Application security company F5 Networks delivered better-than-expected Q1 financial results, reporting non-GAAP net income of $179 million, or $2.89 per diluted share, and a GAAP revenue of $687 million. But the company warned it may have supply chain constraints throughout 2022.
F5 attributed the Q1 revenue growth to a 19% increase in product revenue and a 2% increase in global services revenue growth compared to Q1 2021. F5 saw non-GAAP product revenue grow due to a 47% increase in software revenue and a 1% increase in systems revenue.
F5 expects to deliver Q2 revenue in the range of $610 to $650 million. François Locoh-Donou, F5's president and CEO, said the company saw strong demand for their application security and delivery solutions, leading to the 10% revenue growth in Q1.
"Demand for software solutions was particularly strong, with non-GAAP software revenue growing 47% compared to the same period in the prior year," Locoh-Donou said.
"Demand drivers across our business are as strong as they have ever been. Customers increasingly see F5 as an innovator uniquely equipped to help them build and scale both their traditional and modern application environments with our software- and systems-based solutions."
Deeper into the earnings report, the company said it expects its ability to "meet customers' continued strong demand for systems will be restricted by supply chain constraints for the remainder of fiscal year 2022."
The company is expecting fiscal year 2022 revenue growth to be in the range of 4.5% to 8%, down from previous expectation of 8% to 9% growth.
The report sent F5 shares down 14% in after-hours trading.
Last year, the company announced that it would acquire distributed multi-cloud application security and load-balancing software company Volterra of Santa Clara, California. F5 Networks also announced that it is acquiring cloud security company Threat Stack for $68 million.