[Financial Highlights and CEO Commentary](index=1&type=section&id=Financial%20Highlights%20for%20the%20Fourth%20Quarter%20and%20Full%20Year%202023) Radware reported Q4 and full-year revenue declines, but strong cloud security ARR growth and CEO optimism for 2024 - The CEO highlighted a **22% year-over-year growth in cloud security ARR**, closing 2023 on a positive note, with the company cautiously optimistic for 2024, focusing on cloud security, partner channels, and cost discipline to achieve revenue growth and improved profitability[3](index=3&type=chunk) Key Financial Metrics | Metric | Q4 2023 (Millions $) | Full Year 2023 (Millions $) | | :--- | :--- | :--- | | Revenue | $65.0 (-12% YoY) | $261.3 (-11% YoY) | | Cloud ARR | $64.9 (+22% YoY) | N/A | | GAAP Net Loss per Share ($) | $(0.14) | $(0.50) | | Non-GAAP EPS ($) | $0.13 | $0.43 | [Revenue by Geographic Region](index=1&type=section&id=Revenue%20by%20Geographic%20Region) Full-year 2023 revenues declined across all regions, with Americas seeing the largest drop, while Q4 saw EMEA growth Revenue by Geographic Region | Region | Q4 2023 Revenue (Millions $) | YoY Change | Full Year 2023 Revenue (Millions $) | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Americas | $24.6 | -23% | $103.4 | -17% | | EMEA | $24.9 | +2% | $96.5 | -7% | | APAC | $15.5 | -13% | $61.4 | -6% | [Profitability and Cash Position](index=2&type=section&id=Profitability%20and%20Cash%20Position) Profitability declined in 2023 with widened GAAP net loss and reduced non-GAAP net income, despite a strong cash position Profitability Metrics | Metric | Full Year 2023 (Millions $) | Full Year 2022 (Millions $) | | :--- | :--- | :--- | | GAAP Net Loss | $(21.6) | $(0.2) | | GAAP Diluted EPS ($) | $(0.50) | $0.00 | | Non-GAAP Net Income | $18.9 | $31.3 | | Non-GAAP Diluted EPS ($) | $0.43 | $0.68 | - As of December 31, 2023, the company held **$363.7 million** in cash, cash equivalents, short-term bank deposits, and marketable securities[8](index=8&type=chunk) - Cash flow from operating activities was **$2.7 million** in Q4 2023 but was negative at **$3.5 million** for the full year 2023[8](index=8&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) Financial statements reflect a challenging year with decreased assets and equity, increased net loss, and negative operating cash flow [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $572.3 million, total liabilities to $249.0 million, and total equity to $323.3 million by year-end 2023 Condensed Consolidated Balance Sheets | Balance Sheet Item (Thousands $) | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash, cash equivalents, deposits & marketable securities | $363,719 | $385,772 | | Total Assets | $572,288 | $643,588 | | Total Liabilities | $249,014 | $275,145 | | Total Equity | $323,274 | $368,443 | [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Full-year 2023 revenues declined to $261.3 million, resulting in a gross profit decrease and a significant operating loss of $31.7 million Condensed Consolidated Statements of Income | Income Statement Item (Thousands $) | Full Year 2023 | Full Year 2022 | | :--- | :--- | :--- | | Revenues | $261,292 | $293,426 | | Gross Profit | $209,582 | $239,542 | | Operating Loss | $(31,680) | $(3,339) | | Net Loss | $(21,590) | $(166) | | Diluted Net Loss Per Share ($) | $(0.50) | $(0.00) | [Reconciliation of GAAP to Non-GAAP Financial Information](index=7&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Information) Non-GAAP operating income declined to $9.3 million and non-GAAP net income to $18.9 million in 2023 after adjustments Reconciliation of GAAP to Non-GAAP Financial Information | Reconciliation to Non-GAAP (Thousands $) | Full Year 2023 | Full Year 2022 | | :--- | :--- | :--- | | GAAP Operating Loss | $(31,680) | $(3,339) | | Share-based compensation | $34,022 | $27,353 | | Amortization of intangible assets | $3,968 | $3,704 | | **Non-GAAP Operating Income** | **$9,289** | **$29,679** | | GAAP Net Loss | $(21,590) | $(166) | | Total Adjustments | $40,516 | $31,471 | | **Non-GAAP Net Income** | **$18,926** | **$31,305** | [Reconciliation to EBITDA and Adjusted EBITDA](index=9&type=section&id=RECONCILIATION%20OF%20GAAP%20NET%20LOSS%20TO%20EBITDA%20AND%20ADJUSTED%20EBITDA%20(NON-GAAP)) Adjusted EBITDA for full year 2023 decreased sharply to $17.6 million from $37.7 million in 2022 Reconciliation to EBITDA and Adjusted EBITDA (Non-GAAP) | Reconciliation to Adjusted EBITDA (Thousands $) | Full Year 2023 | Full Year 2022 | | :--- | :--- | :--- | | GAAP Net Loss | $(21,590) | $(166) | | EBITDA | $(19,436) | $8,353 | | Share-based compensation | $34,022 | $27,353 | | Restructuring costs | $1,851 | - | | Acquisition costs | $1,128 | $1,961 | | **Adjusted EBITDA** | **$17,565** | **$37,667** | [Condensed Consolidated Statements of Cash Flow](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flow) Full-year 2023 saw net cash used in operating activities of $3.5 million, a downturn from 2022, with significant share repurchases Condensed Consolidated Statements of Cash Flow | Cash Flow Item (Thousands $) | Full Year 2023 | Full Year 2022 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $(3,500) | $32,148 | | Net cash provided by (used in) investing activities | $92,779 | $(56,018) | | Net cash used in financing activities | $(64,926) | $(22,458) | | **Increase (decrease) in cash and cash equivalents** | **$24,353** | **$(46,328)** | [Supporting Information](index=3&type=section&id=Supporting%20Information) This section clarifies non-GAAP measures, defines ARR, and includes a Safe Harbor statement outlining risks to forward-looking statements - The company uses non-GAAP financial measures, excluding items like stock-based compensation and amortization, to provide what it believes are more meaningful comparisons of operating results[12](index=12&type=chunk) - Annual Recurring Revenue (ARR) is defined as the annualized value of booked orders for term-based cloud services, subscription licenses, and maintenance contracts, serving as a key indicator of the value of the company's recurring business[13](index=13&type=chunk) - The report contains forward-looking statements that are subject to risks including global economic conditions, the war between Israel and Hamas, supply chain shortages, and intense market competition[14](index=14&type=chunk)

| --- | --- | --- | --- | --- | --- | |------------------------|-------|-------|-------|-------|-------| | | | | | | | | Investor Presentation | | | | | | | November 2023 | | | | | | Radware Complete Mitigation Suite This presentation includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements made herein that are not statements of historical fact, including statements about Radware's plans, outlook, beliefs or opinions, are forward-lookin ...

Radware Ltd. (NASDAQ:RDWR) Q3 2023 Earnings Conference Call November 1, 2023 8:30 AM ET Company Participants Yisca Erez - Director, IR Roy Zisapel - President and CEO Guy Avidan - CFO Conference Call Participants George Notter - Jefferies Chris Reimer - Barclays Alex Henderson - Needham & Company Operator Welcome to the Radware conference call discussing Third Quarter 2023 Results, and thank you all for holding. As a reminder, this conference is being recorded, November 1, 2023. [Operator Instructions] I wo ...

