A10 Networks, Inc. - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - April 27, 2017

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EXHIBIT 99.1
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A10 Networks, Inc. Reports First Quarter 2017 Financial Results

SAN JOSE, Calif., April 27, 2017 -- A10 Networks, Inc. (NYSE: ATEN), a Secure Application Services™ company, today announced financial results for its first quarter ended March 31, 2017.

First Quarter 2017 Financial Summary
•
Revenue of $60.3 million, grew 12 percent year-over-year
•
GAAP net loss of $3.9 million or $0.06 per share
•
Non-GAAP net income of $0.7 million or $0.01 per share

A reconciliation between GAAP and non-GAAP information is contained in the financial statements below.

“The first quarter was a solid start to the year with revenue growth driven by our security and cloud-focused solutions gaining momentum among cloud provider, service provider and web-scale customers,” said Lee Chen, president and chief executive officer of A10 Networks. “We believe the cloud presents a long-term growth opportunity for A10, and we are focused on bringing new solutions to market that give customers the visibility, agility, flexibility and security they need for their cloud deployments.”

Prepared Materials and Conference Call Information
A10 Networks has made available a presentation with management’s prepared remarks on its first quarter 2017 financial results. These materials are accessible from the “Investors” section of the A10 Networks website at investors.a10networks.com.

A10 Networks will host a conference call today at 4:30 p.m. Eastern time / 1:30 p.m. Pacific time for analysts and investors to discuss its first quarter 2017 results and outlook for its second quarter of 2017. Open to the public, investors may access the call by dialing +1-844-792-3728 or +1-412-317-5105. A live audio webcast of the conference call will be accessible from the “Investors” section of the A10 Networks’ website at investors.a10networks.com. The webcast will be archived for a period of one year. A telephonic replay of the conference call will be available one hour after the call, will run for five business days, and may be accessed by dialing +1-877-344-7529 or +1-412-317-0088 and entering the passcode 10103323. The press release and supplemental financials will be accessible from the A10 Networks’ website prior to the commencement of the conference call.

Forward-Looking Statements
This press release contains “forward-looking statements,” including statements regarding our belief the cloud presents a long-term growth opportunity for A10, and our ability to bring new solutions to market that give customers the visibility, agility, flexibility and security they need for their cloud deployments. Forward-looking statements are subject to known and unknown risks and uncertainties and are based on assumptions that may prove to be incorrect, which could cause actual results to differ materially from those expected or implied by the forward-looking statements. Factors that may cause actual results to differ include the continued market adoption of our products, our ability to successfully anticipate market needs and opportunities, our timely




development of new products and features, any loss or delay of expected purchases by our largest end-customers, our ability to attract and retain new end-customers, continued growth in markets relating to network security, our ability to hire, retain and motivate qualified personnel, the success of any future acquisitions or investments in complementary companies, products, services or technologies and the ability to successfully integrate acquisitions such as Appcito, the ability of our sales team to execute well, our ability to shorten our close cycles, the ability of our channel partners to sell our products, our ability to achieve or maintain profitability while continuing to invest in our sales, marketing and research and development teams, variations in product mix or geographic locations of our sales and risks associated with our presence in international markets.

Non-GAAP Financial Measures
In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables contain certain non-GAAP financial measures, including non-GAAP net income (loss). Non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures presented by other companies.

A10 Networks considers these non-GAAP financial measures to be important because they provide useful measures of the operating performance of the company, exclusive of unusual events or factors that do not directly affect what we consider to be our core operating performance, and are used by the company's management for that purpose. We define non-GAAP net income (loss) as our net income (loss) excluding: (i) stock-based compensation ii) amortization expense related to acquisition and (iii) amounts paid in settlement of litigation, and other legal expenses associated with these settlements.

We have included non-GAAP net income (loss) in this press release. Non-GAAP financial measures are presented for supplemental informational purposes only for understanding the company's operating results. The non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from non-GAAP financial measures presented by other companies. Please see the reconciliation of non-GAAP financial measures to the most directly comparable GAAP measure attached to this release.


About A10 Networks
A10 Networks (NYSE: ATEN) is a Secure Application Services™ company, providing a range of high-performance application networking solutions that help organizations ensure that their data center applications and networks remain highly available, accelerated and secure. Founded in 2004, A10 Networks is based in San Jose, Calif., and serves customers globally with offices worldwide. For more information, visit: www.a10networks.com and @A10Networks.

