F5 Networks’ Shares Rally Following Excellent Q3 Performance

The shares of F5 Networks were up by over 6% at Tuesday’s pre-market trading session after the company reported better-than-expected third-quarter earnings.

F5 Networks’ Revenue Surpasses Expectations

Enterprise software manufacturer F5 Networks reported its third-quarter fiscal 2021 results a few hours ago. The company performed better than expected, and this led to its stock rallying well into Tuesday’s opening of the market.

According to the call transcript, F5 Networks recorded fiscal third-quarter non-GAAP earnings per share of $2.76, surpassing the Zacks Consensus Estimate of $2.47. Furthermore, the Q3 earnings were above the management’s guidance of $2.36-$2.54 per share.

In terms of revenue, F5 Networks reported that non-GAAP earnings increased 26.6% from the same quarter a year ago. The non-GAAP revenues rose by 11% year on year to $651.5 million, beating the Zacks Consensus Estimate of $636.9 million. F5 Networks can attribute the increase in its revenue to robust software growth. The revenue also surpassed the company’s estimated range of $620-$650 million.

F5 Network’s Shares Rally After Upbeat Outlook

The company is expecting further growth in the fiscal fourth quarter of 2021. For the quarter, F5 Networks is predicting non-GAAP revenues to be between $660 and $680 million (mid-point $670 million). However, it is higher than the Zacks Consensus Estimate, which currently sits at $663.2 million.

F5 Networks anticipates non-GAAP earnings per share to be between $2.68 and $2.80 band (mid-point $2.74). Meanwhile, the Zacks Consensus Estimate estimates EPS to be around $2.73. According to the company, the increasing demand for multi-cloud application services will be a key growth driver in Q4. Furthermore, solid demand for software solutions continues to grow. F5 Networks said increasing demand and recognition from subscription and Enterprise License Agreement (ELA) offerings is another key driving factor for the company.

F5 Network’s stock has been performing excellently since the company reported the earnings result a few hours ago. At the time of this writing, FFIV is up by over 5%, after rising by roughly 6% at Tuesday’s pre-market trading session.

Year-to-date, the company’s stock is up by nearly 20%. FFIV began 2021 trading at $175 per share but rose to now trade at $204.