Financial Performance - Revenue for Q3 2023 totaled $61.6 million, down 13% year-over-year[5] - GAAP net loss for Q3 2023 was $6.9 million, or $(0.16) per diluted share, compared to a net loss of $3.0 million, or $(0.07) per diluted share in Q3 2022[3] - Non-GAAP net income for Q3 2023 was $2.9 million, or $0.07 per diluted share, down from $6.7 million, or $0.15 per diluted share in Q3 2022[4] - GAAP gross profit for Q3 2023 was $48,774 thousand, down 15.1% from $57,383 thousand in Q3 2022[23] - GAAP operating loss for Q3 2023 was $(10,196) thousand, compared to a loss of $(3,394) thousand in Q3 2022[23] - Adjusted EBITDA for Q3 2023 was $1,572 thousand, down 78.6% from $7,334 thousand in Q3 2022[27] Regional Revenue Breakdown - Revenue in the Americas region was $24.9 million, a decrease of 24% from $32.9 million in Q3 2022[6] - Revenue in the EMEA region was $19.3 million, down 13% from $22.2 million in Q3 2022[6] - Revenue in the APAC region was $17.4 million, an increase of 12% from $15.5 million in Q3 2022[6] Cash Flow and Liquidity - Cash flow from operations was negative $9.8 million in Q3 2023[4] - Cash flow from operating activities for Q3 2023 was $(9,783) thousand, compared to $1,516 thousand in Q3 2022[26] - The company reported a decrease in cash and cash equivalents to $32,422 thousand at the end of Q3 2023, down from $42,469 thousand at the end of Q3 2022[26] - As of September 30, 2023, the company had cash, cash equivalents, and marketable securities totaling $371.6 million[4] - The company made a payment of $(2,063) thousand for the business acquisition of SecurityDAM Ltd. during Q3 2023[26] Strategic Focus - The company plans to focus on growing the cloud security business while managing costs prudently[3] Non-GAAP Metrics - Non-GAAP gross profit for the nine months ended September 30, 2023, was $160,753 thousand, a decrease of 12.0% compared to $182,375 thousand in the same period of 2022[23] - Non-GAAP operating income for the nine months ended September 30, 2023, was $5,892 thousand, down 74.8% from $23,318 thousand in the same period of 2022[23] - Non-GAAP net income for the nine months ended September 30, 2023, was $13,474 thousand, a decrease of 42.9% from $23,608 thousand in the same period of 2022[24] - Cloud ARR grew to $62.5 million, representing a 25% increase year-over-year[5]

Exhibit 99.1 Radware Reports Second Quarter 2023 Financial Results Second Quarter 2023 Financial Results and Highlights TEL AVIV, Israel, August 2, 2023 - Radware® (NASDAQ: RDWR), a leading provider of cyber security and application delivery solutions, today announced its consolidated financial results for the second quarter ended June 30, 2023. "During the second quarter of 2023, we continued to execute on our cloud security strategy, accelerating our cloud ARR growth 23% year-over- year," said Roy Zisapel ...

Financial Data and Key Metrics Changes - Revenue for Q1 2023 was $69 million, a decline of 6% year-over-year from $73.7 million in Q1 2022 [22][41] - Earnings per share for Q1 2023 was $0.14, down from $0.19 in Q1 2022 [41] - Operating expenses were $52.4 million, a 1% increase compared to Q1 2022, but a 5% decrease from Q4 2022 [24] - Net income for Q1 2023 was $6.1 million, compared to $8.8 million in the same period last year [41] - Cash flow from operations was negative $1.2 million, an improvement from negative $10.5 million in Q1 2022 [42] Business Line Data and Key Metrics Changes - Cloud ARR grew 21% year-over-year, consistent with Q4 2022 growth, and accounted for 27% of total ARR compared to 24% last year [19][37] - Cloud security bookings saw close to 30% year-over-year growth, with a significant increase in the total number of cloud customers, particularly