F5 (FFIV) 10-K risk factor changes: FY2021 vs FY2020

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In addition, new cloud infrastructures are enabling the emergence of new competitors including large cloud providers who offer their own [removed: ADC] [added: application security and delivery] functionality as well as smaller companies targeting the growing numbers of "born in the cloud" applications.

We may not be able to compete effectively in the emerging application [removed: services] [added: delivery and security] market

[removed: Our principal competitors in the] [added: Within] application [removed: services market include] [added: delivery we compete against] Citrix [removed: Systems, Inc., Radware Ltd.,] [added: Systems] and a number of other competitors that have a smaller market presence or limited feature set, such [removed: as: A10 Networks,] [added: as] Amazon Web Services, HAProxy, [added: Kemp Technologies,] Microsoft Azure, and VMware.

Our success depends on sales and continued innovation of our [removed: Application Delivery Controller] [added: application security] and [removed: Application Security] [added: delivery] product lines

We expect to derive a significant portion of our net revenues from sales of our [removed: Application Delivery Controller (ADC)] [added: application security] and [removed: Application Security products] [added: delivery product lines] in the future.

[removed: Despite our security measures, and those of our] third-party vendors, our information technology and infrastructure has experienced breaches or disruptions and may be vulnerable in the future to breach, attacks or disruptions.

Our competitors may also use our restructuring plans to seek to [added: gain a competitive advantage over us.]

[removed: The] [added: Despite efforts to mitigate the effects of supply chain constraints, the] unavailability of suitable components, any interruption or delay in the supply of any of these hardware components or the inability to procure a similar component from alternate sources at acceptable prices within a reasonable time, may delay assembly and [added: our ability to fulfill our] sales of our products and, hence, our revenues, and may harm our business and results of operations.

For example, customers frequently begin by evaluating our products on a limited basis and devote time and resources to testing our products before they decide whether or [removed: not to purchase.]

In addition, [removed: one] [added: two] worldwide [removed: distributor] [added: distributors] of our products accounted for [removed: 16.7%] [added: 30.3%] of our total net revenue for fiscal year [removed: 2020.][added: 2021.]

[removed: Accordingly, a delay in an anticipated sale past the end of a particular quarter may] negatively impact our results of operations for that quarter, or in some cases, that fiscal year.

We monitor individual payment capability in granting credit arrangements, seek to limit the total credit to amounts [added: we believe our customers can pay and maintain reserves we believe are adequate to cover exposure for potential losses.]

[removed: In addition, we may be subject to examination of our income tax] returns by the U.S. Internal Revenue Service and other tax authorities.

In either event, we could be required to seek licenses from third parties in order to continue offering our products, to re-engineer our products or to discontinue the sale of our products in the event re-engineering cannot [removed: be accomplished on a timely or successful basis, any of which could adversely affect our business, operating results and financial condition.]

These third party licenses may not be [added: available to us on acceptable terms, if at all.]

In addition, [removed: in June 2016, voters in] [added: on January 31, 2020,] the United Kingdom [removed: approved an advisory referendum to withdraw] [added: withdrew] from the European Union (commonly referred to as Brexit).

Sales outside of the Americas represented 44.0% and [removed: 44.5%] [added: 44.0%] of our net revenues for the fiscal years ended September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

[added: In addition, an] increasing portion of our operating expenses is incurred outside the United States, is denominated in foreign currencies, and is subject to fluctuations due to changes in foreign currency exchange rates.

We filed a report on Form SD with the SEC regarding such matters on May [removed: 29, 2020.][added: 27, 2021.]

Our inability to successfully operate and integrate newly-acquired businesses appropriately, effectively and in a timely manner, or to retain key personnel of any acquired business, could have a material adverse effect on our ability to take [removed: advantage of further growth in demand for integrated traffic management and security solutions and other advances in technology, as well as on our revenues, gross margins and expenses.]

In addition, natural disasters could affect our supply chain, manufacturing vendors, or logistics providers’ ability to provide [added: materials and perform services such as manufacturing products or assisting with shipments on a timely basis.]

While our analysis shows COVID-19 did not have a significant impact on our results of operations for the fiscal year ended September 30, [removed: 2020,] [added: 2021,] the impacts of the global pandemic on our business and financial outlook are currently unknown.

As we expand our reach and role into a broader set of multi-cloud solutions, the companies that we consider competitors evolves as well.

In addition to server load balancing, traffic management, and other functions normally associated with application delivery, our suite of solutions has expanded our addressable market into security, and policy management, where we compete with a number of companies focused on niche areas of application security.

We see emerging demand to support modern, container-based applications with new capabilities including managing APIs, optimizing Kubernetes traffic management, and load balancing cloud-native and hybrid cloud applications.

For these use cases we compete against emerging players like Apogee and Kong.

In application security, we compete with companies that provide web application firewalls, bot detection and mitigation, carrier-grade firewall, carrier-grade NAT, SSL orchestration, access policy management, DDoS protection, and fraud defense.

Competitors include Akamai, Citrix Systems, Imperva, Juniper Networks, and Symantec/Blue Coat.

With the addition of Shape, additional fraud, abuse, and analytics solutions become indirect competitors, including Akamai, Cloudflare, Imperva (Distil Networks), Fastly (Signal Sciences) and PerimeterX.

Volterra’s use cases include multi-cloud networking, as well as security offered as SaaS, competing with the likes of Imperva, Fastly, Akamai, and Cloudflare.

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Despite our security measures, and those of our

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Lead times for these components vary significantly and are increasing in light of global shortages of critical components.

Global supply chain constraints in the wake of the COVID-19 pandemic continue to decrease our visibility into component availability and lead times.

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not to purchase.

Accordingly, a delay in an anticipated sale past the end of a particular quarter may

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In addition, we may be subject to examination of our income tax

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be accomplished on a timely or successful basis, any of which could adversely affect our business, operating results and financial condition.

Brexit could lead to economic and legal uncertainty, including volatility in global stock markets and currency exchange rates, and increasingly divergent laws, regulations, and licensing requirements.

Any of these effects of Brexit, among others, could adversely affect our operations and financial results.

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advantage of further growth in demand for integrated traffic management and security solutions and other advances in technology, as well as on our revenues, gross margins and expenses.

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Climate change may have an impact on our business

Risks related to climate change are increasing in both impact and type of risk.

We believe there will not be significant near-term impacts to our offices worldwide due to climate change, but long-term impacts remain unknown.

However, there may be business operational risk due to the significant impacts climate change could pose to our employees’ lives, our supply chain, or electrical power availability from climate-related weather events.

In addition, rapidly changing customer and regulatory requirements to reduce carbon emissions present a risk of loss of business if we are not able to meet those requirements.

The COVID-19 pandemic has disrupted the U.S. and global economies and put unprecedented strain on governments, healthcare systems, educational institutions, businesses, and individuals around the world, the impact and duration of which is difficult to assess or predict.

It is especially difficult to predict the impact on the global economic markets, which have been and will continue to be highly dependent upon the actions of governments, businesses, and other enterprises in response to the pandemic, as well as the effectiveness of those actions.

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In related markets, we compete with companies such as the following:

- Cisco, Juniper Networks, and A10 Networks for carrier-grade firewall capabilities;

- Akamai, Imperva, and Citrix Systems in the web application firewall market;

- Cisco, Juniper Networks, and A10 Networks in Carrier Grade NAT;

- Symantec/Blue Coat and A10 Networks in SSL Orchestration;

- Pulse Security and Ping Identity for Access Policy Manager;

gain a competitive advantage over us.

Lead times for these components vary significantly.

we believe our customers can pay and maintain reserves we believe are adequate to cover exposure for potential losses.

available to us on acceptable terms, if at all.

The uncertainty surrounding the terms of the United Kingdom's withdrawal and its consequences, may cause our customers to closely monitor their costs and reduce their spending on our products and services.

In addition, an

materials and perform services such as manufacturing products or assisting with shipments on a timely basis.

In March 2020, the World Health Organization declared COVID-19 a global pandemic.

The impact on the global population and the duration of the COVID-19 pandemic is difficult to assess or predict and depends on numerous evolving factors that we may not be able to accurately predict or effectively respond to, including, without limitation: the duration and scope of the outbreak; actions taken by governments, businesses, and individuals in response to the outbreak; the effect on economic activity and actions taken in response.

F5 is a leading provider of multi-cloud application [removed: services] [added: security and delivery solutions] which enable our customers to develop, deploy, operate, secure, and govern applications in any architecture, from on-premises to the public cloud.

[removed: The majority] [added: Approximately 48%] of our [added: fiscal year 2021] revenues [removed: are] [added: were] derived from sales of our application [added: security and] delivery [removed: controller (ADC)] products including our BIG-IP appliances and VIPRION chassis and related software modules and our software-only Virtual Editions; Local Traffic Manager (LTM), DNS Services (formerly Global Traffic Manager); Advanced Firewall Manager (AFM) and Policy Enforcement Manager (PEM), that leverage the unique performance characteristics of our hardware and software architecture; and products that incorporate acquired technology, including Application Security Manager (ASM) and Access Policy Manager (APM); NGINX Plus and NGINX Controller; Shape Defense and Enterprise Defense; and the Secure Web Gateway and Silverline DDoS and Application security offerings which are sold to customers on a subscription basis.

[removed: We also derive] [added: Approximately 52% of our fiscal year 2021] revenues [added: were derived] from the sales of [added: global] services including annual maintenance contracts, training and consulting services.

