exhibit_10-1.htm

CONTACTS Chief Financial Officer Meir Moshe +972-3766-8610
Corporate Media Relations Michael Lordi +1 201-785-3206 mikel@radware.com

For Immediate Release

Radware Ltd. Announces Third Quarter 2011 Results

* Record Quarterly Revenues of $42.2 Million

* Record Non-GAAP EPS $0.34

* Record Non-GAAP Operating Margin 17%

TEL AVIV, ISRAEL: October 26, 2011 — Radware (NASDAQ: RDWR), a global leader of application delivery and application security solutions for virtual and cloud data centers, today reported record quarterly revenues of $42.2 million for the third quarter of 2011. This represents an increase of 15% compared with revenues of $36.8 million for the third quarter of 2010, and an increase of 3% compared with revenues of $41.1 million in the second quarter of 2011.

Net income on a GAAP basis for the third quarter of 2011 was $5.4 million or $0.24 per diluted share, compared with net income of $3.7 million or $0.17 per diluted share for the third quarter of 2010.

Net income on a Non-GAAP basis for the third quarter of 2011 was $7.8 million or $0.34 per diluted share, compared with net income of $5.6 million or $0.26 per diluted share in the third quarter of 2010.

During the third quarter 2011 Radware generated $3 million in cash and ended the quarter with $207 million in cash, cash equivalents, deposits and marketable securities.

“This quarter represents yet another record posting for company revenues, earnings per share, and operating margins,” stated Roy Zisapel, president and chief executive officer, Radware. “This sustained growth is driven by market interest in our recently announced Attack Mitigation System along with our continued success with our innovative application delivery solutions for data center consolidation, virtualization, and cloud computing.”

During the third quarter 2011, Radware released the following significant announcements:

Radware Ltd. Announces Second Quarter 2011 Results

Radware Announces 2011 Annual General Meeting

Radware Claims Three 2010 Communications Solutions Product of the Year Awards

Radware Introduces New vDirect Plug-In Joint Solution with VMware vCloud® Director

KONAMI Selects Radware’s ADC-VX Virtualization Solution For its Online Entertainment Site

Radware Reports Results of Annual General Meeting

Radware Announces Its Participation in SAP® EcoHub and SAP PartnerEdge™ Program

Radware’s Attack Mitigation System Delivers the First Fully Integrated Solution to Fight Cyber Attacks in Real Time

Radware Announces Third Quarter 2011 Earnings Conference Call

Radware Announces $20 Million Share Buyback And Refines Guidance for Third Quarter 2011

Company management will host a quarterly investor conference call at 8:45am ET on October 26, 2011. The call will focus on financial results for the quarter ending September 30, 2011 and certain other matters related to the Company’s business.

The conference call will be webcast on October 26, 2011 at 8:45am ET in the “listen only” mode via the Internet at: http://www.radware.com/Company/InvestorRelations/default.aspx and will be available for replay during the next 30 days.

Please use the following dial-in numbers to participate in the Second Quarter 2011 call:

Participants in the US call: Toll Free +1 877-392-9880

International participants call: +1 760-666-3769

About Radware

Radware (NASDAQ: RDWR), is a global leader of application delivery and application security solutions for virtual and cloud data centers. Its award-winning solutions portfolio delivers full resilience for business-critical applications, maximum IT efficiency, and complete business agility. Radware’s solutions empower more than 10,000 enterprise and carrier customers worldwide to adapt to market challenges quickly, maintain business continuity and achieve maximum productivity while keeping costs down. For more information, please visit www.radware.com.

Radware encourages you to join our community and follow us on LinkedIn, Radware Blog, Twitter, YouTube and the Radware Connect app for iPhone®.

Use of Non-GAAP Financial Information

In addition to reporting financial results in accordance with generally accepted accounting principles (GAAP), Radware uses non-GAAP measures of net income and earnings per share, which are adjustments from results based on GAAP to exclude stock-based compensation expenses, in accordance with ASC No. 718, amortization of intangible assets, and exchange rate differences, net on balance sheet items included in finance income. Such exchange rate differences may vary from period to period due to changes in exchange rates driven by general market conditions or other circumstances outside of the normal course of Radware's operations. Management believes that exclusion of these charges allows comparisons of operating results that are consistent across past, present and future periods. Radware’s management believes the non-GAAP financial information provided in this release is useful to investors for the purpose of understanding and assessing Radware’s ongoing operations. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release, to the most directly comparable GAAP financial measures, is included with the financial information contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating business internally and, as such, has determined that it is important to provide this information to investors.

