F5, Inc.

Good afternoon, and welcome to the F5, Inc. First Quarter Fiscal 2026 Financial Results Conference Call. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Also, today's conference is being recorded. If anyone has any objections, please disconnect at this time. And I'm now turning the conference over to Ms. Suzanne Dulong. Thank you, ma'am. You may begin.

Hello and welcome. I'm Suzanne Dulong, F5's Vice President of Investor Relations. We're here to discuss our first quarter fiscal year 2026 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 where an archived version of today's audio will be available through April 27, 2026.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 13757533. The telephonic replay will be available through Midnight Pacific Time, January 28, 2026. 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 GAAP 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 will now turn the call over to Francois.

Thank you, Suzanne, and hello, everyone. We are very pleased to report strong Q1 results with 7% revenue growth driven by 11% product revenue growth, our sixth consecutive quarter of double-digit product growth. This includes a robust 37% systems revenue growth in the quarter. Our growth continues to be fueled by durable demand drivers, including hybrid multi-cloud adoption, scaling AI investment, and the demand for converged platforms. Our EMEA region delivered a particularly strong quarter, and we are seeing momentum from emerging trends which may prove durable. Regulations and mandates for resiliency and digital sovereignty are prompting customers to accelerate hybrid multi-cloud deployments, driving increased demand for F5 solutions. We are especially pleased with our Q1 results, given the uncertainty following the security incident at the start of the quarter. Our global sales and support teams mobilized rapidly, enabling customers to take action and get back to business quickly. They managed more than 9,000 additional support cases and earned positive customer feedback on our response efforts. As a result, we experienced minimal demand disruption in Q1. In addition, Unexpected positive outcomes emerged, including customers gaining a deeper understanding and appreciation of F5's critical role in their infrastructure and opportunities to strengthen relationships, including deeper engagement with CISOs. We remain focused on protecting customers and earning their trust, recognizing the responsibilities that come with our critical role. We are hyper-focused on three areas. further investing in the security of our operations, including security automation, enhancing the security of our products and development environments, and supporting the broader security community by sharing our learnings and innovations, such as introducing endpoint detection and response, or EDR capabilities, to perimeter devices. As we look ahead, we see three forces reshaping customer infrastructure decisions, and they are all accelerating simultaneously. The first is hybrid multicloud. Workloads now span on-premises, private cloud, and multiple public clouds. Customers want flexibility without lock-in, and hybrid multicloud has become the dominant operating model as a result. The second is enterprise AI. customers are shifting from general purpose systems to AI-centric data centers. These environments require far higher levels of data movement and compute, and these new requirements are putting real pressure on networking, storage, and application delivery layers. Finally, organizations are replacing fragmented point products with converged platforms because complexity now directly impacts performance, uptime, and risk. Consolidation is no longer simply a cost exercise. It is how customers simplify operations and improve resilience. I will double-click on the first trend. Hybrid multi-cloud adoption has been driven by enterprises' need for flexibility, cost efficiency, vendor lock-in prevention, and data gravity. Today, drivers like regulations, including MISTU, GDPR, and DORA, are accelerating hybrid multi-cloud adoption by imposing greater resilience and digital sovereignty requirements, especially outside the US. Organizations are also modernizing infrastructures to enhance security, performance, and efficiency. They are repatriating sensitive workloads to ensure compliance and deploying advanced ADC and API security solutions. These trends underscore why hybrid multi-cloud is the leading operating model. F5 is purpose-built to lead in this space. Our unmatched ability to provide complete delivery and security for every app, deployable anywhere and in any form factor, sets us apart. With a platform architected for hybrid multi-cloud, it is no surprise that customers are turning to F5 to secure and scale their environments. Let me share a few examples of some hybrid multicloud wins from Q1. F5 is powering the hybrid multicloud strategy for a regional banking leader. The customer needed more capacity and a modern application infrastructure for digital banking services and AI-based application development. F5 is building an AI-ready infrastructure with enhanced security using BIG-IP for automated and simplified operations. NGINX for cloud-native performance, and distributed cloud services for bot defense and DDoS mitigation. Second, a media and internet provider selected F5 to standardize application delivery across its on-premises and cloud environments. With F5, the customer uses the same ingress and security approach everywhere its applications and AI services run, ensuring predictable performance, security, and user experience. Teams can deploy or expand applications across environments without changing operational practices. This provides a reliable foundation for scaling AI and modern applications in a hybrid multi-cloud environment. Finally, a large operator of veterinary clinics is leveraging F5 to strengthen the resilience of its hybrid multi-cloud architecture. The customer needed to modernize their infrastructure and reduce risks tied to cloud concentration and vendor lock-in. F5 is delivering consistent networking and security functions and eliminating cloud-native dependencies. With F5, the customer is creating a durable foundation for future API and AI use cases. Now, let us look more closely at AI. AI-related investment is scaling as enterprises prepare for increased network capacity and services to support AI workloads, agentic AI, and inferencing demands. The resulting AI-related demand is fueling growth across our portfolio. AI is fundamentally transforming application behavior, and we are seeing three consistent patterns driving demand for F5 solutions. In AI data delivery, multimodal data growth is pushing terabit scale ingestion. With idle GPUs costing real money, customers need sustained end-to-end high throughput data pipelines across network, storage, and application delivery. BigIP solves the AI training and inference throughput bottlenecks traditional infrastructure cannot handle. In AI runtime security, Customers are moving quickly on generative