85] Question: Growth trends in the cloud vertical - The cloud vertical continues to be a growth driver, but there was a moderation in growth rates due to customers delaying migration to the public cloud [91]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents F5 Networks' unaudited consolidated financial statements for Q1 fiscal 2021, covering key financial statements and notes [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) | Metric | Dec 31, 2020 (in thousands) | Sep 30, 2020 (in thousands) | | :-------------------------- | :-------------------------- | :-------------------------- | | Cash and cash equivalents | $1,026,829 | $849,556 | | Total current assets | $2,029,810 | $1,793,476 | | Total assets | $4,899,339 | $4,677,920 | | Total current liabilities | $1,319,249 | $1,288,279 | | Total liabilities | $2,497,749 | $2,445,652 | | Total shareholders' equity | $2,401,590 | $2,232,268 | [Consolidated Income Statements](index=5&type=section&id=Consolidated%20Income%20Statements) | Metric | Three months ended Dec 31, 2020 (in thousands) | Three months ended Dec 31, 2019 (in thousands) | Change (YoY) | | :--------------------------- | :--------------------------------------------- | :--------------------------------------------- | :----------- | | Net revenues | $624,617 | $569,305 | +9.7% | | Products revenue | $288,045 | $234,536 | +22.8% | | Services revenue | $336,572 | $334,769 | +0.5% | | Gross profit | $509,638 | $480,663 | +6.0% | | Income from operations | $117,748 | $122,335 | -3.7% | | Net income | $87,678 | $98,527 | -11.0% | | Net income per share — basic | $1.43 | $1.62 | -11.8% | | Net income per share — diluted | $1.41 | $1.62 | -12.9% | [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) | Metric | Three months ended Dec 31, 2020 (in thousands) | Three months ended Dec 31, 2019 (in thousands) | Change (YoY) | | :--------------------------- | :--------------------------------------------- | :--------------------------------------------- | :----------- | | Net income | $87,678 | $98,527 | -11.0% | | Foreign currency translation adjustment | $1,278 | $634 | +101.6% | | Net change in unrealized (losses) gains on available-for-sale securities, net of tax | $(417) | $180 | -331.7% | | Total other comprehensive income | $861 | $814 | +5.8% | | Comprehensive income | $88,539 | $99,341 | -10.9% | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) | Metric | Dec 31, 2020 (in thousands) | Sep 30, 2020 (in thousands) | Dec 31, 2019 (in thousands) | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Common stock | $386,236 | $305,453 | $211,217 | | Accumulated other comprehensive loss | $(17,855) | $(18,716) | $(18,376) | | Retained earnings | $2,033,209 | $1,945,531 | $1,736,617 | | Total shareholders' equity | $2,401,590 | $2,232,268 | $1,929,458 | - Stock-based compensation for the three months ended December 31, 2020, was **$58,069 thousand**, up from **$47,661 thousand** in the prior year[26](index=26&type=chunk)[27](index=27&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Metric | Three months ended Dec 31, 2020 (in thousands) | Three months ended Dec 31, 2019 (in thousands) | Change (YoY) | | :----------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :----------- | | Net cash provided by operating activities | $137,363 | $144,012 | -4.6% | | Net cash provided by (used in) investing activities | $20,643 | $(29,400) | +170.2% | | Net cash provided by financing activities | $17,715 | $20,959 | -15.5% | | Net increase in cash, cash equivalents and restricted cash | $175,721 | $135,571 | +29.6% | | Cash, cash equivalents and restricted cash, end of period | $1,030,202 | $738,645 | +39.5% | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) This section provides detailed disclosures and explanations for the consolidated financial statements, covering accounting policies and key financial areas [1. Summary of Significant Accounting Policies](index=9&type=section&id=1.%20Summary%20of%20Significant%20Accounting%20Policies) - **F5 Networks, Inc.** is a leading provider of multi-cloud application services, enabling customers to develop, deploy, operate, secure, and govern applications across various architectures, from on-premises to public cloud[36](index=36&type=chunk) - The company adopted ASU 2018-15 (capitalizing implementation costs for hosting arrangements) and ASU 2016-13 (credit losses) on October 1, 2020, with no material impact on its consolidated financial statements[39](index=39&type=chunk)[40](index=40&type=chunk) - The extent to which the COVID-19 pandemic may impact the company's financial condition or results of operations remains uncertain as of the filing date[38](index=38&type=chunk) [2. Revenue from Contracts with Customers](index=10&type=section&id=2.