SAN JOSE, Calif.--(BUSINESS WIRE)--A10 Networks (NYSE: ATEN), a leading provider of cybersecurity and infrastructure solutions, today announced financial results for its fourth quarter and full-year period ended December 31, 2022.
Fourth Quarter 2022 Financial Summary
- Record revenue of $77.6 million, up 9.9% year-over-year.
- Revenue growth was broad-based, with increases in North America and APAC, as well as Japan on a constant currency basis.
- GAAP gross margin of 79.7%; non-GAAP gross margin of 80.3% as a result of better product mix and continued successful navigation of short-term input cost pressures.
- GAAP net income of $18.0 million, or $0.24 per diluted share, compared with GAAP net income of $10.7 million, or $0.13 per diluted share in the fourth quarter of 2021.
- Non-GAAP net income of $18.4 million, or $0.24 per diluted share (non-GAAP EPS), compared with non-GAAP net income of $16.4 million, or $0.20 per diluted share in the fourth quarter of 2021.
- Adjusted EBITDA of $22.3 million, representing 28.7% of revenue, in line with stated business model goals, and representing more Adjusted EBITDA than A10 generated in all of 2018 and 2019 combined.
- The Board of Directors approved a quarterly cash dividend of $0.06 per share, payable on March 1, 2023 to stockholders of record at the close of business on February 17, 2023.
Full-Year 2022 Financial Summary
- Record revenue of $280.3 million, up 12.1% year-over-year.
- Revenue growth was broad-based, with increases in all major geographies and customer verticals on a constant currency basis.
- GAAP gross margin of 79.7%; non-GAAP gross margin of 80.3%.
- GAAP net income of $46.9 million, or $0.60 per diluted share, compared with GAAP net income (inclusive of a non-recurring $65.4 million income tax benefit related to sustained profitability) of $94.9 million, or $1.19 per diluted share in 2021.
- Non-GAAP net income of $57.7 million, or $0.74 per diluted share, compared with non-GAAP net income of $50.1 million, or $0.63 per diluted share in 2021.
- Q3 and Q4 2022 GAAP EPS of $0.16 and $0.24 per diluted share, respectively, compared to Q3 and Q4 2021 GAAP EPS of $0.94 and $0.13 per diluted share, respectively. Full-year 2022 GAAP EPS was $0.60 vs. $1.19 last year.
- With Q3 and Q4 2022 non-GAAP EPS of $0.20 and $0.24 per diluted share, respectively, and Q3 and Q4 2021 non-GAAP EPS of $0.17 and $0.20 per diluted share, respectively, A10’s profit accelerated in the second-half of 2022 compared to the second-half of 2021. Full-year 2022 non-GAAP EPS was $0.74 vs. $0.63 last year.
- Adjusted EBITDA of $75.1 million, representing 26.8% of revenue, in line with stated goals for profitability.
- Full-year cash flow from operations increased 31.9% to $66.1 million, compared to $50.1 million in 2021.
- A10 returned more than $95 million to shareholders during 2022, repurchasing approximately 6.1 million shares at an average price of $13.01 per share for a total of $79.3 million and issuing $15.9 million in cash dividends.
($ in millions, except per-share) |
2019 |
2020 |
2021 |
2022 |
2022 vs. 2021 |
Revenue |
$212.6 |
$225.5 |
$250.0 |
$280.3 |
+12.1% |
Adjusted EBITDA % |
5.5% |
20.2% |
25.0% |
26.8% |
+182 bps |
GAAP EPS |
($0.23) |
$0.22 |
$1.19 |
$0.60 |
(49.1%) |
Non-GAAP EPS |
$0.03 |
$0.44 |
$0.63 |
$0.74 |
+18.6% |
A reconciliation between GAAP and non-GAAP information is contained in the financial statements below.
“Strong demand for our proprietary security-led solutions drove record revenues for the quarter and the full-year, with continued broad-based growth across both enterprises and service providers and in each key geographic region, on a constant-currency basis,” said Dhrupad Trivedi, President and Chief Executive Officer of A10 Networks. “Increasingly, A10 is positioned as a diversified, differentiated security solutions provider, structured to mitigate fluctuations from any single customer or region. While we are not immune from recessionary impacts, our industry leadership makes our offerings a priority over discretionary investments. We remain well-positioned for continued success with both enterprise and service provider customers.”
“In 2022 we successfully navigated supply chain constraints, maintained robust gross margins and effectively managed our operating expenses, which drove profitability and free cash flow,” added Trivedi. “With revenue growth that outpaced operating expenses, we were able to grow our bottom line faster than our top line. For the year, we delivered record non-GAAP operating income and EBITDA margins, enabling us to repurchase more than $79.3 million of our stock and return further capital to shareholders through meaningful cash dividends. Simultaneously, we continued to strategically invest in technology, augmenting our already durable differentiators and making our business increasingly resilient. We remain committed to delivering revenue growth that outpaces our peer set, navigating recessionary headwinds better than our peers and delivering solid bottom-line growth, with expected double-digit growth in 2023 full-year non-GAAP EPS. We continue to carry no debt and hold $151.0 million of cash and cash equivalents.”
