A10 Networks (ATEN) investor relations material

Strategic evolution and market positioning

• Transitioned from hardware-centric and centralized infrastructure to a unified, distributed technology platform supporting on-prem, cloud, and hybrid environments, now entering the intelligent era focused on AI infrastructure and security at scale.

• Consistent value proposition includes low latency, always-on reliability, embedded security, and world-class customer support, enabling seamless migration and supporting both legacy and next-gen architectures.

• Unified product architecture enables next-generation networking, AI infrastructure, intelligent threat protection, and supports AI-driven workloads such as prompt routing, predictive analytics, and inference security.

• Positioned at the intersection of infrastructure, security, and AI, benefiting from trends like sovereign AI, regulatory-driven infrastructure, and global AI build-outs, with a customer base exceeding 7,000 organizations and trusted by major global brands.

• Differentiation built on deep domain expertise, unified architecture, and proven performance at scale.

Financial performance and guidance

• Achieved FY2025 revenue of $290.6 million (+11% YoY), adjusted EBITDA margin of 29.6%, and non-GAAP EPS of $0.90, surpassing Rule of Forty and 2022 Investor Day targets.

• Security-led revenue now represents over 65% of total revenue, with network security growing from 18% to 35% and next-gen networking from 35% to 37% of revenue (2022–2025), while legacy networking declined.

• Portfolio mix shifted to over 70% next-gen networking and security, with these segments expected to grow 16%-18% and 14%-16% respectively.

• Financial outlook targets 10%-12% revenue growth CAGR and 28%-30%+ adjusted EBITDA margins for 2026–2028, with non-GAAP EPS growth exceeding revenue growth.

• Expanded Adjusted EBITDA margins from mid-single digits in 2019 to nearly 30% in 2025, driven by operating leverage and disciplined cost management.

Capital allocation and growth strategy

• Capital allocation prioritizes organic growth in innovation and go-to-market, followed by shareholder returns and disciplined M&A aligned with strategic direction and next-gen networking and security.

• Maintains a strong balance sheet with $378 million in cash and marketable securities at FY25 end, enabling flexibility for investment and capital returns.

• Share repurchases and dividends have increased over time without compromising investment in high-growth areas; issued $225M convertible senior notes in March 2025 to support growth and acquisitions.

• Growth assumptions are not dependent on service provider recovery; AI infrastructure and security demand are primary drivers, with deal size expansion expected through share-of-wallet growth with existing customers.

• Disciplined execution and dynamic resourcing expected to drive continued margin expansion and shareholder value.