Financial Performance - Net income for the three months ended December 31, 2024, was $166.4 million, compared to $138.4 million for the same period in 2023, resulting in a basic net income per share of $2.85[83] - Total revenues for the three months ended December 31, 2024, were $766.5 million, an increase from $692.6 million in the same period of 2023[86] - Total net revenues increased by 10.7% to $766.5 million for the three months ended December 31, 2024, compared to $692.6 million in the same period of the prior year[102] - Net product revenues rose by 20.5% to $368.5 million, driven by a 22.5% increase in software revenues and a growth in systems sales[103][104] - Net service revenues increased by 2.9% to $398.0 million, primarily due to higher maintenance contract renewals[105] - Gross profit for the three months ended December 31, 2024, was $626.0 million, with a gross margin of 81.7%, up from 80.3% in the prior year[106] - Operating expenses totaled $420.9 million, representing 54.9% of net revenues, a decrease from 56.6% in the prior year[109] - Net income for the period was $166.4 million, reflecting a net income margin of 21.7%, compared to 20.0% in the same period last year[113] Revenue Recognition and Deferred Revenue - Deferred revenue balance rose to $1.95 billion at the end of December 2024, compared to $1.83 billion in December 2023, with $556.9 million added but not recognized as revenue during the period[35] - The total non-cancelable remaining performance obligations amounted to $1.9 billion, with an expectation to recognize 62.6% of these revenues over the next 12 months[36] - Deferred revenues increased in the first quarter of fiscal year 2025, primarily due to an increase in maintenance renewal contracts and subscription offerings[97] Cash and Investments - As of December 31, 2024, total cash, cash equivalents, and restricted cash amounted to $1,152.9 million, an increase from $1,078.3 million as of September 30, 2024[53] - Cash provided by operating activities for Q1 fiscal 2025 was $166.4 million, an increase from the prior year due to higher net income and cash received from customers[118] - Cash used in investing activities was $10.0 million for the three months ended December 31, 2024, compared to $7.1 million in the same period last year, primarily due to $8.1 million in capital expenditures[120] - Cash used in financing activities was $114.7 million for the three months ended December 31, 2024, a decrease from $135.0 million in the prior year, mainly due to $125.0 million used for share repurchases[121] - Cash and cash equivalents, along with investments, increased to $1,162.1 million as of December 31, 2024, up from $1,083.2 million at the end of September 2024[117] Share Repurchase and Equity - The Company repurchased 490,000 shares at an average price of $255.31 per share for a total of $125.0 million during the three months ended December 31, 2024[81] - The Company had $1.3 billion remaining authorized for share repurchases as of December 31, 2024[81] Taxation - The effective tax rate for the three months ended December 31, 2024, was 20.4%, a decrease from 20.7% in the same period of 2023, primarily due to the tax impact of stock-based compensation[77] - The Company had $88.9 million of unrecognized tax benefits as of December 31, 2024, which could affect the effective tax rate if recognized[78] - The effective tax rate decreased to 20.4% for the three months ended December 31, 2024, from 20.7% in the prior year[114] Operating Expenses and Restructuring - The Company recorded restructuring charges of $11.3 million for the three months ended December 31, 2024, compared to $9.8 million in the same period of 2023[88] - Restructuring charges amounted to $11.3 million for the three months ended December 31, 2024, compared to $8.5 million in the same period of the prior year[112] Inventory and Receivables - Inventories decreased from $76.4 million as of September 30, 2024, to $73.2 million as of December 31, 2024[54] - Unbilled receivables increased to $433.9 million as of December 31, 2024, compared to $401.1 million as of September 30, 2024[55] Debt and Credit Facilities - The Company had no outstanding borrowings under its $350.0 million Revolving Credit Facility as of December 31, 2024, with available borrowing capacity of $350.0 million[60] - As of December 31, 2024, the Company was in compliance with all covenants related to its Revolving Credit Agreement[60] - The Company had no outstanding borrowings under its $350.0 million Revolving Credit Facility as of December 31, 2024, which expired on January 31, 2025[92] Capitalized Costs and Goodwill - The balance of capitalized contract acquisition costs increased to $70.3 million as of December 31, 2024, from $66.5 million at the beginning of the period, with additional costs of $13.2 million capitalized during the quarter[33] - The amortization of capitalized contract acquisition costs was consistent at $9.1 million for both the three months ended December 31, 2024, and 2023[33] - The Company recorded $23.6 million of goodwill from two acquisitions completed in the second quarter of fiscal 2024, which did not materially impact operating results[52] Market and Economic Conditions - The company does not anticipate a material effect on its financial condition from a 10% change in interest rates due to its current investment portfolio[128] - The company is actively monitoring inflation but does not believe it has materially affected its business or financial condition[129] - The majority of the company's sales and expenses are in U.S. dollars, minimizing foreign currency transaction risks[130] - There have been no material changes to the company's market risk disclosures during the three months ended December 31, 2024[131] Accounting Standards and Disclosures - The company is currently evaluating the impact of new accounting standards on its disclosures, including ASU 2023-07 and ASU 2023-09, which will enhance segment and income tax disclosures respectively[30][31]

