A10 Networks, Inc.

Hello everyone and welcome to the ATEN Network's third quarter 2024 financial results call. My name's Lydia and I'll be your operator today. After the prepared remarks, there'll be an opportunity for you to ask questions. If you'd like to ask a question, you can do so by pressing star followed by one on your telephone keypad. I'll now hand you over to Tom Bowman to begin. Please go ahead.

Thank you all for joining us today. This call has been recorded in webcast live and may be accessed for at least 90 days via the ATEN Networks website at atennetworks.com. Hosting the call today are Drupal Trivedi, ATEN's President and CEO, and CFO, Brian Becker. Before we begin, I would like to remind you that shortly after the market closed today, ATEN Networks issued a press release announcing its third quarter 2024 financial results. Additionally, ATEN published a presentation and supplemental trended financial statements. You may access the press release presentation and trended financial statements on the investor relations section of the company's website. During the course of today's call, management will make forward-looking statements, including statements regarding projections for future operating results, demand, industry and customer trends, strategy, potential new products and solutions, our capital allocation strategy, profitability, expenses, investments, positioning, and our repurchase and dividend programs. These statements are based on current expectations and beliefs as of today, November 7, 2024. These forward-looking statements involve a number of risks and uncertainties, some of which are beyond our control that could cause actual results to differ materially, and you should not rely on them as predictions of future events. A-10 does not intend to update information contained in these forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law. For a more detailed description of these risks and uncertainties, please refer to our most recent 10-K and quarterly report on Form 10-Q. Please note that with the exception of revenue, financial measures discussed today are on a non-GAAP basis. and have been adjusted to exclude certain charges. The non-GAAP financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. It may be different from non-GAAP financial measures presented by other companies. A reconciliation between GAAP and non-GAAP measures can be found on the press release issued today and on the Trended Quarterly Financial Statements posted on the company's website. Now, I would like to turn the call over to Drupal Trivedi, President and CEO of ATEN Networks.

Thank you, Tom, and thank you all for joining us today. This was a balanced quarter for ATEN with improved performance from both enterprise and service provider sectors. Enterprise revenue increased 5% year-to-date and is up 9% on a trailing 12-month basis, validating our new roadmap and increased focus on these customers. Growth with enterprise customers is part of our ongoing strategic focus on driving predictable performance through diversification. Indeed, diversification remains core to our overall strategy, enabling ATEN to navigate challenging conditions more consistently than peers, and over the long term, driving growth that outpaces the broader market segment. Service provider revenue was up 2% year-to-date after being down in the first half of 2024. While the North American segment of this business remains volatile, the overall trend is encouraging. For the past several quarters, we have communicated that the short-term headwinds impacting our service provider customers will likely pose less of a long-term challenge for ATEN as our security-led solutions are less and less optional, even when macro uncertainties force customers to spend more cautiously. We communicated in Q2 that opportunities in the pipeline were not lost, just delayed. This quarter validated those expectations. We do not yet have sufficient visibility to state that the North American service provider market has stabilized but we are cautiously optimistic that the worst is behind us. Our strong competitive position is due to our focus on security solutions. Our security led revenue increased 10% year to date. Customer decisions to bolster security may be delayed, but they cannot be canceled. This is true both of enterprises who experience more and more cybersecurity threats every day and service providers who must safeguard critical networks to service existing customers and to add new ones. We recently announced that we are expanding our security led offering and laid out a longer term blueprint for further expansion, including integration of AI capabilities throughout the portfolio. These new solutions leverage our existing presence and our two decade long track record of enabling best-in-class throughput, low latency, and high levels of cybersecurity, all while focusing on industry-leading low total cost of ownership. Over the next few months, ATAN will continue to introduce additional tools, solutions, and capabilities to better enable positive business outcomes for our customers. Our goal is to create an integrated solution that reduces cybersecurity risk, improves the user experience, and simplifies the IT infrastructure of our customers, including AI build-outs. Overall, we anticipate adding new AI-based capabilities, harnessing machine learning to better identify and mitigate threats. We are also creating solutions specifically targeting threats and vulnerabilities that AI deployments can create launching new approaches to address these threats. Our infrastructure solutions help customer improve the performance and resiliency of their applications. From an infrastructure standpoint, we will integrate AI to predict future network performance. With ATAN Control, we will enable centralized management for all ATAN products, including partner products. With ATAN Defend, we are developing solutions that will help our customers protect their mission critical applications and infrastructure from an ever-growing number of cyber threats. This includes protecting web applications, providing AI-enabled protection from bots and DDoS attacks, and threat intelligence to proactively identify potential threats. Our priorities continue to be a mix of internal investments to support innovation, returning capital to shareholders, and evaluating strategic opportunities to accelerate growth. You are seeing the results of our internal investment reflected in this blueprint, and we continue to consistently return capital to shareholders. Our strong third quarter performance demonstrate the upside that is built into our business model. We maintain robust profitability in line and slightly ahead of our targets in the quarter. During the third quarter, we expanded operating margins, EBITDA margins, and net margins as incremental revenue disproportionately fell to the bottom line. At the same time, it is important to note that we have increased our R&D investment more than 15% year-over-year. We generated more than $21 million in cash from operations, keeping us on track for full-year targets. our EPS in the quarter benefited from non-recurring foreign currency factors, but even excluding these benefits, our net margin and operating income expansion demonstrate the leverage and systemic profitability built into our operating model. We have continued to buy back stock and our cash flow has more than funded our buyback and dividend programs. With that, I'd like to turn the call over to Brian for a detailed review of the quarter. Brian?