(FFIV) 2023 Q2 法說會逐字稿

Good afternoon, and welcome to the F5, Inc. Second Quarter Fiscal 2023 Financial Results Conference Call. (Operator Instructions). Also, today's conference is being recorded. (Operator Instructions). I will now turn the call over to Ms. Suzanne DuLong. Thank you, ma'am. You may begin.

下午好，歡迎參加 F5, Inc. 2023 財年第二季度財務業績電話會議。 （操作員說明）。另外，今天的會議正在錄製中。 （操作員說明）。我現在將電話轉給 Suzanne DuLong 女士。謝謝你，女士。你可以開始了。

Hello, and welcome. I'm Suzanne DuLong, F5's Vice President of Investor Relations. Francois Locoh-Donou, F5's President and CEO; and Frank Pelzer, F5's Executive Vice President and CFO, will be making prepared remarks on today's call. Other members of the F5 executive team are also on hand to answer questions during the Q&A session. A copy of today's press release is available on our website at f5.com, where an archived version of today's audio will be available through July 24, 2023. The slide deck accompanying today's discussion is viewable on the webcast and will be posted to our IR site at the conclusion of the call.

你好，歡迎光臨。我是 F5 投資者關係副總裁 Suzanne DuLong。 F5 總裁兼首席執行官 Francois Locoh-Donou； F5 執行副總裁兼首席財務官 Frank Pelzer 將在今天的電話會議上發表事先準備好的講話。 F5 執行團隊的其他成員也將在問答環節現場回答問題。今天新聞稿的副本可在我們的網站 f5.com 上獲得，今天音頻的存檔版本將在 2023 年 7 月 24 日之前提供。今天討論的幻燈片可在網絡廣播中查看，並將發佈到我們的 IR通話結束時的網站。

To access the replay of today's webcast by phone, dial (877) 660-6853 or (201) 612-7415 and use meeting ID 1373-7373. The telephonic replay will be available through midnight Pacific Time, April 20, 2023. For additional information or follow-up questions, please reach out to me directly at s.dulong@f5.com.

要通過電話重播今天的網絡廣播，請撥打 (877) 660-6853 或 (201) 612-7415 並使用會議 ID 1373-7373。電話重播將在 2023 年 4 月 20 日太平洋時間午夜之前提供。有關其他信息或後續問題，請直接通過 s.dulong@f5.com 與我聯繫。

Our discussion today will contain forward-looking statements, which include words such as believe, anticipate, expect and target. These forward-looking statements involve uncertainties and risks that may cause our actual results to differ materially from those expressed or implied by these statements. We have summarized factors that may affect our results in the press release announcing our financial results and in detail in our SEC filings.

我們今天的討論將包含前瞻性陳述，其中包括相信、預期、預期和目標等詞語。這些前瞻性陳述涉及不確定性和風險，可能導致我們的實際結果與這些陳述明示或暗示的結果存在重大差異。我們在宣布我們財務業績的新聞稿中總結了可能影響我們業績的因素，並在我們提交給美國證券交易委員會的文件中進行了詳細說明。

In addition, we will reference non-GAAP metrics during today's discussion. Please see our full GAAP to non-GAAP reconciliation in today's press release and in the appendix of our earnings slide deck. Please note that F5 has no duty to update any information presented in this call. With that, I will turn the call over to Francois.

此外，我們將在今天的討論中引用非 GAAP 指標。請在今天的新聞稿和收益幻燈片的附錄中查看我們完整的 GAAP 與非 GAAP 對賬。請注意，F5 沒有義務更新此電話中提供的任何信息。有了這個，我會把電話轉給弗朗索瓦。

Thank you, Suzanne, and hello, everyone. Thank you for joining us today. Our team delivered second quarter revenue at the midpoint of our guidance range and earnings per share above the high end of our range. These results come despite persistent macro uncertainty, which has led to broader and more severe customer budget scrutiny, impacting both our software and hardware demand. We have strong conviction that customers' constrained spending is a temporary headwind and that we are well positioned as a trusted and innovative partner for customers as they look to secure, scale, modernize and simplify their hybrid and multi-cloud application environments.

謝謝你，蘇珊娜，大家好。感謝您今天加入我們。我們的團隊在我們指導範圍的中點實現了第二季度收入，每股收益高於我們範圍的高端。儘管宏觀不確定性持續存在，但這些結果還是出現了，這導致了更廣泛和更嚴格的客戶預算審查，影響了我們的軟件和硬件需求。我們堅信，客戶的支出受限是暫時的不利因素，我們有能力成為客戶值得信賴的創新合作夥伴，因為他們希望保護、擴展、現代化和簡化他們的混合和多雲應用程序環境。

In my remarks today, I will speak to the quarter's results, the near-term spending dynamics we are seeing and why we remain confident in our positioning and growth opportunities longer term. First, on our Q2 performance. We delivered 11% revenue growth in Q2 as a result of stronger-than-expected system shipments and strong maintenance renewals. Our systems revenue grew 43%.

在我今天的發言中，我將談到本季度的結果、我們看到的近期支出動態以及為什麼我們對我們的定位和長期增長機會保持信心。首先，關於我們第二季度的表現。由於強於預期的系統出貨量和強勁的維護更新，我們在第二季度實現了 11% 的收入增長。我們的系統收入增長了 43%。

As positive as this is for the quarter, it is more a reflection of our team completing comprehensive board redesign efforts ahead of plan than it is a demand marker. You will recall that last year, rather than just wait for supply chain to improve, we initiated multiple board redesigns with a goal of designing out the hardest-to-get components and opening up new supply. The successful completion of this work is making it possible for us to fulfill waiting customer orders sooner than we anticipated. And as expected, we have seen no order cancellations in the process.

儘管這對本季度來說是積極的，但它更多地反映了我們的團隊提前完成了全面的董事會重新設計工作，而不是需求指標。您會記得去年，我們不是僅僅等待供應鏈改善，而是啟動了多個電路板重新設計，目標是設計出最難獲得的組件並開闢新的供應。這項工作的成功完成使我們能夠比預期更快地完成等待中的客戶訂單。正如預期的那樣，我們在此過程中沒有看到訂單取消。

Our Global Services revenue grew 8%, driven by continued strong renewal rates, which improved across nearly all cohorts. Wrapping up our Q2 results, we also delivered OpEx within guidance and non-GAAP EPS of $2.53 per share, above the top end of our guidance range. So the quarter's results were strong, but they obscure underlying customer spending patterns. Since our December quarter, we have seen customers scrutinizing budgets and deferring spend for anything except the most urgent projects.

在持續強勁的續訂率的推動下，我們的全球服務收入增長了 8%，幾乎所有隊列的續訂率都有所提高。總結我們的第二季度業績，我們還交付了指導範圍內的運營支出和每股 2.53 美元的非 GAAP 每股收益，高於我們指導範圍的上限。因此，本季度的業績強勁，但掩蓋了潛在的客戶支出模式。自我們 12 月的季度以來，我們已經看到客戶仔細審查預算並推遲除最緊急項目以外的任何事情的支出。

These dynamics were even more pronounced in Q2 when we saw previously approved projects going through multiple additional levels of approvals. In some cases, approvals are reaching the C-suite or Board level only to be delayed or downsized. The impact of this extreme spending caution is most evident in our Q2 software revenue, which declined 13% year-over-year. This was well below our expectations for the year and our long-term growth expectations. We believe there are several reasons why we are seeing this kind of impact in our software revenue. These include the relative size of the software projects we tend to be involved in and the percentage of our software revenue derived from term subscriptions.

當我們看到之前批准的項目經過多個額外級別的批准時，這些動態在第二季度更加明顯。在某些情況下，批准到達 C-suite 或董事會級別只是被延遲或縮減。這種極端支出謹慎的影響在我們第二季度的軟件收入中最為明顯，同比下降 13%。這遠低於我們對今年的預期和我們的長期增長預期。我們認為，我們在軟件收入中看到這種影響有幾個原因。這些包括我們傾向於參與的軟件項目的相對規模以及來自定期訂閱的軟件收入的百分比。

First, the majority of our software growth to date has come from transformational type projects of size, often 6- or 7-figure deals. We are seeing larger projects come under more scrutiny, resulting in delays, sometimes by multiple quarters or downsizing into smaller, more incremental additions. Second, the majority of our software revenue comes from term-based subscriptions, which have upfront revenue recognition. As a result, when we see a decline in new term-based subscriptions as we have in the last few quarters, it is immediately evident in our software revenue and much more so than it would be if our software was predominantly ratable or fast driven.

