Radware Ltd.

Welcome to the Radware conference call, discussing first quarter 2021 results, and thank you all for holding. To ask a question during the session, you will need to press star 1 on your telephone. As a reminder, this conference is being recorded May 5th, 2021. I would now like to turn the call over to Iska Erez, Director, Investor Relations at Radware. Please go ahead.

Thank you, Amitra. Good morning, everyone, and welcome to Redwood's First Quarter 2021 Earnings Conference Call. Joining me today are Roy Zisopel, President and Chief Executive Officer, and Rona Bromovic, Chief Financial Officer. A copy of today's press release and financial statements, as well as the investor keys for the first quarter, are available in the investor relations section of our website. During today's call, we may make projections or other forward-looking statements regarding future events or the future financial performance of the company. These forward-looking statements are subject to various risks and uncertainties, and actual results could differ materially from what was currently forecast and estimated. Factors that could cause or contribute to such differences include, but are not limited to, impact from the COVID-19 pandemic, general business conditions and our ability to address changes in our industry, changes in demand for products, the timing in the amount of orders and other risk details from time to time involved with filing. We refer you to the documents that the company files and furnishes from time to time with the SEC, specifically the company's last annual report on 20S as filed on April 20, 2021. We undertake no commitment to revise or update any forward-looking statement in order to reflect events or circumstances after the date of the such statement is made. I will now turn the call to Raiz Isabel.

Thank you, Iska, and thank you all for joining us today. We are pleased to report a strong first quarter, driven by solid performance across our business and specifically our growing cloud business and robust markets. This quarter is testimony to our strategy being firmly in place and working across all fronts. We continue to execute well on our growth drivers. Our cloud and subscription business continues to grow as more customers choose our cloud offerings. This is reflected in our total ARR, which reached yet another record of $176 million. Our successful OEM and GSI partnerships continue to expand our footprint, capturing new opportunities and bringing new customers on board. And our financial results were strong right across the board. In the first quarter of 2021, we reported an increase of 11% in total revenues to $67 million and improved profitability, led to a 22% increase in non-GAAP earnings per share to 17 cents. In recent years, we have witnessed a couple of transformations that have accelerated in the past year. First, the acceleration in digital transformation, as more and more transactions move online, and in many cases to the public cloud. More assets and transactions online create more targets for attackers, which makes cybersecurity even more critical. Second, last year, due to the lockdown, organizations were forced to rapidly move their employees to work from home. The new reality of hybrid workforce creates an increase in attack surface with millions of new entry points, which has led to an all-time high level of cyber activity. The outcome of these two forces is that organizations are experiencing more attacks in their network and in applications, both in terms of increased volumes and increased complexity. In the first quarter of 2021, the number of DDoS attacks mitigated in our scrubbing centers was two and a half times higher than in Q1 2020. The total number of web application attacks we blocked in the first quarter of 2021 almost tripled. And the number of bad bot requests we detected increased more than 80% compared to Q1 2020. It is clear now more than ever that our solutions are mission critical and essential for the operation of organizations. This is evident in the deals we closed in the first quarter. We signed a large deal with multinational pharmaceutical and customer and consumer goods corporation. Their previous vendor solution failed to mitigate a large attack through Cisco, We expeditiously upgraded them from on-demand to always on cloud DDoS protection worldwide and replaced the primary protection from the ISP to ensure business continuity and better ongoing protection. Another example I'd like to share is a deal with a large bank in EMEA, which was looking for strong cybersecurity solutions to protect its digital channels. They needed a robust and broad cybersecurity suite and then chose to invest in Rado's web application firewall, bot manager, and analytics, amongst other solutions. Digital transformation, and specifically the transition of organizations to the cloud, which accelerated in the past year, creates vast opportunities for us. Our cloud business continues to grow as more and more organizations adopt our offering, which is reflected in the continued growth of our ARR. This ARR growth was driven mainly from cloud and subscription ARR, which increased 27% in the first quarter of 2021 compared to last year. Let me share a few more examples. We signed a cloud deal with one of the largest insurance companies in Europe. The customer expanded its relationship with us, adding cloud DDoS protection to all its sites. Another deal is with a leading stock exchange, which upgraded its hybrid cloud solution to always-on cloud deals. Our technology is a key factor in the buying decisions of organizations. Organizations realize that in light of the increasing attacks, the criticality and the complexity of security, and to ensure continuity of operations, they must have superior protection. The breadth and the depth of our attack mitigation portfolio, from DDoS, web application firewall, bot manager, and API to cloud workload protection, and our superior technology plays a pivotal role in the decision of customers to choose our solutions again and again. This is illustrated through existing customers continuing to expand the relationship with us and the increased deal value. In the past quarter, we signed a very large deal with a large cloud provider who extended its relationship with us and is planning to buy additional solutions in the near future. We also signed a deal with a large airline company that was looking for superior security performance and upgraded our bot manager service to protect more of their production domains. Our strength in technology has also received recognition from industry analysts. We were named the leader in Forster 2021 DDoS Mitigation Solution Report. In this report, we achieved the highest possible score in 18 different assessment categories, the most among any of the vendors listed in the report. Forster positioned us as the vendor with the strongest current offering, saying, Rado knows DDoS attacks better than anyone. In addition, Radur was recognized as the customer choice in the 2021 Gartner Peer Insight Web Application Firewall Report. Radur has an overall rating of 4.7 out of 5 in the web application firewall market, which is based on product capabilities, integration, and deployment criteria, among others. Our performance and the addition of new customers is also being driven by successful relationships with our OEMs and GSIs. We signed significant deals, some with new customers, including with one of the largest public healthcare systems in the U.S., one with a large health service organization in Europe, one with a pan-European telecom group, to name but a few. We continue to invest in these strategic relationships and we believe this journey is only at the beginning. In summary, we are very pleased to start the year on a high note and we continue to focus on executing our strategy, expanding our cloud business, delivering innovative offerings and building strong relationships with our partners. We have the right assets in place and we're excited to capitalize on many opportunities ahead of us. Before I turn the call over to Doron, as most of you know, we announced that Doron will be leaving us next month. On behalf of myself and the entire company, I want to thank Doron for his dedication and support during his six years at Radware. A CFO and a valued member of our management team, he contributed to the success of our business. I wish him all the best for the future. I will now turn the call over to Doron.