Q2 2026 F5 Inc Earnings Call Transcript
Key Points
- F5 Inc (FFIV) reported an 11% revenue growth for the quarter, with product revenue increasing by 22%, marking the seventh consecutive quarter of double-digit product growth.
- The company experienced strong international demand, particularly in EMEA and APAC regions, which grew by 22% and 19% respectively.
- F5 Inc (FFIV) raised its fiscal year 2026 revenue growth outlook to 7% to 8%, up from the previous 5% to 6%, due to strong market trends and a growing pipeline.
- The company achieved a record $348 million in free cash flow, highlighting the strength of its operating model.
- F5 Inc (FFIV) is capitalizing on the growing demand for hybrid multi-cloud solutions and AI-driven security, positioning itself well for future growth.
- Despite strong product revenue growth, services revenue only grew by 2% year-over-year, indicating potential challenges in this segment.
- The company faces increased component costs, particularly related to memory, which is expected to impact gross margins in the coming quarters.
- F5 Inc (FFIV) reported a slower growth rate in its software segment this year, attributed to a flat software year in FY23.
- The US region showed relatively modest growth compared to international markets, raising questions about domestic market dynamics.
- There is a lag between systems and software revenue growth, with systems revenue consistently growing while software revenue remains flat, indicating potential challenges in software adoption.
Good afternoon, and welcome to the F5 Inc second quarter fiscal 2026 financial results conference call. (Operator Instructions) Also, today's conference is being recorded. If anyone has any objections, please disconnect at this time.
I'll now turn the call over to Ms. Suzanne DuLong. Ma'am, you may begin.
Hello, and welcome. I'm Suzanne DuLong, F5's Vice President of Investor Relations. We are here to discuss our second quarter fiscal year 2026 financial results. Francois Locoh-Donou, F5's Chairman, President and CEO; and Cooper Werner, F5's Executive Vice President and CFO, will be making prepared remarks on today's call. Other members of the F5 executive team are also here to answer questions during the Q&A session.
Today's press release is available on our website at f5.com, where an archived version of today's audio will be available through July 27, 2026. We will post a slide deck accompanying today's webcast to our IR site following this call. To access the replay of today
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