F5, Inc.

Good afternoon and welcome to the F5 fourth quarter fiscal 2025 financial results conference call. If you require operator assistance during the call, please press star zero. 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 Mrs. Suzanne Dulong. Ma'am, you may begin.

Hello and welcome. I'm Suzanne Dulong, F5's Vice President of Investor Relations. We're here with you today to discuss our fourth quarter and fiscal year 2025 financial results. Francois Locodinou, F5's 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 Today's press release is available on our website at F5.com, where an archived version of today's audio will be available through January 27, 2026. We will post the slide deck accompanying today's webcast to our IR site following this call. To access the replay of today's webcast by phone, dial 877-660-6853 or 201-612-7415. and use Meeting ID 1375-6255. The telephonic replay will be available through midnight Pacific time, October 28, 2025. For additional information or follow-up questions, please reach out to me directly at s.dulong at f5.com. Our discussion today will contain forward-looking statements, which include words such as believe, anticipate, expect, and target. These forward-looking statements involve uncertainties and risks that may cause our actual results to differ materially from those expressed or implied by these statements. We have summarized factors that may affect our results in the press release, announcing our financial results, and in detail in our SEC filings. In addition, we will reference non-GAAP metrics during today's discussion. Please see our full gap to non-GAAP reconciliation in today's press release and in the appendix of our earnings slide deck. Please note that F5 has no duty to update any information presented in this call. I'll now turn the call over to Francois.

Thank you, Suzanne, and hello, everyone. We delivered exceptional fiscal year 2025 results, exceeding $3 billion in revenue and $1 billion in operating profit for the first time. Revenue grew 10%, while earnings per share grew 18%. Our growth was driven by data center reinvestment, hybrid cloud adoption, and enterprise AI infrastructure demand. Our product refresh cycle, competitive takeouts, and the maturation of our software model and go-to-market motions also contributed to growth. In FY25, we maintained our strong profitability delivering gross margins of 83.6% up 80 basis points over FY24 and operating margin of 35.2% up 160 basis points over FY24. This performance resulted in record free cash flow of $906 million up 19% compared to FY24 underscoring the strength of our financial model and execution. Our FY25 results demonstrate the power of our platform and our strategic role in the marketplace. They also strengthen our confidence in our vision and roadmap for the future. Our immediate focus, however, has been on our incident response, and I will speak to our priorities and offer an update on where we are now. Upon identifying the threat on August 9th, Our team immediately activated our incident response process. Our priorities were clear. First, contain the threat actor, initiate a thorough investigation, and take immediate and urgent action to strengthen F5 security posture. While the investigation will continue and the work of bolstering our security posture will expand, our initial steps have been successful. Second, We prioritized delivering reliable software releases to address all undisclosed high vulnerabilities in BIG-IP code as quickly as possible. Through the exceptional efforts of our engineering and support teams, we achieved this, enabling thousands of customers to promptly deploy critical updates upon disclosure. Our customers are moving quickly to update their BIG-IP environments and a significant number of our largest customers have completed their updates with minimal disruption. As an example, a North American technology provider completed updates to 814 devices in a six-hour window in the first weekend. Customers have expressed appreciation for our transparency, the thoroughness of the information we provided, and the clarity in the steps they need to take to improve the security of their environments. Our third priority is raising the bar on security across all aspects of our business. We are acutely aware of the increasing sophistication of attackers and the fact that the threat surface is expanding rapidly. Each year over the last several years, we have aggressively increased our investment in security and we are making further significant investment this year and beyond. To further this work, Michael Montoya, a recognized cybersecurity expert and former member of our board, has joined F5 as Chief Technology Operations Officer. Michael brings deep operational expertise and will drive the execution of a robust roadmap to further enhance security across our internal processes, environments, and products. Our goal across all these actions is to better protect our customers, and we believe F5 will be a stronger partner to customers because of it. We know customers will judge us by how we respond to this incident. Throughout this process, we have been committed to transparent customer communication at every step, reflecting lessons learned from how others have navigated similar challenges. We acknowledge that we may see some near-term impact to our business. we are fully focused on mitigating that impact while doubling down on the value we deliver to our customers. Stepping back, it is evident that advanced nation state threat actors are targeting technology companies and most recently perimeter security companies. We are committed to learning from this incident sharing our insights with customers and peers, and driving collaborative innovation to collectively strengthen the protection of critical infrastructure across the industry. Now, I will turn the call over to Cooper, who will walk you through our Q4 results and our outlook. Following his remarks, I will return to discuss the broader business trends and some key customer highlights.