mid-sized enterprises [19][37] - Subscription bookings crossed 50% of total bookings for the first time, indicating a shift towards a subscription-based model [33] Market Data and Key Metrics Changes - Revenue in the Americas decreased 8% to $27 million compared to Q1 2022, while EMEA revenue increased 6% to $30 million [38][39] - APAC revenue decreased 24% year-over-year to $12 million [39] - Americas accounted for 39% of total revenues, EMEA for 43%, and APAC for 18% in Q1 2023 [39] Company Strategy and Development Direction - The company is focused on transitioning to a subscription-based model and enhancing cloud security offerings [33] - New product launches include next-generation DDoS mitigators and a new management system for enhanced security operations [7][19] - The company aims to capitalize on the increasing demand for cybersecurity solutions driven by rising cyber-attacks [6][21] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macroeconomic challenges leading to longer sales cycles and cautious spending [4][22] - Despite these challenges, management remains confident in the long-term growth prospects due to the critical nature of their solutions [6][21] - The company expects revenue for Q2 2023 to be in the range of $68 million to $70 million [26] Other Important Information - The company repurchased shares amounting to approximately $12.7 million during the quarter [43] - The gross margin for Q1 2023 was 82.3%, down from 83.2% in Q1 2022, primarily due to higher costs associated with new cloud security centers [40] Q&A Session Summary Question: Guidance on interest income for Q2 - Management did not provide specific guidance but expects financial income to continue growing at a similar pace as the previous quarter [28] Question: Positioning against foreign exchange impacts - The company is hedged for the rest of the year against the Israeli shekel's weakness, which should not impact the P&L [51] Question: Performance of service provider vertical - Management noted that the decline was particularly pronounced in service providers, with a shift in business mix affecting performance [52] Question: Progress of U.S. market reorganization - Management indicated improvements in execution and pipeline penetration in the U.S. despite Q1 challenges [55] Question: Changes in sales organization and early returns - Management reported a good quarter with Cisco, seeing increased activity and engagement in the field [62] Question: Onboarding process for emergency customers - The onboarding process can be completed quickly, often within hours, especially when customers are under attack [67][68]

Exhibit 99.1 Radware Reports First Quarter 2023 Financial Results First Quarter 2023 Financial Results and Highlights TEL AVIV, Israel, May 3, 2023 - Radware® (NASDAQ: RDWR), a leading provider of cyber security and application delivery solutions, today announced its consolidated financial results for the first quarter ended March 31, 2023. "Despite the increasing challenges in the macro environment, our cloud security business performed well in the first quarter of 2023 and our cloud ARR grew over 20% year ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 ...

Radware Ltd. (NASDAQ:RDWR) Q4 2022 Earnings Conference Call February 8, 2023 8:30 AM ET Company Participants Yisca Erez - Director of Investor Relations Roy Zisapel - President and Chief Executive Officer Guy Avidan - Chief Financial Officer Conference Call Participants Chris Reimer - Barclays Bank PLC Alex Henderson - Needham & Company, LLC Timothy Horan - Oppenheimer & Co., Inc. George Notter - Jefferies LLC Operator Good morning, and welcome to the Radware Conference Call discussing Fourth Quarter and Fu ...