Conference Call
Management will host a call at 1:30 p.m. Pacific time (4:30 p.m. Eastern time) today, February 7, 2023, to discuss these results. Interested parties may access the conference call by dialing (844) 200-6205 (toll-free) or (929) 526-1599 and referencing access code: 125471.
A live audio webcast of the conference call will be accessible from the “Investor Relations” section of A10 Network’s website at investors.a10networks.com. The webcast will be archived for at least 90 days. A telephonic replay of the conference call will be available two hours after the conclusion of the live call and will run for seven days and may be accessed by dialing (866) 813-9403 (toll-free) or (929) 458-6194 and entering the passcode 897429.
Forward-Looking Statements
This press release contains “forward-looking statements,” including statements regarding our anticipated future financial results, quarterly dividend payments, drivers of growth, strategy, demand, supply chain challenges, positioning, growth and Adjusted EBITDA and non-GAAP EPS expectations. Forward-looking statements are subject to known and unknown risks and uncertainties and are based on assumptions that may prove to be incorrect, which could cause actual results to differ materially from those expected or implied by the forward-looking statements. Factors that may cause actual results to differ include the impact of the COVID-19 pandemic on our business and the business of our customers; a significant decline in global macroeconomic or political conditions that have an adverse impact on our business and financial results; business interruptions related to our supply chain; our ability to manage our business and expenses if customers cancel or delay orders; execution risks related to closing key deals and improving our execution; the continued market adoption of our products; our ability to successfully anticipate market needs and opportunities; our timely development of new products and features; our ability to achieve or maintain profitability; any loss or delay of expected purchases by our largest end-customers; our ability to maintain or improve our competitive position; competitive and execution risks related to cloud-based computing trends; our ability to attract and retain new end-customers and our largest end-consumers; our ability to maintain and enhance our brand and reputation; changes demanded by our customers in the deployment and payment model for our products; continued growth in markets relating to network security; the success of any future acquisitions or investments in complementary companies, products, services or technologies; the ability of our sales team to execute well; our ability to shorten our close cycles; the ability of our channel partners to sell our products; variations in product mix or geographic locations of our sales; risks associated with our presence in international markets; weaknesses or deficiencies in our internal control over financial reporting; our ability to timely file periodic reports required to be filed under the Securities Exchange Act of 1934; and other risks that are described in “Risk Factors” in our periodic filings with the Securities and Exchange Commission, including our Form 10-K filed with the Securities and Exchange Commission on March 8, 2022. We do not intend to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
Non-GAAP Financial Measures
In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), we refer to certain non-GAAP financial measures, including non-GAAP net income, non-GAAP net income per basic and diluted share (or non-GAAP EPS), non-GAAP gross profit and gross margin, non-GAAP operating income and operating margin, non-GAAP operating expenses, and Adjusted EBITDA. Non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures presented by other companies.
A10 Networks considers these non-GAAP financial measures to be important because they provide useful measures of the operating performance of the company, exclusive of unusual events or factors that do not directly affect what we consider to be our core operating performance and are used by the company's management for that purpose.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
We define non-GAAP net income as our GAAP net income excluding: (i) stock-based compensation and related payroll tax, (ii) impairment of investment, (iii) amortization expense related to acquisition, (iv) global distribution center transition expense, (v) litigation and investigation expense (recovery, (vi) non-recurring facilities expense, (vii) restructuring expense and related taxes, (viii) tax benefit of amended returns and (ix) release of deferred tax asset valuation allowance. We define non-GAAP net income per basic and diluted share as our non-GAAP net income divided by our basic and diluted weighted-average shares outstanding. We define tax effected non-GAAP net income as non-GAAP net income adjusted for the income tax effect of excluding the non-GAAP items (i) to (ix) listed above. We define non-GAAP gross profit as our GAAP gross profit excluding (i) stock-based compensation and related payroll tax, and (ii) global distribution center transition expense. We define non-GAAP gross margin as our non-GAAP gross profit divided by our GAAP revenue. We define non-GAAP operating income as our GAAP income from operations excluding (i) stock-based compensation and related payroll tax, (ii) amortization expense related to acquisition and (iii) global distribution center transition expense. We define non-GAAP operating margin as our non-GAAP operating income divided by our GAAP revenue. We define non-GAAP operating expenses as our GAAP operating expenses excluding (i) stock-based compensation and related payroll tax, (ii) amortization expense related to acquisition and (iii) global distribution center transition expense. We define Adjusted EBITDA as our GAAP net income excluding (i) interest and other (income) expense, net, (ii) depreciation and amortization expense, (iii) provision for (benefit from) income taxes, (iv) stock-based compensation and related payroll tax, (v) litigation and investigation expense (recovery), (vi) non-recurring facilities expense, (vi) impairment of investment, (vii) global distribution center transition expense and (ix) restructuring expense.
