01—Abstract
Summary
Summary of the 10-K filed November 22, 2013. Cited figures are marked; the original filing is the authoritative source.
F5, INC. (FFIV) filed its 2013 10-K report on November 22, 2013, detailing its operations as a leading provider of application delivery services.
The company's core technology is the TMOS platform, which powers its Application Delivery Controllers (ADCs). These ADCs are available as both hardware appliances and software-only Virtual Editions, offering customers flexibility in managing application traffic, ensuring security, speed, and availability. F5's strategy centers on a complete, integrated product suite, continuous technological investment, and market expansion through development and acquisitions.
The company demonstrated revenue growth, driven by its services segment, while product revenue saw a slight decline, attributed to customers evaluating new appliance introductions. F5 continues to invest heavily in R&D, reflecting its commitment to innovation in the dynamic IT landscape.
02—Key points
Key Highlights
- F5's core offering revolves around its TMOS platform, enabling Application Delivery Controllers (ADCs) that manage, secure, and accelerate application delivery.
- Products are offered in flexible formats: high-performance hardware appliances (BIG-IP, VIPRION) and software-only Virtual Editions (VEs) for cloud and virtual environments.
- The company is actively expanding its market reach through strategic acquisitions, notably LineRate Systems and Versafe in fiscal year 2013, to enhance its software-defined and security offerings.
- Total net revenues grew by 7.6% in fiscal year 2013, primarily driven by a 22.2% increase in service revenues, reflecting growth in maintenance contracts and consulting services.
- Product revenues experienced a slight decrease of 2.4% year-over-year, attributed to customers awaiting new appliance releases, though sequential growth was observed in the latter half of the fiscal year.
- F5 maintained strong gross margins around 82.9% and demonstrated robust operating cash flow of $499.7 million in fiscal year 2013.
- The company has a significant cash and investments balance of $1.27 billion, with no long-term debt, indicating a strong financial position.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2013, F5, Inc. kept $0.19.
- Revenue$1.48B100.0%
- Cost of revenue−$253.0M17.1%
- Gross profit$1.23B82.9%
- Operating costs−$797.4M53.8%
- Operating income$430.8M29.1%
- Interest, other & tax−$153.5M10.4%
- Net income$277.3M18.7%
Where FY2013 revenue went
$1.48B- Other operating costs: $587.8M, 40% of revenue
- Net income: $277.3M, 19% of revenue
- Cost of revenue: $253.0M, 17% of revenue
- R&D: $209.6M, 14% of revenue
- Interest, other & tax: $153.5M, 10% of revenue
Kept 19% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2013filed November 22, 2013Financial Statements
FY2013 against FY2012
| Line item | FY2013FY2012 | Change |
|---|---|---|
| Revenue | $1.48B$1.38B | +7.6% |
| Cost of Revenue | $253.05M$236.17M | +7.1% |
| Gross Profit | $1.23B$1.14B | +7.6% |
| R&D Expenses | $209.61M$177.41M | +18.2% |
| Operating Expenses | $797.45M$714.78M | +11.6% |
| Operating Income | $430.82M$426.30M | +1.1% |
| Net Income | $277.31M$275.19M | +0.8% |
| EPS (Basic) | $3.53$3.48 | +1.4% |
| EPS (Diluted) | $3.50$3.45 | +1.4% |
| Shares Outstanding (Basic) | 78.56M79.14M | −0.7% |
| Shares Outstanding (Diluted) | 79.14M79.78M | −0.8% |
05—Questions
Frequently Asked Questions
What is F5's primary business and technology?
F5's primary business is providing application delivery services, centered around its proprietary TMOS (Traffic Management Operating System) platform. This platform enables their Application Delivery Controllers (ADCs) to ensure applications are secure, fast, and available to users.
How does F5 offer its products to customers?
F5 offers its products in two main formats: high-performance, purpose-built hardware appliances (like BIG-IP and VIPRION systems) and software-only Virtual Editions (VEs) designed to run on standard servers and major hypervisors, providing flexibility for various deployment environments including private and public clouds.
What were the key financial performance trends in fiscal year 2013?
In fiscal year 2013, F5 saw an overall revenue increase of 7.6%, largely due to a significant 22.2% rise in service revenues from maintenance and consulting. Product revenues experienced a slight decline of 2.4%, which the company attributed to customers evaluating upcoming hardware, though sales improved sequentially in the latter half of the year. The company maintained strong gross margins and generated substantial operating cash flow.
How is F5 managing its market expansion and product portfolio?
F5's strategy includes offering a complete and integrated product suite, investing heavily in R&D, and expanding its addressable market. This expansion is supported by strategic acquisitions, such as LineRate Systems and Versafe in fiscal year 2013, aimed at enhancing its capabilities in areas like software-defined networking and advanced security.
06—Continue