Radware(US:RDWR)2020-11-04 18:24Financial Data and Key Metrics Changes - Revenue for Q3 2020 was $62.5 million, which is 1% below Q3 2019 and in line with guidance [21] - ARR reached $169 million, with a growth rate of 12%, up from 10% in Q2 [7][23] - Gross margin for Q3 was 82.2%, reflecting product mix and a higher proportion of subscriptions [25] - Net income for Q3 was $8.4 million or $0.18 per diluted share, at the high end of guidance [26] - Total deferred revenues balance was approximately $172 million, with 63% expected to be recognized in the next 12 months [24] Business Line Data and Key Metrics Changes - Cloud and product subscription revenues grew approximately 30% year-over-year, driving ARR growth [8][23] - Recurring revenues comprised 63% of total revenues in Q3, up from 64% in the first nine months of 2019 [22][24] Market Data and Key Metrics Changes - Revenues from the Americas increased 24% year-over-year to $30.2 million, while EMEA revenues decreased 5% to $18.3 million, and Asia Pacific revenues decreased 27% to $14 million [21][22] Company Strategy and Development Direction - The company is focusing on expanding its cloud security offerings and investing in infrastructure to meet increased demand [12][17] - New scrubbing centers were added in India, Brazil, and Israel to enhance geographic coverage and capacity [12] - The company aims to broaden its offerings to deliver a full-stack application security solution [13] Management's Comments on Operating Environment and Future Outlook - Management expressed satisfaction with performance despite ongoing macroeconomic uncertainty and lockdowns [20] - The company anticipates continued growth in the Americas and expects improvements in international markets [35][49] - The digital transformation and increased cyber activity present significant opportunities for the company's solutions [17] Other Important Information - The company plans to stop discussing total deferred revenue starting next quarter and will focus on providing ARR information [24] - The company is actively looking for M&A opportunities in the enterprise security and cloud security spaces [66] Q&A Session Summary Question: Growth rates across the Americas business - Management noted satisfaction with North America's performance and plans to continue investing in the region due to high potential [33] Question: U.S. business split and Cisco's impact - Growth in the U.S. is attributed to both Cisco's ramp-up and organic wins, with plans to invest more resources [38] Question: EMEA and APAC performance - Management indicated that the situation in EMEA and APAC is complex but expects improvements in Q4 [48] Question: Investments in scrubbing centers and Airtel partnership - The partnership with Airtel is seen as a significant contributor to performance in emerging markets [54] Question: Opportunities with Bot Manager - The company sees growth potential in bot management solutions, particularly in addressing account takeover and page scraping [60] Question: Cash position and M&A outlook - The company is actively looking for M&A opportunities and has increased share buybacks [66] Question: Recurring revenue percentage - Recurring revenues were 62% of total revenue in Q3, with a slight decrease from the previous year [69][72]