Non-GAAP financial measures are presented for supplemental informational purposes only for understanding the company's operating results.
About A10 Networks
A10 Networks (NYSE: ATEN) provides secure application services and solutions for on-premises, multi-cloud and edge-cloud environments at hyperscale. Our mission is to enable service providers and enterprises to deliver business-critical applications that are secure, available and efficient for multi-cloud transformation and 5G readiness. We deliver better business outcomes that support investment protection, new business models and help future-proof infrastructures, empowering our customers to provide the most secure and available digital experience. Founded in 2004, A10 Networks is based in San Jose, Calif. and serves customers globally. For more information, visit https://www.a10networks.com/ and follow us @A10Networks.
The A10 logo and A10 Networks are trademarks or registered trademarks of A10 Networks, Inc. in the United States and other countries. All other trademarks are the property of their respective owners.
Source: A10 Networks, Inc.
A10 NETWORKS, INC.
|
|||||||||||||||
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
Revenue: |
|
|
|
|
|
|
|
||||||||
Products |
$ |
49,577 |
|
|
$ |
43,680 |
|
|
$ |
173,201 |
|
|
$ |
148,398 |
|
Services |
|
28,057 |
|
|
|
26,991 |
|
|
|
107,137 |
|
|
|
101,644 |
|
Total revenue |
|
77,634 |
|
|
|
70,671 |
|
|
|
280,338 |
|
|
|
250,042 |
|
Cost of revenue: |
|
|
|
|
|
|
|
||||||||
Products |
|
11,793 |
|
|
|
9,460 |
|
|
|
40,135 |
|
|
|
32,620 |
|
Services |
|
3,950 |
|
|
|
4,722 |
|
|
|
16,697 |
|
|
|
20,885 |
|
Total cost of revenue |
|
15,743 |
|
|
|
14,182 |
|
|
|
56,832 |
|
|
|
53,505 |
|
Gross profit |
|
61,891 |
|
|
|
56,489 |
|
|
|
223,506 |
|
|
|
196,537 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Sales and marketing |
|
22,351 |
|
|
|
25,456 |
|
|
|
88,511 |
|
|
|
85,651 |
|
Research and development |
|
16,916 |
|
|
|
13,027 |
|
|
|
58,398 |
|
|
|
54,077 |
|
General and administrative |
|
6,358 |
|
|
|
6,161 |
|
|
|
23,518 |
|
|
|
23,421 |
|
Total operating expenses |
|
45,625 |
|
|
|
44,644 |
|
|
|
170,427 |
|
|
|
163,149 |
|
Income from operations |
|
16,266 |
|
|
|
11,845 |
|
|
|
53,079 |
|
|
|
33,388 |
|
Non-operating income (expense): |
|
|
|
|
|
|
|
||||||||
Interest income |
|
568 |
|
|
|
103 |
|
|
|
1,304 |
|
|
|
409 |
|
Interest and other income (expense), net |
|
(464 |
) |
|
|
(356 |
) |
|
|
(1,667 |
) |
|
|
(2,155 |
) |
Total non-operating income (expense), net |
|
104 |
|
|
|
(253 |
) |
|
|
(363 |
) |
|
|
(1,746 |
) |
Income before income taxes |
|
16,370 |
|
|
|
11,592 |
|
|
|
52,716 |
|
|
|
31,642 |
|
Provision for (benefit from) income taxes |
|
(1,660 |
) |
|
|
864 |
|
|
|
5,808 |
|
|
|
(63,245 |
) |
Net income |
$ |
18,030 |
|
|
$ |
10,728 |
|
|
$ |
46,908 |
|
|
$ |
94,887 |
|
Net income per share: |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.25 |
|
|
$ |
0.14 |
|
|
$ |
0.62 |
|
|
$ |
1.23 |
|
Diluted |
$ |
0.24 |
|
|
$ |
0.13 |
|
|
$ |
0.60 |
|
|
$ |
1.19 |
|
Weighted-average shares used in computing net income per share: |
|
|
|
|
|
|
|
||||||||
Basic |
|
73,560 |
|
|
|
77,548 |
|
|
|
75,528 |
|
|
|
77,046 |
|
Diluted |
|
75,392 |
|
|
|
80,316 |
|
|
|
77,751 |
|
|
|
80,037 |
|
A10 NETWORKS, INC.
