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F5 profits up as clients increase cloud investments

F5 beat third-quarter revenue and profit estimates on Monday, benefiting from higher customer spending on its cloud-related technology, sending its shares up nearly 9% after the bell.

After a cut back in expenses related to software and hardware for several quarters, analysts say companies are now slowly increasing their spending in certain areas.

“We are seeing some early signs of demand stabilization,” President and CEO François Locoh-Donou said.

The company, which provides software and hardware that support applications over the Internet, said revenue in the June quarter grew more than 4% to $702.6 million, higher than analysts’ average estimate of $699.1 million, according to Refinitiv data.

It earned $3.21 per share on adjusted basis, beating the expectations of $2.86.

The company had in April lowered its fiscal 2023 revenue growth forecast and reduced its workforce by 9%, citing macroeconomic headwinds that affected customer spending.

F5’s revenue and profit forecasts for the fourth quarter were largely in line with estimates.

It expects revenue in the range $690 million to $710 million. Analysts polled by Refinitiv expected $701.3 million.

Per share earnings are seen in the range $3.15 to $3.27, compared to the estimate of $3.22. US News

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