Significant items impacting cost of revenues are hardware costs paid to our contract manufacturers, third-party software license fees, software-as-a-service [removed: infrastructure,] [added: infrastructure costs,] amortization of developed technology and personnel and overhead expenses.

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[added: In fiscal year 2020, the decrease to cash and cash equivalents, short-term investments and long-term investments from the prior year was primarily due to $955.6 million in cash paid for the acquisition of Shape in the] second quarter of fiscal 2020 as well as $100.0 million of cash required for the repurchase of outstanding common stock under our share repurchase program in fiscal year 2020 and $59.9 million of capital expenditures related to the expansion of our facilities to support our operations [removed: worldwide as well as investments in information technology infrastructure and equipment purchases to support our core business activities.][added: worldwide.]

The decrease in cash and [removed: cash equivalents] [added: investments] for fiscal year [removed: 2020] [added: 2021] was partially offset by cash provided by operating activities of [removed: $660.9 million and $400.0 million in cash proceeds from the issuance of debt in connection with our acquisition of Shape.][added: $645.2 million.]

[removed: Additionally, on January 31, 2020, we] entered into a Revolving Credit Agreement (the "Revolving Credit Agreement") that provides for a senior unsecured revolving credit facility in an aggregate principal amount of $350.0 million (the "Revolving Credit Facility").

As of September 30, [removed: 2020,] [added: 2021,] there were no outstanding borrowings under the Revolving Credit Facility, and we had available borrowing capacity of $350.0 million.

Deferred revenues continued to increase in fiscal [removed: 2020] [added: 2021] due to the growth of our subscriptions business, including the acquired deferred revenue associated with the [removed: Shape] [added: Volterra] acquisition.

Our days sales outstanding for the fourth quarter of fiscal year [removed: 2020] [added: 2021] was [removed: 43.][added: 45.]

Critical Accounting [removed: Policies][added: Policies and Estimates]

Revenue for term-based license agreements is recognized at a point in time, when we deliver the software license to the customer and the [removed: subscription term has commenced.]

[removed: *Services*][added: *Global Services*]

We enter into certain contracts with customers, including [removed: enterprise license arrangements,] [added: flexible consumption programs and multi-year subscriptions,] with non-standard terms and conditions.

Management exercises significant judgment in assessing contractual terms in these arrangements to identify and evaluate performance [removed: obligations and total consideration.][added: obligations.]

On January [removed: 24, 2020,] [added: 22, 2021,] we completed our acquisition of [removed: Shape Security,] [added: Volterra,] Inc. for a total purchase price of [removed: $1.0 billion,] [added: $427.2 million,] of which approximately [removed: $120.0] [added: $59.5] million of finite-lived developed technology was recorded.

Management valued the developed technology using the [removed: multi-period excess earnings] [added: relief-from-royalty] method under the income approach.

Management applied significant judgment in estimating the fair value of the acquired developed technology, which involved the use of a significant assumption with [removed: respects] [added: respect] to the [removed: revenue growth rate and technology migration curve.][added: royalty rate.]

While our analysis shows COVID-19 did not have a significant impact on our results of operations for the fiscal year ended September 30, [removed: 2020,] [added: 2021,] the impacts of the global pandemic on our business and financial outlook are currently unknown.

[removed: We] [added: In addition, we] are conducting business with substantial modifications to employee travel, employee work locations, and virtualization or cancellation of certain sales and marketing events, among other modifications.

| | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Products | | | | | | $ | [removed: 1,025,856] [added: 1,247,084] | | | | | $ | [removed: 985,591] [added: 1,025,856] | | | | | $ | [removed: 960,108] [added: 985,591] | |

| Services | | | | | | [removed: 1,324,966] [added: 1,356,332] | | | | | | [removed: 1,256,856] [added: 1,324,966] | | | | | | [removed: 1,201,299] [added: 1,256,856] | | |

| Total | | | | | | $ | [removed: 2,350,822] [added: 2,603,416] | | | | | $ | [removed: 2,242,447] [added: 2,350,822] | | | | | $ | [removed: 2,161,407] [added: 2,242,447] | |

| Products | | | | | | [removed: 43.6] [added: 47.9] | | % | | | | [removed: 44.0] [added: 43.6] | | % | | | | [removed: 44.4] [added: 44.0] | | % |

| Services | | | | | | [removed: 56.4] [added: 52.1] | | | | | | [removed: 56.0] [added: 56.4] | | | | | | [removed: 55.6] [added: 56.0] | | |

*Net Revenues.* Total net revenues increased [removed: 4.8%] [added: 10.7%] in fiscal year [removed: 2020] [added: 2021] from fiscal year [removed: 2019,] [added: 2020,] compared to an increase of [removed: 3.7%] [added: 4.8%] in fiscal year [removed: 2019] [added: 2020] from the prior year.

Overall revenue growth for the year ended September 30, [removed: 2020] [added: 2021] was due to [removed: increased] [added: increases in both] product and service revenue.

The product revenue increase was driven by software revenue increases, specifically from the addition of the software-as-a-service product offerings through the Shape acquisition and our subscription-based offerings, which include [added: software sold via] our [removed: enterprise license agreement product offerings.][added: flexible consumption program or multi-year subscriptions.]

Revenues outside of the United States represented [removed: 48.1%, 49.3%] [added: 47.5%, 48.1%] and [removed: 49.6%] [added: 49.3%] of net revenues in fiscal years [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018,] [added: 2019,] respectively.

*Net Product Revenues.* Net product revenues increased [removed: 4.1%] [added: 21.6%] in fiscal year [removed: 2020] [added: 2021] from fiscal year [removed: 2019,] [added: 2020,] compared to an increase of [removed: 2.7%] [added: 4.1%] in fiscal year [removed: 2019] [added: 2020] from the prior year.

The increase of $40.3 million in net product sales for fiscal year 2020 was [added: primarily] due to an increase in software sales compared to the [removed: same period in the] prior year, partially offset by a decrease in systems revenue.

The increase of [removed: $25.5] [added: $221.2] million in net product sales for fiscal year [removed: 2019] [added: 2021] was [removed: primarily] due to an increase in [added: both] software [removed: sales] [added: and systems revenue] compared to the [removed: prior year, partially offset by a decrease] [added: same period] in [removed: systems revenue.][added: the prior year.]

| Systems revenue | | | | | | $ | [removed: 668,313] [added: 748,192] | | | | | $ | [removed: 745,798] [added: 668,313] | | | | | $ | [removed: 810,182] [added: 745,798] | |

| Software revenue | | | | | | [removed: 357,543] [added: 498,892] | | | | | | [removed: 239,793] [added: 357,543] | | | | | | [removed: 149,926] [added: 239,793] | | |

| Total net product revenue | | | | | | $ | [removed: 1,025,856] [added: 1,247,084] | | | | | $ | [removed: 985,591] [added: 1,025,856] | | | | | $ | [removed: 960,108] [added: 985,591] | |

| Systems revenue | | | | | | [removed: 65.1] [added: 60.0] | | % | | | | [removed: 75.7] [added: 65.1] | | % | | | | [removed: 84.4] [added: 75.7] | | % |

| Software revenue | | | | | | [removed: 34.9] [added: 40.0] | | | | | | [removed: 24.3] [added: 34.9] | | | | | | [removed: 15.6] [added: 24.3] | | |

*Net Service Revenues.* Net service revenues increased [removed: 5.4%] [added: 2.4%] in fiscal year [removed: 2020] [added: 2021] from fiscal year [removed: 2019,] [added: 2020,] compared to an increase of [removed: 4.6%] [added: 5.4%] in fiscal year [removed: 2019] [added: 2020] from the prior year.

The decrease in cash and investments for fiscal year 2021 was primarily due to $500.0 million of cash required for the repurchase of shares under our Accelerated Share Repurchase agreements and $411.3 million in cash paid for the acquisition of businesses, primarily Volterra in the second quarter of fiscal 2021.

Additionally, on January 31, 2020, we

Revenue is recognized net of any taxes collected, which are subsequently remitted to governmental authorities.

Shipping and handling fees charged to our customers are recognized as product revenue in the period shipped and the related costs for providing these services are recorded as a cost of sale.

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subscription term has commenced.

Global supply chain constraints in the wake of the COVID-19 pandemic continue to decrease our visibility into component availability and lead times are increasing for critical components necessary for the assembly of our hardware products.

We are undertaking efforts to mitigate these supply chain constraints, but unavailability of components may impact our ability to complete assembly of our hardware products thereby limiting our ability to fulfill our sales to our customers.

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In addition, our stand-alone security product revenue and our global services revenue associated with security continued to grow in fiscal 2021.

| | | | | | | 2021 | | | | | | 2020 | | | | | | 2019 | | |

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| | | | | | | 2021 | | | | | | 2020 | | | | | | 2019 | | |

Cost of net product revenues increased to $286.3 million in fiscal year 2021, up 33.0% from the prior year, primarily due to software product revenue growth.

| | | | | | | 2021 | | | | | | 2020 | | | | | | 2019 | | |

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Sales and marketing expenses for fiscal year 2021 also included impairment charges of $11.5 million related to the exit of certain facilities.

Research and development expenses for fiscal year 2021 also included impairment charges of $13.0 million related to the exit of certain facilities.

The increase in general and administrative expense for fiscal year 2021 was primarily due to increased personnel costs of $11.7 million, compared to the prior year.

