A10 Networks, Inc.
For the period ended Dec 31, 2025. Filed Feb 25, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 25, 2026
ATEN$24.76+9.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-25.
0001580808-25-000043
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-25.
0001580808-26-000014
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 89 previous paragraphs and 91 current paragraphs.
52 unchanged; 28 reworded; 10 added; 7 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
We are a global provider of secure application and network solutions that protect, optimize, and scale business-critical systems across on-premises, hybrid cloud, and edge environments. Our network infrastructure and security products are designed to enable large enterprises, service providers, and cloud platforms worldwide to deliver performance, reliability, and protection against cyber threats, while preparing their networks for the demands of artificial intelligence (“AI”) and next-generation applications.
Current report
We sell our solutions globally to service providers and enterprises who are looking to modernize and secure their digital infrastructure and application. Our service provider customers rely on scalable, efficient, and secure networks to deliver connectivity, cloud and other services that may generate revenue to their customers. Our enterprise customers require secure application delivery, AI-ready infrastructure, and are increasingly concerned about the landscape of cybersecurity threats across their complex networks and emerging AI workloads. Our end-customers operate in a variety of industries, including telecommunications, technology, industrial, retail, financial, gaming, education and government. Since inception, our customer base has grown significantly.
Current report
A10’s portfolio brings together secure application delivery, DDoS and API protection, and unified management into a cohesive platform that integrates with existing network architectures and leading public cloud environments. We deliver these capabilities through flexible deployment models, including software, cloud-native, and hardware form factors that are tailored to the scale and requirements of our customers. We generate revenue primarily from the sale of our secure networking and cybersecurity solutions and related support services. These offerings are delivered through a combination of direct and channel-based sales, with most customers purchasing maintenance and support alongside their initial deployment and renewing that support as contracts expire.
Current report
In March 2025, we issued $225.0 million aggregate principal amount of 2.75% Convertible Senior Notes due 2030 (the “2030 Notes”). The Company received net proceeds from the offering of approximately $217.7 million. The 2030 Notes will mature on April 1, 2030, unless earlier converted, redeemed or repurchased.
Current report
We continue to invest in innovation that strengthens our leadership in secure infrastructure, expands our cybersecurity capabilities, and positions A10 at the intersection of network performance, protection, and AI-driven workloads. Our strategy is grounded in disciplined capital allocation and a commitment to deliver durable revenue growth, expanding recurring revenue, and strong cash flow generation.
Current report
Enhanced U.S. tariffs, import/export restrictions and countermeasures taken by affected countries are contributing to macroeconomic volatility which in turn is impacting demand and our cost inputs. Spending patterns remain uneven due to the unpredictable impact of trade policies, and we may need to implement tariff-related input cost increases.
Current report
We derive revenue from two sources: (i) products revenue, which includes hardware, perpetual software license and subscription offerings, which include term-based license agreements; and (ii) services revenue, which includes PCS, professional services, training and software-as-a-service offerings.
Current report
Products revenue increased $27.3 million, or 20%, in 2025 compared to 2024. The increase was primarily a result of an increase in demand from our service provider and enterprise customers in the Americas region and an increase in demand from our service provider customers in the EMEA region, partially offset by decreases in demand from service provider and enterprise customers in the APJ region and enterprise customers in the EMEA region.
Current report
Products gross margin percentage increased to 80.0% in 2025 compared to 77.7% in 2024, primarily due to product and regional mix.
Current report
In March 2025, the Company issued the 2030 Notes and received net proceeds from the offering of approximately $217.7 million.
Removed paragraphs (7)
Previous report
We are a leading provider of secure application solutions and services that enable a new generation of intelligently connected companies with the ability to continuously improve cyber protection and digital responsiveness across dynamic Information Technology (“IT”) and network infrastructures. Our product portfolio seeks to address many of the cyber protection challenges and solution requirements. The portfolio consists of network infrastructure and security products. The infrastructure portfolio powers the delivery of internet services and applications while the security products protect applications, APIs, infrastructure and enterprises from cyber-attacks. Our security suite is known as A10 Defend. In addition, we have an intelligent management and automation tool known as A10 Control (formally Harmony Controller), which provides intelligent management, automation and analytics for secure application delivery in multi-cloud environments to help simplify operations.
