F5 Networks, Inc. (FFIV) Message Board

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Technology Stocks : F5 Networks, Inc. (FFIV)

FFIV 276.57

+2.0%

Feb 6 9:30 AM EST

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To: puborectalis who wrote (926)	5/9/2000 11:51:00 AM
From: Czechsinthemail	Read Replies (1) of 1801

FFIV estimates for Sep fiscal year: Bear Stearns: FY00 $0.70; FY01 $0.94 Chase H&Q: FY01 $0.88 Consensus: FY00 $0.69; FY01 $1.03 Range 5 Analysts: FY00 $0.50-$0.78; FY01 $0.80-$1.28 Some interesting features in the FFIV earnings picture: --Generally revenue estimates are higher, but earnings estimates have come down to reflect increased sales and marketing expenses -- primarily additions to the sales force. Sales & marketing increased to 36% of net revenues; the long term goal is about 2/3 of that. --Greater deferred income primarily due to EXDS -- jumped from $7.6MM to $9.9MM due over next 24 months. --Company added 25 resellers in the most recent quarter, now has 120. --OEM relationship with DELL could provide a material boost to sales and earnings beginning in the Dec quarter (1QFY01) --Major increases in international sales -- they showed 93% sequential growth in the most recent quarter. Their goal is 25% of total sales by 4Q. --Major increases in service revenues -- up 75% from previous quarter. This builds in a recurring revenue stream. My overall sense is that the company's operations seem to be humming. Major increases in sales & marketing appear to be the major reason the company didn't beat earnings estimates in the most recent quarter. Depending on how fast they are able to bring their new hires up to speed, the relatively high sales & marketing expenses may persist through the rest of this year but should be a long-term positive. Meanwhile, the expectations crossbar has been lowered so it should be easier for the company to provide positive surprises and receive analyst upgrades going forward.

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