|
||||||||||||||||||||||
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|||||||||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|||||||||||||||
GAAP net income |
$ |
18,030 |
|
|
|
$ |
10,728 |
|
|
$ |
46,908 |
|
|
|
$ |
94,887 |
|
|
||||
Non-GAAP items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Stock-based compensation and related payroll tax |
|
|
3,546 |
|
|
|
|
|
3,598 |
|
|
|
|
13,969 |
|
|
|
|
|
15,031 |
|
|
Impairment of investment |
|
|
1,000 |
|
|
|
|
|
— |
|
|
|
|
1,000 |
|
|
|
|
|
— |
|
|
Amortization expense related to acquisition |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
|
505 |
|
|
Global distribution center transition expense |
|
|
— |
|
|
|
|
|
2,117 |
|
|
|
|
— |
|
|
|
|
|
5,063 |
|
|
Tax benefit from amended returns |
|
|
(4,176 |
) |
|
|
|
|
— |
|
|
|
|
(4,176 |
) |
|
|
|
|
— |
|
|
Release of deferred tax asset valuation allowance |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
|
(65,417 |
) |
|
Total non-GAAP items |
|
|
370 |
|
|
|
|
|
5,715 |
|
|
|
|
10,793 |
|
|
|
|
|
(44,818 |
) |
|
Non-GAAP net income (1) |
$ |
|
18,400 |
|
|
|
$ |
|
16,443 |
|
|
$ |
|
57,701 |
|
|
|
$ |
|
50,069 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
GAAP net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Basic |
$ |
0.25 |
|
|
|
$ |
0.14 |
|
|
$ |
0.62 |
|
|
|
$ |
1.23 |
|
|
||||
Diluted |
$ |
0.24 |
|
|
|
$ |
0.13 |
|
|
$ |
0.60 |
|
|
|
$ |
1.19 |
|
|
||||
Non-GAAP items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Stock-based compensation and related payroll tax |
|
|
0.05 |
|
|
|
|
|
0.04 |
|
|
|
|
0.18 |
|
|
|
|
|
0.19 |
|
|
Impairment of investment |
|
|
0.01 |
|
|
|
|
|
— |
|
|
|
|
0.01 |
|
|
|
|
|
— |
|
|
Amortization expense related to acquisition |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
|
0.01 |
|
|
Global distribution center transition expense |
|
|
— |
|
|
|
|
|
0.03 |
|
|
|
|
— |
|
|
|
|
|
0.06 |
|
|
Tax benefit from amended returns |
|
|
(0.06 |
) |
|
|
|
|
— |
|
|
|
|
(0.05 |
) |
|
|
|
|
— |
|
|
Release of deferred tax asset valuation allowance |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
|
(0.82 |
) |
|
Total non-GAAP items |
|
|
— |
|
|
|
|
|
0.07 |
|
|
|
|
0.14 |
|
|
|
|
|
(0.56 |
) |
|
Non-GAAP net income per share: (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Basic |
$ |
0.25 |
|
|
|
$ |
0.21 |
|
|
$ |
0.76 |
|
|
|
$ |
0.65 |
|
|
||||
Diluted |
$ |
0.24 |
|
|
|
$ |
0.20 |
|
|
$ |
0.74 |
|
|
|
$ |
0.63 |
|
|
||||
Weighted average shares used in computing net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Basic |
|
73,560 |
|
|
|
|
77,548 |
|
|
|
75,528 |
|
|
|
|
77,046 |
|
|
||||
Diluted |
|
75,392 |
|
|
|
|
80,316 |
|
|
|
77,751 |
|
|
|
|
80,037 |
|
|
||||
- Net income and earnings per share excluding adjustments are non-GAAP financial measures presented as supplemental financial measures to enable a user of the financial information to understand the impact of these adjustments on reported results. These financial measures should not be considered an alternative to net income, operating income, cash flows provided by operating activities, or any other measure of financial performance or liquidity presented in accordance with U.S. GAAP. Our adjusted net income and earnings per share may not be comparable to similarly titled measures of another company because all companies may not calculate adjusted net income and earnings per share in the same manner.
A10 NETWORKS, INC.
