8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):
April 25, 2007

F5 Networks, Inc.

(Exact name of registrant as specified in its charter)

Washington	000-26041	91-1714307
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

401 Elliott Avenue West
Seattle, WA 98119

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code (206) 272-5555

Not Applicable

Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On April 25, 2007, F5 Networks, Inc. issued a press release regarding its financial results for the second quarter ended March 31, 2007. The press release is attached hereto as Exhibit 99.1. The information in this report shall not be treated as filed for purposes of the Securities Exchange Act of 1934, as amended.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits:

99.1 Press Release of F5 Networks, Inc. announcing quarterly earnings dated April 25, 2007.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	F5 NETWORKS, INC. (Registrant)
Date: April 25, 2007	By:	/s/ John McAdam
		John McAdam
		President and Chief Executive Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release of F5 Networks, Inc. announcing quarterly earnings dated April 25, 2007.

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

CONTACT:	Investor Relations
	John Eldridge (206) 272-6571
	j.eldridge@f5.com
	Public Relations
	Alane Moran
	(206) 272-6850
	a.moran@f5.com

F5 Networks Announces Results for Second Quarter of Fiscal 2007

Strength of core business drives 17^th consecutive quarter of revenue growth

SEATTLE, WA—April 24, 2007—For the second quarter of fiscal 2007, F5 Networks announced revenue of $127.6 million, up 6 percent from $120.0 million in the prior quarter and 36 percent from $94.1 million in the second quarter of fiscal 2006. Net income was $20.0 million ($0.47 per diluted share), compared to $22.4 million ($0.53 per diluted share) in the prior quarter, which included a one-time tax benefit of $0.04 per share. Net income was $16.1 million ($0.39 per diluted share) in the second quarter a year ago.

The company’s solid revenue gains reflect the continuing strength of its core application delivery networking business, which grew 8 percent during the quarter and accounted for 92 percent of total revenue. John McAdam, F5 president and chief executive officer, said the strength of the company’s core business relative to its WAN optimization and security offerings was no surprise and further validated the company’s plans to port WANJet and FirePass to TMOS and integrate their functionality into its application delivery networking solutions. TMOS-based versions of both products are scheduled for delivery in late summer.

“In the meantime, the rich functionality of BIG-IP’s TMOS-based solution set, coupled with the flexibility of iRules and the high-performance of our integrated hardware platforms, is continuing to open new market opportunities,” McAdam said. “Along with growing demand in large enterprises, changes in the technology landscape are driving telecommunications companies and internet service providers to look for new and better ways to manage the complex array of data, information and services they are attempting to provide their customers. From the perspective of both functionality and performance, our family of BIG-IP products offers these organizations the widest array of fully-integrated solutions to meet their needs, and we are continuing to invest in all areas of our business to take advantage of these opportunities.”

In addition to its solid operating results, F5 continued to strengthen its balance sheet during the second quarter. Reflecting the strong growth of its services business, deferred revenue

increased 10% to $75.2 million at quarter end. Cash flow from operations was $37.0 million, and the company ended the quarter with $586 million in cash and investments.

For the current quarter, ending June 30, 2007, McAdam said management has set a revenue goal of $131 million to $133 million with an earnings target of $0.48 to $0.50 per diluted share.

About F5 Networks

F5 Networks is the global leader in Application Delivery Networking. F5 provides solutions that make applications secure, fast and available for everyone, helping organizations get the most out of their investment. By adding intelligence and manageability into the network to offload applications, F5 optimizes applications and allows them to work faster and consume fewer resources. F5’s extensible architecture intelligently integrates application optimization, protects the application and the network, and delivers application reliability — all on one universal platform. Over 10,000 organizations and service providers worldwide trust F5 to keep their applications running. The company is headquartered in Seattle, Washington with offices worldwide. For more information, go to www.f5.com.