首先，迄今為止，我們的大部分軟件增長都來自規模較大的轉型型項目，通常是 6 或 7 位數的交易。我們看到更大的項目受到更多的審查，導致延遲，有時是多個季度或縮減為更小、更多的增量添加。其次，我們的大部分軟件收入來自基於期限的訂閱，這些訂閱具有預先的收入確認。因此，當我們看到過去幾個季度新的基於期限的訂閱有所下降時，我們的軟件收入會立即顯現出來，而且比我們的軟件主要是評級或快速驅動時要多得多。

Now there is some good news to point to in software. We have a base of software renewals, which is growing. Our renewal consist primarily of second term multiyear term subscriptions. And similar to Q1, in Q2, our software renewals performed largely as expected. In addition, our SaaS and managed services revenue is growing and we expect it will become a more significant and predictable contributor to our software revenue over time.

現在在軟件方面有一些好消息要指出。我們有一個不斷增長的軟件更新基礎。我們的續訂主要包括第二期多年期訂閱。與第一季度類似，在第二季度，我們的軟件更新表現基本符合預期。此外，我們的 SaaS 和託管服務收入正在增長，我們預計隨著時間的推移它將成為我們軟件收入的更重要和更可預測的貢獻者。

The spending patterns I have described were not limited to our software demand. We also experienced softer systems demand in the quarter as customers push the capacity of their existing systems, sweat their assets and work to deploy delivered systems into production. We expect these headwinds on both software and systems will persist at least through the end of this fiscal year. As a result, we now expect low to mid-single-digit revenue growth for FY '23. This is down from the 9% to 11% growth we previously forecasted.

我所描述的支出模式並不局限於我們的軟件需求。隨著客戶提升現有系統的容量，耗費他們的資產並努力將交付的系統部署到生產中，我們在本季度也經歷了疲軟的系統需求。我們預計這些軟件和系統方面的不利因素至少會持續到本財年末。因此，我們現在預計 23 財年的收入將實現中低個位數增長。這低於我們之前預測的 9% 至 11% 的增長率。

I will now speak to my third point, why we are confident that the current demand environment is temporary and why we are uniquely positioned to help customers simplify their hybrid multi-cloud challenges. We are confident that current demand levels are temporary for several reasons. First, because of the direct commentary we are getting from customers. Customers are telling us that the delays we are seeing are a matter of budgets and approvals, not competitive pressures or architectural shifts. During Q2, I met personally with roughly 100 customers and partners. It was clear from my discussions with customers that they expect F5 will be a key part of their future hybrid and multi-cloud architectures as the only company capable of securing and delivering applications and APIs in all environments. Partners, too, are leaning into the new F5 and our rapidly expanding set of distributed cloud services are accelerating that movement.

我現在要談談我的第三點，為什麼我們相信當前的需求環境是暫時的，以及為什麼我們具有獨特的優勢來幫助客戶簡化他們的混合多雲挑戰。由於多種原因，我們相信當前的需求水平是暫時的。首先，由於我們從客戶那裡得到的直接評論。客戶告訴我們，我們看到的延遲是預算和審批的問題，而不是競爭壓力或架構轉變。在第二季度，我親自會見了大約 100 位客戶和合作夥伴。從我與客戶的討論中可以清楚地看出，他們希望 F5 成為他們未來混合和多雲架構的關鍵部分，因為它是唯一一家能夠在所有環境中保護和交付應用程序和 API 的公司。合作夥伴也傾向於使用新的 F5，而我們快速擴展的分佈式雲服務集正在加速這一進程。

Second, because of our win rates. While the direct customer commentary is reassuring, we also consistently analyze our win rates. When we look at the first half of FY '23 compared to the first half of FY '22, we see broadly steady win rates across our theaters and product lines, confirming we continue to win our fair share of the deals we are involved in. Third, our factored pipeline, which accounts for the probability of a deal closing is up from where it's been in the last couple of quarters, suggesting customer activity is increasing and deals are reaching a higher level of maturity. This too is encouraging. But given what we have seen in the first half, we believe it is prudent to remain conservative on expected conversion of this factor pipeline.

其次，因為我們的勝率。雖然直接的客戶評論令人放心，但我們也始終如一地分析我們的贏率。當我們將 23 財年上半年與 22 財年上半年進行比較時，我們看到我們的影院和產品線的贏率大致穩定，這證實我們繼續贏得我們所參與交易的公平份額。第三，我們考慮交易完成概率的因素管道比過去幾個季度有所上升，這表明客戶活動正在增加，交易正在達到更高的成熟度。這也令人鼓舞。但鑑於我們在上半年所看到的情況，我們認為對這一因素管道的預期轉換保持保守是謹慎的。

Fourth, our strong maintenance renewal signal customers are delaying purchasing decisions by sweating assets. We see this in the substantial attach rate increase on all the deployments where you would expect the behavior of sweating assets would be most pronounced. We also are seeing a substantial increase in deferred maintenance revenue compared to prior year trends. This behavior is consistent with what we have seen during past periods of macro uncertainty, with apps and APIs continuing to grow. However, customers can only postpone investment so long if they want those apps and APIs to remain performant and secure.

第四，我們強烈的維護更新信號表明客戶正在通過出汗資產來推遲購買決定。我們在所有部署中看到了顯著的附加率增加，在這些部署中，您預計出汗資產的行為最為明顯。與去年的趨勢相比，我們還看到遞延維護收入大幅增加。這種行為與我們在過去的宏觀不確定時期看到的一致，應用程序和 API 持續增長。但是，如果客戶希望這些應用程序和 API 保持高性能和安全，那麼他們只能推遲這麼長時間的投資。

In the meantime, we are focused on controlling the things we can control, including operating with discipline and ensuring we are prepared for when customer spending resumes. This includes reducing our cost base. We are reducing our global headcount by approximately 620 employees or approximately 9% of our total workforce. We expect these actions, combined with other cost reductions, including rationalizing our technology consumption, applying additional scrutiny to discretionary projects and reducing our facilities footprint will drive ongoing operating leverage. In addition, we are substantially reducing the size of our corporate bonus pool in 2023 and further reducing travel.

與此同時，我們專注於控制我們可以控制的事情，包括遵守紀律並確保我們為客戶消費恢復做好準備。這包括降低我們的成本基礎。我們將在全球範圍內裁員約 620 名員工，約占我們員工總數的 9%。我們預計這些行動與其他成本削減相結合，包括合理化我們的技術消耗、對可自由支配的項目進行額外審查以及減少我們的設施足跡，將推動持續的運營槓桿。此外，我們將在 2023 年大幅縮減公司獎金池的規模，並進一步減少差旅。

As a result, we expect to deliver FY '23 non-GAAP operating margins of approximately 30% and non-GAAP earnings growth of 7% to 11%. Further, the leverage from these cost reductions, combined with our anticipated gross margin improvement, positions us to deliver meaningful non-GAAP operating margin expansion and double-digit non-GAAP earnings growth in FY '24. While customers are spending only were critical near term, they continue to face significant challenges ahead, including creating engaging digital experiences, managing resource constraints and addressing technical debt. Their business velocity and long-term growth will rely on finding ways to connect and protect applications and APIs across distributed environments. With our unique ability to secure and deliver applications and APIs across all environments, we are differentiated in our ability to help customers with these challenges. We believe this position will drive sustainable long-term growth.

因此，我們預計 23 財年非 GAAP 營業利潤率約為 30%，非 GAAP 收益增長 7% 至 11%。此外，這些成本削減的槓桿作用，加上我們預期的毛利率提高，使我們能夠在 24 財年實現有意義的非 GAAP 營業利潤率增長和兩位數的非 GAAP 收益增長。雖然客戶的支出只是近期的關鍵，但他們未來仍將面臨重大挑戰，包括創造引人入勝的數字體驗、管理資源限制和解決技術債務。他們的業務速度和長期增長將依賴於尋找跨分佈式環境連接和保護應用程序和 API 的方法。憑藉我們在所有環境中保護和交付應用程序和 API 的獨特能力，我們在幫助客戶應對這些挑戰的能力方面脫穎而出。我們相信這一立場將推動可持續的長期增長。

As we have evaluated and adjusted our business, in addition to reducing cost, we have also intensified our investments in areas we believe will drive the highest mid- and long-term impact for our customers, including software and hybrid and multi-cloud. Now I will turn the call to Frank. Frank?