General and administrative headcount at the end of fiscal year 2021 increased to 829 from 704 at the end of fiscal year 2020.

There were no restructuring expenses recorded for the year ended September 30, 2021.

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| | | | | | | 2021 | | | | | | 2020 | | | | | | 2019 | | |

The decrease in the effective tax rate from fiscal year 2020 to 2021 is primarily due to the discrete impact from filing the Company's fiscal year 2020 U.S. federal income tax return and the tax impact from stock based compensation.

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| | | | | | | 2021 | | | | | | 2020 | | | | | | 2019 | | |

The decrease was partially offset by cash provided by operating activities of $645.2 million.

Cash used in financing activities for fiscal year 2021 included $500.0 million to repurchase shares under our Accelerated Share Repurchase agreements, as well as $20.0 million in cash used to make principal payments on our term loan and $14.0 million in cash used for taxes related to net share settlement of equity awards.

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As of September 30, 2021, there were no outstanding borrowings under the Revolving Credit Facility, and we had available borrowing capacity of $350.0 million.

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The Company adopted this new standard prospectively on October 1, 2020.

The adoption of this standard did not have a material impact to the Company’s consolidated financial statements or disclosures.

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.

The new guidance requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers, as if it had originated the contracts.

Under the current business combinations guidance, such assets and liabilities are recognized by the acquirer at fair value on the acquisition date.

The adoption of the standard will impact future business combinations and require us to measure acquired contract assets and liabilities in accordance with ASC 606.

We expect the impact of the standard to result in measuring acquired contract assets and liabilities as if we had originated the contracts.

The standard will not impact acquired contract assets or liabilities from business combinations occurring prior to the effective date of adoption.

On January 24, 2020, we completed the acquisition of Shape Security, a provider of fraud and abuse prevention solutions.

Together, F5 and Shape represent an end-to-end application security solution, reducing infrastructure complexity while protecting every aspect of the ‘code to customer’ journey against losses from online fraud, reputational damage, and disruptions to critical online services.

The decrease in cash and cash equivalents for fiscal year 2020 was primarily due to $955.6 million in cash paid for the acquisition of Shape in the

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Cost of net product revenues decreased to $175.0 million in fiscal year 2019 from $181.1 million in fiscal year 2018, primarily due to a change in product mix.

The increase in general and administrative expense for fiscal year 2019 was primarily due to an increase of $18.1 million in fees paid to outside consultants for legal, accounting and tax services, primarily related to the acquisition of NGINX.

internal-use software costs, and an increase in facilities cost of $8.7 million, compared to the prior year, primarily due to the move of our corporate headquarters which began in April 2019.

In September 2018, we initiated a restructuring plan, recording a restructuring charge of $18.4 million in the fourth quarter of fiscal year 2018 related to a reduction in workforce.

The decrease in the effective tax rate from fiscal year 2018 to 2019 is primarily due to a further reduction in the U.S. federal income tax rate to 21%, the non-recurring tax expense recorded in fiscal year 2018 for deemed repatriation of undistributed foreign earnings and remeasurement of net deferred tax assets, partially offset by a decrease in tax deductible stock compensation.

The ultimate resolution of these

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09).

ASU 2014-09 and the related amendments outline a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance.

The new model requires revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services.

Refer to Note 2 - Revenue from Contracts with Customers for further discussion.

In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, Leases (Topic 842) (ASU 2016-02), which requires lessees to recognize on the balance sheet a right-of-use asset, representing its right to use the underlying asset for the lease term, and a corresponding lease liability for all leases with terms greater than twelve months.

Our leases consist primarily of operating leases for our offices and lab spaces.

We do not have finance leases.

The guidance also requires qualitative and quantitative disclosures designed to assess the amount, timing and uncertainty of cash flows arising from leases.

We adopted this standard on October 1, 2019 on a modified retrospective basis by applying the new standard to our lease portfolio as of October 1, 2019.

Under the modified retrospective method, financial results reported in periods prior to fiscal 2020 are unchanged.

As a result of the adoption of this standard, we recognized lease liabilities and corresponding right-of-use assets for our long-term leases for office space, which had a material impact to our consolidated balance sheets.

The adoption of this standard had no impact on the consolidated income statements and consolidated statements of cash flows.

Refer to Note 8 - Leases for further discussion.

Upon adoption of the standard, we elected the package of three practical expedients for existing and expired contracts to not reassess: the existence of additional leases, lease classification, or the treatment of initial direct costs.

We also apply the short-term lease exemption for leases with an original expected term of 12 months or less and expense such leases month-to-month and do not record a right-of-use asset or lease liability.

Short-term lease activity under the exception is not significant.

Additionally, we do not separate lease and non-lease components in the allocation of minimum lease payments for our office space and equipment leases, as such separation is not significant.

We include in minimum lease payments, fixed and variable payments based on a rate or index, but exclude variable payments based on satisfying future benchmarks or actual future costs incurred; such amounts are expensed as incurred.

To calculate the net present value, we apply an incremental borrowing rate.

This incremental borrowing rate is determined using a portfolio approach based on the rate of interest we would pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term.

Renewal options to extend lease terms are excluded from the minimum lease term at lease commencement.

Early adoption is permitted.

While we have conducted some transactions in foreign currencies during the fiscal year ended [removed: 2020] [added: 2021] and expect to continue to do so, we do not anticipate that foreign currency transaction gains or losses will be significant at our current level of operations.

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A hypothetical increase in interest rates of 100 basis points at September 30, 2021 could result in a market value reduction for our portfolio of approximately $3.4 million.

A decrease of one percent in the average interest rate would have resulted in a decrease of approximately $2.3 million in our interest income for the fiscal year 2020.

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| | | | | | | Maturing in | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | Three Months or Less | | | | | | Three Months to One Year | | | | | | Greater Than One Year | | | | | | Total | | | | | | Fair Value | | |

| | | | | | | (in thousands, except for percentages) | | | | | | | | | | | | | | | | | | | | | | | | | | |

| September 30, 2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Included in cash and cash equivalents | | | | | | $ | 250,970 | | | | | $ | — | | | | | $ | — | | | | | $ | 250,970 | | | | | $ | 250,970 | |

| Weighted average interest rate | | | | | | 0.6 | | % | | | | — | | | | | | — | | | | | | — | | | | | | — | | |

| Included in short-term investments | | | | | | $ | 51,871 | | | | | $ | 308,462 | | | | | $ | — | | | | | $ | 360,333 | | | | | $ | 360,333 | |

| Weighted average interest rates | | | | | | 1.4 | | % | | | | 1.5 | | % | | | | — | | | | | | — | | | | | | — | | |

| Included in long-term investments | | | | | | $ | — | | | | | $ | — | | | | | $ | 102,939 | | | | | $ | 102,939 | | | | | $ | 102,939 | |

| Weighted average interest rate | | | | | | — | | | | | | — | | | | | | 1.6 | | % | | | | — | | | | | | — | | |

| September 30, 2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Included in cash and cash equivalents | | | | | | $ | 293,642 | | | | | $ | — | | | | | $ | — | | | | | $ | 293,642 | | | | | $ | 293,642 | |

| Weighted average interest rate | | | | | | 2.1 | | % | | | | — | | | | | | — | | | | | | — | | | | | | — | | |

| Included in short-term investments | | | | | | $ | 98,811 | | | | | $ | 274,252 | | | | | $ | — | | | | | $ | 373,063 | | | | | $ | 373,063 | |

| Weighted average interest rates | | | | | | 2.1 | | % | | | | 2.2 | | % | | | | — | | | | | | — | | | | | | — | | |

| Included in long-term investments | | | | | | $ | — | | | | | $ | — | | | | | $ | 358,402 | | | | | $ | 358,402 | | | | | $ | 358,402 | |

| Weighted average interest rate | | | | | | — | | | | | | — | | | | | | 2.5 | | % | | | | — | | | | | | — | | |

| September 30, 2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Included in cash and cash equivalents | | | | | | $ | 54,336 | | | | | $ | — | | | | | $ | — | | | | | $ | 54,336 | | | | | $ | 54,336 | |

| Weighted average interest rate | | | | | | 1.1 | | % | | | | — | | | | | | — | | | | | | — | | | | | | — | | |

| Included in short-term investments | | | | | | $ | 146,376 | | | | | $ | 468,329 | | | | | $ | — | | | | | $ | 614,705 | | | | | $ | 614,705 | |

| Weighted average interest rates | | | | | | 1.4 | | % | | | | 1.7 | | % | | | | — | | | | | | — | | | | | | — | | |

| Included in long-term investments | | | | | | $ | — | | | | | $ | — | | | | | $ | 411,184 | | | | | $ | 411,184 | | | | | $ | 411,184 | |

| Weighted average interest rate | | | | | | — | | | | | | — | | | | | | 1.9 | | % | | | | — | | | | | | — | | |

We see a world where [added: we enable] our customers’ applications [added: to] adapt to changing environments, automating redundant processes for greater efficiencies, expanding and contracting based on performance needs, protecting themselves, and securing points of vulnerability.

Our business is organized into [removed: the following] three geographic regions: Americas; Europe, [added: the] Middle East, and Africa (EMEA); and the Asia Pacific region (APAC).

While the majority of our product revenue today is derived from appliance sales, we are actively managing a transformation to a software- and SaaS-driven business with [removed: software] [added: product] revenue [added: from software sales] growing [removed: 52%] [added: 40%] in fiscal year [removed: 2020] [added: 2021] and representing [removed: 35%] [added: 40%] of product revenue.