%20Revenue%20from%20Contracts%20with%20Customers) | Metric | Three months ended Dec 31, 2020 (in thousands) | Three months ended Dec 31, 2019 (in thousands) | | :--------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Capitalized contract acquisition costs, end of period | $71,969 | $58,153 | | Amortization of capitalized contract acquisition costs | $8,152 | $8,705 | | Contract assets, end of period | $245,804 | $135,245 | | Deferred revenue, end of period | $1,358,825 | $1,237,973 | - As of December 31, 2020, total non-cancelable remaining performance obligations were approximately **$1.4 billion**, with **68.9%** expected to be recognized as revenue over the next 12 months[52](index=52&type=chunk) [3. Fair Value Measurements](index=11&type=section&id=3.%20Fair%20Value%20Measurements) | Asset Category (Fair Value) | Dec 31, 2020 (in thousands) | Sep 30, 2020 (in thousands) | | :-------------------------- | :-------------------------- | :-------------------------- | | Cash equivalents | $494,901 | $250,970 | | Short-term investments | $346,515 | $360,333 | | Long-term investments | $88,753 | $102,939 | | **Total** | **$930,169** | **$714,242** | - The company recorded an impairment of **$6.7 million** against the right-of-use asset related to the integration of the former Shape headquarters in Santa Clara, California, in the first quarter of fiscal 2021[65](index=65&type=chunk) [4. Short-Term and Long-Term Investments](index=13&type=section&id=4.%20Short-Term%20and%20Long-Term%20Investments) | Investment Type (Fair Value) | Dec 31, 2020 (in thousands) | Sep 30, 2020 (in thousands) | | :--------------------------- | :-------------------------- | :-------------------------- | | Short-term investments | $346,515 | $360,333 | | Long-term investments | $88,753 | $102,939 | - Interest income from investments decreased significantly to **$1.1 million** for the three months ended December 31, 2020, from **$5.6 million** in the prior year[66](index=66&type=chunk) - Gross unrealized losses were not material, and no other-than-temporary impairments were identified as of December 31, 2020[69](index=69&type=chunk)[70](index=70&type=chunk) [5. Business Combinations](index=14&type=section&id=5.%20Business%20Combinations) - F5 acquired **Shape Security, Inc.** on January 24, 2020, for approximately **$1.0 billion** in cash, aiming for synergies and enhanced fraud prevention solutions[71](index=71&type=chunk)[72](index=72&type=chunk) | Acquired Assets (Shape Security) | Amount (in thousands) | Estimated Useful Life | | :------------------------------- | :-------------------- | :-------------------- | | Developed technologies | $120,000 | 7 years | | Customer relationships | $21,000 | 4 years | | Trade name | $9,500 | 5 years | | Goodwill | $804,537 | N/A | - Goodwill related to the Shape acquisition was increased by **$4.9 million** in the first quarter of fiscal 2021 due to a post-close measurement period adjustment[75](index=75&type=chunk) [6. Balance Sheet Details](index=16&type=section&id=6.%20Balance%20Sheet%20Details) | Account (in thousands) | Dec 31, 2020 | Sep 30, 2020 | | :------------------------------------- | :----------- | :----------- | | Cash, cash equivalents and restricted cash | $1,030,202 | $852,826 | | Inventories | $26,455 | $27,898 | | Other current assets | $283,341 | $259,506 | | Other assets, net | $367,955 | $347,447 | | Accrued liabilities | $305,792 | $321,398 | | Other long-term liabilities | $61,653 | $59,511 | [7. Debt Facilities](index=17&type=section&id=7.%20Debt%20Facilities) - The company has a **$400.0 million** Term Loan Facility, with **$385.0 million** outstanding as of December 31, 2020, maturing on January 24, 2023[86](index=86&type=chunk) - A **$350.0 million** Revolving Credit Facility is available, with no outstanding borrowings as of December 31, 2020, providing **$350.0 million** in available borrowing capacity[88](index=88&type=chunk) - The company was in compliance with all financial covenants under both debt agreements as of December 31, 2020[86](index=86&type=chunk)[88](index=88&type=chunk) [8. Leases](index=18&type=section&id=8.