F5, Inc. · NASDAQ:FFIV

F5 — Q2 2025 Earnings Presentation

45 slides from F5's earnings presentation, Apr 28, 2025

  1. Slide 1: Q2FY25 Results

    Q2FY25 Results PERIOD ENDING March 31, 2025 Published April 28, 2025

  2. Slide 2: Forward-looking statements

    Forward-looking statements This presentation contains forward-looking statements including, among other things, F5’s ability to alleviate the high costs, crushing complexity, and escalating cyber risks IT teams face in an AI- driven hybrid multicloud world, the capabilities of the recently introduce

  3. Slide 3: GAAP to non-GAAP presentation

    GAAP to non-GAAP presentation In addition to financial information prepared in accordance with U.S. GAAP, this presentation also contains adjusted financial measures that we believe provide investors and management with supplemental information relating to operating performance and trends that facil

  4. Slide 4: Today's speakers

    Today’s speakers François Locoh-Donou Cooper Werner CEO, President Chief Financial Officer, EVP Intro & Business Overview Q2FY25 Results & Business Outlook 4 © 2025 F5

  5. Slide 5: Business Overview

    Business Overview François Locoh-Donou, President & CEO 5 © 2025 F5

  6. Slide 6: GAAP & non-GAAP results

    GAAP & non-GAAP results GAAP results Non-GAAP results Q2FY25 Q2FY24 Q2FY25 Q2FY24 Revenue $731M $681M Revenue $731M $681M Gross profit $590M $540M Gross profit $607M $559M Gross margin 80.7% 79.3% Gross margin 83.1% 82.1% Income from operations $159M $140M Income from operations $233M $210M Operatin

  7. Slide 7: Q2FY25 performance highlights

    Q2FY25 performance highlights 7% 12% Total revenue growth Y/Y Product revenue growth Y/Y 27% 18% Systems revenue growth Y/Y Non-GAAP EPS growth Y/Y See appendix for GAAP to non-GAAP reconciliation 7 © 2025 F5

  8. Slide 8: Q3FY25 guidance and raised FY25 revenue and EPS outlook

    We are providing Q3FY25 guidance and raising our FY25 revenue and EPS outlook Q3FY25 Outlook FY25 Outlook $740 to $760M 6.5% to 7.5% Q3FY25 total revenue Total revenue growth Y/Y (from 6% to 7% previously) ~8% 8% to 10% Growth Y/Y at midpoint Non-GAAP EPS growth Y/Y (from 6.5% to 8.5% previously) 8

  9. Slide 9: At AppWorld, we showcased innovation addressing customers' Ball of Fire challenges

    At AppWorld, we showcased innovation addressing our customers’ Ball of Fire challenges AWS SaaS High costs Azure Colocation Crushing complexity Google Data Centers Cloud Traditional & Escalating cyber risks Private Cloud Edge 9 © 2025 F5

  10. Slide 10: A platform for application delivery and security doesn't exist

    A platform for application delivery and security doesn’t exist Until now… Endpoints Network access Cloud workloads (EPP) (SASE) (CNAPP) 10 © 2025 F5

  11. Slide 11: The F5 Application Delivery and Security Platform

    The F5 Application Delivery and Security Platform uniquely address the Ball of Fire 11 © 2025 F5

  12. Slide 12: Comprehensive delivery and security for every app and API

    1 Comprehensive delivery and security for every app and API 2 Seamless deployment across any environment and form factor 3 Unified management with a single, consistent policy framework 4 Deep analytics and actionable insights 5 Programmable data planes for maximum flexibility 6 End-to-end lifecycle

  13. Slide 13: At AppWorld, we unveiled a suite of groundbreaking innovations

    At AppWorld, we unveiled a suite of groundbreaking innovations AI for ADC ADC for AI Innovations that make it Innovations to enable AI-driven easier for customers to harness applications, particularly inference the power of F5. workloads and model interactions. 13 © 2025 F5

  14. Slide 14: AI for ADC innovations

    AI for ADC innovations iRule Code Generator AI Assistant Functionality Application Study Tool Enables customers to leverage F5’s Contextual, intelligent guidance that Enables customers to monitor unmatched programmable capabilities with reduces time to resolution, improves and optimize performance w

  15. Slide 15: ADC for AI innovations

    ADC for AI innovations F5 is building the infrastructure foundation to support the next era of intelligent computing F5 AI Gateway Native Support for Model Context Purpose built to secure and manage the new frontier of enterprise AI Protocol (MCP) COMING SOON • Generally available in Q2FY25 • MCP is