We have [removed: 71] [added: 80] subsidiaries, branch offices, or representative offices worldwide.

Through a link on the Investor Relations section of our website, we make available the following filings as soon as reasonably possible after they are electronically filed with or furnished to the Securities and Exchange Commission (SEC): our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any amendments to those reports filed or furnished [added: pursuant to Section 13(a) or 15(d) of the Exchange Act.]

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

F5 is focused on solving our customers’ most important application [removed: challenges.][added: challenges and we have continued to evolve our business as our customer’s needs have changed.]

Today, our customers need to [added: securely and] cost effectively deliver extraordinary digital experiences to their end [removed: users.][added: users, which include employees, consumers and partners.]

Through our organic investments and the acquisitions of NGINX in May [removed: 2019 and] [added: 2019,] Shape Security in January 2020, [added: and Volterra in January 2021,] we have assembled the broadest portfolio of application security and delivery technologies in the market today.

Our State of [removed: Applications Services report 2020] [added: Application Strategy Report 2021] shows [removed: 76%] [added: 87%] of organizations are managing a complex application portfolio spanning traditional and modern [removed: applications.][added: architectures.]

F5 is unique in our ability to span both traditional and modern [removed: applications,] [added: architectures,] as a result, our customers are able to provision consistent, and industry-leading application security across their combined traditional and modern application portfolio.

[removed: We] [added: In addition, we] are leveraging our access to application data and our analytics capabilities to enable automation and unlock business insights for our customers.

We will continue to improve customer [added: awareness and] understanding of F5’s expanded portfolio with a focus on buying personas and business needs and intend to enhance our digital customer experiences to deliver both growth and efficiency.

Our ability to serve both traditional and modern [removed: applications] [added: architectures] means we are uniquely suited to provide consistent, industry-leading security across our customers entire application estate.

We expect to drive continued software [added: and SaaS] growth from additional enhancements to our BIG-IP family, as well as advancements and continued [added: customer] adoption of NGINX, application security, [removed: Shape] [added: Shape,] and [removed: cloud services.][added: Volterra solutions.]

[removed: Refined over 20+ years of experience and innovation,] BIG-IP has established itself as the leading application [added: security and] delivery technology for traditional applications, providing load balancing, and DNS [added: (domain name system)] services.

Many customers also use the advanced security capabilities of BIG-IP, including [removed: Web Application Firewall,] [added: WAF (web application firewall),] carrier-grade firewall and [removed: NAT,] [added: NAT (network address translation),] identity-aware proxy, SSL-VPN, and SSL [added: (securer sockets layer)] offloading, that are available as tightly-integrated modules or extensions.

[removed: VE] [added: VEs] can be deployed on public clouds, including Amazon Web Services, Microsoft Azure, and Google Cloud Platform, through Bring Your Own License (BYOL) and the public cloud marketplaces.

[removed: Virtual Edition is] [added: VEs are] available via utility pricing (via public cloud marketplaces), short- and long-term [removed: subscription,] [added: subscriptions,] and perpetual licensing models.

In addition, F5 offers customers additional licensing, consumption flexibility, and value via [removed: Enterprise Licensing Agreements.][added: our flexible consumption program or multi-year subscriptions.]

Currently, we offer two types of physical configurations: BIG-IP iSeries appliances and [removed: our] chassis-based VIPRION [added: and VELOS] systems.

Both BIG-IP iSeries and [removed: VIPRION] [added: our chassis-based] systems run the same BIG-IP software modules as are available in the Virtual Edition and are licensed on a perpetual [added: basis or subscription] basis.

BIG-IP iSeries appliances and chassis-based [removed: VIPRION] systems differ primarily in their performance and size characteristics resulting from the hardware components and configurations that make up these systems.

We believe [removed: the combination of F5 and] NGINX solutions help our customers enable adaptive applications in container, cloud-native, and microservices environments, providing the ease-of-use and flexibility developers require while also delivering the scale, security, reliability, and enterprise readiness network operations teams demand.

F5’s advanced application security services, including DDoS [added: (distributed denial of service)] mitigation, [removed: web] [added: WAF (web] application [removed: firewall (WAF),] [added: firewall),] bot protection, [removed: and] SSL/TLS traffic [removed: decryption] [added: decryption, and API discovery/control] provide best-in-class [removed: enterprise infrastructure] protection [added: for applications and infrastructure] across any deployment [removed: type,] [added: model,] from on-premises to [removed: cloud.][added: multi-cloud to the network edge.]

[removed: Both Essential App Protect and] NGINX App Protect [removed: provide] [added: provides web application protection with] self-service access and API-driven integration into automation and orchestration frameworks.

Often referred to as “shifting security [removed: left”, or DevSecOps,] [added: left,”] this ensures security is applied earlier in the software development lifecycle and covers the full portfolio of modern and long-tail applications in the enterprise.

Shape's technology addresses the increasing sophistication of [added: automated bot attacks as well as] fraud and [removed: abuse attacks.][added: abuse.]

This technology is sold as integrated, fully-managed [removed: services,] [added: services] in an “outcome-as-a-service” cybersecurity model.

[added: In F5’s third fiscal quarter,] Shape technology was combined [removed: in F5's fiscal third quarter] with F5's Silverline managed services platform to launch Silverline Shape Defense, creating a version of Shape’s technology platform capabilities for customers who prefer a managed service.

[removed: Service] [added: Service] Provider [removed: Solutions][added: Solutions]

Our carrier-class network firewall services are used to secure the Gi/N6 interface, secure signaling threats and IoT [added: applications, and detect and mitigate DDoS attacks.]

[removed: Competition][added: Competition]

As F5 expands its reach and role into a broader set of multi-cloud solutions, the companies that we consider competitors [removed: changes too.][added: evolves as well.]

[removed: These include] [added: Within application delivery, we compete against] Citrix [removed: Systems, Radware,] [added: Systems] and a number of other competitors that have a smaller market presence or limited feature set, such as [removed: A10 Networks,] Amazon Web Services, [removed: Array Networks, Barracuda Networks,] HAProxy, Kemp Technologies, Microsoft Azure, and VMware.

Competitors include [removed: A10 Networks,] Akamai, [removed: Cisco,] Citrix Systems, Imperva, Juniper Networks, [removed: Radware,] and Symantec/Blue Coat.

However, because F5 offers superior performance, broad functionality, including lighter-weight options with NGINX and [removed: F5 Cloud Services,] [added: Volterra,] we believe that we can and will compete effectively against such pricing policies.

[removed: Our engineering] organization uses standard processes for the development, documentation, and quality control of services, software, and systems that are designed to meet these goals.

F5 holds [removed: 387] [added: 433] patents in the United States and has [removed: 44] [added: 59] international patents (with applications pending for various aspects of our technology).

During the fiscal years ended September 30, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018,] [added: 2019,] we had research and product development expenses of [removed: $441.3] [added: $512.6] million, [removed: $408.1] [added: $441.3] million, and [removed: $366.1] [added: $408.1] million, respectively.

Adaptive applications bring intelligence and real-time changes to the world of application deployments, which today are mostly static and manual.

On January 25, 2021, we completed the acquisition of Volterra, a provider of edge-as-a-service platform solutions.

The F5+Volterra platform will be designed to address challenges found with current edge solutions that are built on CDNs and have limited security features.

F5’s new enterprise-focused edge will be security-first and app-driven, with unlimited scale.

At the end of fiscal 2021, we had product backlog of approximately $124.9 million.

Backlog is primarily systems-based and represents orders confirmed with a purchase order for products to be fulfilled and invoiced, generally within 90 days to customers with approved credit status.

Orders are subject to cancellation, rescheduling by customers, or product specification changes by customers.

Although we believe that the backlog orders are firm, purchase orders may be canceled by the customer prior to fulfillment without significant penalty.

For this reason, we believe that our product backlog at any given date is not a reliable indicator of future revenues.

Adaptive applications utilize an architectural approach that can rapidly respond to changes in performance, global availability, or security problems across one or more infrastructure environments and with little to no human interaction.

These apps are enabled by a near-real-time collection of live application telemetry, analyzed by machine learning and artificial intelligence techniques, and harnessed to automation toolchains to rapidly adjust infrastructure to new conditions.

Attacks are now focused on the applications with threats like malware, bots, and API penetration.

Volterra’s SaaS platform will help detect threats more rapidly and reduce neutralization times.

Together, F5’s portfolio provides maximum protection and reduced risk for all applications across data centers, cloud, and the edge.

This reduces our customers’ total cost of application security by reducing standalone products and leveraging a unified portfolio of on-premises and SaaS-based controls.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

Traditional applications are based on monolithic, three-tier, or client-server architectures.

Such traditional applications are the most ubiquitous application architecture today, and many organizations continue to rely exclusively on traditional applications to power the most mission-critical business applications, customer facing digital interfaces and internally used applications.

For most organizations, the priority around traditional applications is maximizing operational efficiency and minimizing the total cost of ownership.

BIG-IPs “best-of-suite” approach helps standardize and consolidate application delivery and security functions into a single solution, and enables automating the functions to reduce operational cost.

As we align to modern architectures, we also added the VELOS chassis-based system to our lineup.

VELOS relies on a Kubernetes-based platform layer that is integrated tightly with F5’s TMOS software.

