F5, Inc. reports results on Tuesday 27 October, after the market closes. Revenue over the twelve months to Q3 2026 was $3.3 billion, which rose 9.4% on the year before.
What analysts expect
Analysts have been raising their forecasts going into the report. For the quarter, the analysts’ average EPS estimate is $4.26, in a range from $4.20 to $4.47. The average revenue estimate for the quarter is $885.1 million. Meanwhile, the analysts’ average estimate for full-year EPS is $17.33, which would be up 9.6% on last year (based on 10 analysts). That estimate has risen 5.1% over the past 90 days. Of the analysts’ recommendations, 5 are positive, 7 neutral and 1 negative.
Company guidance
In its latest earnings release, management set fiscal year 2026 non-GAAP earnings per share guidance at $17.21 to $17.33. In its latest earnings release, management set fourth quarter of fiscal year 2026 non-GAAP earnings per diluted share guidance at $4.14 to $4.26. At the same time, in its latest earnings release, management set fourth quarter of fiscal year 2026 revenue guidance at $870.0 million to $890.0 million.
Earnings surprise model
The model estimates EPS could land above the analysts’ average estimate by 7.8%. Its estimated chance of an EPS beat is 75.0%, based on the last 4 quarters. The model shrinks the median recent surprise toward zero and uses a neutral prior for beat frequency; this small sample is a reference estimate, not company guidance.
Track record against estimates
The company reported EPS above the analysts’ average estimate in 4 of the last 4 quarters. Last quarter, EPS of $4.73 compared with an estimate of $4.00, above it by 18.2%.
The trends going in
That growth rate was down 0.3 percentage points on the rate a quarter earlier. The trailing gross margin was 81.9%. The trailing operating margin was 24.5%, down 0.3 percentage points from a year earlier. The trailing net margin was 22.0%. Net income over the twelve months was $726.5 million, which rose 8.9% on the year before.
Where the cash went
Investment is rising faster than operating cash flow, squeezing what is left for shareholders. Operating cash flow over the twelve months was $1.0 billion, up 6.2% on the year before. Capital spending was $79.8 million, or 2.4% of revenue. Free cash flow, operating cash flow less capital spending, was $969.6 million, up 1.5% on the year before. Free cash flow was 29.3% of revenue (the free-cash-flow margin), down 2.3 percentage points from a year earlier. The average diluted share count fell 1.7% over the year.
In context
Measured against its own history: today’s free-cash-flow margin of 29.3% is higher than 39% of the company’s own past quarterly readings, which have ranged from 15.2% to 34.4%. Today’s operating margin of 24.5% is higher than 38% of past readings (14.1% to 31.1%). Today’s twelve-month revenue growth rate of 9.4% is higher than 67% of past readings (−1.1% to 41.2%).
Questions this report will answer
Whether the slowdown in revenue growth continues. Whether results land above or below the analysts’ expectations set out above. Meanwhile, Whether margins hold at the trailing levels above. The next filing will show whether the trends above continue, slow or reverse.
What it means for our valuation
These trends feed directly into what the shares are worth in our model. In our model, growth 5 percentage points lower would lower the value by 23.2%, and 5 percentage points higher would raise it by 30.1%. A free-cash-flow margin 1 percentage point lower would lower it by 3.2%.