AI, but security and compliance often become bottlenecks to deployment and ROI. Agentsic systems raise the stakes by accessing and acting on sensitive data, driving demand for stronger runtime controls and guardrails. F5 safeguards AI applications, APIs, and models from abuse, data leaks, and attacks like prompt injection. We ensure visibility, control, and trust. With our Q4 acquisition of Calypso AI, we enhanced our runtime security offerings with real-time threat defense, red teaming models, and robust guardrails. We are preventing prompt injections and ensuring models act as intended, even under attack. In AI factory load balancing, as AI deployments scale, Intelligent traffic distribution across models, clusters, and GPUs is critical, creating new demand for load balancing across and within the AI factory. F5 optimizes traffic and GPU utilization, increasing token throughput, reducing time to first token, and lowering per token costs. These trends highlight a clear reality. AI is accelerating demand for application delivery and security, areas where F5 excels. In Q1, we added nearly as many AI customers as we did in all of FY25. This growing demand is a testament to our layer seven expertise and decades of experience connecting applications and users, key differentiators in a rapidly evolving market. I will highlight a few of our AI wins from the quarter. In an AI data delivery use case, one of the largest global technology OEMs is expanding its big IP infrastructure to support a new high bandwidth AI data ingestion use case. The customer is repatriating large amounts of IoT data from the cloud to enable AI and analytics workloads. F5 is modernizing their S3 data delivery tier with big IP for ultra high performance. We are also accelerating their internal large language model development, powering large scale data ingestion into AI storage and pipelines. In AI runtime security, a global financial services leader is leveraging F5 to integrate generative AI into its AI trust framework. F5 is ensuring security, regulatory compliance, and continuous access controls at scale. S5's AI guardrails with programmable risk-based controls reinforced with continuous S5 AI Red Team testing is enhancing trust, resilience, and regulatory readiness across every AI interaction. F5's approach seamlessly integrates with the customer's existing identity, access management, and governance systems and is providing advanced protection against emerging threats while delivering low latency performance. And finally, in an AI factory load balancing win with a major energy and chemicals company, our team successfully leveraged a tech refresh into an expanded AI use case. the customer is shifting from public AI consumption to hosting private AI models and needed a solution to reduce latency and prevent timeouts. F5 is ensuring faster, more reliable AI responses with hardware-level handling of layer-4 traffic and SSL processing, significantly improving time-to-first token. All of these examples highlight how customers are building their AI infrastructure with F5. Let's shift gears to the third trend, converged networking and security platforms. Growing hybrid multi-cloud complexity has customers desperate for ways to reduce costs and improve the performance of fragmented point solutions. F5's Application Delivery and Security Platform, or ADSP, is the first platform to unite high-performance traffic management with advanced application and API security across hybrid and multi-cloud environments. ADSP converges security, scalability, and operational efficiency. It enables customers to consolidate multiple point solutions in one unified platform, simplifying operations and reducing risk. ADSP also delivers valuable XOPS capabilities for customers like policy management, analytics, and automation. Let me highlight a few Q1 wins that demonstrate how customers are adopting ADSP, converging solutions, and simplifying operations. In banking, a long-standing BIG-IP customer is modernizing its infrastructure, consolidating networking, application delivery, and security with F5. The customer is modernizing its digital banking applications and needed increased capacity and improved resilience to comply with central banking regulations. Today, the customer is leveraging a powerful combination of BIG-IP, NGINX and distributed cloud services for traffic management, WAF and DDoS protection. a global consumer products company standardized on a converged F5 platform to address governance and reliability concerns. By expanding its use of NGINX and refreshing its big IP footprint, the customer consolidated application delivery and security controls, ensuring consistent performance. Finally, a foreign national law enforcement agency selected a converged F5 platform to support its national open data initiative. the customer's disparate infrastructures struggled with ransomware threats, high false positives, and limited scalability. F5's Converge solution enabled the agency to consolidate load balancing, API protection, authentication, and threat mitigation. And these are just a few of the examples of customers leveraging F5's Converge platform to consolidate vendors, simplify operations, and reduce risk. F5 is unmatched in delivering complete application delivery and security across hybrid multi-cloud environments. Our vision for a unified, converged platform is fueled by our commitment to customer-focused innovation. And we are continuing to invest to create even greater value for our customers. In November, we launched F5 Big IP version 21.0, scaling the core for the most demanding AI workloads. This release delivers the significant control plane enhancements required to handle the scale and complexity of modern traffic. Crucially, we have applied this performance directly to AI data delivery, introducing native support for the model context protocol or MCP and S3. This ensures that BIG-IP is optimized for the high throughput storage and retrieval workloads that are critical to AI architectures. We are also bringing our advanced API security to the data center. One of the primary challenges our customers face is the risk of shadow APIs, endpoints that are active but invisible within their private networks. We have now enabled our API discovery engines to run locally in customer environments. This means we can deliver the exact same discovery and security capabilities on premises that our customers already rely on in F5 distributed cloud services. This allows customers to maintain a consistent API security posture in any environment. In summary, Our first quarter performance underscores F5's strong alignment with durable market demand drivers, including hybrid multi-cloud adoption, the acceleration of AI, and the increasing need for converged platforms. We remain deeply committed to driving innovation and to delivering cutting-edge solutions that address our customers' rapidly evolving application delivery and security challenges. Now, I will turn the call over to Cooper who will walk you through our Q1 results and our outlook.