在我們評估和調整我們的業務時，除了降低成本外，我們還加強了對我們認為將為我們的客戶帶來最大中長期影響的領域的投資，包括軟件、混合雲和多雲。現在我將把電話轉給弗蘭克。坦率？

Thank you, Francois, and hello, everyone. I will review our Q2 results before I speak to our third quarter outlook and provide additional color on our FY '23 expectations. We delivered Q2 revenue of $703 million, reflecting 11% growth year-over-year. Global Services revenue of $363 million grew a strong 8% due to the high maintenance renewals and the impacts of the price increase introduced in Q4 of last year. Our revenue remained roughly split between Global Services and Product with Global Services representing 52% of total revenue.

謝謝你，弗朗索瓦，大家好。在談到我們的第三季度展望之前，我將回顧我們的第二季度業績，並為我們的 23 財年預期提供更多色彩。我們在第二季度實現了 7.03 億美元的收入，同比增長 11%。全球服務收入為 3.63 億美元，強勁增長 8%，這是由於高維護續訂率和去年第四季度引入的價格上漲的影響。我們的收入大致分為全球服務和產品，全球服務佔總收入的 52%。

Product revenue grew 14% year-over-year, reflecting strong system shipments against an easier comparison in the year ago quarter. As Francois described, our successful redesign efforts enabled systems revenue of $209 million, representing growth of 43% year-over-year. At $132 million, Q2 software revenue was down 13% compared to last year.

產品收入同比增長 14%，反映出強勁的系統出貨量與去年同期相比更為輕鬆。正如 Francois 所描述的，我們成功的重新設計工作使系統收入達到 2.09 億美元，同比增長 43%。第二季度軟件收入為 1.32 億美元，與去年相比下降了 13%。

Let's take a closer look at our software revenue, which is comprised of subscription and perpetual license sales. Subscription-based revenue, which includes term subscriptions, our SaaS offerings and utility-based revenue totaled $109 million or 83% of Q2's total software revenue. Within our Q2 subscription business, as Francois described, new term subscriptions performed significantly below plan in the quarter. In contrast, and similar to last quarter, software renewals continued to perform largely in line with our expectations. Perpetual license sales of $23 million represented 17% of Q2's software revenue. Revenue from recurring sources contributed 65% of Q2's revenue.

讓我們仔細看看我們的軟件收入，它包括訂閱和永久許可銷售。基於訂閱的收入，包括定期訂閱、我們的 SaaS 產品和基於實用程序的收入總計 1.09 億美元，佔第二季度軟件總收入的 83%。正如 Francois 所描述的，在我們第二季度的訂閱業務中，新期限訂閱在本季度的表現明顯低於計劃。相比之下，與上一季度相似，軟件續訂的表現繼續在很大程度上符合我們的預期。 2300 萬美元的永久許可銷售額佔第二季度軟件收入的 17%。來自經常性來源的收入佔第二季度收入的 65%。

This includes subscription-based revenue as well as the maintenance portion of our services revenue. On a regional basis, we saw growth across all theaters, though I'd note that these trends are more reflective of shipments in the quarter than current demand. Revenue from Americas grew 7% year-over-year, representing 54% of total revenue. EMEA grew a strong 22%, representing 27% of revenue, and APAC grew 9%, representing 18% of revenue.

這包括基於訂閱的收入以及我們服務收入的維護部分。在區域基礎上，我們看到所有影院都有增長，但我注意到這些趨勢更多地反映了本季度的出貨量，而不是當前的需求。來自美洲的收入同比增長 7%，佔總收入的 54%。歐洲、中東和非洲地區強勁增長 22%，佔收入的 27%，亞太地區增長 9%，佔收入的 18%。

Looking at our major verticals. During Q2, enterprise customers represented 67% of product bookings, service providers represented 13% and government customers represented 20%, including 6% from U.S. Federal.

看看我們的主要垂直行業。在第二季度，企業客戶佔產品預訂的 67%，服務提供商佔 13%，政府客戶佔 20%，其中 6% 來自美國聯邦。

I will now share our Q2 operating results. GAAP gross margin was 77.9%. Non-GAAP gross margin was 80.4%, in line with our guidance for the quarter. GAAP operating expenses were $441 million. Non-GAAP operating expenses were $374 million, in line with our guided range. Our GAAP operating margin was 15.1%. Our non-GAAP operating margin was 27.2%. Our GAAP effective tax rate for the quarter was 25.1%. Our non-GAAP effective tax rate was 20.8%. Our GAAP net income for the quarter was $81 million or $1.34 per share. Non-GAAP net income was $154 million or $2.53 per share, above the top end of our guided range of $2.36 to $2.48 per share. This reflects improved operating margins from strong cost discipline as well as a benefit to our tax rate in the quarter.

我現在將分享我們第二季度的經營業績。 GAAP 毛利率為 77.9%。非美國通用會計準則毛利率為 80.4%，符合我們對該季度的指引。 GAAP 運營費用為 4.41 億美元。非 GAAP 運營費用為 3.74 億美元，符合我們的指導範圍。我們的 GAAP 營業利潤率為 15.1%。我們的非 GAAP 營業利潤率為 27.2%。我們本季度的 GAAP 有效稅率為 25.1%。我們的非 GAAP 有效稅率為 20.8%。我們本季度的 GAAP 淨收入為 8100 萬美元或每股 1.34 美元。非 GAAP 淨收入為 1.54 億美元或每股 2.53 美元，高於我們指導的每股 2.36 美元至 2.48 美元的上限。這反映了嚴格的成本控制帶來的營業利潤率的提高以及本季度我們的稅率的提高。

I will now turn to cash flow and the balance sheet, which remains very strong. We generated $141 million in cash flow from operations in Q2. Capital expenditures for the quarter were $11 million. DSO for the quarter was 62 days, flat with Q1 and up from historical levels, primarily due to strong service maintenance contract renewals in the quarter and, to a lesser degree, back-end shipping linearity. Cash and investments totaled $760 million at quarter end. We did not repurchase any shares in Q2. We remained out of the market as we analyze the potential impacts of the cost-saving measures we discussed previously as well as the changes we were seeing in the demand environment and its effects on our outlook.

我現在將轉向現金流和資產負債表，它們仍然非常強勁。我們在第二季度的運營中產生了 1.41 億美元的現金流。本季度的資本支出為 1100 萬美元。本季度的 DSO 為 62 天，與第一季度持平，高於歷史水平，這主要是由於本季度強勁的服務維護合同續簽，其次是後端運輸線性度。截至季度末，現金和投資總額為 7.6 億美元。我們沒有在第二季度回購任何股票。在分析我們之前討論的成本節約措施的潛在影響以及我們在需求環境中看到的變化及其對我們前景的影響時，我們仍然置身於市場之外。

Deferred revenue increased 12% year-over-year to $1.8 billion, up from $1.76 billion in Q1. This increase was largely driven by substantially higher maintenance renewals on our installed base of products sold 4-plus years ago.

遞延收入同比增長 12% 至 18 億美元，高於第一季度的 17.6 億美元。這一增長主要是由於我們 4 年多前銷售的產品安裝基礎的維護更新大幅增加。

Finally, we ended the quarter with approximately 7,100 employees. This number does not reflect the reductions we announced today. We expect these headcount reductions will result in annualized savings of approximately $130 million. We expect to incur approximately $45 million in severance and benefits costs and other charges related to these actions in FY '23.

最後，我們在本季度結束時擁有大約 7,100 名員工。這個數字並不反映我們今天宣布的削減。我們預計這些裁員將導致每年節省約 1.3 億美元。我們預計在 23 財年將產生約 4500 萬美元的遣散費和福利費用以及與這些行動相關的其他費用。

I will now share our outlook for Q3. Unless otherwise stated, my guidance comments reference non-GAAP operating metrics. We expect Q3 revenue in the range of $690 million to $710 million, with gross margins of approximately 82%. With the partial quarter impact of our announced cost reductions, we estimate Q3 operating expenses of $348 million to $360 million and our Q3 non-GAAP earnings target is $2.78 to $2.90 per share. We expect Q3 share-based compensation expense of approximately $60 million to $62 million. Finally, we plan to repurchase at least $250 million worth of shares during Q3. We remain committed to returning cash to our shareholders and continue to expect to use at least 50% of our annual free cash flow towards share repurchases.

