F5(US:FFIV)2023-07-25 00:09Q3FY23 Performance Highlights - F5 delivered Q3 revenue at the midpoint of guidance and non-GAAP EPS well above the high end of the guidance range[5, 6] - The company is demonstrating operating discipline and driving operating leverage[6] - There are early signs of demand stabilization[5, 6, 70, 105] Financial Results - Q3FY23 revenue reached $703 million[18], compared to $674 million in Q3FY22[24, 67, 132], representing a +4% increase year-over-year[91] - Non-GAAP gross margin was 82.5%[18, 20, 67, 117], slightly lower than the 83.2% in Q3FY22[51, 59, 67] - Non-GAAP operating margin was 33.2%[7, 67, 97, 117], up from 28.8% in Q3FY22[51, 67, 107] - Non-GAAP EPS was $3.21[18, 67, 98, 113], compared to $2.57 in Q3FY22[67, 107, 120] - Subscription software revenue grew +4% year-over-year[12, 19] Revenue Breakdown - Global Services revenue grew by +8% year-over-year[19, 45] - Product revenue grew by +1% year-over-year[19, 45] - Systems revenue grew by +5% year-over-year[19, 45] - Total software revenue decreased by -3% year-over-year[19, 45] but increased by +32% quarter-over-quarter[19] - 87% of total software revenue came from subscriptions[46] Cash Flow and Capital Allocation - The company has committed to using at least 50% of annual free cash flow for share repurchases beginning in FY23[35] - As of July 24, 2023, there was $982 million remaining under the authorized stock repurchase program[56]