|
|||||||
|
December 31,
|
|
December 31,
|
||||
ASSETS |
|||||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
67,971 |
|
|
$ |
78,925 |
|
Marketable securities |
|
83,018 |
|
|
|
106,117 |
|
Accounts receivable, net of allowances of $32 and $543, respectively |
|
72,928 |
|
|
|
61,795 |
|
Inventory |
|
19,693 |
|
|
|
22,462 |
|
Prepaid expenses and other current assets |
|
13,381 |
|
|
|
14,720 |
|
Total current assets |
|
256,991 |
|
|
|
284,019 |
|
Property and equipment, net |
|
19,743 |
|
|
|
10,692 |
|
Goodwill |
|
1,307 |
|
|
|
1,307 |
|
Deferred tax assets, net |
|
63,183 |
|
|
|
65,773 |
|
Other non-current assets |
|
27,881 |
|
|
|
31,294 |
|
Total assets |
$ |
369,105 |
|
|
$ |
393,085 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|||||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
6,725 |
|
|
$ |
6,852 |
|
Accrued and other liabilities |
|
37,183 |
|
|
|
36,101 |
|
Deferred revenue, current |
|
74,340 |
|
|
|
73,132 |
|
Total current liabilities |
|
118,248 |
|
|
|
116,085 |
|
Deferred revenue, non-current |
|
52,652 |
|
|
|
48,499 |
|
Other non-current liabilities |
|
17,193 |
|
|
|
19,613 |
|
Total liabilities |
|
188,093 |
|
|
|
184,197 |
|
Stockholders' equity: |
|||||||
Common stock, $0.00001 par value: 500,000 shares authorized; 87,123 and 84,717 shares issued and 73,738 and 77,423 shares outstanding, respectively |
|
1 |
|
|
|
1 |
|
Treasury stock, at cost: 13,384 and 7,294 shares, respectively |
|
(134,934 |
) |
|
|
(55,677 |
) |
Additional paid-in-capital |
|
466,927 |
|
|
|
446,035 |
|
Dividends paid |
|
(19,802 |
) |
|
|
(3,880 |
) |
Accumulated other comprehensive loss |
|
(726 |
) |
|
|
(229 |
) |
Accumulated deficit |
|
(130,454 |
) |
|
|
(177,362 |
) |
Total stockholders' equity |
|
181,012 |
|
|
|
208,888 |
|
Total liabilities and stockholders' equity |
$ |
369,105 |
|
|
$ |
393,085 |
|
A10 NETWORKS, INC.
|
|||||||
|
Year Ended December 31, |
||||||
|
2022 |
|
2021 |
||||
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
46,908 |
|
|
$ |
94,887 |
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
|
|
|
||||
Depreciation and amortization |
|
7,381 |
|
|
|
8,907 |
|
Stock-based compensation |
|
13,331 |
|
|
|
14,422 |
|
Provision for doubtful accounts and sales returns |
|
166 |
|
|
|
(616 |
) |
Release of deferred tax asset valuation allowance and other adjustments |
|
— |
|
|
|
(64,186 |
) |
Other non-cash items |
|
591 |
|
|
|
1,688 |
|
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
(10,065 |
) |
|
|
(10,399 |
) |
Inventory |
|
2,035 |
|
|
|
(1,826 |
) |
Prepaid expenses and other assets |
|
1,627 |
|
|
|
(2,134 |
) |
Accounts payable |
|
103 |
|
|
|
1,995 |
|
Accrued and other liabilities |
|
(1,338 |
) |
|
|
(5,573 |
) |
Deferred revenue |
|
5,361 |
|
|
|
12,932 |
|
Net cash provided by operating activities |
|
66,100 |
|
|
|
50,097 |
|
Cash flows from investing activities: |
|
|
|
||||
Proceeds from sales of marketable securities |
|
6,252 |
|
|
|
6,865 |
|
Proceeds from maturities of marketable securities |
|
71,045 |
|
|
|
88,790 |
|
Purchases of marketable securities |
|
(55,411 |
) |
|
|
(128,554 |
) |
Purchases of property and equipment |
|
(10,799 |
) |
|
|
(5,171 |
) |
Net cash provided by (used in) investing activities |
|
11,087 |
|
|
|
(38,070 |
) |
Cash flows from financing activities: |
|
|
|
||||
Proceeds from issuance of common stock under employee equity incentive plans |
|
7,038 |
|
|
|
5,764 |
|
Repurchases of common stock |
|
(79,257 |
) |
|
|
(18,267 |
) |
Payments for dividends |
|
(15,922 |
) |
|
|
(3,880 |
) |
Net cash used in financing activities |
|
(88,141 |
) |
|
|
(16,383 |
) |
Net decrease in cash and cash equivalents |
|
(10,954 |
) |
|
|
(4,356 |
) |
Cash and cash equivalents—beginning of period |
|
78,925 |
|
|
|
83,281 |
|
Cash and cash equivalents—end of period |
$ |
67,971 |
|
|
$ |
78,925 |
|
|
|
|
|
||||
Non-cash investing and financing activities: |
|
|
|
||||
Transfers between inventory and property and equipment |
$ |
733 |
|
|
$ |
94 |
|
Purchases of property and equipment included in accounts payable |
$ |
230 |
|
|
$ |
6 |
|
A10 NETWORKS, INC.
