We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
F5 Networks' (FFIV) Q1 Earnings Beat, Revenues Miss Estimates
Read MoreHide Full Article
F5 Networks (FFIV - Free Report) reported mixed first-quarter fiscal 2023 results, wherein the top line missed but the bottom line surpassed the Zacks Consensus Estimates.
The Seattle-based company’s non-GAAP earnings of $2.47 per share beat the Zacks Consensus Estimate of $2.34. Although the bottom line declined 1.5% from the year-ago quarter’s $2.89 per share, the figure came in way higher than management’s guided range of $2.25-$2.37 per share.
During the reported quarter, F5 Networks witnessed a 2% increase in its revenues amid a global chip shortage scenario in the semiconductor industry. The company’s non-GAAP revenues were $700.4 million, which missed the Zacks Consensus Estimate of $700.6 million. The top line was in line with the mid-point of the guided range of $690-$710 million.
Product revenues (48.6% of total revenues), which comprise Software and Systems sub-divisions, decreased 1% year on year to $341 million. Software sales jumped 3% year over year to $168 million, accounting for approximately 49.3% of the total Product revenues. However, System revenues slumped 4% to $173 million, making up the remaining 50.7% of the total Product revenues. This downside was due to the ongoing global chip shortage.
Global Service revenues (51.4% of total revenues) grew 5% to $359.8 million.
F5 Networks registered sales growth across the EMEA, witnessing a year-over-year increase of 13.6%. The company registered 0.2% and 6.6% decrease in sales growth from the Americas and APAC regions, respectively. Revenue contributions from the Americas, EMEA and APAC regions were 57%, 26% and 16%, respectively.
Customer-wise, Enterprises, Service providers and Government represented 62%, 21% and 17% of product bookings, respectively.
Margins
GAAP and non-GAAP gross margins contracted 240 basis points (bps) and 260 bps to 77.9% and 80.4%, respectively.
GAAP and non-GAAP operating expenses went up 3.7% and 9.5%, respectively, to $454.2 million and $378 million. F5 Networks’ GAAP and non-GAAP operating margins shrunk 360 bps and 620 bps to 13% and 26.5%, respectively.
Balance Sheet & Cash Flow
F5 Networks exited the December-ended quarter with cash and short-term investments of $660 million compared with the previous quarter’s $884.6 million.
During the fiscal first quarter, the company generated $158 million of operating cash flow compared with the $154 million reported in the previous quarter. The operating cash flow remained under pressure due to strong multi-year subscription sales, which impacted the cash collection process.
F5 Networks repurchased shares worth $40 million during first-quarter fiscal 2023.
Guidance
F5 Networks projects non-GAAP revenues in the $690-$710 million (mid-point of $700 million) and non-GAAP earnings per share in the $2.36-$2.48 band (mid-point of $2.42) for second-quarter fiscal 2023.
For fiscal 2023, F5 Networks provided an estimate of 9-11% total revenue growth. The company expects global services sales to grow in mid-single digit.
F5 Networks anticipates non-GAAP earnings to grow in the low-to-mid teens.
Zacks Rank & Stocks to Consider
F5 Networks currently carries a Zacks Rank #4 (Sell). Shares of FFIV have slumped 35.3% in the past year.
The Zacks Consensus Estimate for Axcelis’ fourth-quarter 2022 earnings has been revised 41 cents northward to $1.46 per share over the past seven days. For 2022, earnings estimates have improved by 8.5% to $5.21 per share over the past seven days.
ACLS’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 23.2%. Shares of the company have risen 81.5% in the past year.
The Zacks Consensus Estimate for Bandwidth’s fourth-quarter 2022 earnings has been revised by a penny to 4 cents per share over the past 90 days. For 2022, earnings estimates have moved north by 25 cents to 37 cents per share in the past 90 days.
BAND's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 301.8%. Shares of the company have declined 59.6% in the past year.
The Zacks Consensus Estimate for Zscaler's second-quarter fiscal 2023 earnings has been revised 3 cents north to 29 cents per share over the past 60 days. For fiscal 2023, earnings estimates have moved north by a penny to $1.24 per share in the past 30 days.
ZS' earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 27.3%. Shares of the company have declined 45.8% in the past year.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Shutterstock
F5 Networks' (FFIV) Q1 Earnings Beat, Revenues Miss Estimates
F5 Networks (FFIV - Free Report) reported mixed first-quarter fiscal 2023 results, wherein the top line missed but the bottom line surpassed the Zacks Consensus Estimates.