Previous report
Our secure infrastructure solutions include; Thunder Application Delivery Controller (“ADC”), Thunder Carrier Grade Networking (“CGN”), Thunder SSL Insight (“SSLi”) and Thunder Convergent Firewall (“CFW”). Our security products include; A10 Defend Threat Control, A10 Defend Orchestrator, A10 Defend Detector, A10 Defend Mitigator and A10 Defend ThreatX Protect. Our solutions are available in a variety of form factors, such as optimized hardware appliances, bare metal software, containerized software, virtual appliances and cloud-native software. Our customers include leading service providers (cloud, telecommunications, multiple system operators, cable), government organizations, and enterprises.
Previous report
We intend to continue to invest for long-term growth. We have invested and expect to continue to invest in our product development efforts to deliver new products and additional features in our current products to address customer needs. In addition, we may expand our global sales and marketing organizations, expand our distribution channel programs and increase awareness of our solutions on a global basis. Our investments in growth in these areas may affect our short-term profitability.
Previous report
Products revenue decreased $1.3 million, or 1%, in 2024 compared to 2023 primarily driven by lower demand from our service provider and enterprise customers in the Americas, and EMEA regions, partially offset by higher demand from service provider customers in APJ.
Previous report
Products gross margin percentage remained flat in 2024 compared to 2023.
Previous report
In September 2022, we entered into a Common Stock Repurchase Agreement (the “Repurchase Agreement”) with Summit Partners Growth Equity Fund VIII-A, L.P., Summit Partners Growth Equity Fund VIII-B L.P., Summit Investors I, LLC and Summit Investors I (UK), L.P. (collectively, “Summit”). Pursuant to the Repurchase Agreement, we repurchased 3.5 million shares of common stock from Summit for approximately $44.6 million.
Previous report
In November 2024, we entered into a Common Stock Repurchase Agreement (the “Repurchase Agreement”) with Summit. Pursuant to the Repurchase Agreement, we repurchased 330 thousand shares of common stock from Summit for approximately $5.2 million. The common shares repurchased are held in treasury and accounted for under the cost method.
Reworded paragraphs (28)
Previous wording
The following discussion and analysis of our financial condition and results of operations (“MD&A”) should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this document. In addition to historical information, the MD&A contains forward-looking statements that involve risks and uncertainties. These forward-looking statements include, but are not limited to, those matters discussed under the heading “Forward-looking Statements.” Our actual results could differ materially from those anticipated by these forward‑looking statements due to various factors, including, but not limited to, those set forth under Item 1A. Risk Factors of this Form 10-K and elsewhere in this document.
Current wording
The following discussion and analysis of our financial condition and results of operations (“MD&A”) should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this document. In addition to historical information, the MD&A contains forward-looking statements that involve risks and uncertainties. These forward-looking statements include, but are not limited to, those matters discussed under the heading “Forward-looking Statements.” Our actual results could differ materially from those anticipated by these forward‑looking statements due to various factors, including, but not limited to, those set forth under Item 1A. Risk Factors of this Annual Report on Form 10-K and elsewhere in this document.
Previous wording
This section of the Form 10-K generally discusses fiscal 2024 and 2023 items and year-to-year comparisons between fiscal 2024 and 2023. Discussions of fiscal 2022 items and year-to-year comparisons between fiscal 2023 and 2022 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on February 29, 2024.
Current wording
This section of this Annual Report on Form 10-K generally discusses fiscal 2025 and 2024 items and year-to-year comparisons between fiscal 2025 and 2024. Discussions of fiscal 2024 items and year-to-year comparisons between fiscal 2024 and 2023 that are not included in this Annual Report on Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the SEC on February 25, 2025.