我現在將分享我們對第三季度的展望。除非另有說明，否則我的指導意見參考了非 GAAP 運營指標。我們預計第三季度收入在 6.9 億美元至 7.1 億美元之間，毛利率約為 82%。考慮到我們宣布的成本削減對部分季度的影響，我們估計第三季度的運營費用為 3.48 億美元至 3.6 億美元，我們的第三季度非 GAAP 收益目標為每股 2.78 美元至 2.90 美元。我們預計第三季度基於股份的薪酬支出約為 6000 萬至 6200 萬美元。最後，我們計劃在第三季度回購至少價值 2.5 億美元的股票。我們仍然致力於向股東返還現金，並繼續期望將至少 50% 的年度自由現金流用於股票回購。

I will now speak to our FY '23 expectations. We expect low to mid-single-digit revenue growth in FY '23. Given our first half results and the environment for new software projects, we no longer see a path to 15% to 20% software growth in FY '23, and are not offering guidance for the second half product revenue mix at this time. Based on current visibility and our earlier-than-anticipated systems recovery, we expect to see lower systems revenue in Q3 and Q4 than in Q2. We expect that we will continue to substantially work down our systems backlog over the second half of FY '23. We expect FY '23 non-GAAP operating margins of approximately 30% and non-GAAP earnings growth in the range of 7% to 11%. Incorporating our year-to-date results, we have narrowed our estimate for our FY '23 effective tax rate to 21% to 22% for the year. I will now turn the call back over to Francois. Francois?

我現在將談談我們對 23 財年的期望。我們預計 23 財年的中低個位數收入增長。鑑於我們上半年的業績和新軟件項目的環境，我們不再看到 23 財年軟件增長 15% 到 20% 的途徑，並且目前不提供下半年產品收入組合的指導。根據目前的可見性和我們早於預期的系統恢復，我們預計第三季度和第四季度的系統收入將低於第二季度。我們預計我們將在 23 財年下半年繼續大幅減少系統積壓。我們預計 23 財年非 GAAP 營業利潤率約為 30%，非 GAAP 盈利增長在 7% 至 11% 之間。結合我們年初至今的結果，我們已將我們對 23 財年有效稅率的估計收窄至 21% 至 22%。我現在將把電話轉回給 Francois。弗朗索瓦？

Thank you, Frank. Like last quarter, I'd ask that you take away 3 things from this call. We believe the current demand environment is temporary. And while we cannot predict when it will recover, we are confident it will, for the very simple reason that applications and APIs continue to grow. We are also confident that as customers resume more normal levels of investment and begin to take on the challenges associated with hybrid multi-cloud environments, we will be a differentiated partner for them.

謝謝你，弗蘭克。和上個季度一樣，我會要求你從這次電話會議中拿走 3 件事。我們認為當前的需求環境是暫時的。雖然我們無法預測它何時會恢復，但我們相信它會恢復，原因很簡單，應用程序和 API 會繼續增長。我們也相信，隨著客戶恢復更正常的投資水平並開始應對與混合多雲環境相關的挑戰，我們將成為他們的差異化合作夥伴。

And finally, while we have implemented cost reductions and continue to strive to achieve double-digit earnings growth, we also have intensified our investment in areas we believe will be most impactful for our customers over the medium and long term, including software and hybrid and multi-cloud.

最後，在我們實施成本削減並繼續努力實現兩位數收益增長的同時，我們還加強了對我們認為在中長期內對客戶影響最大的領域的投資，包括軟件和混合動力和多雲。

Operator, please open the call to questions.

接線員，請打開問題電話。

(Operator Instructions) And our first question comes from the line of Sami Badri with Credit Suisse.

（操作員說明）我們的第一個問題來自瑞士信貸的 Sami Badri。

I had two questions. First thing, maybe, Frank, you could help us just understand modeling parameters for the year. And the reason why I ask that is we were not really forecasting a fairly large growth contribution from services revenue, and that's clearly looking like that's changing as of fiscal 2Q and into the second half of the year. What should we be assuming for services growth now, given things have changed and customers are sweating assets?

我有兩個問題。首先，也許，弗蘭克，你可以幫助我們了解當年的建模參數。我之所以這麼問，是因為我們並沒有真正預測服務收入會帶來相當大的增長貢獻，而且從第二財季到下半年，這種情況顯然正在發生變化。鑑於情況已經發生變化，客戶正在流失資產，我們現在應該為服務增長假設什麼？

And then kind of backing into product, how should we be -- I think you made a comment saying you weren't going to make guidance for software growth into the second half of fiscal year '23 for software. But I kind of just need a little bit more color on that, just given the systems commentary as well. And then I have a follow-up after this.

然後有點回到產品，我們應該如何 - 我想你發表評論說你不會為軟件的軟件增長提供指導，直到 23 財年下半年。但我只是需要更多的顏色，只是考慮到系統評論。在此之後我有一個跟進。

Yes. Sure, Sami. So we did not update the mid-single-digit outlook that we did update in Q1 on services. Obviously, we outperformed that in Q2. And for all the dynamics that you highlighted, we continue to think services contribution is going to be strong through the course of the year as customers continue to sweat assets and particularly when we look at some of the aged assets and their decisions around that. And so we don't have an update, but I think that mid-single digit is well intact, and we'll see what happens. Specifically, we did not give any guidance on mix and product and the results of looking at that services growth to what the product growth will be in that mix, I will leave that to you to model. But we are not giving any specific guidance to what we think software growth is going to be for the balance of the year and our systems growth for the balance of the year.

是的。當然，薩米。因此，我們沒有更新我們在第一季度更新的服務業中個位數展望。顯然，我們在第二季度的表現優於它。對於您強調的所有動態，我們仍然認為，隨著客戶繼續消耗資產，尤其是當我們查看一些陳舊的資產及其相關決策時，服務貢獻將在這一年中保持強勁。所以我們沒有更新，但我認為中間個位數完好無損，我們會看到會發生什麼。具體來說，我們沒有給出任何關於組合和產品的指導，以及將服務增長與產品組合中的產品增長聯繫起來的結果，我將把它留給你去建模。但是我們沒有給出任何具體的指導來說明我們認為軟件增長將在今年餘下時間和我們的系統在今年餘下時間增長。

Okay. Got it. And maybe a question for Francois. I think one thing we really kind of want to know is, if you were to think about which customer industry group really caused the majority of the drag or the impact to the revision of the guide for fiscal year '23, which customer cohort or customer vertical really kind of caused that if you could put your finger on one?

好的。知道了。也許有一個問題要問 Francois。我認為我們真正想知道的一件事是，如果您考慮哪個客戶行業群體真正對 23 財年指南的修訂造成了大部分拖累或影響，哪個客戶群體或客戶垂直確實是一種原因，如果你能把手指放在一個上？

Thanks, Sami. So a couple of indicators on that. The first is what we have seen in our second fiscal quarter is this pullback in spending has been broader and more severe, frankly, across all verticals and all geographies. And so I would say all verticals and geographies are affected at this point. If I had to pull out a couple, I would say the financial services in the -- especially in the second half of March, where we saw a number of large deals being pulled out, delayed or downside or delayed by multiple quarters.

謝謝，薩米。所以有幾個指標。首先，我們在第二個財政季度看到的是，坦率地說，這種支出回落在所有垂直領域和所有地區都更廣泛、更嚴重。所以我想說所有的垂直和地理在這一點上都會受到影響。如果我不得不退出幾筆交易，我會說金融服務——尤其是在 3 月下半月，我們看到許多大型交易被取消、推遲或下行或推遲了多個季度。

Financial Services was impacted prior to the collapse of SVB, but we did see even more caution in the financial services industry after that, and we expect that will persist. The other vertical, Sami, that I would call out is service providers, where we had a number of customers that had expectations around their budget, I would say, in our fiscal Q1 or calendar Q4. And when the budgets were settled in the February time frame, the budgets were a lot less than they expected.