%20Leases) - Adoption of ASU 2016-02 (Leasing Standard) on October 1, 2019, led to the recognition of **$304.8 million** in right-of-use assets and **$386.4 million** in lease liabilities[89](index=89&type=chunk) | Lease Metric (in thousands) | Dec 31, 2020 | Sep 30, 2020 | | :--------------------------------------- | :----------- | :----------- | | Operating lease right-of-use assets, net | $286,044 | $300,680 | | Total operating lease liabilities | $375,231 | $384,725 | | Weighted average remaining lease term (in years) | 10.1 | 10.2 | | Weighted average discount rate | 2.59% | 2.58% | - Total lease expense for the three months ended December 31, 2020, was **$20.2 million**, up from **$18.0 million** in the prior year[91](index=91&type=chunk) [9. Commitments and Contingencies](index=19&type=section&id=9.%20Commitments%20and%20Contingencies) - The company is involved in a lawsuit filed by **Lynwood Investment CY Limited**, claiming intellectual property rights to **NGINX software**, which F5 intends to vigorously defend[101](index=101&type=chunk)[102](index=102&type=chunk) - Accrued warranty costs were not material as of December 31, 2020, and no accrual for loss contingencies related to legal proceedings has been recorded[97](index=97&type=chunk)[103](index=103&type=chunk) [10. Income Taxes](index=20&type=section&id=10.%20Income%20Taxes) - The effective tax rate increased to **25.1%** for the three months ended December 31, 2020, from **22.8%** in the prior year, primarily due to the tax impact from stock-based compensation and other non-deductible expenses[105](index=105&type=chunk) - Unrecognized tax benefits totaled **$54.3 million** as of December 31, 2020, which could affect the effective tax rate if recognized[106](index=106&type=chunk) - The company is currently under audit by various states and foreign jurisdictions (Israel, Saudi Arabia, Singapore) for different fiscal years[108](index=108&type=chunk) [11. Net Income Per Share](index=21&type=section&id=11.%20Net%20Income%20Per%20Share) | Metric | Three months ended Dec 31, 2020 | Three months ended Dec 31, 2019 | | :--------------------------- | :------------------------------ | :------------------------------ | | Basic net income per share | $1.43 | $1.62 | | Diluted net income per share | $1.41 | $1.62 | | Weighted average shares outstanding — diluted | 62,282 thousand | 60,815 thousand | [12. Segment Information](index=21&type=section&id=12.%20Segment%20Information) - **F5 Networks** operates as a single reportable operating segment focused on the development, marketing, and sale of application services[111](index=111&type=chunk) | Geographic Region | Three months ended Dec 31, 2020 (in thousands) | Three months ended Dec 31, 2019 (in thousands) | | :---------------- | :--------------------------------------------- | :--------------------------------------------- | | Americas | $343,136 | $301,562 | | EMEA | $162,084 | $155,952 | | Asia Pacific | $119,397 | $111,791 | | **Total Revenues**| **$624,617** | **$569,305** | | Net Product Revenues | Three months ended Dec 31, 2020 (in thousands) | Three months ended Dec 31, 2019 (in thousands) | | :------------------- | :--------------------------------------------- | :--------------------------------------------- | | Systems revenue | $178,571 | $169,601 | | Software revenue | $109,474 | $64,935 | | **Total** | **$288,045** | **$234,536** | - Key distributors accounting for over 10% of total net revenue in Q1 fiscal 2021 were **Ingram Micro, Inc. (18.1%)** and **Synnex Corporation (10.0%)**[114](index=114&type=chunk) [13. Restructuring Charges](index=22&type=section&id=13.%20Restructuring%20Charges) - In December 2019, the company initiated a restructuring plan, including a reduction in force of approximately **75 employees**, resulting in a **$7.8 million** charge in the first quarter of fiscal 2020[115](index=115&type=chunk)[117](index=117&type=chunk) [14. Subsequent Events](index=23&type=section&id=14.%20Subsequent%20Events) - On January 22, 2021, F5 acquired **Volterra, Inc.