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Winners And Losers Of Q1: F5 Networks (NASDAQ:FFIV) Vs The Rest Of The Software Development Stocks


Radek Strnad /
2022/07/01 3:31 am EDT
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Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at F5 Networks (NASDAQ:FFIV), and the best and worst performers in the software development group.

Software is eating the world, as Marc Andreessen says, and there is virtually no industry left that has been untouched by it. That in turn drives increasing demand for tools that help software developers do their jobs, whether it is monitoring critical cloud infrastructure, integrating audio and video functionality or ensuring smooth streaming of content.

The 13 software development stocks we track reported a decent Q1; on average, revenues beat analyst consensus estimates by 3.49%, while on average next quarter revenue guidance was 1.18% above consensus. There has been a stampede out of high valuation technology stocks, but software development stocks held their ground better than others, with share price down 7.61% since earnings, on average.

Weakest Q1: F5 Networks (NASDAQ:FFIV)

While the company initially started in the late 90s by selling hardware appliances, these days F5 (NASDAQ:FFIV) is making software that helps large enterprises ensure their web applications are always available, by distributing network traffic and protecting them from cyber attacks.

F5 Networks reported revenues of $634.2 million, down 1.72% year on year, in line with analyst expectations. It was a weak quarter for the company, with a slow revenue growth and an underwhelming revenue guidance for the next quarter.

“Our strong 40% software growth enabled us to deliver above the midpoint of our revenue guidance and at the top end of our non-GAAP earnings per share guidance for the quarter,” said François Locoh-Donou, F5’s President and CEO.

F5 Networks Total Revenue

The stock is down 20.9% since the results and currently trades at $153.04.

Read our full report on F5 Networks here, it's free.

Best Q1: GitLab (NASDAQ:GTLB)

Founded as an open-source project in 2011, GitLab (NASDAQ:GTLB) is a leading software development tools platform.

GitLab reported revenues of $87.4 million, up 61.7% year on year, beating analyst expectations by 11.8%. It was a very strong quarter for the company, with an impressive beat of analyst estimates and an exceptional revenue growth.

GitLab Total Revenue

GitLab scored the strongest analyst estimates beat among its peers. The stock is up 34.1% since the results and currently trades at $53.47.

Is now the time to buy GitLab? Access our full analysis of the earnings results here, it's free.

Agora (NASDAQ:API)

Founded in 2014 by former engineers at WebEx and based in China, Agora (NASDAQ:API) provides a cloud platform that makes it easy for developers to integrate real-time audio and video functionalities in their apps.

Agora reported revenues of $38.5 million, down 4.08% year on year, beating analyst expectations by 4.27%. It was a weak quarter for the company, with a slow revenue growth and a decline in net revenue retention rate.

Agora had the slowest revenue growth in the group. The company added 36 customers to a total of 2,706. The stock is down 1.18% since the results and currently trades at $6.65.

Read our full analysis of Agora's results here.

Cloudflare (NYSE:NET)

Founded by two grad students of Harvard Business School, Cloudflare (NYSE:NET) is a software as a service platform that helps improve security, reliability and loading times of internet applications and websites.

Cloudflare reported revenues of $212.1 million, up 53.6% year on year, beating analyst expectations by 3.16%. It was a very strong quarter for the company, with an exceptional revenue growth.

The stock is down 44% since the results and currently trades at $43.57.

Read our full, actionable report on Cloudflare here, it's free.

Bandwidth (NASDAQ:BAND)

Started in 1999 by David Morken who was later joined by Henry Kaestner as co-founder in 2001, Bandwidth (NASDAQ:BAND) provides thousands of customers with a software platform that uses its own global network to provide phone numbers, voice, and text connectivity.

Bandwidth reported revenues of $131.3 million, up 15.7% year on year, beating analyst expectations by 4.43%. It was a strong quarter for the company, with accelerating customer growth.

The company added 144 customers to a total of 3,372. The stock is down 28.6% since the results and currently trades at $18.57.

Read our full, actionable report on Bandwidth here, it's free.

The author has no position in any of the stocks mentioned