Investor Contact:
Maria Riley
The Blueshirt Group
415-217-7722
investors@a10networks.com

or

Media Contact:
Ben Stricker
A10 Networks
+1-408-325-8616
bstricker@a10networks.com
Source: A10 Networks, Inc






A10 NETWORKS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share amounts)

 
Three Months Ended March 31,
 
2017
 
2016
Revenue:
 
 
 
Products
$
39,706

 
$
36,374

Services
20,580

 
17,430

Total revenue
60,286

 
53,804

Cost of revenue:
 

 
 

Products
9,784

 
8,698

Services
4,360

 
4,529

Total cost of revenue
14,144

 
13,227

Gross profit
46,142

 
40,577

Operating expenses:
 

 
 

Sales and marketing
26,263

 
26,768

Research and development
17,042

 
14,777

General and administrative
7,161

 
6,661

Litigation expense
—

 
1,791

Total operating expenses
50,466

 
49,997

Loss from operations
(4,324
)
 
(9,420
)
Other income (expense), net:
 

 
 

Interest expense
(44
)
 
(126
)
Interest and other income (expense), net
842

 
215

Total other income (expense), net
798

 
89

Loss before income taxes
(3,526
)
 
(9,331
)
Provision for income taxes
374

 
204

Net loss
$
(3,900
)
 
$
(9,535
)
Net loss per share:
 

 
 

Basic and diluted
$
(0.06
)
 
$
(0.15
)
Weighted-average shares used in computing net loss per share:
 
 
 
Basic and diluted
68,571

 
64,309







A10 NETWORKS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Continued)
(unaudited, in thousands, except per share amounts)

 
Three Months Ended March 31,
 
2017
 
2016
GAAP net loss
$
(3,900
)
 
$
(9,535
)
Stock-based compensation
4,316

 
4,612

Amortization expense related to acquisition
252

 
—

Litigation and settlement expense
—

 
836

Non-GAAP net income (loss)
$
668

 
$
(4,087
)
Non-GAAP net income (loss) per share:
 
 
 
Basic and diluted
$
0.01

 
$
(0.06
)
Weighted average shares used in computing non-GAAP net income (loss) per share:
 
 
 
Basic
68,571

 
64,309

Diluted
74,312

 
64,309







A10 NETWORKS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
 
March 31,
2017
 
December 31,
2016
ASSETS
Current Assets:
 
 
 
Cash and cash equivalents
$
30,580

 
$
28,975

Marketable securities
85,595

 
85,372

Accounts receivable, net of allowances
61,842

 
66,755

Inventory
16,509

 
15,070

Prepaid expenses and other current assets
6,210

 
5,137

Total current assets
200,736

 
201,309

Property and equipment, net
8,131

 
8,219

Goodwill and intangible assets
7,579

 
7,940

Other non-current assets
4,569

 
3,870

Total Assets
$
221,015

 
$
221,338

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
 
 
 
Accounts payable
$
8,522

 
$
9,851

Accrued liabilities
29,887

 
31,525

Deferred revenue, current
58,780

 
61,334

Total current liabilities
97,189

 
102,710

Deferred revenue, non-current
34,325

 
31,574

Other non-current liabilities
912

 
988

Total Liabilities
132,426

 
135,272

Stockholders’ Equity:
 
 
 
Common stock and additional paid-in-capital
335,494

 
328,870

Accumulated other comprehensive loss
(46
)
 
(45
)
Accumulated deficit
(246,859
)
 
(242,759
)
Total Stockholders' Equity
88,589

 
86,066

Total Liabilities and Stockholders' Equity
$
221,015

 
$
221,338







A10 NETWORKS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
 
Three Months Ended March 31,
 
2017
 
2016
Cash flows from operating activities:
 

 
 

Net loss
$
(3,900
)
 
$
(9,535
)
Adjustments to reconcile net loss to net cash provided by operating activities:
 
 
 

Depreciation and amortization
2,202

 
1,906

Stock-based compensation
4,316

 
4,612

Other non-cash items
(278
)
 
276

Changes in operating assets and liabilities:
 

 
.

Accounts receivable, net
5,214

 
15,641

Inventory
(2,222
)
 
772

Prepaid expenses and other assets
(1,699
)
 
(1,167
)
Accounts payable
(1,624
)
 
(824
)
Accrued liabilities
(1,647
)
 
(3,351
)
Deferred revenue
197

 
2,039

Other
(14
)
 
69

Net cash provided by operating activities
545

 
10,438

Cash flows from investing activities:
 

 
 

Purchases of marketable securities
(18,616
)
 
(69,530
)
Proceeds from sales and maturities of marketable securities
18,314

 
214

Purchases of property and equipment
(678
)
 
(1,388
)
Net cash used in investing activities
(980
)
 
(70,704
)
Cash flows from financing activities:
 

 
 

Proceeds from issuance of common stock under employee equity incentive plans, net of repurchases
2,065

 
370

Other
(25
)
 
(25
)
Net cash provided by financing activities
2,040

 
345

Net increase (decrease) in cash and cash equivalents
1,605

 
(59,921
)
Cash and cash equivalents - beginning of period
28,975

 
98,117

Cash and cash equivalents - end of period
$
30,580

 
$
38,196




A10 Networks, Inc. Reports