In addition, going to a microservice-based platform layer allows VELOS to provide new and exciting features that were not possible in previous generations of F5 BIG-IP platforms.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

Securing applications and APIs everywhere

For protecting web applications from advanced threats and malware, F5 has several solutions.

F5 Advanced WAF has been an industry-leading web application firewall for many years.

It employs countermeasures to detect and stop evolving application-layer threats, integrating behavioral analysis and dynamic code injections as its two main mechanisms to more completely assess the threat associated with any given client session.

Volterra provides advanced machine learning (ML)-based API protection through API auto-discovery and control.

Volterra VoltMesh automatically discovers all APIs in an application environment without the need for manual DevOps/DevSecOps actions.

It then automatically allows only those APIs that are safe and required for a given workflow.

It also baselines API activity and continually monitors for anomalous behavior to ensure ongoing protection in the often-dynamic environment of modern applications.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

We see emerging demand to support modern, container-based applications with new capabilities including managing APIs, optimizing Kubernetes traffic management, load balancing cloud-native and hybrid cloud applications and providing service mesh.

For these use cases, we compete against emerging players like Apogee and Kong.

Volterra’s use cases include multi-cloud networking, as well as security offered as SaaS, competing with the likes of Imperva, Fastly, Akamai, and Cloudflare.

Our engineering

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

Over 90 percent of our engineers are engaged in software, SaaS, and managed services development in several major locations including Seattle, Washington; Hyderabad, India; Tel Aviv, Israel; San Jose and San Francisco, California; Cork, Ireland; and Moscow, Russia.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

By mining all of these data points, applications get smarter, insightful, become self-healing, and evolve even more quickly.

On January 24, 2020, we completed the acquisition of Shape Security ("Shape"), a leader in online fraud and abuse prevention, adding protection against automated attacks, bots, and targeted fraud to F5’s world-class portfolio of application delivery and security solutions.

The acquisition delivers value to customers by combining F5’s expertise in powering over half of the world’s applications across multi-cloud environments, with Shape’s insight from mitigating one billion application attacks per day through sophisticated AI, cloud-based analytics, and anti-fraud technologies.

Together, F5 and Shape represent an end-to-end application security solution, reducing infrastructure complexity, protecting our customers against losses from online fraud, reputational damage, and disruptions to critical online services.

pursuant to Section 13(a) or 15(d) of the Exchange Act.

We have successfully evolved our business as the needs of our customers have changed.

By creating adaptive applications, capable of adapting to changing environments, automating redundant processes for greater efficiencies, expanding and contracting based on performance needs, protecting themselves, and securing points of vulnerability, we are reducing operating complexity associated with delivering a mix of traditional and modern applications while also enabling consistent security for every application, regardless of its environment.

Our ability to mine and analyze data from applications helps customers unlock valuable application insights while making applications smarter, enabling self-healing and automation to evolve them more quickly.

F5 Labs Threat Research shows a 300% increase in attacks on applications in the past two years.

With cyber criminals increasingly attacking applications and their users, we believe application security will be an area of significant investment over the next decade.

Traditional applications are based on monolithic, three-tier, or client-server architectures which remain the dominant architecture for millions of core business, customer-facing, and internally used applications in most organizations.

BIG-IP Cloud Edition (CE) is a software offering that enables customers to leverage BIG-IP capabilities in virtualized and cloud-based environments on a per-application basis.

CE provides right-sized packaging and pricing and enhanced manageability for organizations that want to deploy dedicated BIG-IP services to support individual applications.

The iSeries appliance lineup ranges from the entry-level BIG-IP i2000 series for small and medium-sized organizations to the highest-performing BIG-IP i15000 series for large enterprises and service providers.

Currently, we offer four chassis-based systems: VIPRION 4800, VIPRION 4480, VIPRION 2400, and VIPRION 2200.

We also offer the VIPRION 4450 blade for VIPRION 4800 (8-blade chassis) and VIPRION 4480 (4-blade chassis).

Securing every app, anywhere

With Essential App Protect SaaS and NGINX App Protect software offerings, F5 provides its advanced security capabilities for development and DevOps teams.

Beacon, a SaaS application launched in the first quarter of fiscal 2020, enables cross-platform visibility and analytics of application service performance and security.

By fusing the broad telemetry available via in-situ F5 products with third-party data sources and end-user monitoring capabilities, Beacon helps customers detect and resolve application performance and security issues helping reduce mean-time-to-detect, -innocence, and -repair enabling better end-user experiences.

applications, and detect and mitigate DDoS attacks.

The ability to create customized, programmable services (e.g., using iRules) enables our customers and our partners to design solutions to problems for which there is no off-the-shelf solution.

As a result, we believe the traditional definitions of our market do not encompass all of the features, functions, and capabilities of our products, or accurately represent the addressable market for our solutions.

Within the more narrowly defined traditional ADC market, several companies sell server load balancing products and capabilities.

Over 90 percent of our engineers are engaged in software, SaaS, and managed services development in eight major locations.

The BIG-IP LTM, DNS, and Automation Tool Chain offerings are primarily developed in Seattle, Washington and Hyderabad, India.

Development of security products is centered in Tel Aviv, Israel and San Jose, California with our web application firewall and WebSafe/MobileSafe centered in Tel Aviv, and our core firewall (AFM) and identity and access and SSL-offloading products and technologies developed primarily in San Jose.

Policy Enforcement Manager is also developed in

San Jose and Hyderabad, India.

NGINX products are developed in San Francisco, California; Cork, Ireland; and Moscow, Russia.

However, some components are purchased from a single or limited source.

distribution to partners and customers in APAC.

Additionally, our Global Good program supports vulnerable communities where we work through volunteer efforts, matching of employee donations and volunteer time.

F5’s EIGs are employee-led and such employee leaders participate in a F5 sponsored leadership development program.

In this way, F5 is building an internal diverse and inclusive leadership pipeline within the Company.

During fiscal year 2020, our EIGs have played a critical role in F5 offering distinct programming to help build awareness, host community events, commemorate important dates, develop our employees, and attract diverse talent to F5.

Governance

In April 2020, F5 formally updated the Compensation Committee charter to reflect a broadening of its purview beyond executive compensation to include oversight of our policies and strategies relating to talent management and development.

| Gus Robertson | | | | | | 51 | | | | | | Senior Vice President and General Manager, NGINX | | |

| Derek Smith | | | | | | 56 | | | | | | Senior Vice President and General Manager, Shape | | |

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

For the fiscal year ended September 30, [removed: 2020][added: 2021]

[removed: F5 Networks,] [added: F5,] Inc.

As of March 31, [removed: 2020,] [added: 2021,] the aggregate market value of the Registrant’s Common Stock held by non-affiliates of the Registrant was [removed: $6,445,848,331] [added: $12,481,712,486] based on the closing sales price of the Registrant’s Common Stock on the NASDAQ Global Select Market on that date.

As of November [removed: 9, 2020,] [added: 8, 2021,] the number of shares of the Registrant’s common stock outstanding was [removed: 61,603,102.][added: 61,229,388.]

Information required in response to Part III of this Form 10-K (Items 10, 11, 12, 13 and 14) is hereby incorporated by reference to the specified portions of the Registrant’s Definitive Proxy Statement for the Annual Shareholders Meeting for fiscal year [removed: 2020,] [added: 2021,] which Definitive Proxy Statement shall be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days of the end of the fiscal year to which this Report relates.

| Item 1. | | | [removed: [Business](#i48e256cb083847579897757c7cad01a8_16)] [added: [Business](#i4633b04cec6f4f6683f24458423fe05b_16)] | | | [removed: [3](#i48e256cb083847579897757c7cad01a8_16)] [added: [3](#i4633b04cec6f4f6683f24458423fe05b_16)] | | |

| Item 1A. | | | [Risk [removed: Factors](#i48e256cb083847579897757c7cad01a8_34)] [added: Factors](#i4633b04cec6f4f6683f24458423fe05b_34)] | | | [removed: [13](#i48e256cb083847579897757c7cad01a8_34)] [added: [14](#i4633b04cec6f4f6683f24458423fe05b_34)] | | |

| Item 1B. | | | [Unresolved Staff [removed: Comments](#i48e256cb083847579897757c7cad01a8_37)] [added: Comments](#i4633b04cec6f4f6683f24458423fe05b_37)] | | | [removed: [26](#i48e256cb083847579897757c7cad01a8_37)] [added: [27](#i4633b04cec6f4f6683f24458423fe05b_37)] | | |

| Item 2. | | | [removed: [Properties](#i48e256cb083847579897757c7cad01a8_40)] [added: [Properties](#i4633b04cec6f4f6683f24458423fe05b_40)] | | | [removed: [26](#i48e256cb083847579897757c7cad01a8_40)] [added: [27](#i4633b04cec6f4f6683f24458423fe05b_40)] | | |

| Item 3. | | | [Legal [removed: Proceedings](#i48e256cb083847579897757c7cad01a8_43)] [added: Proceedings](#i4633b04cec6f4f6683f24458423fe05b_43)] | | | [removed: [26](#i48e256cb083847579897757c7cad01a8_43)] [added: [27](#i4633b04cec6f4f6683f24458423fe05b_43)] | | |

| Item 4. | | | [Mine Safety [removed: Disclosures](#i48e256cb083847579897757c7cad01a8_46)] [added: Disclosures](#i4633b04cec6f4f6683f24458423fe05b_46)] | | | [removed: [26](#i48e256cb083847579897757c7cad01a8_46)] [added: [27](#i4633b04cec6f4f6683f24458423fe05b_46)] | | |

