F5(US:FFIV)2023-02-02 16:00Revenue and Financial Performance - Total revenues for the three months ended December 31, 2022, were $700.4 million, a slight increase from $687.1 million in the same period of 2021[93]. - Net income for the three months ended December 31, 2022, was $72.4 million, resulting in a basic and diluted net income per share of $1.20, compared to $93.6 million and $1.54 in the same period of 2021[90]. - Systems revenue for the three months ended December 31, 2022, was $173.0 million, while software revenue was $167.5 million, leading to total net product revenue of $340.6 million[94]. - The Americas region generated $402.2 million in revenue for the three months ended December 31, 2022, slightly down from $402.9 million in the same period of 2021[93]. Deferred Revenue and Performance Obligations - The deferred revenue balance at the end of the period was $1.76 billion, an increase from $1.57 billion at the end of December 2021, reflecting a growth of approximately 11.6% year-over-year[30]. - The Company added $460.4 million in deferred revenue that was not recognized as revenue during the three months ended December 31, 2022[30]. - As of December 31, 2022, the total non-cancelable remaining performance obligations under the Company's contracts with customers was $1.8 billion, with an expectation to recognize revenues on approximately 64.3% over the next 12 months[31]. Assets and Liabilities - The Company recorded unbilled receivables of $333.8 million as of December 31, 2022, an increase from $319.7 million on September 30, 2022[56]. - Total cash, cash equivalents, and restricted cash decreased from $762.2 million on September 30, 2022, to $610.0 million on December 31, 2022[54]. - Operating lease liabilities totaled $311.1 million as of December 31, 2022, with a weighted average remaining lease term of 9.0 years[67]. - The Company had no outstanding borrowings under the Revolving Credit Facility as of December 31, 2022, with available borrowing capacity of $350.0 million[64]. Acquisitions - The acquisition of Threat Stack, Inc. is expected to enhance the Company's cloud security capabilities, contributing to its application and API protection solutions[48]. - The acquisition of Threat Stack involved a cash payment of approximately $68.9 million, with transaction costs being immaterial[49]. - The total assets acquired from Threat Stack amounted to $79.5 million, including $43.3 million in goodwill, which is not tax-deductible[51]. - The Company completed the acquisition of Lilac Cloud, Inc. on February 1, 2023, enhancing its portfolio with innovative application delivery services[97]. Tax and Share Repurchase - The effective tax rate for the three months ended December 31, 2022, was 24.5%, up from 16.3% in the same period of 2021, primarily due to the tax impact of stock-based compensation and international operations[83]. - The Company had $68.7 million of unrecognized tax benefits as of December 31, 2022, which could affect the effective tax rate if recognized[84]. - The Company repurchased 263,000 shares at an average price of $151.87, totaling $40.0 million during the three months ended December 31, 2022[87]. - The Company has $1.2 billion remaining authorized for share repurchases under its program as of December 31, 2022[87]. Financial Assets and Risks - The Company’s financial assets measured at fair value on a recurring basis totaled $270.1 million as of December 31, 2022[39]. - The Company’s investment in corporate bonds and notes had a fair value of $30.3 million, with unrealized losses of $613, as of December 31, 2022[39]. - The company actively monitors interest rate and credit risks, with no leverage on fixed income investments as of December 31, 2022[133]. - There have been no material changes to market risk disclosures during the three-month period ended December 31, 2022[136]. - The majority of sales, cost of net revenues, and operating expenses are denominated in U.S. dollars, minimizing foreign currency transaction risks[135]. - The company does not believe that inflation has had a material effect on its business or financial condition[134]. Amortization and Impairment - Amortization of capitalized contract acquisition costs for the three months ended December 31, 2022, was $9.7 million, compared to $9.4 million for the same period in 2021[28]. - The balance of capitalized contract acquisition costs at the end of the period was $73.8 million, down from $78.9 million at the end of December 2021[28]. - The Company did not recognize any impairment charges related to intangible assets in the first quarter of fiscal 2023, following a $6.2 million impairment in the first quarter of fiscal 2022[46]. - The amortization of developed technology and customer relationships intangible assets from the Threat Stack acquisition is over a useful life of five years[52]. Restructuring and Interest Rates - The Company recorded a restructuring charge of $8.7 million in the first quarter of fiscal 2023, compared to $7.9 million in the first quarter of fiscal 2022[95]. - The weighted average interest rate on the Term Loan Facility was 4.072% for the three months ended December 31, 2022[62]. - The total lease payments for operating leases are projected to be $354.7 million, with expected sublease income of approximately $19.1 million[69].