Please ensure Javascript is enabled for purposes of website accessibility

Why F5 Networks Stock Jumped Today

By Evan Niu, CFA – Apr 28, 2020 at 1:57PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The application delivery company reported strong quarterly results and issued a rosy outlook.

What happened

Shares of F5 Networks (FFIV 1.85%) have jumped today, up by 9% as of 1:30 p.m. EDT, after the company reported fiscal second-quarter earnings. The network application delivery specialist beat expectations and offered strong guidance for the next quarter.

So what

Revenue in fiscal Q2 increased 7% to $583.4 million, topping the consensus estimate of $564 million. That led to adjusted net income of $135.9 million, or $2.23 per share, easily beating the $1.99 per share in adjusted profits that analysts were modeling for.

F5 office in San Jose

Image source: F5 Networks.

The COVID-19 pandemic is having mixed impacts on the tech company, boosting adoption of F5's services for some clients while other customers cut back on spending. On the conference call with analysts, CEO Francois Locoh-Donou said the outbreak had a "net neutral impact" during the quarter.

"During our second quarter, we saw continued rapid acceptance of our software and subscription-based offerings as enterprises and service provider customers worldwide look to F5 to ensure consistent application access, delivery and security," Locoh-Donou said in a statement. "In the last month of the quarter, we also saw increased demand for capacity as customers looked to quickly and, in some cases, massively scale remote access capabilities to keep their employees safe and their businesses running."

Now what

In terms of guidance, F5 expects revenue in the fiscal third quarter to be in the range of $555 million to $585 million, putting the midpoint comfortably above the consensus of $551.2 million. Adjusted earnings per share are forecast at $1.91 to $2.13, compared to analysts' expectation of $1.87 per share.

Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

F5 Networks, Inc. Stock Quote
F5 Networks, Inc.
FFIV
$148.88 (1.85%) $2.71

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
327%
 
S&P 500 Returns
105%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/28/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.