金融服務業在 SVB 倒閉之前受到影響，但在那之後我們確實看到金融服務業更加謹慎，我們預計這種情況將持續下去。另一個垂直領域，Sami，我要提到的是服務提供商，我們有許多客戶對他們的預算有期望，我會說，在我們的財政第一季度或日曆第四季度。當預算在 2 月的時間框架內確定時，預算比他們預期的要少很多。

And that's driven by, I think, in some cases, certainly in the MSO sector, cable sector, worries about our service provider customers perhaps losing or reducing the growth on the highest margin customers. And we're seeing that also in that with certain mobile operators, around their planned spend on 5G. So that's -- I would say those are the 2 verticals that perhaps have been where we've seen perhaps the strongest differential between where they were in Q1 and where they are today.

我認為，在某些情況下，這是由 MSO 部門、有線電視部門擔心我們的服務提供商客戶可能會失去或減少利潤率最高的客戶的增長所驅動的。我們在某些移動運營商中也看到了這一點，圍繞他們在 5G 上的計劃支出。所以那是——我想說的是，這兩個垂直方向可能是我們在第一季度和今天看到的最大差異。

And the next question comes from the line of Ray McDonough with Guggenheim Securities.

下一個問題來自古根海姆證券公司的 Ray McDonough。

Great. Two, if I could. The first one, Francois, can you comment -- or maybe even for Frank, can you comment on how or if new business declines accelerated from last quarter? I believe -- and with that, I also believe a part of the renewals that you expected to come in came from the true forwards. How have they performed versus expectations from the beginning of the year? And is the move towards optimizing cloud spend from customers impacting those true forwards at all given pricing is somewhat based on what customers consume per year in those contracts?

偉大的。兩個，如果可以的話。第一個，弗朗索瓦，你能評論一下——或者甚至對弗蘭克來說，你能評論一下新業務是如何或是否從上個季度開始加速下滑的嗎？我相信 - 因此，我也相信你期望的部分續約來自真正的前鋒。與年初的預期相比，他們的表現如何？考慮到定價在某種程度上是基於客戶在這些合同中每年的消費量，向優化客戶雲支出的舉措是否會影響這些真正的遠期？

Ray, I'll start and certainly if Francois wants to speak up, he can. I think we saw a challenge in new business sales in both Q1 as well as Q2. Did it accelerate in Q2? Probably slightly versus our expectation, but not necessarily when you take a look at the raw number. So that's how I'd answer that one for you. I think in terms of your second question around spend, on the true forwards that we saw, those were slightly below our expectation level.

雷，我會開始，當然，如果弗朗索瓦想說出來，他可以。我認為我們在第一季度和第二季度都看到了新業務銷售的挑戰。 Q2加速了嗎？可能與我們的預期略有出入，但如果您查看原始數據，則不一定。這就是我為你回答那個問題的方式。我認為就你關於支出的第二個問題而言，在我們看到的真正前瞻性方面，這些略低於我們的預期水平。

We do keep that in the renewal bucket. And so when we said that it largely performed to our expectation, that was the one piece that did not perform to our expectation where we think that people are being a bit more critical around their consumption and being much closer to what they had planned to consume and not going over, and that's not what we experienced up until this year.

我們確實將其保留在續訂桶中。因此，當我們說它在很大程度上符合我們的預期時，那是一件沒有達到我們預期的作品，我們認為人們對他們的消費更加挑剔並且更接近他們計劃消費的東西並且不會過去，直到今年我們才經歷過這種情況。

Okay. That makes sense. And then maybe a follow-up, Frank, for you. Can you help us on the direction of cash flow margins for this year and where you think that can go? You have the benefit of supply chain challenges subsiding somewhat, at least. You're lapping the initial cohort of term license renewals. And now you have the benefit or will have the benefit of some of the cost reductions hitting this year that you're putting in place.

好的。這就說得通了。然後可能是跟進，弗蘭克，給你。您能否幫助我們了解今年現金流量利潤率的方向以及您認為可以走向何方？至少，您可以從供應鏈挑戰中獲益。您正在處理第一批長期許可證續訂。現在，您已經或將受益於今年實施的一些成本削減措施。

So is it reasonable to think that a mid-20% cash flow margin is achievable this year? Or is there still some noise in the model that would preclude you from hitting that sort of target or range?

那麼，認為今年可以實現 20% 左右的現金流利潤率是否合理？或者模型中是否仍然存在一些噪音，使您無法達到那種目標或範圍？

Yes, So we don't specifically guide to cash flow. And I think the dynamics that you mentioned are the similar ones to the ones that we are experiencing. So we did have some unusual cash hits to last year in relation to component costs and other supply chain challenges that we do anticipate are going to work their way out of our model by Q4. You saw some of that happen in the Q2 time frame. You'll see more of that happen in Q3. But we don't guide to a specific margin percentage because we don't guide to cash flow.

是的，所以我們不專門指導現金流。我認為你提到的動態與我們正在經歷的動態相似。因此，去年我們確實遇到了一些與組件成本和其他供應鏈挑戰相關的不尋常的現金損失，我們確實預計這些挑戰將在第四季度擺脫我們的模式。您看到其中一些發生在第二季度的時間範圍內。你會在第三季度看到更多這樣的事情發生。但我們不指導具體的保證金百分比，因為我們不指導現金流。

And the next question comes from the line of Tim Long with Barclays.

下一個問題來自巴克萊銀行的 Tim Long。

I have two as well on software. First, you guys said a few times the renewals came in as expected. It would be helpful if you could give us a little color about what you were expecting there. Were you expecting them to be down or up? So any color you can give us on what your kind of expectations were for the renewals business. And then second, similar to a previous question, but if you could talk about kind of the weakness more on the product and solution lens. So how much of this is the core virtually do you see? How much of this is maybe not fully monetizing NGINX, how much of this is not really able to bundle other software offerings on top of virtual ADCs? So anything you can give us kind of on that. What's missing when you look back at the acquisitions and what it was supposed to do for the software business, what's not happening?

我在軟件上也有兩個。首先，你們說了幾次續約是按預期進行的。如果您能給我們一些關於您在那裡的期望的顏色，那將會很有幫助。你希望他們下跌還是上漲？因此，您可以給我們任何顏色，說明您對續訂業務的期望是什麼。其次，類似於之前的問題，但如果你能更多地談談產品和解決方案方面的弱點。那麼你實際上看到有多少是核心？其中有多少可能沒有完全將 NGINX 貨幣化，有多少不能真正將其他軟件產品捆綁在虛擬 ADC 之上？所以任何你可以給我們的東西。當您回顧收購以及它應該為軟件業務做些什麼時，缺少了什麼，沒有發生什麼？

Thank you, Tim. I'll start with the second part of your question, and Frank will come back to the renewals question. So if we could -- so let me start with the product piece. Where we have seen an impact in is in the ADC area. We are impacted both on hardware and software. And then -- what I mean by that is really traditional ADC, both systems and software. And we are seeing very strong evidence that this is our customers sweating their assets. And we are seeing that from the service renewals and the attach rates. In some cases where we're able to measure it, we can see the utilization of some of our platforms have gone higher than customers would typically go. And even in customer conversations, it is clear that where they can avoid spending right now, they are avoiding it or delaying making these purchases later.

謝謝你，蒂姆。我將從你問題的第二部分開始，Frank 將回到續訂問題。所以，如果可以的話——讓我從產品開始。我們在 ADC 領域看到了影響。我們在硬件和軟件上都受到了影響。然後——我的意思是真正的傳統 ADC，包括系統和軟件。我們看到非常有力的證據表明，這是我們的客戶在耗費他們的資產。我們從服務續訂和附加率中看到了這一點。在某些我們能夠衡量的情況下，我們可以看到我們某些平台的利用率已經高於客戶通常的利用率。甚至在客戶談話中，很明顯，如果他們現在可以避免消費，他們就會避免或推遲以後進行這些購買。

In Security, part of our Security business is attached to ADC and that part of the business, we have seen an impact, and it is affected. And we're also seeing a bigger impact in the service provider vertical in Security, whether they've tried to reduce their CapEx pretty quickly. Our software security business is more resilient. And our SaaS and managed services security business actually continues to grow, albeit at a lower rate than last year, but continues to grow. So if you parse it out, I would say, those are the areas. And of course with NGINX, we have continued to see growth there. Of course, the growth rate is also impacted, but we continue to see growth there. When you step back from this, then, and you mentioned the overall portfolio and acquisitions, we are absolutely clear, and it's the feedback from our customers that the world is going more and more to hybrid cloud and multi-cloud.

