F5 Networks announces third quarter fiscal year 2019 results
Delivers GAAP EPS of $1.43 and non-GAAP EPS of $2.52 per diluted share includes 91% Software Revenue Growth
F5 Networks announced financial results for its fiscal 2019 third quarter ended June 30, 2019.
Third quarter fiscal year 2019 results include the acquisition of NGINX, Inc., completed on May 8, 2019.
"The quarter's 4% total revenue growth and 91% software growth was driven by customer demand for the software form factors of our application services, as customers globally rely on F5 to provide consistent application security and reliable performance across private, public and multi-cloud environments," said François Locoh-Donou, F5 President and Chief Executive Officer. "With customers facing an ever-increasing array of threats, our software growth continues to be driven by security use cases, including web application firewall and bot-defense and mitigation."
"We continue to aggressively execute our strategy of expanding our reach and broadening our role while transitioning F5 to a software-driven model," continued Locoh-Donou." Customers are beginning to recognize a new F5 as a result of our reprioritization of development resources, introduction of new, flexible consumption models, and most recently, the acquisition and integration of NGINX."
Third Quarter Performance Summary
Revenue of $563.4 million for the third quarter of fiscal year 2019 reflects 4% growth from $542.2 million in the third quarter of fiscal year 2018, driven by total software solutions revenue growth of 91%, including a partial quarter contribution from NGINX.
GAAP net income for the third quarter of fiscal year 2019 was $85.9 million, or $1.43 per diluted share, and includes $41.0 million in stock-based compensation, $30.1 million in costs related to the acquisition of NGINX, $8.7 million in facility-exit costs and $3.7 million in amortization of purchased intangible assets. This compares with third quarter fiscal year 2018 GAAP net income of $122.7 million, or $1.99 per diluted share.
Non-GAAP net income for the third quarter of fiscal year 2019 was $151.5 million, or $2.52 per diluted share, compared to $150.1 million, or $2.44 per diluted share, in the third quarter of fiscal year 2018. Non-GAAP net income for the third quarter of fiscal year 2019 and the third quarter of fiscal year 2018 excludes the impact of stock-based compensation, and amortization of purchased intangible assets. Non-GAAP net income for the third quarter of fiscal year 2019 also excludes facility-exit costs related to the Company's headquarters move and costs related to the acquisition of NGINX.
A reconciliation of net income, earnings per share, and other measures on a GAAP to non-GAAP basis is included in the attached Consolidated Income Statements. Additional information about non-GAAP financial information is included below.
For the fourth quarter of fiscal year 2019 ending September 30, 2019, the Company expects to deliver revenue in the range of $577 million to $587 million with non-GAAP earnings in the range of $2.53 to $2.56 per diluted share.
All forward-looking non-GAAP measures included in the outlook exclude estimates for amortization of intangible assets, share-based compensation expenses, significant effects of tax legislation and judicial or administrative interpretation of tax regulations, including the impact of income tax reform, non-recurring income tax adjustments, valuation allowance on deferred tax assets, and the income tax effect of non-GAAP exclusions, and do not include the impact of any future acquisitions or divestitures, restructuring charges, facility exit costs, or other non-recurring charges that may occur in the period.
F5 is unable to provide a reconciliation of non-GAAP guidance measures to corresponding U.S. generally accepted accounting principles or GAAP measures on a forward-looking basis without unreasonable effort due to the overall high variability and low visibility of most of the foregoing items that have been excluded. Material changes to any one of these items could have a significant effect on our guidance and future GAAP results.