[Executive Summary & Business Outlook](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Outlook) Radware delivered solid Q4 and FY2022 financial results driven by cloud and subscription growth, while outlining a 2023 strategy focused on cloud security, mid-market expansion, and channel partnerships amidst macro headwinds [Fourth Quarter and Full Year 2022 Financial Highlights](index=1&type=section&id=Fourth%20Quarter%20and%20Full%20Year%202022%20Financial%20Highlights) Radware reported solid Q4 and full-year 2022 financial results, marked by double-digit cloud and subscription revenue growth, despite a slight Q4 revenue decline and reduced EPS - Cloud and subscription revenue delivered **double-digit growth in 2022**, with a **record number of new cloud wins in Q4**[2](index=2&type=chunk) Financial Highlights Summary | Metric | Q4 2022 (in millions) | Q4 2021 (in millions) | YoY Change (Q4) | FY 2022 (in millions) | FY 2021 (in millions) | YoY Change (FY) | | :-------------------------------- | :------ | :------ | :-------------- | :------ | :------ | :-------------- | | **Revenue** | $74.1M | $76.6M | -3% | $293.4M | $286.5M | +2% | | **Non-GAAP Gross Margin** | 82.7% | 82.4% | +0.3 pp | 83.0% | 82.4% | +0.6 pp | | **Non-GAAP EPS** | $0.17 | $0.22 | -22.7% | $0.68 | $0.81 | -16.0% | | **GAAP Net Loss Per Share** | $(0.09) | $(0.12) | +25.0% | $(0.00) | $0.16 | -100% | | **ARR (as of Dec 31)** | - | - | - | $202.4M | - | +7% | | **Cash, Cash Equivalents, Deposits & Marketable Securities (as of Dec 31)** | - | - | - | $432.0M | - | - | | **Net Cash from Operating Activities** | $9.6M | $28.9M | -66.9% | $32.1M | $71.8M | -55.3% | [Strategic Focus and 2023 Outlook](index=1&type=section&id=Strategic%20Focus%20and%202023%20Outlook) Radware's CEO, Roy Zisapel, outlined a strategic focus for 2023 centered on cloud solutions, expanding into the mid-sized enterprise market, and strengthening channel partnerships, alongside disciplined expense management, to drive profitable growth despite anticipated macro headwinds - The company expects macro environment headwinds to continue impacting results in the coming year but remains optimistic about long-term growth potential[2](index=2&type=chunk) - For 2023, Radware's strategy includes increasing focus on cloud security solutions, growing presence in the mid-sized enterprise market, and expanding channel partnerships[2](index=2&type=chunk) - Commitment to driving profitable growth through disciplined expense management[2](index=2&type=chunk) [Financial Performance Overview](index=1&type=section&id=Financial%20Performance%20Overview) Radware's 2022 financial performance showed mixed results, with full-year revenue growth, but declines in Q4 revenue, non-GAAP EPS, and operating cash flow, alongside a shift to a GAAP net loss [Revenue Performance](index=1&type=section&id=Revenue%20Performance) Radware's total revenue for Q4 2022 decreased by 3% year-over-year to $74.1 million, while full-year 2022 revenue increased by 2% to $293.4 million. Regional performance varied, with APAC showing strong growth in both periods, EMEA declining in Q4 but growing for the full year, and Americas showing slight Q4 growth but a full-year decrease [Overall Revenue](index=1&type=section&id=Overall%20Revenue) Radware's overall revenue saw a 3% decline in Q4 2022 but achieved a 2% increase for the full year, reaching $293.4 million | Metric | Q4 2022 (in millions) | Q4 2021 (in millions) | YoY Change | FY 2022 (in millions) | FY 2021 (in millions) | YoY Change | | :------- | :------ | :------ | :--------- | :------ | :------ | :--------- | | Revenue | $74.1M | $76.6M | -3% | $293.4M | $286.5M | +2% | [Regional Revenue Breakdown](index=1&type=section&id=Regional%20Revenue%20Breakdown) Regional revenue performance varied, with APAC showing strong growth, EMEA declining in Q4 but growing annually, and Americas experiencing a full-year decrease | Region | Q4 2022 Revenue (in millions) | Q4 2021 Revenue (in millions) | Q4 YoY Change | FY 2022 Revenue (in millions) | FY 2021 Revenue (in millions) | FY YoY Change | | :------- | :-------------- | :-------------- | :------------ | :-------------- | :-------------- | :------------ | | Americas | $31.9M | $31.2M | +2% | $123.9M | $128.8M | -4% | | EMEA | $24.3M | $29.7M | -18% | $104.2M | $98.4M | +6% | | APAC | $17.9M | $15.7M | +14% | $65.3M | $59.3M | +10% | [Profitability and EPS](index=1&type=section&id=Profitability%20and%20EPS) Radware's GAAP net loss for Q4 2022 improved to $(0.09) per diluted share from $(0.12) in Q4 2021, while the full-year GAAP net loss was $(0.00) per diluted share, a significant decline from $0.16 in FY 2021. Non-GAAP diluted EPS decreased in both periods, reflecting a reduction in non-GAAP net income | Metric | Q4 2022 (in millions) | Q4 2021 (in millions) | YoY Change (Q4) | FY 2022 (in millions) | FY 2021 (in millions) | YoY Change (FY) | | :-------------------- | :------ | :------ | :-------------- | :------ | :------ | :-------------- | | **GAAP Net Loss** | $(4.1)M | $(5.6)M | +26.8% | $(0.2)M | $7.8M | -102.6% | | **GAAP Net Loss Per Share** | $(0.09) | $(0.12) | +25.0% | $(0.00) | $0.16 | -100% | | **Non-GAAP Net Income** | $7.7M | $10.3M | -25.3% | $31.3M | $38.3M | -18.2% | | **Non-GAAP EPS** | $0.17 | $0.22 | -22.7% | $0.68 | $0.81 | -16.0% | [Cash Position and Operating Cash Flow](index=2&type=section&id=Cash%20Position%20and%20Operating%20Cash%20Flow) As of December 31, 2022, Radware maintained a strong liquidity position with $432.0 million in cash, cash equivalents, and marketable securities. However, net cash provided by operating activities saw a significant decrease in both the fourth quarter and the full year 2022 compared to the previous year Cash, Cash Equivalents, Deposits & Marketable Securities | Metric | As of Dec 31, 2022 (in millions) | As of Dec 31, 2021 (in millions) | | :---------------------------------------------------- | :----------------- | :----------------- | | Cash, cash equivalents, short-term and long-term bank deposits, and marketable securities | $432.0M | - | Net Cash Provided by Operating Activities | Metric | Q4 2022 (in millions) | Q4 2021 (in millions) | YoY Change (Q4) | FY 2022 (in millions) | FY 2021 (in millions) | YoY Change (FY) | | :------------------------------ | :------ | :------ | :-------------- | :------ | :------ | :-------------- | | Net cash provided by operating activities | $9.6M | $28.9M | -66.9% | $32.1M | $71.8M | -55.3% | [Detailed Financial Statements](index=5&type=section&id=Detailed%20Financial%20Statements) This section provides a detailed look at Radware's financial position, income, and cash flows for 2022, highlighting changes in assets, liabilities, profitability, and cash movements [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Radware's balance sheet as of December 31, 2022, shows a slight increase in total assets to $647.4 million from $635.4 million in 2021, primarily driven by increases in short-term bank deposits, intangible assets, and goodwill. Total equity saw a minor decrease, while total liabilities increased | Metric | Dec 31, 2022 (in thousands of US dollars) | Dec 31, 2021 (in thousands of US dollars) | | :-------------------------------- | :----------- | :----------- | | **Assets** | | | | Cash and cash equivalents | $46,185 | $92,513 | | Marketable securities (Current) | $44,180 | $39,497 | | Short-term bank deposits | $207,679 | $155,879 | | Total current assets | $335,870 | $320,706 | | Total assets | $647,405 | $635,370 | | **Liabilities and Equity** | | | | Deferred revenues (Current) | $108,243 | $99,922 | | Total current liabilities | $166,439 | $165,887 | | Total liabilities | $278,962 | $265,377 | | Total equity | $368,443 | $369,993 | [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Radware's consolidated income statement for Q4 2022 reported a net loss of $4.1 million, an improvement from a $5.6 million loss in Q4 2021. For the full year 2022, the company recorded a net loss of $0.2 million, a significant shift from a net income of $7.8 million in 2021, primarily due to increased operating expenses and higher taxes on income | Metric | Q4 2022 (in thousands of US dollars) | Q4 2021 (in thousands of US dollars) | FY 2022 (in thousands of US dollars) | FY 2021 (in thousands of US dollars) | | :-------------------------------- | :------ | :------ | :------ | :------ | | Revenues | $74,083 | $76,642 | $293,426 | $286,496 | | Gross profit | $60,166 | $62,594 | $239,542 | $234,050 | | Total operating expenses, net | $65,274 | $57,726 | $242,881 | $215,825 | | Operating income (loss) | $(5,108) | $4,868 | $(3,339) | $18,225 | | Net income (loss) | $(4,124) | $(5,591) | $(166) | $7,811 | | Diluted net earnings (loss) per share | $(0.09) | $(0.12) | $(0.00) | $0.16 | [Condensed Consolidated Statements of Cash Flow](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flow) Radware's cash flow statement shows a significant decrease in net cash provided by operating activities for both Q4 and the full year 2022. Investing activities shifted from providing cash in 2021 to using substantial cash in 2022, largely due to a $30 million payment for the SecurityDAM Ltd. acquisition. Financing activities continued to be a net cash outflow, primarily due to share repurchases | Metric | Q4 2022 (in thousands of US dollars) | Q4 2021 (in thousands of US dollars) | FY 2022 (in thousands of US dollars) | FY 2021 (in thousands of US dollars) | | :-------------------------------- | :------ | :------ | :------ | :------ | | Net cash provided by operating activities | $9,560 | $28,934 | $32,148 | $71,774 | | Net cash provided by (used in) investing activities | $5,625 | $14,995 | $(56,018) | $7,849 | | Net cash used in financing activities | $(11,469) | $(14,621) | $(22,458) | $(41,881) | | Payment for the business acquisition of SecurityDAM Ltd. | - | - | $(30,000) | - | | Repurchase of shares | $(12,301) | $(17,449) | $(59,492) | $(52,471) | [Non-GAAP Financial Measures & Reconciliations](index=2&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section clarifies Radware's use of non-GAAP financial measures and key performance indicators, providing detailed reconciliations from GAAP to non-GAAP figures [Explanation of Non-GAAP Measures and Key Performance Indicators](index=2&type=section&id=Use%20of%20Non-GAAP%20Financial%20Information%20and%20Key%20Performance%20Indicators) Radware utilizes non-GAAP financial measures, such as gross profit, operating expenses, operating income, net income, and diluted EPS, to provide a clearer view of ongoing operations by excluding items like stock-based compensation, amortization of intangibles, and litigation costs. Annual Recurring Revenue (ARR) is also defined as a key performance indicator for the recurring components of the business - Non-GAAP measures exclude stock-based compensation, amortization of intangible assets, litigation costs, acquisition costs, exchange rate differences, and tax-related adjustments to allow for meaningful comparisons of operating results[8](index=8&type=chunk)[12](index=12&type=chunk) - Annual recurring revenue (ARR) is defined as the annualized value of booked orders for term-based cloud services, subscription licenses, and maintenance contracts in effect at the end of a reporting period, serving as a key performance indicator for recurring business components[13](index=13&type=chunk) [GAAP to Non-GAAP Reconciliation (Income Statement Items)](index=7&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Information) The reconciliation highlights significant adjustments from GAAP to Non-GAAP figures, primarily driven by stock-based compensation, amortization of intangible assets, and acquisition costs. These adjustments resulted in higher Non-GAAP gross profit, lower Non-GAAP operating expenses, and a positive Non-GAAP operating income and net income, contrasting with GAAP losses in some periods | Metric | Q4 2022 GAAP (in thousands of US dollars) | Q4 2022 Non-GAAP (in thousands of US dollars) | FY 2022 GAAP (in thousands of US dollars) | FY 2022 Non-GAAP (in thousands of US dollars) | | :-------------------------------- | :----------- | :------------- | :----------- | :------------- | | Gross profit | $60,166 | $61,270 | $239,542 | $243,645 | | Total operating expenses, net | $65,274 | $54,909 | $242,881 | $213,966 | | Operating income (loss) | $(5,108) | $6,361 | $(3,339) | $29,679 | | Net income (loss) | $(4,124) | $7,697 | $(166) | $31,305 | | Diluted net earnings (loss) per share | $(0.09) | $0.17 | $(0.00) | $0.68 | - Key adjustments from GAAP to Non-GAAP include: **Stock-based compensation** (Q4 2022: **$9.66 million**; FY 2022: **$27.35 million**), **Amortization of intangible assets** (Q4 2022: **$0.99 million**; FY 2022: **$3.70 million**), and **Acquisition costs** (Q4 2022: **$0.82 million**; FY 2022: **$1.96 million**)[24](index=24&type=chunk)[25](index=25&type=chunk) [GAAP Net Income to EBITDA and Adjusted EBITDA Reconciliation](index=9&type=section&id=RECONCILIATION%20OF%20GAAP%20NET%20INCOME%20TO%20EBITDA%20AND%20ADJUSTED%20EBITDA%20(NON-GAAP)) Radware provides a reconciliation from GAAP net income to EBITDA and Adjusted EBITDA, showing that while GAAP net income was a loss in Q4 and a minimal loss for the full year 2022, Adjusted EBITDA remained positive and substantial, reflecting the add-back of non-cash and non-recurring expenses such as share-based compensation and acquisition costs | Metric | Q4 2022 (in thousands of US dollars) | Q4 2021 (in thousands of US dollars) | FY 2022 (in thousands of US dollars) | FY 2021 (in thousands of US dollars) | | :-------------------- | :------ | :------ | :------ | :------ | | GAAP net income (loss) | $(4,124) | $(5,591) | $(166) | $7,811 | | EBITDA | $(2,230) | $7,352 | $8,353 | $28,421 | | Adjusted EBITDA | $8,247 | $13,020 | $37,667 | $47,208 | | Share-based compensation (added back) | $9,658 | $5,372 | $27,353 | $17,574 | | Acquisition costs (added back) | $819 | $296 | $1,961 | $925 | [Company Information & Disclosures](index=2&type=section&id=Company%20Information%20%26%20Disclosures) This section provides an overview of Radware's business, includes a safe harbor statement regarding forward-looking information, and details for the Q4 and full-year 2022 earnings conference call [About Radware](index=4&type=section&id=About%20Radware) Radware is a global leader in cyber security and application delivery solutions, offering award-winning products for infrastructure, application, and corporate IT protection across physical, cloud, and software-defined data centers. The company aims to help enterprises and carriers maintain business continuity, achieve productivity, and manage costs - Radware is a **global leader in cyber security and application delivery solutions** for physical, cloud, and software-defined data centers[15](index=15&type=chunk) - Its solutions portfolio provides infrastructure, application, and corporate IT protection, and availability services to enterprises globally[15](index=15&type=chunk) [Safe Harbor Statement](index=3&type=section&id=Safe%20Harbor%20Statement) This section contains forward-looking statements subject to various risks and uncertainties, including global economic conditions, supply chain issues, geopolitical conflicts, and the ability to implement strategic initiatives. Actual results may differ materially from forecasts, and Radware undertakes no obligation to update these statements - The press release includes forward-looking statements, which are subject to various risks and uncertainties that could cause actual results to differ materially from current forecasts[14](index=14&type=chunk) - Key risk factors include global economic conditions, natural disasters, public health crises (e.g., COVID-19), component shortages, geopolitical conflicts (e.g., Russia-Ukraine), ability to implement cloud business strategy, competition, and changes in government regulation[14](index=14&type=chunk) - Radware undertakes no commitment to revise or update any forward-looking statement, except as required by applicable law[14](index=14&type=chunk) [Conference Call Details](index=2&type=section&id=Conference%20Call) Radware hosted a conference call on February 8, 2023, to discuss its Q4 and full-year 2022 results and 2023 outlook. Replay options were available via telephone and webcast for a limited period - Radware management hosted a conference call on **February 8, 2023, at 8:30 a.m. EST** to discuss Q4 and full year 2022 results and the 2023 outlook[9](index=9&type=chunk) - A replay was available for two days via telephone and for 12 months via webcast on the Company's website[9](index=9&type=chunk)[10](index=10&type=chunk)