F5 Networks (FFIV) Q3 Earnings Lag Estimates, Revenues Beat
Zacks Investment Research | Jul 24, 2019 11:19PM ET
F5 Networks Inc. (NASDAQ:FFIV) reported third-quarter fiscal 2019 GAAP earnings per share of $2.52, missing the Zacks Consensus Estimate of $2.57 but inching up 3.3% year over year. Excluding the impact of the NGINX buyout, non-GAAP earnings would have been in line with estimates.
F5 Networks revenues rose 4% year over year to $563.4 million and also surpassed the Zacks Consensus Estimate of $555 million. The acquisition of NGINX contributed $5.1 million to revenues in the quarter under review.
Quarterly Details
Products revenues (44.2% of total revenues) during the reported quarter totaled $248.9 million, up 4.2% from the year-ago period, driven by software. NGINX contributed to $4 million of subscription software revenues.
Software soared 91% year over year and represented 27% of product revenues. This upside can be attributed to the growing adoption of the Enterprise License Agreement (ELA) and annual subscriptions among customers.
Excluding NGINX, software revenues surged 79% year over year and accounted for 26% of the product revenues.
Software growth is consistently aided by security use cases, which include web application firewall, bot-defense and mitigation. A few multimillion-dollar ELA deals were also a tailwind in the quarter under consideration.
Systems revenues, denoting 73% of product revenues, declined 11% on a year-over-year basis.
Services revenues (55.8%) increased 3.7% year over year to $314.5 million with $1.1 million contributed by NGINX.
Geographically, on a year-over-year basis, revenues from the Americas — reflecting 53% of the total count — dipped 1%. Asia Pacific and Japan revenues rose 22% and generated 23% of the total top line. EMEA was nudged up 2% and accounted for 24% of the total revenue tally.
Going by the verticals, Enterprise, Service providers and Government (including 8% from the U.S. Federal) depicted 60%, 20% and 19% of the total revenue stream, respectively.
The company’s distributor Ingram Micro translated to 18% of the company’s revenues. Tech Data and Westcon contributed 11% and 10%, respectively, to the total revenue base.
F5 Networks, Inc. Price, Consensus and EPS Surprise
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