Forward Looking Statements

Statements in this press release concerning the continuing strength of F5’s business, sequential growth, the target revenue and earnings range, demand for application delivery networking and other statements that are not historical facts are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others: customer acceptance of our new traffic management, security, application delivery and WAN optimization offerings; the timely development, introduction and acceptance of additional new products and features by F5 or its competitors; competitive pricing pressures; increased sales discounts; F5’s ability to sustain, develop and effectively utilize distribution relationships; F5’s ability to attract, train and retain qualified product development, marketing, sales, professional services and customer support personnel; F5’s ability to expand in international markets; and the unpredictability of F5’s sales cycle.

F5 has no duty to update any matters discussed in this press release. More information about potential risk factors that could affect F5’s business and financial results is included in the company’s annual report on Form 10-K for the fiscal year ended September 30, 2006, and other public filings with the Securities and Exchange Commission.

# # #

F5 Networks, Inc.
Condensed Consolidated Balance Sheets
(unaudited, in thousands)

	March 31,			September 30,
	2007			2006
Assets
Current assets
Cash and cash equivalents	$	46,834		$	37,746
Short-term investments		384,426			336,427
Accounts receivable, net of allowances of $2,809 and $2,858		73,142			62,750
Inventories		7,915			5,763
Deferred tax assets		4,479			4,682
Other current assets		21,746			15,607
Total current assets		538,542			462,975
Restricted cash		4,147			3,929
Property and equipment, net		31,693			29,951
Long-term investments		154,834			118,003
Deferred tax assets		11,572			18,657
Goodwill		81,701			81,701
Other assets, net		13,611			14,295
Total assets	$	836,100		$	729,511
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable	$	23,012		$	13,174
Accrued liabilities		32,863			31,583
Deferred revenue		67,411			54,880
Total current liabilities		123,286			99,637
Other long-term liabilities		8,488			7,976
Deferred revenue, long-term		7,805			5,440
Total long-term liabilities		16,293			13,416
Commitments and contingencies
Shareholders’ equity
Preferred stock, no par value; 10,000 shares authorized, no shares outstanding		—			—
Common stock, no par value; 100,000 shares authorized, 41,505 and 40,778 shares issued and outstanding		559,435			521,791
Accumulated other comprehensive loss		(928	)		(1,038	)
Retained earnings		138,014			95,705
Total shareholders’ equity		696,521			616,458
Total liabilities and shareholders’ equity	$	836,100		$	729,511

F5 Networks, Inc.
Condensed Consolidated Statements of Operations
(unaudited, in thousands, except per share amounts)

	Three Months Ended				Six Months Ended
	March 31,				March 31,
	2007		2006		2007		2006
Net revenues
Products	$	96,126	$	72,775	$	188,188	$	141,366
Services		31,479		21,341		59,447		40,837
Total		127,605		94,116		247,635		182,203
Cost of net revenues (1)
Products		20,425		15,441		39,641		30,034
Services		8,390		5,846		15,698		10,820
Total		28,815		21,287		55,339		40,854
Gross Profit		98,790		72,829		192,296		141,349
Operating expenses (1)
Sales and marketing		43,177		31,162		82,232		60,027
Research and development		17,086		12,276		31,625		22,754
General and administrative		12,867		7,148		25,685		14,545
Total		73,130		50,586		139,542		97,326
Income from operations		25,660		22,243		52,754		44,023
Other income, net		7,230		3,877		13,661		6,847
Income before income taxes		32,890		26,120		66,415		50,870
Provision for income taxes		12,934		10,053		24,106		19,582
Net Income	$	19,956	$	16,067	$	42,309	$	31,288
Net income per share — basic	$	0.48	$	0.40	$	1.03	$	0.79
Weighted average shares — basic		41,417		40,120		41,222		39,636
Net income per share — diluted	$	0.47	$	0.39	$	1.00	$	0.76
Weighted average shares — diluted		42,390		41,627		42,244		41,278

(1) Amounts include stock-based compensation, as follows:
Cost of net revenues	$	584	$	349	$	1,193	$	698
Sales and marketing		4,400		2,200		7,838		4,289
Research and development		2,651		1,535		4,979		2,978
General and administrative		4,070		1,508		6,425		2,878
	$	11,705	$	5,592	$	20,435	$	10,843