Previous wording
We derive revenue from two sources: (i) products revenue, which includes hardware, perpetual software license and subscription offerings, which include term-based license agreements; and (ii) services revenue, which includes post contract support (“PCS”), professional services, training and software-as-a-service offerings. Revenue for term-based license agreements is recognized at a point in time when the Company delivers the software license to the customer and over time once the subscription term has commenced. For our software-as-a-service offerings, our customers do not take possession of the Company’s software but rather we provide access to the service via a hosting arrangement. Revenue in these arrangements is recognized over time as the services are provided. A substantial portion of our revenue is from sales of our products and services through distribution channel partners, such as resellers and distributors. Our customers predominantly purchase PCS services in conjunction with purchases of our products other than our software-as-a-service offerings.
Current wording
We derive revenue from two sources: (i) products revenue, which includes hardware, perpetual software licenses and subscription offerings, which include term-based license agreements; and (ii) services revenue, which includes post contract support (“PCS”), professional services, training and software-as-a-service (”SaaS”) offerings. Revenue for term-based license agreements is recognized at a point in time when the Company delivers the software license to the customer and over time once the subscription term has commenced. For our software-as-a-service offerings, our customers do not take possession of the Company’s software but rather we provide access to the service via a hosting arrangement. Revenue in these arrangements is recognized over time as the services are provided. A substantial portion of our revenue is from sales of our products and services through distribution channels, such as resellers and distributors. Our customers predominantly purchase PCS services in conjunction with purchases of our products.
Previous wording
We sell our products globally to service providers and enterprises that depend on data center applications and networks to generate revenue and manage operations efficiently. We report two customer verticals: service providers, which accounted for 57% and 58% of our total revenue during 2024 and 2023, respectively, and enterprise, which accounted for 43% and 42% of our total revenue during 2024 and 2023, respectively. While we expect total demand to remain strong as the need for cybersecurity solutions continues to increase, we expect the demand shift trend from service provider to enterprise to continue in the near term. We report customer revenues in three broad geographic regions: the Americas, APJ and EMEA regions. The Americas region comprises the U.S. and all other countries in the Americas (excluding the U.S.). The APJ region comprises Asia Pacific region including Japan. The EMEA region comprises Europe, Middle East and Africa. We believe this vertical and geographic view aligns with how we manage the business and maps our product portfolio to customer verticals.
Current wording
We sell our products globally to service providers and enterprises that depend on data center applications and networks to generate revenue and manage operations efficiently. We report two customer verticals: service providers, which accounted for 60%, 57% and 58% of our total revenue during 2025, 2024 and 2023, respectively, and enterprise, which accounted for 40%, 43% and 42% of our total revenue during 2025, 2024 and 2023, respectively. While we expect total demand to remain strong as the need for cybersecurity solutions continues to increase, we expect the demand shift trend from service provider to enterprise to continue in the near term. We report customer revenues in three broad geographic regions: the Americas, APJ and EMEA regions. The Americas region comprises the U.S. and all other countries in the Americas (excluding the U.S.). The APJ region comprises Asia Pacific region including Japan. The EMEA region comprises Europe, Middle East and Africa. We believe this vertical and geographic view aligns with how we manage the business and maps our product portfolio to customer verticals.
Previous wording
We believe this sales approach allows us to obtain the benefits of channel distribution, such as expanding our market coverage, while still maintaining face-to-face relationships with our end-customers. We outsource the manufacturing of our hardware products to original design manufacturers. We perform quality assurance and testing at our San Jose, Taiwan and Japan distribution centers, as well as at our manufacturers’ locations.
