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F5, Inc.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 28 April 2026: press release. Guidance figures: 2 raised, 2 new. The quarter’s numbers.

Key takeaways

  • Total revenue rose 11%: Revenue was $812 million, up from $731 million a year earlier. Products and services both contributed, with services growing more slowly than products. Source
  • Non-GAAP earnings rose faster: Non-GAAP net income was $223 million, or $3.90 per diluted share, compared with $201 million and $3.42 a year earlier. Source
  • Non-GAAP operating margin widened: Non-GAAP operating margin was 33.8% against 31.9%, on non-GAAP operating income of $274 million compared with $233 million. Source
  • Demand tied to structural drivers: Management attributes rising demand to hybrid multicloud adoption, cybersecurity threat expansion, and AI inference. Source
  • Product growth streak continued: Product revenue grew 22%, the seventh straight quarter of double-digit product growth, per the CEO. Source
  • Six-month buybacks increased: Repurchases of common stock were $401.1 million in the six months, against $252.1 million a year earlier, including excise taxes. Source
  • Full-year guidance raised: Management raised both full-year revenue growth and non-GAAP EPS ranges from the prior release. Source

“With our continued emphasis on customer-focused innovation, F5 is well positioned to help customers scale and secure the AI-powered applications of the future.”

François Locoh-Donou, F5’s Chairman, President, and CEO

Guidance

AreaPeriodFigureAgainst last quarter
Revenue growth Sourcefiscal year 20267% to 8%Raised from 5% to 6%
Non-GAAP earnings per share Sourcefiscal year 2026$16.25 to $16.55Raised from $15.65 to $16.05
Revenue Sourcethird quarter of fiscal year 2026$820 million to $840 millionNew
Non-GAAP earnings per diluted share Sourcethird quarter of fiscal year 2026$3.91 to $4.03New

What changed from last quarter

  • Guidance raised: Full-year revenue growth guidance raised. Source
  • Guidance raised: Full-year non-GAAP EPS guidance raised. Source
  • New guidance: Third-quarter revenue and non-GAAP EPS guidance given; the prior release gave second-quarter ranges. Source
  • New: Chairman title added to the CEO's title; the prior release listed President and CEO. Source

Revenue and earnings growth

  • Total revenue rose 11%: Revenue was $812 million, up from $731 million a year earlier. Products and services both contributed, with services growing more slowly than products. Source
  • GAAP earnings per diluted share rose: GAAP net income was $148 million, or $2.58 per diluted share, against $146 million and $2.48 a year earlier. Source
  • Non-GAAP earnings rose faster: Non-GAAP net income was $223 million, or $3.90 per diluted share, compared with $201 million and $3.42 a year earlier. Source

Margins and operating costs

  • Non-GAAP operating margin widened: Non-GAAP operating margin was 33.8% against 31.9%, on non-GAAP operating income of $274 million compared with $233 million. Source
  • GAAP operating margin rose slightly: GAAP operating margin was 22.1% against 21.7%, with GAAP income from operations of $179 million compared with $159 million. Source
  • General and administrative costs rose most: Operating expense lines all rose; general and administrative expense was $91.6 million against $76.6 million, the largest percentage increase. Source
  • Tax provision was higher: The provision for income taxes was $41.5 million against $25.7 million a year earlier. Source

“Our continued strong performance reflects rising demand for F5’s solutions anchored in structural demand drivers, including growing hybrid multicloud adoption, an expanding cybersecurity threat landscape, and an inflection in AI inference.”

François Locoh-Donou, F5’s Chairman, President, and CEO

Demand and product growth

  • Demand tied to structural drivers: Management attributes rising demand to hybrid multicloud adoption, cybersecurity threat expansion, and AI inference. Source
  • Product growth streak continued: Product revenue grew 22%, the seventh straight quarter of double-digit product growth, per the CEO. Source
  • Deferred revenue rose: Current deferred revenue was $1,268.6 million against $1,213.2 million at September 30, 2025; long-term deferred revenue was $849.7 million against $786.0 million. Source

Cash flow and balance sheet

  • Operating cash flow increased: Six-month net cash from operating activities was $525.1 million against $459.4 million a year earlier. Source
  • Capital spending increased: Six-month purchases of property and equipment were $28.1 million against $18.6 million. Source
  • Cash balance higher than September: Cash and cash equivalents were $1,442.8 million at March 31, 2026, against $1,344.3 million at September 30, 2025. Source

Share repurchases and share count

  • Six-month buybacks increased: Repurchases of common stock were $401.1 million in the six months, against $252.1 million a year earlier, including excise taxes. Source
  • Shares outstanding declined: Shares issued and outstanding were 56.8 million at March 31, 2026, against 57.7 million at September 30, 2025. Source
  • Diluted share count fell: Weighted average diluted shares were 57.3 million in the quarter, against 58.8 million a year earlier. Source

Full-year and next-quarter guidance

  • Full-year guidance raised: Management raised both full-year revenue growth and non-GAAP EPS ranges from the prior release. Source
  • Third-quarter ranges given: The release gives third-quarter revenue and non-GAAP EPS ranges; the prior release gave second-quarter ranges. Source
  • Guidance excludes certain items: Non-GAAP guidance excludes share-based compensation, amortization of intangibles, tax items, and future acquisitions, cyber incident costs, and restructuring. Source

Cyber incident and acquisition costs

  • Cyber incident costs of $6.0 million: Cyber incident costs were $6.0 million in the quarter and $23.5 million in the six months, both excluded from non-GAAP results. Source
  • Acquisition-related charges defined: Acquisition-related charges were $9.0 million against $1.2 million a year earlier, and $18.8 million over six months. Source
  • Non-GAAP excludes both costs: Management excludes acquisition-related charges from non-GAAP measures to compare with prior periods and peers. Source

Figures management reported

FigureReported
Systems revenue Source$226 million, up 26%
Software revenue Source$184 million, up 17%
Services revenue Source$401 million, up 2%
GAAP gross margin Source81.4%
Non-GAAP gross margin Source83.7%

Risks management discussed

  • Operational: Management reports costs of investigating and remediating the cyber incident, which it treats as non-recurring. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.