| Item 5. | | | [Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#i48e256cb083847579897757c7cad01a8_52)] [added: Securities](#i4633b04cec6f4f6683f24458423fe05b_52)] | | | [removed: [27](#i48e256cb083847579897757c7cad01a8_52)] [added: [28](#i4633b04cec6f4f6683f24458423fe05b_52)] | | |

| Item 6. | | | [Selected Financial [removed: Data](#i48e256cb083847579897757c7cad01a8_55)] [added: Data](#i4633b04cec6f4f6683f24458423fe05b_55)] | | | [removed: [29](#i48e256cb083847579897757c7cad01a8_55)] [added: [30](#i4633b04cec6f4f6683f24458423fe05b_55)] | | |

| Item 7. | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#i48e256cb083847579897757c7cad01a8_58)] [added: Operations](#i4633b04cec6f4f6683f24458423fe05b_58)] | | | [removed: [30](#i48e256cb083847579897757c7cad01a8_58)] [added: [31](#i4633b04cec6f4f6683f24458423fe05b_58)] | | |

| Item 7A. | | | [Quantitative and Qualitative Disclosure About Market [removed: Risk](#i48e256cb083847579897757c7cad01a8_79)] [added: Risk](#i4633b04cec6f4f6683f24458423fe05b_82)] | | | [removed: [40](#i48e256cb083847579897757c7cad01a8_79)] [added: [41](#i4633b04cec6f4f6683f24458423fe05b_82)] | | |

| Item 8. | | | [Financial Statements and Supplementary [removed: Data](#i48e256cb083847579897757c7cad01a8_82)] [added: Data](#i4633b04cec6f4f6683f24458423fe05b_85)] | | | [removed: [41](#i48e256cb083847579897757c7cad01a8_82)] [added: [42](#i4633b04cec6f4f6683f24458423fe05b_85)] | | |

| Item 9. | | | [Changes in and Disagreements With Accountants on Accounting and Financial [removed: Disclosure](#i48e256cb083847579897757c7cad01a8_166)] [added: Disclosure](#i4633b04cec6f4f6683f24458423fe05b_160)] | | | [removed: [79](#i48e256cb083847579897757c7cad01a8_166)] [added: [81](#i4633b04cec6f4f6683f24458423fe05b_160)] | | |

| Item 9A. | | | [Controls and [removed: Procedures](#i48e256cb083847579897757c7cad01a8_169)] [added: Procedures](#i4633b04cec6f4f6683f24458423fe05b_163)] | | | [removed: [79](#i48e256cb083847579897757c7cad01a8_169)] [added: [81](#i4633b04cec6f4f6683f24458423fe05b_163)] | | |

| Item 9B. | | | [Other [removed: Information](#i48e256cb083847579897757c7cad01a8_172)] [added: Information](#i4633b04cec6f4f6683f24458423fe05b_166)] | | | [removed: [80](#i48e256cb083847579897757c7cad01a8_172)] [added: [82](#i4633b04cec6f4f6683f24458423fe05b_166)] | | |

| Item 10. | | | [Directors, Executive Officers and Corporate [removed: Governance](#i48e256cb083847579897757c7cad01a8_178)] [added: Governance](#i4633b04cec6f4f6683f24458423fe05b_172)] | | | [removed: [81](#i48e256cb083847579897757c7cad01a8_178)] [added: [83](#i4633b04cec6f4f6683f24458423fe05b_172)] | | |

| Item 11. | | | [Executive [removed: Compensation](#i48e256cb083847579897757c7cad01a8_181)] [added: Compensation](#i4633b04cec6f4f6683f24458423fe05b_175)] | | | [removed: [81](#i48e256cb083847579897757c7cad01a8_181)] [added: [83](#i4633b04cec6f4f6683f24458423fe05b_175)] | | |

| Item 12. | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#i48e256cb083847579897757c7cad01a8_184)] [added: Matters](#i4633b04cec6f4f6683f24458423fe05b_178)] | | | [removed: [81](#i48e256cb083847579897757c7cad01a8_184)] [added: [83](#i4633b04cec6f4f6683f24458423fe05b_178)] | | |

| Item 13. | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#i48e256cb083847579897757c7cad01a8_187)] [added: Independence](#i4633b04cec6f4f6683f24458423fe05b_181)] | | | [removed: [81](#i48e256cb083847579897757c7cad01a8_187)] [added: [83](#i4633b04cec6f4f6683f24458423fe05b_181)] | | |

| Item 14. | | | [Principal Accountant Fees and [removed: Services](#i48e256cb083847579897757c7cad01a8_190)] [added: Services](#i4633b04cec6f4f6683f24458423fe05b_184)] | | | [removed: [81](#i48e256cb083847579897757c7cad01a8_190)] [added: [83](#i4633b04cec6f4f6683f24458423fe05b_184)] | | |

| Item 15. | | | [Exhibits and Financial Statement [removed: Schedules](#i48e256cb083847579897757c7cad01a8_196)] [added: Schedules](#i4633b04cec6f4f6683f24458423fe05b_190)] | | | [removed: [82](#i48e256cb083847579897757c7cad01a8_196)] [added: [84](#i4633b04cec6f4f6683f24458423fe05b_190)] | | |

| Item 16. | | | [Form 10-K [removed: Summary](#i48e256cb083847579897757c7cad01a8_199)] [added: Summary](#i4633b04cec6f4f6683f24458423fe05b_193)] | | | [removed: [82](#i48e256cb083847579897757c7cad01a8_196)] [added: [84](#i4633b04cec6f4f6683f24458423fe05b_190)] | | |

Unless the context otherwise requires, in this Annual Report on Form 10-K, the terms “F5,” “the Company,” “we,” “us,” and “our” refer to [removed: F5 Networks,] [added: F5,] Inc. and its subsidiaries.

For example, “fiscal year [removed: 2020”] [added: 2021”] and “fiscal [removed: 2020”] [added: 2021”] refer to the fiscal year ended September 30, [removed: 2020.][added: 2021.]

(Former name or former address, if changed since last report)

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

F5, INC.

For the Fiscal Year Ended September 30, 2021

| [PART II](#i4633b04cec6f4f6683f24458423fe05b_49) | | | | | | | | |

| [PART III](#i4633b04cec6f4f6683f24458423fe05b_169) | | | | | | | | |

| [PART IV](#i4633b04cec6f4f6683f24458423fe05b_187) | | | | | | | | |

| [SIGNATURES](#i4633b04cec6f4f6683f24458423fe05b_199) | | | | | | [87](#i4633b04cec6f4f6683f24458423fe05b_199) | | |

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

| [PART II](#i48e256cb083847579897757c7cad01a8_49) | | | | | | | | |

| [PART III](#i48e256cb083847579897757c7cad01a8_175) | | | | | | | | |

| [PART IV](#i48e256cb083847579897757c7cad01a8_193) | | | | | | | | |

| [SIGNATURES](#i48e256cb083847579897757c7cad01a8_205) | | | | | | [85](#i48e256cb083847579897757c7cad01a8_205) | | |

In December 2019, a novel strain of coronavirus (“COVID-19“) was first identified, and in March 2020, the World Health Organization categorized COVID-19 as a pandemic.

We assessed the impact that COVID-19 had on our results of operations, including, but not limited to an assessment of our allowance for doubtful accounts, the carrying value of short-term and long-term investments, the carrying value of goodwill and other long-lived assets, and the impact to revenue recognition and cost of revenues.

We are actively monitoring the impact to the results of our business operations, and may make decisions required by federal, state or local authorities, or that are determined to be in the best interests of our employees, customers, partners, suppliers and stockholders.

As of the filing date, the extent to which the COVID-19 pandemic may impact our financial condition or results of operations remains uncertain.

We also lease a total of approximately 320,000 square feet of space at another location in Seattle, which served as our previous corporate headquarters through June 2019, when we relocated to our current location.

The leases for the three buildings that served as our previous corporate headquarters expire in July 2022.

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

| | | | | | | Fiscal Year [removed: 2020] [added: 2021] | | | | | | | | | | | | Fiscal Year [removed: 2019] [added: 2020] | | | | | | | | |

| First Quarter | | | | | | $ | [removed: 153.00] [added: 178.09] | | | | | $ | [removed: 128.51] [added: 121.77] | | | | | $ | [removed: 195.41] [added: 153.00] | | | | | $ | [removed: 149.87] [added: 128.51] | |

| Second Quarter | | | | | | $ | [removed: 141.31] [added: 215.91] | | | | | $ | [removed: 79.78] [added: 173.41] | | | | | $ | [removed: 173.44] [added: 141.31] | | | | | $ | [removed: 148.91] [added: 79.78] | |

| Third Quarter | | | | | | $ | [removed: 153.56] [added: 216.15] | | | | | $ | [removed: 101.42] [added: 174.34] | | | | | $ | [removed: 168.94] [added: 153.56] | | | | | $ | [removed: 131.53] [added: 101.42] | |

| Fourth Quarter | | | | | | $ | [removed: 156.36] [added: 215.56] | | | | | $ | [removed: 116.79] [added: 181.98] | | | | | $ | [removed: 153.99] [added: 156.36] | | | | | $ | [removed: 121.36] [added: 116.79] | |

The last reported sales price of our common stock on the Nasdaq Global Select Market on November [removed: 9, 2020] [added: 8, 2021] was [removed: $154.97.][added: $223.16.]