Current wording
We sell substantially all of our solutions through our high-touch sales organization as well as distribution channels, including distributors, value-added resellers and system integrators, and fulfill nearly all orders globally through such resellers. We believe this sales approach allows us to obtain the benefits of channel distribution, such as expanding our market coverage, while still maintaining face-to-face relationships with our end-customers. We outsource the manufacturing of our hardware products to original design manufacturers. We perform quality assurance and testing at our San Jose, Taiwan and Japan distribution centers, as well as at our manufacturers’ locations.
Previous wording
As a result of the nature of our target market and the current stage of our development, a substantial portion of our revenue comes from a limited number of large end-customers and service providers. Purchases from our ten largest end-customers accounted for 38%, 33% and 41% of our total revenue for 2024, 2023 and 2022, respectively. Sales to these large end-customers have typically been characterized by large but irregular purchases with long sales cycles. The timing of these purchases and the delivery of the purchased products are difficult to predict and rely upon customer growth and network enhancements. Consequently, any acceleration or delay in anticipated product purchases by or deliveries to our largest end-customers could materially impact our revenue and operating results in any quarterly period. This may cause our quarterly revenue and operating results to fluctuate from quarter to quarter and make them difficult to predict.
Current wording
As a result of the nature of our target market and the current stage of our development, a substantial portion of our revenue comes from a limited number of large end-customers, including service providers and enterprise customers, in any period. Purchases from our ten largest end-customers accounted for 40%, 38% and 33% of our total revenue for 2025, 2024 and 2023, respectively. Sales to these large end-customers have typically been characterized by large but irregular purchases with long sales cycles. The timing of these purchases and the delivery of the purchased products are difficult to predict and rely upon customer growth and network enhancements. Consequently, any acceleration or delay in anticipated product purchases by or deliveries to our largest end-customers could materially impact our revenue and operating results in any quarterly period. This may cause our quarterly revenue and operating results to fluctuate from quarter to quarter and make them difficult to predict.
Previous wording
In February 2025, we acquired the assets and key personnel of ThreatX Protect, which expanded our cybersecurity portfolio with WAAP protection (web application and application programming interfaces).
Current wording
In February 2025, we acquired the assets and key personnel of ThreatX Protect, which expanded our cybersecurity portfolio with WAAP protection (web application and application programming interfaces). We offer protection under A10 Defend ThreatX Protect.
Previous wording
We generate services revenue from sales of post contract support (“PCS”), which is bundled with sales of products and technical services. We offer tiered PCS services under renewable, fee-based PCS contracts, primarily including technical support, hardware repair and replacement parts, and software upgrades on a when-and-if-available basis. We recognize services revenue ratably over the term of the PCS contract, which is typically one year, but can be up to seven years.
Current wording
We generate services revenue from sales of PCS, which is bundled with sales of products and technical services. We offer tiered PCS services under renewable, fee-based PCS contracts, primarily including technical support, hardware repair and replacement parts, and software upgrades on a when-and-if-available basis. We recognize services revenue ratably over the term of the PCS contract, which is typically one year, but can be up to seven years.
Previous wording
Total revenue increased by $10.0 million, or 4%, in 2024 compared to 2023. This increase was due to a $11.3 million increase in services revenue, partially offset by a decrease of $1.3 million in products revenue.
Current wording
Total revenue increased by $28.9 million, or 11%, in 2025 compared to 2024 as a result of an increase of $27.3 million in products revenue and an increase of $1.6 million in services revenue.
Previous wording
Services revenue increased $11.3 million, or 10%, in 2024 compared to 2023. The increase was primarily attributable to the increase in PCS sales in connection with our increased installed customer base in the APJ region, and to a lesser extent in the Americas and EMEA regions.
Current wording
Services revenue increased $1.6 million, or 1%, in 2025 compared to 2024. The increase was primarily attributable to the increase in PCS sales in connection with our increased installed customer base in the Americas region.
Previous wording
During 2024, $134.4 million, or 51% of total revenue, was generated from the Americas region, which represents a 1% increase compared to 2023. The increase was primarily due to higher services revenue driven by an increase in demand from our enterprise customers.
