Strong Quarterly Revenue Growth
Revenue grew 13.4% year-over-year to $75.0 million in Q1 FY2026, marking the third quarter in four with double-digit growth and contributing to a trailing 12-month revenue growth of 12.1%.
A10 Networks
· ATEN
April 28th, 2026
Summary
- Earnings Call Date:
- 2026-04-28
- Change Since:
- +21.77%
- Next Earnings Date:
- 2026-07-29
Earnings Call Sentiment
PositiveThe call presents a predominantly positive operational and financial picture: strong revenue and product growth (13.4% and 22.3% YoY), high gross margins (80.6%), robust adjusted EBITDA (30% of revenue) and solid balance sheet metrics, supported by a strategic AI infrastructure win that underscores market relevance. Notable near-term headwinds include supply-chain and memory cost/lead-time pressures, temporary cash-flow timing impacts, regional demand softness (EMEA/APJ), services lagging product growth, and customer concentration (one customer = ~5% of revenue). Management reiterated full-year guidance and emphasized confidence in the long-term operating model while remaining cautious on near-term variability. Overall, the positive financial results and strategic positioning outweigh the manageable near-term challenges.
Company Guidance
A10 reiterated its 2026 guidance: revenue growth of 10%–12%, adjusted EBITDA margins of 28%–30%, and EPS growth of 12%–14%, while saying full‑year free cash flow is expected to expand year‑over‑year; that outlook is supported by Q1 results of $75.0M revenue (13.4% YoY), product revenue $44.0M (59% of total, +22.3% YoY), adjusted EBITDA $22.5M (30% of revenue), non‑GAAP gross margin 80.6%, operating margin 25.2%, net income $17.7M, EPS $0.25 basic / $0.24 diluted on 72.9M diluted shares, and trailing‑12‑month revenue growth of 12.1% with TTM adjusted EBITDA margin of 29.7%; balance‑sheet and capital‑return metrics cited included $369.8M cash and marketable securities, $147.2M deferred revenue, $4.3M in cash dividends and $2.5M in share repurchases in Q1, an approved quarterly dividend of $0.06/share (payable June 1, 2026) and $53.4M remaining on a $75M repurchase authorization.
Robust Product Revenue Acceleration
Product revenue was $44.0 million (59% of total), up 22.3% year-over-year, driven primarily by security-led product demand.
Healthy Profitability and Margins
Adjusted EBITDA for the quarter was $22.5 million (30% of revenue) and trailing 12‑month adjusted EBITDA margin was 29.7%, consistent with the company's Rule of 40 objectives. Non-GAAP gross margin was 80.6% and operating margin was 25.2%.
Strong Net Income and EPS
Q1 non-GAAP net income was $17.7 million, producing basic EPS of $0.25 and diluted EPS of $0.24 on a diluted weighted share count of 72.9 million.
Solid Balance Sheet and Shareholder Returns
Cash and marketable securities totaled $369.8 million and deferred revenue was $147.2 million. The company returned $6.8 million to shareholders in the quarter ($4.3M dividends and $2.5M buybacks), announced a $0.06 quarterly dividend, and has $53.4 million remaining on a $75 million repurchase authorization.
Strategic AI Infrastructure Win
A10 was selected as a technology partner on a major AI infrastructure build-out; the customer represented approximately 5% of total revenue in the quarter. Management prioritized inventory and engineering to support the time-sensitive deployment, underscoring strategic relevance to AI infrastructure demand.
Balanced Vertical Performance
Enterprise revenue represented 56% of Q1 revenue and grew (enterprise TTM growth cited at 13%), while service provider revenue comprised 44% (service provider TTM growth cited at 11%), reflecting the company’s strategic shift and cross-segment relevance to AI and next-gen networking.
Reiterated Full‑Year Guidance
Management reiterated 2026 outlook: revenue growth guidance of 10%–12%, adjusted EBITDA margins of 28%–30%, and EPS growth of 12%–14%, indicating confidence in the business model and long-term operating plan.
Operator
Greetings. Welcome to the A10 Networks First Quarter 2026 Financial Results Conference Call. [Operator Instructions] I will now turn the conference over to your host, Tom Baumann. Sir, you may begin.
Tom Baumann
Thank you, and thank you all for joining us today. This call is being recorded and webcast live and may be accessed for at least 90 days via the A10 Networks website at a10networks.com. Hosting the call today are Dhrupad Trivedi, A10's President and CEO; and CFO, Michelle Caron. Before we begin, I would like to remind you that shortly after the market closed today, A10 Networks issued a press release announcing its first quarter 2026 financial results. Additionally, A10 published a presentation and supplemental trended financial statements. You may access the press release, presentation and trended financial statements on the Investor Relations section of the company's website. During the course of today's call, management will make forward-looking statements, including statements regarding projections for future operating results, demand, industry and customer trends, macroeconomic factors, strategy, potential new products and solutions, our capital allocation strategy, profitability, expenses and investments, positioning and our dividend program. These statements are based on current expectations and beliefs as of today, April 28, 2026.
These forward-looking statements involve a number of risks and uncertainties, some of which are beyond our control that could cause actual results to differ materially, and you should not rely on them as predictions of future events. A10 does ...
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