A Preview Of F5's Wednesday Q1 Earnings Report

F5 Networks, Inc. (NASDAQ: FFIV) is scheduled to report its FQ1 2017 results Wednesday. The company would likely report in-line results, and announce a positive outlook, with new products “fully in place,” Wunderlich’s Matthew S. Robison said in a report. He maintains a Hold rating on the company, with a price target of $130.

Q1 Preview

Robison expects F5 Networks to report its quarterly non-GAAP EPS at $1.94, in line with consensus forecasts, and revenue of $515 million, marginally short of the consensus estimate of $517 million, but within the guidance range.

Product Cycle

The company’s product cycle was scheduled to be completed in 1Q. “With much of the current product cycle in place by the start F1Q17 and all scheduled to have been in place by January, management anticipates sequential product sales growth every quarter this year after the customary first quarter decline,” Robison wrote.

Cisco Systems, Inc. (NASDAQ: CSCO) exited the Application Delivery Controller market several years back. Customers transitioned to F5 Networks, with the company’s endorsement of the Cisco SDN architecture.

“This began during the last product cycle 3+ years ago and is part of the backdrop for management characterizing installed base growth to more than 43k systems from 25k for the last cycle,” the analyst added.

Robison expects security to be “a highlight” of 1Q, especially since this would be the first full quarter of standalone product availability.