F5 Networks Profit Tops Estimates, Details Strong Outlook; Stock Up 11% - Update

(RTTNews) - F5 Networks, Inc. (FFIV) Wednesday reported a marginal drop in first-quarter profit, hurt mainly by lower margins even as revenues climbed 11 percent. However, both earnings and revenues for the quarter came in ahead of Wall Street estimates.

The company provided strong earnings and revenue outlook for the second quarter, sending its shares surging 11 percent to a one-year high at $108.92 in after-hours trade on the Nasdaq.

F5 Networks' board has authorized an additional $500 million share buyback program, alongside the $281 million currently balance in the existing program authorized in October 2010.

F5 Networks develops application delivery networking products that optimize the security, performance, and availability of network applications, servers, and storage systems.

The Seattle, Washington-based company posted first-quarter net income of $68 million or $0.87 per share, compared with $69.5 million or $0.88 per share last year.

Excluding items, adjusted earnings for the quarter were $94.8 million or $1.22 per share, compared with $90.6 million or $1.14 per share a year ago. On average, 33 analysts polled by Thomson Reuters expected earnings of $1.19 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter grew to $406.5 million from $365.5 million in the prior year. Thirty-three analysts had a consensus revenue estimate of $397.28 million for the quarter.

Commenting on the results, CEO John McAdam said the quarter benefited from demand for new hardware and software products across all geographies.

Results were mainly offset by operating expenses that climbed to $224 million from $195 million a year ago.

For the second quarter, the company expects net earnings of $0.87 to $0.90 per share, adjusted earnings of $1.23 to $1.26 per share, and revenues of $408 million to $418 million. Analysts currently expect earnings of $1.21 per share on revenues of $404.13 million for the quarter.

F5 Networks stock closed Wednesday at $97.48, down $0.72 or 0.73%, on a volume of 2.9 million shares on the Nasdaq. In after hours, the stock gained $11.44 or 11.74%, to trade at $108.92. In the past year, the stock has traded in the range of $67.53 - $107.99.