|
|||||||||||||||||||||||
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||||||||||
GAAP gross profit |
$ |
61,891 |
|
|
|
$ |
56,489 |
|
|
|
$ |
223,506 |
|
|
|
$ |
196,537 |
|
|
||||
GAAP gross margin |
|
|
79.7 |
% |
|
|
|
|
79.9 |
% |
|
|
|
|
79.7 |
% |
|
|
|
|
78.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation and related payroll tax |
|
|
414 |
|
|
|
|
|
398 |
|
|
|
|
|
1,662 |
|
|
|
|
|
1,733 |
|
|
Global distribution center transition expense |
|
|
— |
|
|
|
|
|
117 |
|
|
|
|
|
— |
|
|
|
|
|
655 |
|
|
Non-GAAP gross profit |
$ |
62,305 |
|
|
|
$ |
57,004 |
|
|
|
$ |
225,168 |
|
|
|
$ |
198,925 |
|
|
||||
Non-GAAP gross margin |
|
|
80.3 |
% |
|
|
|
|
80.7 |
% |
|
|
|
|
80.3 |
% |
|
|
|
|
79.6 |
% |
|
A10 NETWORKS, INC.
|
|||||||||||||||||||||||
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||||||||||
GAAP total operating expenses |
$ |
45,625 |
|
|
|
$ |
44,644 |
|
|
|
$ |
170,427 |
|
|
|
$ |
163,149 |
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation and related payroll tax |
|
|
(3,132 |
) |
|
|
|
|
(3,200 |
) |
|
|
|
|
(12,307 |
) |
|
|
|
|
(13,298 |
) |
|
Amortization expense related to acquisition |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(505 |
) |
|
Global distribution center transition expense |
|
|
— |
|
|
|
|
|
(2,000 |
) |
|
|
|
|
— |
|
|
|
|
|
(4,408 |
) |
|
Non-GAAP total operating expenses |
$ |
42,493 |
|
|
|
$ |
39,444 |
|
|
|
$ |
158,120 |
|
|
|
$ |
144,938 |
|
|
||||
A10 NETWORKS, INC.
|
|||||||||||||||||||||||
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||||||||||
GAAP income from operations |
$ |
16,266 |
|
|
|
$ |
11,845 |
|
|
|
$ |
53,079 |
|
|
|
$ |
33,388 |
|
|
||||
GAAP operating margin |
|
|
21.0 |
% |
|
|
|
|
16.8 |
% |
|
|
|
|
18.9 |
% |
|
|
|
|
13.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation and related payroll tax |
|
|
3,546 |
|
|
|
|
|
3,598 |
|
|
|
|
|
13,969 |
|
|
|
|
|
15,031 |
|
|
Amortization expense related to acquisition |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
505 |
|
|
Global distribution center transition expense |
|
|
— |
|
|
|
|
|
2,117 |
|
|
|
|
|
— |
|
|
|
|
|
5,063 |
|
|
Non-GAAP operating income |
$ |
19,812 |
|
|
|
$ |
17,560 |
|
|
|
$ |
67,048 |
|
|
|
$ |
53,987 |
|
|
||||
Non-GAAP operating margin |
|
|
25.5 |
% |
|
|
|
|
24.8 |
% |
|
|
|
|
23.9 |
% |
|
|
|
|
21.6 |
% |
|
A10 NETWORKS, INC.
|
|||||||||||||||||||||||
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||||||||||
GAAP net income |
$ |
18,030 |
|
|
|
$ |
10,728 |
|
|
|
$ |
46,908 |
|
|
|
$ |
94,887 |
|
|
||||
GAAP net income margin |
|
|
23.2 |
% |
|
|
|
|
15.2 |
% |
|
|
|
|
16.7 |
% |
|
|
|
|
37.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Exclude: Interest and other (income) expense, net |
|
|
(104 |
) |
|
|
|
|
253 |
|
|
|
|
|
363 |
|
|
|
|
|
1,746 |
|
|
Exclude: Depreciation and amortization |
|
|
2,473 |
|
|
|
|
|
1,863 |
|
|
|
|
|
8,012 |
|
|
|
|
|
8,907 |
|
|
Exclude: Provision for (benefit from) income taxes |
|
|
(1,660 |
) |
|
|
|
|
864 |
|
|
|
|
|
5,808 |
|
|
|
|
|
(63,245 |
) |
|
EBITDA |
|
|
18,739 |
|
|
|
|
|
13,708 |
|
|
|
|
|
61,091 |
|
|
|
|
|
42,295 |
|
|
Exclude: Stock-based compensation and related payroll tax |
|
|
3,546 |
|
|
|
|
|
3,598 |
|
|
|
|
|
13,969 |
|
|
|
|
|
15,031 |
|
|
Exclude: Global distribution center transition expense |
|
|
— |
|
|
|
|
|
2,117 |
|
|
|
|
|
— |
|
|
|
|
|
5,063 |
|
|
Adjusted EBITDA |
$ |
22,285 |
|
|
|
$ |
19,423 |
|
|
|
$ |
75,060 |
|
|
|
$ |
62,389 |
|
|
||||
Adjusted EBITDA margin |
|
|
28.7 |
% |
|
|
|
|
27.5 |
% |
|
|
|
|
26.8 |
% |
|
|
|
|
25.0 |
% |
|
A10 NETWORKS, INC.