  16. Slide 16: F5's early AI opportunities in high performance data delivery and security

    F5’s early AI opportunities are concentrated on three areas of high performance data delivery and security AI Model Training: AI Inference: F5 BIG-IP moving incredible amounts of F5 BIG-IP deployed in front of data stores Data delivery for AI models data at high speed to and from data stores, to sca

  17. Slide 17: F5's early AI opportunities: AI app security and load balancing

    F5’s early AI opportunities are concentrated on three areas of high performance data delivery and security AI App & Model Security AI Factory Load Balancing Service provider Retailer • Customer aims to establish central governance • F5 BIG-IP enabling responsive, real-time AI- controls and robust se

  18. Slide 18: Customers rely on F5 for their Ball of Fire challenges

    Customers rely on F5 for their “Ball of Fire” challenges App & API Security Consolidation Standardization & Automation F5 has the industry’s most F5’s hybrid multicloud strategy F5 streamlines operations with effective and comprehensive app enables consolidation on a single consistent policies, comp

  19. Slide 19: Customers rely on F5: App & API Security, Consolidation

    Customers rely on F5 for their “Ball of Fire” challenges App & API Security Consolidation F5 has the industry’s most comprehensive app and API security platform F5 enables consolidation on a single vendor for application security and delivery Integrated and comprehensive F5 enables customers to F5 d

  20. Slide 20: Customers rely on F5: Standardization & Automation

    Customers rely on F5 for their “Ball of Fire” challenges Standardization & Automation F5 streamlines operations with consistent policies, comprehensive automation, and rich analytics F5 enables customers to simplify operational management across all environments Financial institution • Customer mode

  21. Slide 21: F5's hybrid multicloud approach drives competitive displacement

    Customers rely on F5 for their “Ball of Fire” challenges F5’s differentiated hybrid multicloud approach continues to drive competitive displacement momentum Insurance Service provider • F5’s superior ADC capabilities and exceptional • Underscoring F5’s value as a strategic provider, responsiveness c

  22. Slide 22: Q2FY25 Results

    Q2FY25 Results Cooper Werner, CFO & EVP 22 © 2025 F5

  23. Slide 23: Revenue mix and year-over-year change

    Revenue mix and year-over-year change Revenue mix Year/Year change $800 $700 $681 $695 $747 $766 $731 7% $209 Total revenue $158 $228 0% $600 $159 $179 Revenue $ in millions $500 $160 $179 Software $142 $130 $130 $400 $300 27% Systems $200 $381 $387 $388 $398 $394 $100 3% $0 Global services Q2FY24 Q

  24. Slide 24: Software revenue mix

    Software revenue mix $250 $228 $200 $24 $209 87% of Q2FY25 total $179 $46 software revenue Revenue $ in millions $159 $24 $158 from subscriptions $150 $18 $20 $100 $204 $155 $162 $140 $138 $50 $0 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Subscription software revenue includes term subscriptions, both multi

  25. Slide 25: Recurring revenue

    Recurring revenue (subscription, SaaS & managed services, and maintenance) Recurring Non-recurring 25% 28% $512M $525M Recurring Recurring revenue revenue 75% 72% Q2FY24 Q2FY25 Recurring revenue includes term subscriptions, SaaS & managed services, utility-based revenue and the maintenance portion o

  26. Slide 26: Revenue contribution by geography

    Revenue contribution by geography % of revenue by geo Y/Y growth by region Q2FY25 17% 18% 16% 17% 17% 3% Growth APAC 26% 20% 26% 27% 27% 29% Growth EMEA 57% 55% 58% 56% 54% 3% Growth AMER Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Totals may not add to 100% due to rounding. Americas EMEA APAC 26 © 2025 F5

  27. Slide 27: Customer verticals as a % of product bookings

    Customer verticals as a % of product bookings % of total product bookings 13% 12% 10% 13% 11% 18% 16% 20% 19% 21% 69% 67% 72% 71% 69% Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Totals may not add to 100% due to rounding. Enterprise Government Service Provider 27 © 2025 F5

  28. Slide 28: Non-GAAP gross and operating margins

    Non-GAAP gross and operating margins Non-GAAP gross margin Non-GAAP operating margin +98 90.0% 40.0% BPS Y/Y 37.4% +103 83.9% 34.4% BPS Y/Y 83.1% 83.0% 83.1% 33.4% 82.1% 31.9% 30.9% % of non-GAAP revenue % of non-GAAP revenue 80.0% 30.0% 70.0% 20.0% 60.0% 10.0% Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q2F