Current wording
During 2025, $175.2 million, or 60% of total revenue, was generated from the Americas region, which represents a 30% increase compared to 2024. The increase was primarily a result of higher products and services revenue driven by an increase in demand from both service provider and enterprise customers.
Previous wording
During 2024, $40.2 million, or 16% of total revenue, was generated from EMEA, which represented a 3% decrease compared to 2023. The decrease was primarily due to lower products revenue driven by a decrease in demand from our service provider customers.
Current wording
During 2025, $70.5 million, or 24% of total revenue, was generated from APJ, which represents a 19% decrease compared to 2024. The decrease was primarily a result of lower products and services revenue driven by a decrease in demand from our service provider and enterprise customers.
Previous wording
During 2024, $87.2 million, or 33% of total revenue, was generated from APJ, which represents a 12% increase compared to 2023. The increase was primarily due to higher products and services revenue driven by an increase in demand from our service provider customers.
Current wording
During 2025, $44.9 million, or 16% of total revenue, was generated from EMEA, which represented a 12% increase compared to 2024. The increase was primarily a result of higher products revenue driven by an increase in demand from our service provider customers.
Previous wording
Cost of services revenue is primarily comprised of personnel costs for our technical support, training and professional service teams. Cost of services revenue also includes the costs of inventory used to provide hardware replacements to end- customers under PCS contracts and certain allocated facilities and information technology infrastructure costs.
Current wording
Cost of services revenue is primarily comprised of personnel costs for our technical support, training and professional service teams. Cost of services revenue also includes the costs of inventory used to provide hardware replacements to end- customers under PCS contracts and certain allocated facilities and information technology infrastructure costs. Additionally, cost of services revenue includes a one-time asset impairment cost of $951 thousand for the year ended December 31, 2025.
Previous wording
Services gross margin percentage decreased by 1.7% in 2024 compared to 2023 primarily due to an increase in personnel-related support costs, especially variable compensation.
Current wording
Services gross margin percentage decreased to 78.4% in 2025 compared to 83.4% in 2024 primarily due to an increase in personnel-related support costs and the mix of services delivered, which include technical support, training and service costs. Additionally, in 2025 services gross margin percentage was negatively impacted by a one-time asset impairment charge totaling $951 thousand.
Previous wording
The $2.7 million decrease in sales and marketing expenses in 2024 compared to 2023 was primarily due to decreases of $3.2 million in personnel costs as a result of a decrease in headcount, partially offset by an increase in marketing events of $0.6 million.
Current wording
The $1.2 million increase in sales and marketing expenses in 2025 compared to 2024 was primarily due to increases of $1.8 million in personnel costs as a result of an increase in headcount, $0.3 million in equipment expense and $0.3 million of amortization and depreciation expense, partially offset by a decrease in bad debt expense of $1.2 million.
Previous wording
The $2.5 million increase in research and development expenses in 2024 compared to 2023 was primarily due to an increase of $1.5 million in personnel costs and a $1.3 million increase in equipment and software expense, partially offset by a decrease of $0.6 million in professional services.
Current wording
The $11.4 million increase in research and development expenses in 2025 compared to 2024 was primarily due to an increase of $12.0 million in personnel costs and a $1.5 million increase in equipment and software expense, partially offset by a decrease of $2.3 million in consultants and professional services.
Previous wording
The $1.4 million increase in general and administrative expenses in 2024 compared to 2023 was primarily due to an increase of $1.3 million in personnel costs as a result of an increase in variable compensation.
Current wording
The $4.5 million increase in general and administrative expenses in 2025 compared to 2024 was primarily due to an increases of $1.2 million in legal services, $1.0 million in personnel costs primarily as a result of an increase in variable compensation, $1.0 million in amortization and depreciation, $0.5 million in business insurance and $0.4 million in equipment expense.
Previous wording
Interest income was $6.7 million and $5.1 million in the years ended December 31, 2024 and 2023, respectively.