As of November [removed: 9, 2020,] [added: 8, 2021,] there were [removed: 45] [added: 43] holders of record of our common stock.

Unregistered Securities Sold in [removed: 2020][added: 2021]

We did not sell any unregistered shares of our common stock during the fiscal year [removed: 2020.][added: 2021.]

This [removed: new] authorization is incremental to the existing $4.4 billion program, initially approved in October 2010 and expanded in each fiscal [removed: year.][added: year thereafter.]

Acquisitions for the share repurchase programs will be made from time to time in private [removed: transactions] [added: transactions, accelerated share repurchase programs,] or open market purchases as permitted by securities laws and other legal requirements.

During fiscal year [removed: 2020,] [added: 2021,] we repurchased and retired [removed: 799,495] [added: 2,501,279] shares at an average price of [removed: $125.10] [added: $199.90] per share and as of September 30, [removed: 2020,] [added: 2021,] we had [removed: $1.3 billion] [added: $773 million] remaining authorized to purchase shares.

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

The following graph compares the annual percentage change in the cumulative total return on shares of our common stock, the Nasdaq Composite Index and the S&P 500 Index for the period commencing September 30, [removed: 2015,] [added: 2016,] and ending September 30, [removed: 2020.][added: 2021.]

On Investment Since September 30, [removed: 2015*][added: 2016*]

[removed: ][added: ]

The Company’s closing stock price on September 30, [removed: 2020,] [added: 2021,] the last trading day of the Company’s [removed: 2020] [added: 2021] fiscal year, was [removed: $122.77] [added: $198.78] per share.

* Assumes that $100 was invested September 30, [removed: 2015] [added: 2016] in shares of Common Stock and in each index, and that all dividends were reinvested.

On February 3, 2021, the Company entered into Accelerated Share Repurchase (ASR) agreements with two financial institutions under which the Company paid an aggregate of $500 million.

The ASR agreements were accounted for as two separate transactions (1) a repurchase of common stock and (2) an equity-linked contract on the Company's own stock.

Upon execution of the ASR agreements, the Company received an initial delivery of 2.1 million shares for an aggregate price of $400 million, based on the market price of $194.91 per share of the Company's common stock on the date of the transaction.

The initial shares received by the Company were retired immediately upon receipt.

The equity-linked contract for the remaining $100 million, representing remaining shares to be delivered by the financial institutions under the ASR agreements, was recorded to common stock as of March 31, 2021 and was settled in the third quarter of fiscal 2021 with the Company receiving 449,049 additional shares, which were retired immediately upon receipt.

The total ASR resulted in a repurchase of 2.5 million shares of the Company's common stock at a volume weighted average repurchase price, less an agreed upon discount, of $199.90 per share.

The shares received by the Company were retired, accounted for as a reduction to stockholder’s equity in the Condensed Consolidated Balance Sheets, and treated as a repurchase of common stock for purposes of calculating earnings per share.

The Company was not required to make any additional cash payments or delivery of common stock to the financial institutions upon settlement of the agreements.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

Item 6.Selected Financial Data

| | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

Shares repurchased and retired during the fourth quarter of fiscal year 2020 are as follows (in thousands, except shares and per share data):

| | | | | | | Total Number of Shares Purchased1 | | | | | | Average Price Paid per Share | | | | | | Total Number of Shares Purchased per the Publicly Announced Plan | | | | | | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plan2 | | |

| July 1, 2020 — July 31, 2020 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 1,322,518 | |

| August 1, 2020 — August 31, 2020 | | | | | | 373,078 | | | | | | $ | 139.79 | | | | | 357,644 | | | | | | $ | 1,272,511 | |

| September 1, 2020 — September 30, 2020 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 1,272,511 | |

(1)Includes 15,434 shares withheld from restricted stock units that vested in the fourth quarter of 2020 to satisfy minimum tax withholding obligations that arose on the vesting of restricted stock units.

(2)Shares withheld from restricted stock units that vested to satisfy minimum tax withholding obligations that arose on the vesting of such awards do not deplete the dollar amount available for purchases under the repurchase program.

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

The following selected consolidated historical financial data are derived from our audited financial statements.

The consolidated balance sheet data as of September 30, 2020 and 2019 and the consolidated income statement data for the years ended September 30, 2020, 2019 and 2018 are derived from our audited consolidated financial statements and related notes that are included elsewhere in this report.

The consolidated balance sheet data as of September 30, 2018, 2017 and 2016 and the consolidated income statement data for the years ended September 30, 2017 and 2016 are derived from our audited consolidated financial statements and related notes which are not included in this report.

The information set forth below should be read in conjunction with our historical financial statements, including the notes thereto, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included elsewhere in this report.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | Years Ended September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | 2020 | | | | | | 2019 (4) | | | | | | 2018 | | | | | | 2017 | | | | | | 2016 | | |

| | | | | | | (In thousands, except per share data) | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Consolidated Income Statement Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Net revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Products | | | | | | $ | 1,025,856 | | | | | $ | 985,591 | | | | | $ | 960,108 | | | | | $ | 964,662 | | | | | $ | 944,469 | |

| Services | | | | | | 1,324,966 | | | | | | 1,256,856 | | | | | | 1,201,299 | | | | | | 1,125,379 | | | | | | 1,050,565 | | |

| Total | | | | | | 2,350,822 | | | | | | 2,242,447 | | | | | | 2,161,407 | | | | | | 2,090,041 | | | | | | 1,995,034 | | |

| Cost of net revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Products | | | | | | 215,275 | | | | | | 174,986 | | | | | | 181,061 | | | | | | 176,032 | | | | | | 166,624 | | |

| Services | | | | | | 192,612 | | | | | | 181,591 | | | | | | 180,420 | | | | | | 177,453 | | | | | | 170,581 | | |

| Total | | | | | | 407,887 | | | | | | 356,577 | | | | | | 361,481 | | | | | | 353,485 | | | | | | 337,205 | | |

| Gross profit | | | | | | 1,942,935 | | | | | | 1,885,870 | | | | | | 1,799,926 | | | | | | 1,736,556 | | | | | | 1,657,829 | | |

| Operating expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Sales and marketing | | | | | | 843,178 | | | | | | 748,619 | | | | | | 664,135 | | | | | | 652,239 | | | | | | 628,743 | | |

| Research and development | | | | | | 441,324 | | | | | | 408,058 | | | | | | 366,084 | | | | | | 350,365 | | | | | | 334,227 | | |

| General and administrative | | | | | | 258,366 | | | | | | 210,730 | | | | | | 160,382 | | | | | | 156,887 | | | | | | 138,431 | | |

| Litigation expense (1) | | | | | | — | | | | | | — | | | | | | — | | | | | | 391 | | | | | | 9,051 | | |

| Restructuring charges (2) | | | | | | 7,800 | | | | | | — | | | | | | 18,426 | | | | | | 12,718 | | | | | | — | | |

| Total | | | | | | 1,550,668 | | | | | | 1,367,407 | | | | | | 1,209,027 | | | | | | 1,172,600 | | | | | | 1,110,452 | | |

| Income from operations | | | | | | 392,267 | | | | | | 518,463 | | | | | | 590,899 | | | | | | 563,956 | | | | | | 547,377 | | |

| Other income, net | | | | | | 4,130 | | | | | | 22,648 | | | | | | 12,861 | | | | | | 11,561 | | | | | | 2,514 | | |

| Income before income taxes | | | | | | 396,397 | | | | | | 541,111 | | | | | | 603,760 | | | | | | 575,517 | | | | | | 549,891 | | |

| Provision for income taxes | | | | | | 88,956 | | | | | | 113,377 | | | | | | 150,071 | | | | | | 154,756 | | | | | | 184,036 | | |

| Net income | | | | | | $ | 307,441 | | | | | $ | 427,734 | | | | | $ | 453,689 | | | | | $ | 420,761 | | | | | $ | 365,855 | |

| Net income per share — basic | | | | | | $ | 5.05 | | | | | $ | 7.12 | | | | | $ | 7.41 | | | | | $ | 6.56 | | | | | $ | 5.43 | |

| Weighted average shares — basic | | | | | | 60,911 | | | | | | 60,044 | | | | | | 61,262 | | | | | | 64,173 | | | | | | 67,433 | | |

| Net income per share — diluted | | | | | | $ | 5.01 | | | | | $ | 7.08 | | | | | $ | 7.32 | | | | | $ | 6.50 | | | | | $ | 5.38 | |

| Weighted average shares — diluted | | | | | | 61,378 | | | | | | 60,456 | | | | | | 62,013 | | | | | | 64,775 | | | | | | 67,984 | | |

| Consolidated Balance Sheet Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Cash, cash equivalents, and short-term investments | | | | | | $ | 1,209,889 | | | | | $ | 972,282 | | | | | $ | 1,039,412 | | | | | $ | 1,016,928 | | | | | $ | 882,395 | |

| Restricted cash (3) | | | | | | 3,270 | | | | | | 3,035 | | | | | | 1,187 | | | | | | 1,224 | | | | | | 1,151 | | |

| Long-term investments | | | | | | 102,939 | | | | | | 358,402 | | | | | | 411,184 | | | | | | 284,802 | | | | | | 276,375 | | |

| Total assets | | | | | | 4,677,920 | | | | | | 3,390,275 | | | | | | 2,605,476 | | | | | | 2,476,489 | | | | | | 2,306,323 | | |