** for approximately **$440 million** in cash and **$60 million** in deferred consideration, aiming to integrate its universal edge-as-a-service platform[118](index=118&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk) - On February 3, 2021, the company entered into Accelerated Share Repurchase (ASR) agreements totaling **$500 million**, with an initial delivery of shares approximating **80%** of the total to be repurchased[122](index=122&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations for Q1 fiscal 2021 [Overview](index=24&type=section&id=Overview) - **F5** is a leading provider of multi-cloud application services, offering cloud-based, software-as-a-service, and software-only solutions optimized for multi-cloud environments[125](index=125&type=chunk) - Key performance indicators monitored include revenues (from **ADC products**, **NGINX**, **Shape**, and subscription offerings), cost of revenues, operating expenses, liquidity, cash flows, and balance sheet metrics like deferred revenue and accounts receivable[126](index=126&type=chunk)[128](index=128&type=chunk) - Days sales outstanding (DSO) for the first quarter of fiscal year 2021 was **50 days**[128](index=128&type=chunk) [Summary of Critical Accounting Policies and Estimates](index=25&type=section&id=Summary%20of%20Critical%20Accounting%20Policies%20and%20Estimates) - Critical accounting policies and estimates requiring complex judgments include revenue recognition, accounting for business combinations, and accounting for leases[129](index=129&type=chunk) - There were no material changes to the critical accounting policies and estimates compared to the prior fiscal year[130](index=130&type=chunk) [COVID-19 Update](index=25&type=section&id=COVID-19%20Update) - While **COVID-19** did not have a significant impact on Q1 fiscal 2021 results, the potential effects on business and financial outlook remain unknown due to ongoing modifications to employee travel, work locations, and events[131](index=131&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) | Metric | Three months ended Dec 31, 2020 (in thousands) | Three months ended Dec 31, 2019 (in thousands) | Change (YoY) | | :--------------------------- | :--------------------------------------------- | :--------------------------------------------- | :----------- | | Total net revenues | $624,617 | $569,305 | +9.7% | | Net product revenues | $288,045 | $234,536 | +22.8% | | Net service revenues | $336,572 | $334,769 | +0.5% | | Cost of net product revenues | $67,038 | $42,118 | +59.2% | | Cost of net service revenues | $47,941 | $46,524 | +3.0% | | Gross profit | $509,638 | $480,663 | +6.0% | | Income from operations | $117,748 | $122,335 | -3.7% | | Net income | $87,678 | $98,527 | -11.0% | - The increase in net product revenues was primarily driven by higher software sales, while the increase in cost of net product revenues was mainly due to the **Shape acquisition** and related managed service costs[136](index=136&type=chunk)[140](index=140&type=chunk) | Operating Expense (in thousands) | Three months ended Dec 31, 2020 | Three months ended Dec 31, 2019 | Change (YoY) | | :------------------------------- | :------------------------------ | :------------------------------ | :----------- | | Sales and marketing | $214,546 | $195,519 | +9.7% | | Research and development | $114,191 | $96,005 | +18.9% | | General and administrative | $63,153 | $59,004 | +7.0% | | Restructuring charges | $0 | $7,800 | -100.0% | | **Total Operating Expenses** | **$391,890** | **$358,328** | **+9.4%** | - Other (loss) income, net decreased primarily due to a **$4.4 million** decrease in interest income from investments and a **$1.7 million** increase in interest expense from the Term Loan Facility[146](index=146&type=chunk) - The effective tax rate increased to **25.1%** from **22.8%** due to the tax impact from stock-based compensation and other non-deductible expenses[147](index=147&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) - Cash, cash equivalents, short-term, and long-term investments increased by **$149.3 million** to **$1,462.1 million** as of December 31, 2020, primarily driven by **$137.4 million** in cash from operating activities[151](index=151&type=chunk) - Cash provided by investing activities was **$20.6 million**, a significant improvement from **$29.4 million** used in the prior year, mainly due to maturities of investments[153](index=153&type=chunk) - The company has **$350.0 million** in available borrowing capacity under its Revolving Credit Facility and believes current cash, investments, and anticipated cash flows are sufficient to meet liquidity needs[152](index=152&type=chunk)[155](index=155&type=chunk) - Subsequent to the quarter, the company entered into **$500 million** Accelerated Share Repurchase (ASR) agreements on February 3, 2021[156](index=156&type=chunk) [Obligations and Commitments](index=29&type=section&id=Obligations%20and%20Commitments) - Principal commitments include **$385.0 million** outstanding under the Term Loan Facility and obligations under operating leases expiring through 2033[157](index=157&type=chunk)[158](index=158&type=chunk)[161](index=161&type=chunk) - The