This press release may contain forward-looking statements that are subject to risks and uncertainties. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, general business conditions in the Application Switching and Network Security industry, changes in demand for Application Switching and Network Security products, the timing and amount or cancellation of orders and other risks detailed from time to time in Radware's filings with the Securities and Exchange Commission, including Radware's Form 20-F.

Condensed Consolidated Balance Sheets

(U.S. Dollars in thousands)

	December 31, 2010			September 30, 2011
				(Unaudited)
Current assets
Cash and cash equivalents		15,284			15,729
Available-for-sale marketable securities		24,200			14,995
Short term bank deposits		51,441			70,157
Trade receivables, net		16,543			17,661
Other receivables and prepaid expenses		3,402			3,453
Inventories		9,722			11,438
		120,592			133,433
Long-term investments
Available-for-sale marketable securities		82,864			100,777
Long-term bank deposits		5,000			5,000
Severance pay funds		3,342			3,134
		91,206			108,911

Property and equipment, net		11,801			11,664

Other assets
Intangible assets, net		12,011			9,134
Other long-term assets		560			603
Goodwill		24,465			24,465
Total assets		260,635			288,210

Current liabilities
Trade payables		5,913			5,844
Deferred revenues, other payables and accrued expenses		47,223			51,337
		53,136			57,181

Long-term liabilities		22,509			22,533

Shareholders’ equity
Share capital		506			524
Additional paid-in capital		218,593			229,286
Accumulated other comprehensive income (loss)		125			(1,797	)
Treasury stock, at cost		(18,036	)		(18,036	)
Accumulated deficit		(16,198	)		(1,481	)
Total shareholders’ equity		184,990			208,496
Total liabilities and shareholders' equity		260,635			288,210

Condensed Consolidated Statements of Income
(U.S. Dollars in thousands, except share and per share data)

	For the Three months ended September 30,						For the Nine months ended September 30,
	2010			2011			2010			2011
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)

Revenues		36,763			42,196			105,065			121,930
Cost of revenues		7,448			8,534			21,236			24,731
Gross profit		29,315			33,662			83,829			97,199
Operating expenses:
Research and development		8,240			9,122			23,380			26,918
Selling and marketing		15,934			17,282			47,662			51,027
General and administrative		2,526			2,343			7,656			7,128
Total operating expenses		26,700			28,747			78,698			85,073
Operating income		2,615			4,915			5,131			12,126
Financial income, net		1,294			776			1,202			3,413
Income before taxes on income		3,909			5,691			6,333			15,539
Taxes on income		(191	)		(293	)		(623	)		(822	)
Net Income		3,718			5,398			5,710			14,717

Basic net earnings per share	$	0.19		$	0.26		$	0.30		$	0.70

Weighted average number of shares used to compute basic net earnings per share		19,711,311			21,052,835			19,286,258			20,886,623

Diluted net earnings per share	$	0.17		$	0.24		$	0.27		$	0.64

Weighted average number of shares used to compute diluted net earnings per share		21,921,819			22,782,410			21,146,646			22,936,293

Reconciliation of Supplemental Financial Information

(U.S. Dollars in thousands, except share and per share data)

	For the Three months ended September 30,				For the Nine months ended September 30,
	2010		2011		2010		2011
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)

GAAP net Income		3,718		5,398		5,710		14,717
Stock-based compensation expenses, included in:
Cost of revenues		18		15		47		46
Research and development		365		248		943		787
Selling and marketing		711		731		1,766		2,122
General and administrative		470		209		1,380		872
		1,564		1,203		4,136		3,827

Amortization of intangible assets included in:
Cost of revenues		439		541		1,217		1,623
Selling and marketing		531		421		1,753		1,263
		970		962		2,970		2,886

Exchange rate differences, net on balance sheet items included in finance income	(616)			233		709		(263	)

Non-GAAP net income		5,636		7,796		13,525		21,167

Non-GAAP diluted net earnings per share	$	0.26	$	0.34	$	0.64	$	0.92

Weighted average number of shares used to compute Non-GAAP diluted net earnings per share		21,921,819		22,782,410		21,146,646		22,936,293