|
|||||||||||||||||||||||
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||||||||||
Adjusted EBITDA |
$ |
22,285 |
|
|
|
$ |
19,423 |
|
|
|
$ |
75,060 |
|
|
|
$ |
62,389 |
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciling items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest and other income (expense), net |
|
104 |
|
|
|
|
(253 |
) |
|
|
|
(363 |
) |
|
|
|
(1,746 |
) |
|
||||
Depreciation and amortization |
|
(2,473 |
) |
|
|
|
(1,863 |
) |
|
|
|
(8,012 |
) |
|
|
|
(8,907 |
) |
|
||||
Provision for (benefit from) income taxes (1) |
|
(2,516 |
) |
|
|
|
(864 |
) |
|
|
|
(9,984 |
) |
|
|
|
(2,172 |
) |
|
||||
Impairment of investment |
|
|
1,000 |
|
|
|
|
|
— |
|
|
|
|
|
1,000 |
|
|
|
|
|
— |
|
|
Amortization expense related to acquisition |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
505 |
|
|
Income tax effect of non-GAAP items (2) |
|
|
(889 |
) |
|
|
|
|
(1,095 |
) |
|
|
|
|
(5,487 |
) |
|
|
|
|
(5,857 |
) |
|
Total |
|
(4,774 |
) |
|
|
|
(4,075 |
) |
|
|
|
(22,846 |
) |
|
|
|
(18,177 |
) |
|
||||
Tax effected non-GAAP net income |
|
17,511 |
|
|
|
|
15,348 |
|
|
|
|
52,214 |
|
|
|
|
44,212 |
|
|
||||
Exclude: Income tax effect of non-GAAP items (2) |
|
889 |
|
|
|
|
1,095 |
|
|
|
|
5,487 |
|
|
|
|
5,857 |
|
|
||||
Non-GAAP net income |
$ |
18,400 |
|
|
|
$ |
16,443 |
|
|
|
$ |
57,701 |
|
|
|
$ |
50,069 |
|
|
||||
- In addition to provision for (benefit from) income taxes, includes tax benefit from amended returns of $4,176 thousand in the three months and year ended December 31, 2022 and release of deferred tax asset valuation allowance of $65,417 thousand in the year ended December 31, 2021.
- For the three months and year ended December 31, 2022 this represents the tax impact using estimated non-GAAP profit before tax rates of 4.8% and 9.5%, respectively. For the three months and year ended December 31, 2021 this represents the tax impact using estimated non-GAAP profit before tax rates of 6.7% and 11.7%, respectively.
A10 NETWORKS, INC.
|
|||||||
|
Three Months Ended |
|
|||||
|
September 30, 2022 |
|
September 30, 2021 |
|
|||
GAAP net income |
$ |
12,113 |
|
$ |
74,886 |
|
|
Non-GAAP items: |
|
|
|
|
|||
Stock-based compensation and related payroll tax |
|
3,798 |
|
|
4,201 |
|
|
Global distribution center transition expense |
|
— |
|
|
(1 |
) |
|
Release of deferred tax asset valuation allowance |
|
— |
|
|
(65,417 |
) |
|
Total non-GAAP items |
|
3,798 |
|
|
(61,217 |
) |
|
Non-GAAP net income (1) |
$ |
15,911 |
|
$ |
13,669 |
|
|
|
|
|
|
|
|||
GAAP net income per share: |
|
|
|
|
|||
Basic |
$ |
0.16 |
|
$ |
0.97 |
|
|
Diluted |
$ |
0.16 |
|
$ |
0.94 |
|
|
Non-GAAP items: |
|
|
|
|
|||
Stock-based compensation and related payroll tax |
|
0.04 |
|
|
0.05 |
|
|
Global distribution center transition expense |
|
— |
|
|
— |
|
|
Release of deferred tax asset valuation allowance |
|
— |
|
|
(0.82 |
) |
|
Total non-GAAP items |
|
0.04 |
|
|
(0.77 |
) |
|
Non-GAAP net income per share: (1) |
|
|
|
|
|||
Basic |
$ |
0.21 |
|
$ |
0.18 |
|
|
Diluted |
$ |
0.20 |
|
$ |
0.17 |
|
|
Weighted average shares used in computing net income per share: |
|
|
|
|
|||
Basic |
|
75,881 |
|
|
77,149 |
|
|
Diluted |
|
77,679 |
|
|
79,927 |
|
|
- Net income and earnings per share excluding adjustments are non-GAAP financial measures presented as supplemental financial measures to enable a user of the financial information to understand the impact of these adjustments on reported results. These financial measures should not be considered an alternative to net income, operating income, cash flows provided by operating activities, or any other measure of financial performance or liquidity presented in accordance with U.S. GAAP. Our adjusted net income and earnings per share may not be comparable to similarly titled measures of another company because all companies may not calculate adjusted net income and earnings per share in the same manner.
