A10 Networks reported third‑quarter 2025 revenue of $74.7 million, up 11.9% from $66.4 million a year earlier. The company’s non‑GAAP net income rose to $16.7 million, and non‑GAAP diluted earnings per share reached $0.23, beating the consensus estimate of $0.21 by $0.02 (9.5%). GAAP net income was $12.2 million, translating to a GAAP EPS of $0.17. Gross profit of $59.9 million gave an 80% gross margin, while operating income of $13.0 million produced a GAAP operating margin of 17.4% and a non‑GAAP operating margin of 24.7%.
Revenue growth was driven largely by a 17% year‑over‑year increase in product revenue, reflecting strong demand for AI‑enabled infrastructure and cybersecurity solutions. The Americas region contributed 65% of total revenue and grew 12% YoY, underscoring the company’s leadership in the high‑performance, low‑latency market. Service‑provider customers accounted for 45% of revenue, while enterprise and government segments grew 9% and 14% respectively, indicating broad‑based demand across the company’s portfolio.
Margin expansion was supported by a favorable product mix shift toward higher‑margin AI and security offerings, which offset modest cost increases in support services. The 80% gross margin reflects pricing power in the AI infrastructure space and efficient cost management. Operating margin growth to 24.7% non‑GAAP was driven by disciplined operating expenses and the elimination of one‑time items that had impacted the prior quarter. The company’s cost‑control initiatives, including streamlined engineering and sales processes, helped maintain profitability even as it invested in new product development.
The non‑GAAP EPS beat of $0.02 per share was largely a result of the higher product mix, strong revenue growth, and effective cost discipline. While GAAP EPS of $0.17 fell short of the $0.18 estimate, the company’s management highlighted that the GAAP figure was impacted by a one‑time restructuring charge that was excluded from the non‑GAAP calculation. The management’s focus on non‑GAAP metrics signals confidence in the underlying operating performance.
Management guided for full‑year 2025 revenue growth of 10% and EBITDA margins in the 26%‑28% range, a slight upward revision from the prior guidance. CFO Michelle Karan emphasized disciplined capital allocation and a focus on high‑return verticals, while CEO Dhrupad Trivedi reiterated the company’s commitment to scaling its AI platform and maintaining pricing power. The company noted headwinds from CapEx constraints in the service‑provider market and macroeconomic uncertainty outside the Americas, but highlighted continued momentum in the AI and cybersecurity segments.
Analysts responded positively to the earnings beat and margin expansion, citing the company’s strong demand trajectory and disciplined cost management. Some analysts expressed caution regarding valuation multiples and the potential impact of macro headwinds, but overall sentiment remained supportive of the company’s strategic focus on high‑growth AI infrastructure and security markets.
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