在安全方面，我們的部分安全業務附屬於 ADC，而這部分業務，我們已經看到了影響，並且受到了影響。我們還看到，服務提供商在安全方面的垂直影響更大，無論他們是否試圖迅速減少資本支出。我們的軟件安全業務更具彈性。我們的 SaaS 和託管服務安全業務實際上在繼續增長，儘管增速低於去年，但仍在繼續增長。因此，如果您將其解析出來，我會說，這些就是領域。當然，對於 NGINX，我們繼續看到那裡的增長。當然，增長率也會受到影響，但我們繼續看到那裡的增長。當你退後一步時，你提到了整體投資組合和收購，我們非常清楚，我們的客戶反饋說世界越來越多地轉向混合雲和多雲。

And the portfolio that we have assembled is essentially the only portfolio in the industry that can secure and deliver every application in any one of these environments, private cloud, public cloud, increasingly at the edge, in any consumption form factors, so hardware, software and SaaS. And so we feel very good about the portfolio we have and how it's positioned to drive the architectures of our customers going forward. Where we think we are seeing the more severe slowdown in the short term is in ADCs where customers can actually perhaps sweat the assets for a little longer. But we expect that demand will resume in short order.

我們組裝的產品組合本質上是業內唯一能夠在任何這些環境中保護和交付每個應用程序的產品組合，私有云、公共雲，越來越多地處於邊緣，以任何消費形式因素，所以硬件、軟件和軟件即服務。因此，我們對我們擁有的產品組合以及它如何定位以推動我們客戶的架構向前發展感到非常滿意。我們認為我們在短期內看到更嚴重的放緩是在 ADC 中，客戶實際上可能會為資產付出更長的時間。但我們預計需求將在短期內恢復。

And Tim, on the maintenance -- the renewal question, I'm going to separate out the maintenance renewals, which have obviously been quite strong on the services side, and the software renewals, which are also strong and that you were saying, what are your expectations. When you think about the way we've talked about the business, FCPs have been the predominant amount of growth that we've seen in our software business. And that's the majority of what comes up for renewal in any given quarter.

蒂姆，關於維護 - 續訂問題，我將把維護續訂分開，這在服務方面顯然非常強大，而軟件續訂也很強大，你說的是什麼是你的期望。當您考慮我們談論業務的方式時，FCP 一直是我們在軟件業務中看到的主要增長量。這就是任何給定季度更新的大部分內容。

Those have performed largely to our expectations, and in many cases, growing from the levels that they were when they ended year 3. There has been some this year where we've taken a look at year 2 of the agreement and year 3 of the agreement, where that true forward amount has not been up to the level of expectations that we had that we modeled from previous years as people are very critical on trying to consume very close to what they've contracted for. And so we're not seeing the same overages that we have before. And we think that's probably indicative of the same way that cloud providers are seeing their consumption. So when we say the renewal base, the renewal base is up substantially from last year as expected as this is the first full year of STP sales when we take a look back 3 years ago as a comparison.

這些表現在很大程度上符合我們的預期，並且在許多情況下，比第 3 年結束時的水平有所增長。今年有一些我們查看了協議的第 2 年和協議的第 3 年。協議，其中真正的遠期金額沒有達到我們從前幾年建模的預期水平，因為人們對嘗試非常接近他們合同規定的消費非常關鍵。因此，我們沒有看到與以前相同的超支情況。我們認為這可能表明雲提供商看待他們消費的方式相同。因此，當我們說續訂基數時，續訂基數比去年大幅增加，正如我們預期的那樣，因為當我們回顧 3 年前作為比較時，這是 STP 銷售的第一個完整年度。

The next question comes from the line of Samik Chatterjee with JPMorgan.

下一個問題來自摩根大通的 Samik Chatterjee。

I guess for the first one, I think just to clarify, I think, Francois, you made a comment about fiscal '24, talking about double-digit earnings growth. Just wanted to see sort of how you're thinking about top line sort of underpinning that expectation. I know you talked about gross margin improvement as well as operating margin, but sort of maybe give us a bit more color about how you're thinking about the top line underpinning that guide? And I have a follow-up.

我想對於第一個，我想只是為了澄清，我想，弗朗索瓦，你對 24 財年發表了評論，談到了兩位數的盈利增長。只是想看看您是如何考慮支撐這種期望的頂線的。我知道你談到了毛利率的提高以及營業利潤率，但也許可以給我們更多關於你如何看待支撐該指南的頂線的顏色？我有一個後續行動。

So I missed part of the question, but is it about top line in fiscal 2024?

所以我錯過了部分問題，但它是關於 2024 財年的頂線嗎？

Yes. I think you made a comment about double digit earnings growth. So just curious sort of how you're thinking about the top line as you talked about margin expansion being the key driver there?

是的。我想你對兩位數的收入增長發表了評論。所以，當你談到利潤率擴張是那裡的關鍵驅動因素時，你是如何考慮收入的？

Yes. So look, Samik, when we look at fiscal '24, of course, we're not in a position or have the visibility really to guide to the top line for 2024. But I can give you just a few pointers here. It is clear from the -- from where we're at with our ability to ship today that we will ship the vast majority of our backlog in fiscal 2024, either by the end of the third quarter or the end of the fourth quarter -- sorry, by the end of fiscal '23, sorry. By the end of Q3 or at the end of Q4 fiscal 2023. So when you look at that on a normalized backlog level in 2024, clearly, that's going to represent a headwind to revenue growth in '24 in the order of 6 to 8 points of growth given that dynamic.

是的。所以，Samik，當我們審視 24 財年時，當然，我們無法或無法真正指導 2024 年的收入。但我可以在這裡給你一些建議。很明顯——從我們今天的發貨能力來看，我們將在 2024 財年發貨，無論是在第三季度末還是第四季度末——抱歉，到 23 財年末，抱歉。到 2023 財年第三季度末或第四季度末。因此，當你在 2024 年的標準化積壓水平上看時，很明顯，這將代表 24 年收入增長的逆風，約為 6 到 8 個百分點鑑於這種動態的增長。

On the other hand, we also see that -- we're seeing a lot of projects that are delayed, and our view is that customers can only sweat their assets for so long. And that at some point, demand is being pent up and demand is going to pick up. When that is going to happen is a bit of an uncertainty, but it's reasonable to assume that we would see some of that at some point in 2024. So I can't give you a position on revenue growth for 2024. But what we can control of course, is our cost base. And you see that we have made an adjustment to our cost base that will give us meaningful expansion of operating margins in 2024 and secure our ability to deliver double-digit earnings growth in fiscal 2024.

另一方面，我們也看到——我們看到很多項目被推遲了，我們的觀點是客戶只能在這麼長時間內耗費他們的資產。在某個時候，需求被壓抑，需求將會回升。這什麼時候會發生有點不確定，但可以合理地假設我們會在 2024 年的某個時候看到其中的一些。所以我不能給你一個關於 2024 年收入增長的位置。但我們可以控制當然是我們的成本基礎。你會看到我們對成本基礎進行了調整，這將使我們在 2024 年顯著擴大營業利潤率，並確保我們有能力在 2024 財年實現兩位數的收益增長。

Okay. And so for my follow-up, I mean, it was on the cost structure, obviously, with some of the actions you're taking and the rules you're sort of taking out, you'll operate at a much lower level of operating expense as a percent of revenue than you have historically. I mean how much of that is sort of sustainable and you can operate at that level for a multiyear period versus just more of a function of how you're looking at the macro and trying to be more conservative around it. Like is there a more structural upside to how you can -- how you think about operating margins in -- operating at a lower cost structure?

好的。所以對於我的後續行動，我的意思是，它是關於成本結構的，很明顯，通過你正在採取的一些行動和你正在取消的規則，你將在更低的水平上運作營業費用佔收入的百分比高於歷史水平。我的意思是其中有多少是可持續的，你可以在那個水平上運作多年，而不是更多地取決於你如何看待宏觀並試圖對其更加保守。就像你如何能夠以較低的成本結構運營 - 你如何看待營業利潤率有更多的結構性優勢？

Well, a couple of things there, Samik. Number one is -- our objective has been and continue to be to drive operating leverage in the business. And we think from where we're at today at the 30% operating margin for the year, if you look at it in the second half of the year, it's going to be -- the first half was in the 26%, 27% zone. The second half of the year is going to be meaningfully higher than that when you look at the full year being at 30%. And from there, our intent is to drive further operating leverage in '24 and beyond.

