F5 Networks Beats on Revenue and Matches Expectations on EPS

Seth Jayson, The Motley Fool
Updated

F5 Networks (NAS: FFIV) reported earnings on April 18. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q2), F5 Networks beat slightly on revenue and met expectations on earnings per share.

Compared to the prior-year quarter, both revenue and GAAP earnings per share grew significantly.


Margins improved across the board.

Revenue details
F5 Networks reported revenue of $339.6 million. The 37 analysts polled by S&P Capital IQ wanted to see net sales of $335.4 million on the same basis. GAAP reported sales were 22% higher than the prior-year quarter's $277.6 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $1.08. The 37 earnings estimates compiled by S&P Capital IQ averaged $1.07 per share on the same basis. GAAP EPS of $0.86 for Q2 were 26% higher than the prior-year quarter's $0.68 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 83.0%, 130 basis points better than the prior-year quarter. Operating margin was 30.8%, 80 basis points better than the prior-year quarter. Net margin was 20.2%, 20 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $352.7 million. On the bottom line, the average EPS estimate is $1.14.

Next year's average estimate for revenue is $1.39 billion. The average EPS estimate is $4.49.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 661 members rating the stock outperform and 64 members rating it underperform. Among 228 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 212 give F5 Networks a green thumbs-up, and 16 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on F5 Networks is outperform, with an average price target of $131.28.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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