Group 1 - The article recommends a buy rating for F5, Inc. (NASDAQ: FFIV) based on expectations of achieving FY25 guidance due to a favorable macro environment and increased demand [1] - The investment is considered ideal if it operates in a sector projected to experience structural organic growth exceeding GDP growth over the next 5-10 years, has sustainable competitive advantages, and is managed by competent and ethical long-term thinkers [1] - The company is expected to have attractive unit economics and a fair valuation, which are critical factors for investment consideration [1]

Core Viewpoint - Investors in the Internet - Software sector may consider Definitive Healthcare Corp. (DH) or F5 Networks (FFIV) as potential undervalued stocks [1] Valuation Metrics - DH has a forward P/E ratio of 15.74, while FFIV has a forward P/E of 20.79 [5] - DH's PEG ratio is 1.72, compared to FFIV's PEG ratio of 3.09 [5] - DH's P/B ratio is 0.82, whereas FFIV's P/B ratio is 5.33 [6] - These metrics contribute to DH's Value grade of B and FFIV's Value grade of D [6] Earnings Outlook - DH is currently showing an improving earnings outlook, which enhances its position in the Zacks Rank model [7] - The Zacks Rank for DH is 2 (Buy) and for FFIV is 3 (Hold), indicating a more favorable outlook for DH [3]

Group 1 - Proactive provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2][3] - The company specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - Proactive's news team delivers insights across various sectors including biotech, pharma, mining, natural resources, battery metals, oil and gas, crypto, and emerging technologies [3] Group 2 - Proactive has a history of adopting technology to enhance workflows and content production [4] - The company utilizes automation and software tools, including generative AI, while ensuring all content is edited and authored by humans [5]

Core Viewpoint - F5 Inc reported better-than-expected first-quarter financial results, with revenue of $766.49 million and EPS of $3.84, leading to a positive outlook for the second quarter with guidance of $705 million to $725 million in revenue and EPS of $3.02 to $3.14 [1][2][4] Financial Performance - First-quarter revenue increased by 10.6% year-on-year from $692.6 million, surpassing the analyst consensus estimate of $715.41 million [1] - EPS of $3.84 exceeded the consensus estimate of $3.36 [1] - Analysts have raised their price targets for F5 stock following the strong performance, with Piper Sandler increasing it from $246 to $304 and Needham from $285 to $360 [8] Analyst Insights - Analysts noted that the strong results were driven by better IT budgets, data center refreshes, vendor consolidation, and AI-related demand [2][4] - The company is experiencing a shift towards software revenue, which grew by 22%, while hardware revenue also saw significant growth, accounting for nearly two-thirds of the product upside [7][5] - The guidance for fiscal 2025 revenue and software revenue has been raised to 6.5% and 10%+ year-on-year, respectively, indicating improved expectations [9] Market Dynamics - F5 is benefiting from a more stable IT spending environment and robust software renewals, with a record number of ADC displacement deals reported in the first quarter [4][6] - The company is seeing increased demand for solutions that manage the complexity of multi-cloud environments and AI, which is expected to drive future growth [11][12] Stock Performance - Following the earnings report, F5 stock rose by 10.8%, reaching $299.00 [13]

F5, Inc. (FFIV) delivered outstanding first-quarter fiscal 2025 results with non-GAAP earnings of $3.84 per share.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.F5’s first-quarter fiscal 2025 earnings surpassed the Zacks Consensus Estimate by 14% and came ahead of management’s guidance of $3.29-$3.41 (midpoint of $3.35). The bottom line grew 12% annually, illustrating the combined effects of strong top-line growth, disciplined operating expense management and improved gross margin.FF ...