好吧，有幾件事，薩米克。第一是——我們的目標一直是並將繼續是推動業務的運營槓桿。我們認為，從今天我們今年 30% 的營業利潤率來看，如果你在今年下半年看，它將會是——上半年是 26%、27%區。今年下半年將明顯高於全年 30% 的水平。從那裡開始，我們的目的是在 24 世紀及以後推動進一步的運營槓桿。

And we see the opportunity to do that with a combination of getting more efficient in our business and driving productivity as well as continuing to drive top line growth. We said at our Analyst Day in 2020 that we were going to invest in driving some efficiencies and costs out of the business. We have been doing that. Today, we're announcing some changes to our cost base. But whilst we're doing that, we're also doubling down on investments in automation that will allow us to drive operating leverage going forward. So we see that as an ongoing journey of driving operating leverage, which we will -- you'll start to see the benefits of that in the second half of this fiscal year, but that will continue in '24.

我們看到了通過提高業務效率和提高生產力以及繼續推動收入增長相結合來實現這一目標的機會。我們在 2020 年的分析師日表示，我們將投資於提高業務效率和降低成本。我們一直在這樣做。今天，我們宣布對我們的成本基礎進行一些更改。但是，在我們這樣做的同時，我們也在加倍投資自動化，這將使我們能夠推動運營槓桿向前發展。因此，我們將其視為推動運營槓桿的持續旅程，我們將 - 你將在本財年下半年開始看到它的好處，但這種情況將在 24 年繼續。

And the next question comes from the line of Simon Leopold with Raymond James.

下一個問題來自 Simon Leopold 和 Raymond James 的台詞。

First, it does seem as if there's maybe a bit of a potential conflict in sort of the tone of really describing the situation that's temporary, but taking this, the action of cutting staff levels and cutting expenses because I guess the expense cuts sort of implies something about the duration of how you see the risk. And I just -- I've heard everything you've said. I just feel like maybe it would be helpful to get a little bit more handholding on how you're thinking about the duration and what led you to make the decision. Maybe it's -- where are the cuts coming from. I appreciate you can't give us all the detail, but a little handholding would help to sort of help understand the potential conflict there.

首先，在真正描述暫時情況的語氣中似乎確實存在一些潛在的衝突，但採取這種削減員工人數和削減開支的行動，因為我猜削減開支有點暗示關於您如何看待風險的持續時間。我只是——我聽到了你所說的一切。我只是覺得，多了解一下您是如何考慮持續時間以及是什麼導致您做出決定的，這可能會有所幫助。也許是 - 削減來自哪裡。我很感激你不能給我們所有的細節，但稍微握手會有助於理解那裡的潛在衝突。

So let me start with saying when we looked at our -- we spent quite a bit of time, in the first half of our fiscal year, looking at the demand signals that we were seeing from our customers. And if you recall, Simon, last year, we have challenges on our revenue in the second half of the year that were driven largely by issues of supply. And at the top, we said we did not want to reduce our staffing levels because this was not a demand issue, it was a supply issue.

因此，讓我首先說，當我們查看我們的時 - 在本財年的上半年，我們花了很多時間來查看我們從客戶那裡看到的需求信號。如果你還記得，西蒙，去年，我們下半年的收入面臨挑戰，這主要是由供應問題驅動的。在最高層，我們說我們不想減少人員配置水平，因為這不是需求問題，而是供應問題。

We also said at the time that if we did see a softening in demand, that, that would cause us to relook at our cost base and potentially address our staffing levels, and that's exactly what we're doing. This year, we're seeing a softening of demand. And whilst we appreciate that, that is driven by macro environment and it is temporary, we are also being quite disciplined about driving our earnings performance. But also ensuring that in this environment, we are operating as lean as we can be and as lean as we should be. And that's what's driven our approach to reducing our staffing levels. We do feel that with the staffing levels, we are well positioned to drive growth and capture the opportunity when demand levels normalize, and our customers are ready to spend.

我們當時還表示，如果我們確實看到需求疲軟，那將導致我們重新審視我們的成本基礎並可能解決我們的人員配置水平問題，而這正是我們正在做的事情。今年，我們看到需求疲軟。雖然我們意識到這是由宏觀環境驅動的，而且是暫時的，但我們在推動盈利表現方面也非常自律。但也要確保在這種環境下，我們盡可能精益運營，也盡可能精益運營。這就是推動我們減少人員配置水平的方法。我們確實認為，隨著人員配置水平的提高，我們有能力在需求水平正常化且我們的客戶準備好消費時推動增長並抓住機會。

In terms of giving you a couple of pointers, Simon, on where we have made some cuts, it's across the board, but if I park it in roughly 3 categories. In G&A, we have looked at increasing productivity and driving some efficiencies and just being able to rationalize the G&A organization for the size of the company we are post these cuts.

西蒙，就給你一些建議而言，關於我們做了一些削減的地方，它是全面的，但如果我把它放在大約 3 個類別中。在 G&A 中，我們著眼於提高生產力和推動一些效率，並且能夠根據我們發布這些裁員的公司規模合理化 G&A 組織。

In sales, we are -- we have looked at realigning or consolidating some territories and we're configuring some of the roles in our go-to-market to have a leaner go-to-market motion and having a focus on the territories that will drive the best returns in the near to medium term. And then in our product organizations, we have looked at all R&D projects that we have underway and really are focusing on the ones that will drive the best returns and where we have made cuts is on those projects that are perhaps more speculative or have longer-term returns.

在銷售方面，我們 - 我們已經考慮重新調整或合併一些地區，我們正在配置我們進入市場的一些角色，以進行更精簡的進入市場行動，並專注於那些領域將在中短期內推動最佳回報。然後在我們的產品組織中，我們研究了我們正在進行的所有研發項目，真正關注的是那些將帶來最佳回報的項目，而我們削減的是那些可能更具投機性或時間更長的項目——長期回報。

And all of those really amount to us focusing on our top priority projects and really being leaner and positioned for when demand will normalize. I would add that whilst we're doing that, we are doubling down on investment in our software, our hybrid and multi-cloud portfolio. Because we're seeing growing evidence from customers from architecture conversations that we are ideally positioned for where their applications are going, where the security challenges are going which is really about securing and delivering apps not in a single infrastructure environment, but across multiple public clouds, private clouds in the edge and being able to network all these environments together. And I think we're in a unique position in that. So we're continuing to make these investments.

所有這些實際上相當於我們專注於我們的首要項目，真正變得更精簡，並為需求正常化做好準備。我要補充的是，在我們這樣做的同時，我們正在加倍投資我們的軟件、我們的混合雲和多雲產品組合。因為我們從客戶的體系結構對話中看到越來越多的證據表明，我們處於理想的位置，可以應對他們的應用程序的發展方向，安全挑戰的發展方向，這實際上是關於保護和交付應用程序，而不是在單一基礎設施環境中，而是跨多個公共雲，邊緣的私有云，並能夠將所有這些環境聯網在一起。我認為我們在這方面處於獨特的地位。因此，我們將繼續進行這些投資。

That's very helpful. And just one quick follow-up. I know you mentioned that you thought you'd have backlog normalized either at the end of the third or fourth quarter, certainly in fiscal '24. Can we -- can you quantify where backlog was at the end of the March quarter?

這很有幫助。並且只是一個快速跟進。我知道你提到過你認為你會在第三季度末或第四季度末將積壓正常化，當然是在 24 財年。我們能否——您能否量化 3 月季度末的積壓情況？

Yes, Simon, we are not in the -- our normal course is not to update backlog in any one particular quarter. We talk about it at the end of the year. We tried to highlight to people during this particular call that we did expect to be through most of our shippable backlog by the end of the fiscal year, whether that's Q3 or Q4, I can't tell you. But we didn't quantify where we were at the end of Q1, and we're not quantifying where we are at the end of Q2.

是的，西蒙，我們不在——我們的正常做法是不更新任何一個特定季度的積壓工作。我們在年底討論它。在這次特別的電話會議上，我們試圖向人們強調，我們確實希望在本財年結束時解決大部分可交付的積壓訂單，無論是第三季度還是第四季度，我不能告訴你。但我們沒有量化第一季度末的情況，也沒有量化第二季度末的情況。

And the next question comes from the line of Meta Marshall with Morgan Stanley.