Current wording
Interest income was $11.6 million and $6.7 million in the years ended December 31, 2025 and 2024, respectively.
Previous wording
In the years ended December 31, 2024 and 2023, interest and other income (expense), net consisted primarily of gains on equity investments and foreign currency exchange gains and losses. The Company recorded $5.3 million of investment gains in the year ended December 31, 2024, compared to an immaterial loss in the year ended December 31, 2023. Foreign currency exchange gains and losses had a favorable change of $2.1 million in the year ended December 31, 2024 compared to a favorable change of $0.1 million in 2023.
Current wording
In the year ended December 31, 2025, interest and other income (expense), net consisted primarily of interest expense for the 2030 Notes and foreign currency exchange gains and losses. In the year ended December 31, 2024, interest and other income (expense), net consisted primarily of gains on equity investments and foreign currency exchange gains and losses. The Company recorded $6.1 million of interest expense for the 2030 Notes in the year ended December 31, 2025, while no interest expense was recorded during the year ended December 31, 2024. The Company recorded $5.3 million of investment gains in the year ended December 31, 2024, while no investment gains or losses were recorded in the year ended December 31, 2025. Foreign currency exchange gains and losses, net had an unfavorable change of $0.3 million in the year ended December 31, 2025 compared to a favorable change of $2.1 million in the year ended December 31, 2024.
Previous wording
We recorded a provision for income tax of $8.0 million for the year ended December 31, 2024 and $3.8 million for the year ended December 31, 2023. Our deferred tax assets primarily consist of research and development credits, capitalized research and development expenses and accruals and reserves. The Company’s income tax provision for the year ended December 31, 2024 primarily consisted of U.S. federal and state taxes. The Company’s income tax provision for the year ended December 31, 2023 primarily consisted of U.S. federal, state and foreign income taxes.
Current wording
We recorded a provision for income tax of $10.3 million for the year ended December 31, 2025 and $8.0 million for the year ended December 31, 2024. Our deferred tax assets primarily consist of research and development credits, capitalized research and development expenses and accruals and reserves. The Company’s income tax provision for the year ended December 31, 2025 and 2024, primarily consisted of U.S. federal, state and foreign income taxes.
Previous wording
As of December 31, 2024, we had cash and cash equivalents of $95.1 million, including $3.9 million held outside the U.S. in our foreign subsidiaries, and $100.4 million of marketable securities. We currently do not have any plans to repatriate our earnings from our foreign operations. As of December 31, 2024, we had working capital of $183.7 million, accumulated deficit of $40.3 million and total stockholders’ equity of $231.8 million.
Current wording
As of December 31, 2025, we had cash and cash equivalents of $71.1 million, including $4.1 million held outside the U.S. in our foreign subsidiaries, and $306.7 million of marketable securities. We currently do not have any plans to repatriate our earnings from our foreign operations. As of December 31, 2025, we had working capital of $342.3 million, retained earnings of $1.8 million and total stockholders’ equity of $211.5 million.
Previous wording
On November 1, 2022, the Company announced its Board of Directors authorized a stock repurchase program of up to $50 million of its common stock over a period of twelve months. On November 7, 2023, the Company announced its Board of Directors had authorized a stock repurchase program under which the Company may repurchase up to $50 million of its outstanding common stock over a period of twelve months. On November 7, 2024, the Company announced its Board of Directors had authorized a new, non-expiring stock repurchase program under which the Company may repurchase up to $50 million of its outstanding common stock. As of December 31, 2024, the Company had $44.2 million available to repurchase shares. Under these repurchase programs, repurchased shares are held in treasury at cost. The Company’s stock repurchase programs do not obligate us to acquire any specific number of shares. Shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act. To date, all repurchases under the Company’s stock repurchase programs have occurred in the open market, in negotiated transactions and from withholding shares in connection with vesting equity awards held by certain employees. During the year ended December 31, 2024, the Company repurchased 2.2 million shares for a total cost of $30.1 million. During the year ended December 31, 2023, the Company repurchased 1.3 million shares for a total cost of $16.0 million.