Key TakeawaysF5 beat profit and sales estimates and boosted its outlook as the cloud-services provider benefited from increased demand.CEO François Locoh-Donou pointed to the firm's "alignment with significant secular trends" and more stable spending on IT for the gains.The news sent shares to an all-time high. Shares of F5 (FFIV) traded at an all-time high Wednesday, a day after the cloud-solutions provider posted record results and strong guidance on increasing market demand. The company reported fiscal 2 ...

The F5, Inc. logo appears on the screen of a smartphone in Reno, United States, on December 1, 2024. ... [+] (Photo by Jaque Silva/NurPhoto via Getty Images)NurPhoto via Getty ImagesF5 stock (NASDAQ: FFIV) is trending higher on Wednesday, January 29, after the company posted upbeat Q1 fiscal 2025 results (fiscal ends in September) and an upward revision in its guidance for 2025. It posted revenue of $766 million and adjusted earnings of $3.84 per share, well above the consensus estimate of $715 million and ...

Michael Wiggins De Oliveira is an inflection investor. This means buying into cheap companies at the moment when their narrative is changing and the business is on a path toward becoming significantly more profitable over the next year.With a focus on tech and “the Great Energy Transition (including uranium)”, Michael runs a concentrated portfolio with approximately 15 to 20 stocks and an average holding period of 18 months. Through his 10+ years analyzing countless companies, Michael has accumulated outsta ...

Financial Data and Key Metrics Changes - F5 reported total revenue growth of 11% to $766 million, with product revenue growing by 20% [9][34] - Non-GAAP EPS for Q1 was $3.84, exceeding guidance by $0.43 [9][41] - Recurring revenue accounted for 72% of total revenue, reflecting a 10% year-over-year growth [39] Business Line Data and Key Metrics Changes - Software revenue grew 22% year-over-year to $209 million, with subscription-based software revenue increasing by 30% [35] - Systems revenue totaled $160 million, up 18% year-over-year, driven by technology refresh momentum [36][38] - Global services revenue grew 3% to $398 million [34] Market Data and Key Metrics Changes - Revenue from the Americas grew 15% year-over-year, representing 56% of total revenue [40] - EMEA and APAC regions both grew by 6%, accounting for 27% and 17% of revenue, respectively [40] Company Strategy and Development Direction - F5 is focusing on hybrid multi-cloud architectures and addressing complexities in IT environments [12][50] - The company aims to leverage AI opportunities, particularly in data delivery and security for AI workloads [22][52] - F5's strategy includes consolidating multiple security solutions onto a single platform to enhance customer value [15][19] Management's Comments on Operating Environment and Future Outlook - Management noted a stable IT spending environment and increasing demand for software as customers resume modernization projects [10][11] - The company raised its FY '25 revenue growth expectations to 6% to 7%, up from 4% to 5% [11][47] - Management expressed confidence in sustaining hardware growth due to strong refresh activity and competitive displacements [58] Other Important Information - F5 achieved a record number of competitive displacements in Q1, indicating strong market positioning [20] - The company repurchased $125 million worth of shares, representing 64% of free cash flow [43] Q&A Session Summary Question: Insights on AI business and customer segments - Management highlighted three categories of AI opportunities, primarily focusing on data delivery for AI model training and inference, with a majority of deals coming from large enterprises [62][63] Question: Sustainability of hardware systems business - Management expects strong hardware growth driven by refresh activity and competitive displacements, with no significant supply constraints [58][60] Question: Size of distributed cloud business - The total ARR for SaaS and managed services was around $180 million, with over 1,000 customers on distributed cloud, indicating rapid growth [75][78] Question: Seasonal trends and guidance for the year - Management noted that while Q1 was strong, they are cautious about assuming similar expansion rates in the second half of the year [72][132] Question: Perpetual revenue and federal business performance - Perpetual software revenue showed strong seasonal performance, particularly in the service provider vertical, while federal business remained solid with a healthy pipeline [101][105]