下一個問題來自 Meta Marshall 與摩根士丹利的對話。

A couple for me. Maybe to start with, you mentioned that customers are kind of running their networks at higher utilization of the F5 equipment. Just wondered if you could give a sense of is that matching kind of previous levels that you've seen in prior kind of macro pullbacks? Or just kind of where we are on kind of how hot they're running their networks versus peaks that we've previously seen if there's any way to contextualize that maybe as a first question.

對我來說一對。也許首先，您提到客戶正在以更高的 F5 設備利用率運行他們的網絡。只是想知道您是否可以感覺到您在之前的宏觀回調中看到的那種匹配的先前水平？或者只是我們所處的位置，他們運行網絡的熱度與我們之前看到的峰值相比，是否有任何方法可以將其作為第一個問題進行背景化。

I would say on that front, we were -- the sample size of customers where we have really the ability to see that and understand that is limited. But for those where we can see it, we have a number of customers that are getting close to or exceeding kind of -- I want to call it a red line, but the maximum they would have normally gone to in normal times. And so that just points to us that at some point, they will expand capacity. And this is consistent actually with what we have seen in prior macro slowdowns where customers have tended to sweat their assets in this way.

我想說的是，在這方面，我們是——我們真正能夠看到並理解的客戶樣本量是有限的。但是對於那些我們可以看到它的人來說，我們有一些客戶已經接近或超過了某種程度——我想稱它為紅線，但他們通常會達到正常情況下的最大值。因此，這只是向我們表明，在某個時候，他們將擴大產能。這實際上與我們在之前的宏觀經濟放緩中看到的情況是一致的，在這種情況下，客戶往往會以這種方式揮霍他們的資產。

And in the past, when we have seen customers sweat their assets this way, we have seen it happen for 4 to 6 quarters. Now every micro slowdown is different in shape and different in how it plays out. But that's what we have seen in the past. What we are also seeing made a kind of evidence to this behavior is that the attach rate, the services attach rate that we see on our platforms, especially the platforms that are 4 years old and beyond, we're seeing the attach rate on this platform -- the maintenance attachment on these platforms go up, which is also very typical of customers sweating these older assets for a little longer. And that, again, is consistent with what we have seen in prior micro slowdowns.

過去，當我們看到客戶以這種方式耗費他們的資產時，我們已經看到這種情況持續了 4 到 6 個季度。現在，每一次微放緩的形式和結果都各不相同。但這就是我們過去所看到的。我們還看到這種行為的一種證據是附加率，我們在我們的平台上看到的服務附加率，尤其是 4 歲及以上的平台，我們看到了附加率平台——這些平台上的維護附件增加了，這也是客戶使用這些舊資產的時間更長的典型情況。這再次與我們在之前的微觀放緩中看到的一致。

So all of that points to us that, that's the behavior of customers that they're sweating assets. That is not a change in their thinking around architecture or a change really in our competitive position. We're seeing customers kind of hunkering down with us for a period of time.

所以所有這些都向我們表明，這就是客戶的行為，他們正在流汗資產。這並沒有改變他們對架構的看法，也沒有真正改變我們的競爭地位。我們看到客戶在一段時間內與我們保持聯繫。

Got it. That's helpful. And then maybe as a follow-up question. Obviously, a lot of your software revenue tied to kind of the cloud transformation projects are now being delayed a little bit with cloud optimization projects. But is there a way to -- or is that largely virtual ADC projects, which are being kind of postponed, but security projects are going ahead? I'm just trying to get a sense of is this kind of across the board? Or are there certain projects that are more security attached that are getting higher prioritization? Anything that would be helpful in terms of what software projects are getting approved versus not.

知道了。這很有幫助。然後可能作為後續問題。顯然，您的許多與雲轉型項目相關的軟件收入現在因雲優化項目而有所延遲。但是有沒有辦法——或者是那些被推遲的主要虛擬 ADC 項目，但安全項目仍在繼續？我只是想了解這種情況是否全面？或者是否有某些安全性更高的項目獲得了更高的優先級？任何對軟件項目獲得批准和未獲批准有幫助的信息。

I think -- so our security software business has been more resilient. I would say we're seeing all product lines affected, but our security software business has been more resilient. And for managed services and Software as a Service part of our business, which is still a small part of our business overall, but we're seeing that, that is affected, but continues to grow. Where we are seeing the biggest impact data is in these large multimillion dollar, multiyear project that typically include our ADC solution, and it could be ADC and attached security. But these projects have enormous scrutiny. .

我認為 - 所以我們的安全軟件業務更具彈性。我會說我們看到所有產品線都受到影響，但我們的安全軟件業務更具彈性。對於我們業務的託管服務和軟件即服務部分，這仍然是我們整體業務的一小部分，但我們看到，它受到了影響，但仍在繼續增長。我們看到影響最大的數據是在這些價值數百萬美元、多年的大型項目中，這些項目通常包括我們的 ADC 解決方案，它可能是 ADC 和附加的安全性。但這些項目受到了嚴格的審查。 .

We've seen a couple of them where they are approved all the way up to the CIO only for the COO or CEO or the Board to come and say, we're not doing this project. And of course, that happens with these multimillion dollar projects, but it doesn't happen as much with normal deals that are a few hundreds of thousands of dollars. In fact, our -- this quarter, the number, if I just speak in terms of volume, the number of multiyear subscription software deals that we did was up significantly relative to a year ago.

我們已經看到他們中的一些，他們一直被批准到 CIO，只是為了 COO 或 CEO 或董事會過來說，我們不做這個項目。當然，這種情況發生在這些數百萬美元的項目中，但它不會發生在數十萬美元的正常交易中。事實上，我們 - 本季度的數字，如果我就數量而言，我們所做的多年訂閱軟件交易的數量與一年前相比顯著增加。

But when you look at it in terms of dollars, because the large multimillion dollar projects were those that were most affected or postponed, you saw the impact on our software revenue. So that's the difference we're seeing in terms of the scrutiny on the smaller deals versus the big multimillion dollar deals. And those deals from the feedback we're getting from customers are not going away. They're essentially delayed by 1 or multiple quarters. But we do see that demand coming back down the road.

但是當你以美元來看待它時，因為數百萬美元的大型項目是那些受影響或推遲最多的項目，你會看到對我們軟件收入的影響。因此，這就是我們在審查小型交易與數百萬美元的大型交易方面所看到的差異。我們從客戶那裡得到的反饋中的那些交易並沒有消失。它們基本上延遲了 1 個或多個季度。但我們確實看到這種需求正在回歸。

Due to time constraints, we will take our last question from the line of James Fish with Piper Sandler.

由於時間限制，我們將回答 James Fish 和 Piper Sandler 的最後一個問題。

Most of mine have been asked, but just wanted to follow up. Francois, you actually made the comment that you expect some of the -- maybe it was Frank, some of the working capital stuff to kind of work itself out by fiscal Q4, and I know you don't want to talk about backlog specifically, but it sounds like if it's going to work itself out by fiscal Q4 that we should expect to kind of exit the year at a more normal backlog level now. Is that the right way to kind of think about it at this point?

我的大部分問題都被問到了，但只是想跟進。弗朗索瓦，你實際上發表了評論，你期望一些——也許是弗蘭克，一些營運資金的東西會在第四財季自行解決，我知道你不想具體談論積壓，但聽起來如果它能在第四財季自行解決，我們現在應該期望以更正常的積壓水平退出今年。在這一點上，這是正確的思考方式嗎？

Yes, Jim, that is the right way to think about it.

是的，吉姆，這是正確的思考方式。

Okay. And just lastly, I know you called out SaaS being more resilient and that it's still growing on a year-to-year basis. Just given now that, that's become a more resilient part, and it seems like it should be, at this point, a material part of the business, any further color as to what percentage of the total recurring software business is now SaaS overall and if it grew actually sequentially? .

好的。最後，我知道你說 SaaS 更具彈性，而且它仍在逐年增長。鑑於現在，這已經成為一個更具彈性的部分，而且在這一點上，它似乎應該成為業務的重要部分，關於現在 SaaS 總體經常性軟件業務的百分比以及如果它實際上是按順序增長的？ .

Yes. Jim, we have not split that out, and we are not currently splitting that out now. In terms of growth year-over-year, yes, but we just have not split that out yet.

是的。吉姆，我們還沒有把它分開，我們現在也沒有把它分開。就同比增長而言，是的，但我們還沒有將其拆分出來。

This concludes today's call. Thank you for attending. You may now disconnect your lines.

今天的電話會議到此結束。感謝您的出席。您現在可以斷開線路。