  29. Slide 29: Non-GAAP net income and EPS

    Non-GAAP net income and EPS EPS reflects 18.1% Q2FY25 and 20.0% Q2FY24 non-GAAP effective tax rate Non-GAAP net income Non-GAAP EPS $250 $4.00 $3.84 +18% $227 $3.67 Y/Y $217 $3.42 $3.36 $199 $201 $200 $2.91 $173 $3.00 $150 $ in millions $2.00 $100 $1.00 $50 $0 $0.00 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY2

  30. Slide 30: Cash flow from operations

    Cash flow from operations $280 $257 $247 $240 $222 $203 $200 $159 $160 $ in millions $120 $80 $40 $0 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 30 © 2025 F5

  31. Slide 31: Cash and investments

    Cash and investments $1,500 $1,272 $1,250 $1,162 $1,083 $1,000 $943 $910 $ in millions $750 $500 $250 $0 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 31 © 2025 F5

  32. Slide 32: Deferred revenue

    Deferred revenue $2,500 Key insights +6% Y/Y Deferred revenue consists $2,000 $1,946 $1,923 predominantly of global services $1,812 $1,773 $1,798 maintenance renewals and also includes term-based software subscriptions. $1,500 $ in millions $1,000 $500 $0 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 32 © 2025

  33. Slide 33: Committed to returning cash to shareholders via share repurchases

    We are committed to returning cash to shareholders via share repurchases Key insights Share repurchases ($ in millions) $600 • We repurchased $125 million in FFIV shares during Q2FY25 57% $500 $500 $500 of FY25 YTD • We have used 57% of our $441M $500 free cash flow* used toward free cash flow* YTD

  34. Slide 34: Expect low tariff impact to costs and supply chain in FY25

    Expect low tariff impact to costs and supply chain in FY25 Costs Supply Low tariff exposure across systems business We do not expect any material impacts to lead times or availability as a result of our resilient • Majority of finished goods are USMCA compliant and diversified global supply chain an

  35. Slide 35: Business Outlook

    Business Outlook 35 © 2025 F5

  36. Slide 36: Our Q3FY25 outlook

    Our Q3FY25 outlook Q3FY25 outlook Total revenue $740 to $760M Non-GAAP gross margin 83% to 83.5% Non-GAAP operating expenses $366 to $378M Share-based compensation $57 to $59M Non-GAAP EPS $3.41 to $3.53 36 © 2025 F5

  37. Slide 37: Our FY25 outlook

    Our FY25 outlook FY24A FY25 outlook Total revenue $2.82B 6.5% to 7.5% growth (from 6% to 7% previously) Software revenue growth 11% ≥10% Non-GAAP gross margin 82.8% 83% to 84% Non-GAAP operating margin 33.6% ~35% Effective non-GAAP tax rate 19.2% 20% to 22% (from 21% to 23% previously) 8% to 10% gro

  38. Slide 38: Conclusion

    Conclusion François Locoh-Donou, President & CEO 38 © 2025 F5

  39. Slide 39: F5 is the only company that secures, delivers, and optimizes any app, any API, anywhere

    F5 is the only company that secures, delivers, and optimizes any app, any API, anywhere Alleviating the high costs, crushing complexity, and escalating cyber risks IT teams face in an increasingly AI-driven hybrid multicloud world. Enabling consistent policies, full visibility, and AI-driven insight

  40. Slide 40: F5 secures, delivers, and optimizes any app, any API, anywhere

    F5 is the only company that secures, delivers, and optimizes any app, any API, anywhere. 40 © 2025 F5

  41. Slide 41: Appendix

    Appendix 41 © 2025 F5

  42. Slide 42: GAAP to non-GAAP reconciliation

    GAAP to non-GAAP reconciliation (in thousands except percentages and per share amounts) Three Months Ended Six Months Ended March 31, March 31, 2025 2024 2025 2024 Net revenues…………………………………………….…………………………………………………………………………………………… $ 731,123 $ 681,354 $ 1,497,612 $ 1,373,951 Gross profit and gross mar

  43. Slide 43: GAAP to non-GAAP reconciliation (cont'd)

    GAAP to non-GAAP reconciliation (cont’d) F5, Inc. GAAP to Non-GAAP Reconciliation (unaudited, in thousands) Three Months Ended Six Months Ended March 31, March 31, 2025 2024 2025 2024 GAAP cost of net revenues…………………………………………….…………………………………………………………………………………………… $ 140,959 $ 141,113 $ 281,469 $ 277,5

  44. Slide 44: GAAP to non-GAAP reconciliation (continued)

    GAAP to non-GAAP reconciliation (continued) The non-GAAP adjustments, and F5's basis for excluding them from non-GAAP financial measures, are Restructuring charges. F5 has incurred restructuring charges that are included in its GAAP outlined below: financial statements, primarily related to workforc

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F5 — Q2 2025 Earnings Presentation on 6ix