Current wording
The Board of Directors, from time to time, has authorized various stock repurchase programs, including most recently, a twelve-month $50 million program approved November 7, 2023 (the “2023 Program”), a $50 million program approved November 7, 2024 (the “2024 Program”) and a $75 million program approved May 1, 2025 (the “2025 Program”). The Board of Directors terminated the 2024 Program on May 1, 2025. Under all programs, repurchased shares are held in treasury at cost. The Company’s stock repurchase programs do not obligate us to acquire any specific number of shares. Shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act of 1934 (the “Exchange Act”). During the year ended December 31, 2025, the Company had repurchased 3.7 million shares for a total cost of $68.9 million under the 2025 and 2024 Programs. During the year ended December 31, 2024, the Company repurchased 2.2 million shares for a total cost of $30.1 million under the 2024 and 2023 Programs.
Previous wording
In October 2021, our Board approved the initiation of a regular quarterly cash dividend on our common stock. The first dividend, in the amount of $0.05 per share of common stock outstanding, was paid in December 2021 and was treated as a return of capital, and on November 1, 2022, the Board of Directors increased the dividend amount to $0.06 per share. We currently anticipate that we will continue to pay comparable quarterly cash dividends in the future. However, the payment, amount and timing of future dividends remain within the discretion of our Board and will depend on our results of operations, financial condition, cash requirements, and other factors.
Current wording
In October 2021, the Board of Directors approved the initiation of a regular quarterly cash dividend on our common stock. During the year ended December 31, 2025, the Company paid quarterly cash dividends in the amount of $0.06 per share outstanding, for a total of $17.4 million. The next dividend, in the amount of $0.06 per share, will be paid on March 2, 2026 to stockholders of record on February 16, 2026. We currently anticipate that we will continue to pay comparable quarterly cash dividends in the future. However, the payment, amount and timing of future dividends remain within the discretion of the Board of Directors and will depend upon our results of operations, financial condition, cash requirements, and other factors.
Previous wording
During the year ended December 31, 2023, cash provided by operating activities was $44.5 million, consisting of net income of $40.0 million and non-cash benefits totaling $22.8 million, partially offset by an unfavorable net change in operating assets and liabilities of $18.3 million. Our non-cash benefits primarily consisted of non-cash charges of $14.1 million for stock-based compensation and $9.3 million of depreciation and amortization expense. The net change in our operating assets and liabilities primarily reflects cash outflows from changes in accrued and other liabilities of $20.8 million, inventory of $6.3 million, accounts payable of $3.0 million and prepaid expenses and other assets of $1.9 million, partially offset by cash inflows from changes in deferred revenue of $14.3 million. The unfavorable change in accounts receivable was due to the timing of collections from our customers. The favorable change in deferred revenues was attributable to the timing of service contract bookings.
Current wording
During the year ended December 31, 2025, cash provided by operating activities was $84.9 million, consisting of net income of $42.1 million, non-cash benefits totaling $37.8 million and a favorable net change in operating assets and liabilities of $5.0 million. Our non-cash benefits primarily consisted of non-cash charges of $20.0 million for stock-based compensation and $14.9 million of depreciation and amortization expense. The net change in our operating assets and liabilities primarily reflects cash inflows from changes in accounts receivable of $14.6 million, accrued and other liabilities of $4.6 million and inventory of $3.7 million, partially offset by cash outflows from changes in prepaid expenses and other assets of $8.3 million, deferred revenue of $8.0 million, and accounts payable of $1.5 million. The favorable change in accounts receivable was due to the timing of collections from our customers. The favorable change in accrued liabilities was due to increases in accrued income taxes and variable compensation. The unfavorable change in prepaid expenses and other assets was due to an increase in deferred contract acquisition costs. The unfavorable change in deferred revenues was attributable to the timing of service contract bookings. The favorable change in accounts payable is due to the timing of payments to our vendors.