The Seattle-based company’s non-GAAP earnings of $2.47 per share beat the Zacks Consensus Estimate of $2.34. Although the bottom line declined 1.5% from the year-ago quarter’s $2.89 per share, the figure came in way higher than management’s guided range of $2.25-$2.37 per share.
During the reported quarter, F5 Networks witnessed a 2% increase in its revenues amid a global chip shortage scenario in the semiconductor industry. The company’s non-GAAP revenues were $700.4 million, which missed the Zacks Consensus Estimate of $700.6 million. The top line was in line with the mid-point of the guided range of $690-$710 million.
F5, Inc. Price, Consensus and EPS Surprise
F5, Inc. price-consensus-eps-surprise-chart | F5, Inc. Quote
Top Line in Detail
Product revenues (48.6% of total revenues), which comprise Software and Systems sub-divisions, decreased 1% year on year to $341 million. Software sales jumped 3% year over year to $168 million, accounting for approximately 49.3% of the total Product revenues. However, System revenues slumped 4% to $173 million, making up the remaining 50.7% of the total Product revenues. This downside was due to the ongoing global chip shortage.
Global Service revenues (51.4% of total revenues) grew 5% to $359.8 million.
F5 Networks registered sales growth across the EMEA, witnessing a year-over-year increase of 13.6%. The company registered 0.2% and 6.6% decrease in sales growth from the Americas and APAC regions, respectively. Revenue contributions from the Americas, EMEA and APAC regions were 57%, 26% and 16%, respectively.
Customer-wise, Enterprises, Service providers and Government represented 62%, 21% and 17% of product bookings, respectively.
Margins
GAAP and non-GAAP gross margins contracted 240 basis points (bps) and 260 bps to 77.9% and 80.4%, respectively.
GAAP and non-GAAP operating expenses went up 3.7% and 9.5%, respectively, to $454.2 million and $378 million. F5 Networks’ GAAP and non-GAAP operating margins shrunk 360 bps and 620 bps to 13% and 26.5%, respectively.
Balance Sheet & Cash Flow
F5 Networks exited the December-ended quarter with cash and short-term investments of $660 million compared with the previous quarter’s $884.6 million.
During the fiscal first quarter, the company generated $158 million of operating cash flow compared with the $154 million reported in the previous quarter. The operating cash flow remained under pressure due to strong multi-year subscription sales, which impacted the cash collection process.
F5 Networks repurchased shares worth $40 million during first-quarter fiscal 2023.
Guidance
F5 Networks projects non-GAAP revenues in the $690-$710 million (mid-point of $700 million) and non-GAAP earnings per share in the $2.36-$2.48 band (mid-point of $2.42) for second-quarter fiscal 2023.
For fiscal 2023, F5 Networks provided an estimate of 9-11% total revenue growth. The company expects global services sales to grow in mid-single digit.
F5 Networks anticipates non-GAAP earnings to grow in the low-to-mid teens.
Zacks Rank & Stocks to Consider
F5 Networks currently carries a Zacks Rank #4 (Sell). Shares of FFIV have slumped 35.3% in the past year.
Some top-ranked stocks from the broader Computer and Technology sector are Axcelis Technologies (ACLS - Free Report) , Bandwidth (BAND - Free Report) and Zscaler (ZS - Free Report) . While Axcelis sports a Zacks Rank #1 (Strong Buy), Bandwidth and Zscaler carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Axcelis’ fourth-quarter 2022 earnings has been revised 41 cents northward to $1.46 per share over the past seven days. For 2022, earnings estimates have improved by 8.5% to $5.21 per share over the past seven days.
ACLS’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 23.2%. Shares of the company have risen 81.5% in the past year.
The Zacks Consensus Estimate for Bandwidth’s fourth-quarter 2022 earnings has been revised by a penny to 4 cents per share over the past 90 days. For 2022, earnings estimates have moved north by 25 cents to 37 cents per share in the past 90 days.
BAND's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 301.8%. Shares of the company have declined 59.6% in the past year.
The Zacks Consensus Estimate for Zscaler's second-quarter fiscal 2023 earnings has been revised 3 cents north to 29 cents per share over the past 60 days. For fiscal 2023, earnings estimates have moved north by a penny to $1.24 per share in the past 30 days.
ZS' earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 27.3%. Shares of the company have declined 45.8% in the past year.