A10 NETWORKS, INC.
|
||||||||||||
|
|
Year Ended December 31, |
||||||||||
|
|
2020 |
|
2019 |
||||||||
GAAP net income |
|
$ |
17,816 |
|
|
|
$ |
(17,819 |
) |
|
||
GAAP net income margin |
|
|
|
7.9 |
% |
|
|
|
|
(8.4 |
) % |
|
|
|
|
|
|
|
|
|
|
||||
Exclude: Interest and other (income) expense, net |
|
|
|
(1,406 |
) |
|
|
|
|
(682 |
) |
|
Exclude: Depreciation and amortization |
|
|
|
11,303 |
|
|
|
|
|
10,028 |
|
|
Exclude: Provision for (benefit from) income taxes |
|
|
|
1,323 |
|
|
|
|
|
1,407 |
|
|
EBITDA |
|
|
|
29,036 |
|
|
|
|
|
(7,066 |
) |
|
Exclude: Stock-based compensation and related payroll tax |
|
|
|
12,817 |
|
|
|
|
|
16,790 |
|
|
Exclude: Litigation and investigation expense (recovery) |
|
|
|
30 |
|
|
|
|
|
(1,066 |
) |
|
Exclude: Non-recurring facilities expense |
|
|
|
795 |
|
|
|
|
|
425 |
|
|
Exclude: Global distribution center transition expense |
|
|
|
2,884 |
|
|
|
|
|
— |
|
|
Exclude: Restructuring expense |
|
|
|
— |
|
|
|
|
|
2,530 |
|
|
Adjusted EBITDA |
|
$ |
45,562 |
|
|
|
$ |
11,613 |
|
|
||
Adjusted EBITDA margin |
|
|
|
20.2 |
% |
|
|
|
|
5.5 |
% |
|
A10 NETWORKS, INC.
|
||||||
|
Year Ended December 31, |
|||||
|
2020 |
|
2019 |
|||
GAAP net income (loss) |
$ |
17,816 |
|
$ |
(17,819 |
) |
Non-GAAP items: |
|
|
|
|||
Stock-based compensation and related payroll tax |
|
12,817 |
|
|
16,790 |
|
Amortization expense related to acquisition |
|
1,011 |
|
|
1,012 |
|
Litigation and investigation expense (recovery) |
|
30 |
|
|
(1,066 |
) |
Non-recurring facilities expense |
|
795 |
|
|
425 |
|
Global distribution center transition expense |
|
2,884 |
|
|
— |
|
Restructuring expense and related taxes |
|
— |
|
|
2,676 |
|
Total non-GAAP items |
|
17,537 |
|
|
19,837 |
|
Non-GAAP net income (1) |
$ |
35,353 |
|
$ |
2,018 |
|
|
|
|
|
|||
GAAP net income (loss) per share: |
|
|
|
|||
Basic |
$ |
0.23 |
|
$ |
(0.23 |
) |
Diluted |
$ |
0.22 |
|
$ |
(0.23 |
) |
Non-GAAP items: |
|
|
|
|||
Stock-based compensation and related payroll tax |
|
0.16 |
|
|
0.22 |
|
Amortization expense related to acquisition |
|
0.01 |
|
|
0.01 |
|
Litigation and investigation expense (recovery) |
|
— |
|
|
(0.01 |
) |
Non-recurring facilities expense |
|
0.01 |
|
|
0.01 |
|
Global distribution center transition expense |
|
0.04 |
|
|
— |
|
Restructuring expense and related taxes |
|
— |
|
|
0.03 |
|
Total non-GAAP items |
|
0.22 |
|
|
0.26 |
|
Non-GAAP net income per share: (1) |
|
|
|
|||
Basic |
$ |
0.45 |
|
$ |
0.03 |
|
Diluted |
$ |
0.44 |
|
$ |
0.03 |
|
Weighted average shares used in computing net income per share: |
|
|
|
|||
Basic |
|
77,776 |
|
|
76,080 |
|
Diluted |
|
80,019 |
|
|
78,487 |
|
- Net income and earnings per share excluding adjustments are non-GAAP financial measures presented as supplemental financial measures to enable a user of the financial information to understand the impact of these adjustments on reported results. These financial measures should not be considered an alternative to net income, operating income, cash flows provided by operating activities, or any other measure of financial performance or liquidity presented in accordance with U.S. GAAP. Our adjusted net income and earnings per share may not be comparable to similarly titled measures of another company because all companies may not calculate adjusted net income and earnings per share in the same manner.