Previous wording
During the year ended December 31, 2023, cash provided in investing activities was $13.6 million, consisting of proceeds from maturities of marketable securities of $64.5 million and proceeds from the sales of marketable securities of $45.4 million, partially offset by purchases of marketable securities of $85.4 million and capital expenditures of $10.9 million.
Current wording
During the year ended December 31, 2025, cash used by investing activities was $243.6 million, consisting of purchases of marketable securities of $342.0 million, our acquisition of ThreatX Protect for $19.1 million and capital expenditures of $20.1 million, partially offset by proceeds from maturities of marketable securities of $136.8 million and proceeds from the sales of marketable securities of $0.9 million.
Previous wording
During the year ended December 31, 2023, cash used in financing activities was $28.8 million consisting primarily of $17.8 million of cash used for the payments of cash dividends and $16.0 million of cash used to repurchase our common stock in the open market, partially offset by $4.9 million of cash proceeds from common stock issuances under our equity incentive plans.
Current wording
During the year ended December 31, 2025, cash provided by financing activities was $134.8 million consisting primarily of $217.7 million of net cash proceeds from the issuance of the 2030 Notes and $3.4 million of cash proceeds from common stock issuances under our equity incentive plans. Partially offsetting these cash inflows was $68.9 million of cash used to repurchase our common stock in the open market, from privately negotiated transactions and from withholding shares in connection with vesting equity awards held by certain employees and $17.4 million of cash used for the payments of cash dividends.
Previous wording
We derive revenue from two sources: (i) products revenue, which includes hardware, perpetual software license and subscription offerings, which include term-based license agreements; and (ii) services revenue, which includes post contract support (“PCS”), professional services, training and software-as-a-service offerings. Revenue for term-based license agreements is recognized at a point in time when the Company delivers the software license to the customer and the subscription term has commenced. For our software-as-a-service offerings, our customers do not take possession of the Company’s software but rather we provide access to the service via a hosting arrangement. Revenue in these arrangements is recognized ratably as the services are provided. A substantial portion of our revenue is from sales of our products and services through distribution channels, such as resellers and distributors. Our customers predominantly purchase PCS services in conjunction with purchases of our products.
Current wording
We derive revenue from two sources: (i) products revenue, which includes hardware, perpetual software license and subscription offerings, which include term-based license agreements; and (ii) services revenue, which includes PCS, professional services, training and software-as-a-service offerings. Revenue for term-based license agreements is recognized at a point in time when the Company delivers the software license to the customer and the subscription term has commenced. For our software-as-a-service offerings, our customers do not take possession of the Company’s software but rather we provide access to the service via a hosting arrangement. Revenue in these arrangements is recognized ratably as the services are provided. A substantial portion of our revenue is from sales of our products and services through distribution channels, such as resellers and distributors. Our customers predominantly purchase PCS services in conjunction with purchases of our products.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
We operate worldwide across the Americas, EMEA, and Asia Pacific, supported by a hybrid go-to-market model that combines a direct, high-touch sales organization with a broad ecosystem of distributors, resellers, and system integrators. We believe this sales approach allows us to obtain the benefits of channel distribution, such as expanding our market coverage, while still maintaining face-to-face relationships with our end-customers. We outsource the manufacturing of our hardware products to original design manufacturers. We perform quality assurance and testing at our San Jose, Taiwan and Japan distribution centers, as well as at our manufacturers’ locations.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
We sell substantially all of our solutions through our high-touch sales organization as well as distribution channels, including distributors, value-added resellers and system integrators, and fulfill nearly all orders globally through such resellers.
Previous report — wording carried elsewhere
We derive revenue from two sources: (i) products revenue, which includes hardware, perpetual software license and subscription offerings, which include term-based license agreements; and (ii) services revenue, which includes post contract support (“PCS”), professional services, training and software-as-a-service offerings.