company is contractually obligated to purchase component inventory from contract manufacturers based on rolling production forecasts[162](index=162&type=chunk) [Recent Accounting Pronouncements](index=30&type=section&id=Recent%20Accounting%20Pronouncements) - The anticipated impact of recent accounting pronouncements is discussed in Note 1 to the accompanying Notes to Consolidated Financial Statements[163](index=163&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the company's exposure to market risks, primarily interest rate and foreign currency risks - The company is exposed to **interest rate risk**, where a sharp rise in market interest rates could adversely impact the fair value of its fixed income investment portfolio and increase interest payable on its Term Loan Facility[164](index=164&type=chunk)[166](index=166&type=chunk) - As of December 31, 2020, **41.5%** of the fixed income securities balance consisted of U.S. government and U.S. government agency securities, and the overall credit quality of the portfolio is strong[164](index=164&type=chunk) - The majority of sales and expenses are denominated in U.S. dollars, resulting in no significant foreign currency transaction gains and losses to date[167](index=167&type=chunk) [Item 4. Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of disclosure controls and procedures and reports no material changes to internal control over financial reporting - The company's disclosure controls and procedures were effective as of December 31, 2020, ensuring timely and accurate reporting of required information[168](index=168&type=chunk)[170](index=170&type=chunk) - There were no material changes to internal control over financial reporting during the first fiscal quarter, even with the entire global workforce working remotely due to the COVID-19 pandemic[171](index=171&type=chunk) [Changes in Internal Control over Financial Reporting](index=31&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - No material changes to internal control over financial reporting occurred during the first fiscal quarter, despite the global F5 workforce working remotely due to the **COVID-19 pandemic**[171](index=171&type=chunk) [PART II. OTHER INFORMATION](index=31&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 9 for details on legal proceedings, including a lawsuit concerning NGINX software IP - Information regarding legal proceedings, including the lawsuit filed by **Lynwood Investment CY Limited** concerning **NGINX software** intellectual property, is detailed in Note 9 to the Financial Statements[172](index=172&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) This section states no material changes to the company's risk factors from those described in its Annual Report on Form 10-K - No material changes to risk factors were identified compared to those disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2020[173](index=173&type=chunk) [Item 2. 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) This section details the company's common stock share repurchase program, with no repurchases in Q1 fiscal 2021 - The Board of Directors authorized an additional **$1.0 billion** for the common stock share repurchase program in October 2018, supplementing an existing **$4.4 billion** program[174](index=174&type=chunk) - The company did not repurchase and retire any shares during the three months ended December 31, 2020[174](index=174&type=chunk) [Item 4. Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable[176](index=176&type=chunk) [Item 5. Other Information](index=32&type=section&id=Item%205.%20Other%20Information) This item states that there is no other information to report - None[177](index=177&type=chunk) [Item 6. Exhibits](index=32&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications and XBRL-related documents - Exhibits include certifications pursuant to **Sections 302 and 906 of the Sarbanes-Oxley Act of 2002**, and various **XBRL taxonomy extension documents**[178](index=178&type=chunk) [SIGNATURES](index=33&type=section&id=SIGNATURES) [SIGNATURES](index=33&type=section&id=SIGNATURES) This section contains the official signatures, certifying the filing of the report on behalf of F5 Networks, Inc. - The report was duly signed on **February 5, 2021**, by **Francis J. Pelzer**, **Executive Vice President, Chief Financial Officer** (principal financial officer and principal accounting officer) of F5 Networks, Inc.[181](index=181&type=chunk)[182](index=182&type=chunk)