[removed: F5 NETWORKS, INC.][added: F5 Networks, Inc. (Munich, Germany)]

| [Report of Independent Registered Public Accounting [removed: Firm](#i48e256cb083847579897757c7cad01a8_85)] [added: Firm](#i4633b04cec6f4f6683f24458423fe05b_88)] | | | [removed: [42](#i48e256cb083847579897757c7cad01a8_85)] [added: [43](#i4633b04cec6f4f6683f24458423fe05b_88)] | | |

| [Consolidated Balance [removed: Sheets](#i48e256cb083847579897757c7cad01a8_88)] [added: Sheets](#i4633b04cec6f4f6683f24458423fe05b_91)] | | | [removed: [44](#i48e256cb083847579897757c7cad01a8_88)] [added: [45](#i4633b04cec6f4f6683f24458423fe05b_91)] | | |

| [Consolidated Income [removed: Statements](#i48e256cb083847579897757c7cad01a8_94)] [added: Statements](#i4633b04cec6f4f6683f24458423fe05b_94)] | | | [removed: [45](#i48e256cb083847579897757c7cad01a8_94)] [added: [46](#i4633b04cec6f4f6683f24458423fe05b_94)] | | |

| [Consolidated Statements of Comprehensive [removed: Income](#i48e256cb083847579897757c7cad01a8_97)] [added: Income](#i4633b04cec6f4f6683f24458423fe05b_97)] | | | [removed: [46](#i48e256cb083847579897757c7cad01a8_97)] [added: [47](#i4633b04cec6f4f6683f24458423fe05b_97)] | | |

| [Consolidated Statements of Shareholders' [removed: Equity](#i48e256cb083847579897757c7cad01a8_103)] [added: Equity](#i4633b04cec6f4f6683f24458423fe05b_100)] | | | [removed: [47](#i48e256cb083847579897757c7cad01a8_103)] [added: [48](#i4633b04cec6f4f6683f24458423fe05b_100)] | | |

| [Consolidated Statements of Cash [removed: Flows](#i48e256cb083847579897757c7cad01a8_106)] [added: Flows](#i4633b04cec6f4f6683f24458423fe05b_103)] | | | [removed: [48](#i48e256cb083847579897757c7cad01a8_106)] [added: [49](#i4633b04cec6f4f6683f24458423fe05b_103)] | | |

| [Notes to Consolidated Financial [removed: Statements](#i48e256cb083847579897757c7cad01a8_109)] [added: Statements](#i4633b04cec6f4f6683f24458423fe05b_106)] | | | [removed: [50](#i48e256cb083847579897757c7cad01a8_109)] [added: [51](#i4633b04cec6f4f6683f24458423fe05b_106)] | | |

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

To the Board of Directors and Shareholders of [removed: F5 Networks,] [added: F5,] Inc.

We have audited the accompanying consolidated balance sheets of [removed: F5 Networks,] [added: F5,] Inc. and its subsidiaries (the “Company”) as of September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the related consolidated statements of income, of comprehensive income, of shareholders’ equity and of cash flows for each of the three years in the period ended September 30, [removed: 2020,] [added: 2021,] including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of September 30, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the three years in the period ended September 30, [removed: 2020] [added: 2021] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 30, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the COSO.

As discussed in [removed: Note] [added: Notes 8 and] 1 to the consolidated financial statements, the Company changed the manner in which it accounts for leases as of October 1, 2019 and the manner in which it accounts for revenues from contracts with customers as of October 1, 2018.

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the [added: company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.]

*Acquisition of [removed: Shape Security,] [added: Volterra,] Inc. – Valuation of [added: the] Developed Technology Intangible Asset*

As described in Notes 1 and 3 to the consolidated financial statements, on January [removed: 24, 2020,] [added: 22, 2021,] the Company completed the acquisition of [removed: Shape Security,] [added: Volterra,] Inc. for a total purchase price of [removed: $1.0 billion,] [added: $427.2 million,] of which approximately [removed: $120.0] [added: $59.5] million of [added: finite-lived] developed technology was recorded.

Management valued the developed technology using the [removed: multi-period excess earnings] [added: relief-from-royalty] method under the income approach.

Management applied significant judgment in estimating the fair value of the [added: acquired] developed [removed: technology intangible asset,] [added: technology,] which involved the use of [added: a] significant [removed: assumptions related] [added: assumption with respect] to the [removed: revenue growth rate and the technology migration curve.][added: royalty rate.]

The principal considerations for our determination that performing procedures relating to the [removed: acquisition of Shape Security, Inc. and the] valuation of [added: the] developed technology [added: intangible asset from the acquisition of Volterra, Inc.] is a critical audit matter are (i) [removed: the] [added: a] high degree of auditor judgment and subjectivity in applying procedures relating to the fair value [removed: measurement] of the [added: acquired] developed technology [removed: acquired] [added: intangible asset] due to the significant judgment by management when developing the estimate; (ii) [added: the] significant audit effort in evaluating the significant [removed: assumptions relating] [added: assumption related] to the [removed: estimate, such as the revenue growth rate and technology migration curve;] [added: royalty rate;] and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

These procedures included testing the effectiveness of controls relating to the acquisition accounting, including controls over management’s valuation of the acquired developed technology [added: intangible asset] and controls over [added: the] development of the [removed: revenue growth] [added: royalty] rate [removed: and technology migration curve assumptions.][added: assumption.]

These procedures also included, among [removed: others,] [added: others] (i) reading the merger [removed: agreement,] [added: agreement] and (ii) testing management’s process for estimating the fair value of the acquired developed [removed: technology.][added: technology intangible asset.]

Testing management’s process included evaluating the appropriateness of the valuation method, testing the completeness and accuracy of data provided by management, and evaluating the reasonableness of [added: management’s] significant [removed: assumptions] [added: assumption] related to the [removed: revenue growth rate and technology migration curve.][added: royalty rate.]

Evaluating the reasonableness of [removed: management’s revenue growth] [added: the royalty] rate [removed: and technology migration curve assumptions] [added: assumption] involved considering (i) the past performance of the acquired [removed: business,] [added: business;] (ii) the consistency with external market and industry [removed: data,] [added: data;] and (iii) whether [removed: these assumptions were] [added: the assumption was] consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in [removed: evaluating] the [removed: method used to value] [added: evaluation of] the [removed: developed technology,] [added: Company’s valuation method] and the [removed: reasonableness of the technology migration curve assumption used by management.][added: royalty rate assumption.]

[added: |] November [removed: 19,] [added: 2,] 2020 [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| | | | | | | [added: 2021 | | | | | |] 2020 | | | | | | 2019 | | |

| Cash and cash equivalents | | | | | | $ | [removed: 849,556] [added: 580,977] | | | | | $ | [removed: 599,219] [added: 849,556] | |

| Short-term investments | | | | | | [removed: 360,333] [added: 329,630] | | | | | | [removed: 373,063] [added: 360,333] | | |

| Accounts receivable, net of allowances of [removed: $3,105] [added: $3,696] and [removed: $3,259] [added: $3,105] | | | | | | [removed: 296,183] [added: 340,536] | | | | | | [removed: 322,029] [added: 296,183] | | |

| Inventories | | | | | | [removed: 27,898] [added: 22,055] | | | | | | [removed: 34,401] [added: 27,898] | | |

| Other current assets | | | | | | [removed: 259,506] [added: 337,902] | | | | | | [removed: 182,874] [added: 259,506] | | |

| Total current assets | | | | | | [removed: 1,793,476] [added: 1,611,100] | | | | | | [removed: 1,511,586] [added: 1,793,476] | | |

| Property and equipment, net | | | | | | [removed: 229,239] [added: 191,164] | | | | | | [removed: 223,426] [added: 229,239] | | |

| Operating lease right-of-use assets | | | | | | [removed: 300,680] [added: 244,934] | | | | | | [removed: —] [added: 300,680] | | |

| Long-term investments | | | | | | [removed: 102,939] [added: 132,778] | | | | | | [removed: 358,402] [added: 102,939] | | |

| Deferred tax assets | | | | | | [removed: 45,173] [added: 128,193] | | | | | | [removed: 27,701] [added: 45,173] | | |

| Goodwill | | | | | | [removed: 1,858,966] [added: 2,216,553] | | | | | | [removed: 1,065,379] [added: 1,858,966] | | |

| Other assets, net | | | | | | [removed: 347,447] [added: 472,558] | | | | | | [removed: 203,781] [added: 347,447] | | |

F5, INC.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

November 16, 2021

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

F5, INC.

| | | | | | | 2021 | | | | | | 2020 | | |

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

F5, INC.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

F5, INC.

| Net income | | | | | | $ | 331,241 | | | | | $ | 307,441 | | | | | $ | 427,734 | |

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

F5, INC.

| Repurchase of common stock | | | | | | (2,501) | | | | | | (411,056) | | | | | | — | | | | | | (88,944) | | | | | | (500,000) | | |

| Taxes paid related to net share settlement of equity awards | | | | | | (82) | | | | | | (14,032) | | | | | | — | | | | | | — | | | | | | (14,032) | | |

| Net income | | | | | | — | | | | | | — | | | | | | — | | | | | | 331,241 | | | | | | 331,241 | | |

| Balance, September 30, 2021 | | | | | | 60,652 | | | | | | $ | 192,458 | | | | | $ | (20,073) | | | | | $ | 2,187,828 | | | | | $ | 2,360,213 | |

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

F5, INC.

| Net income | | | | | | $ | 331,241 | | | | | $ | 307,441 | | | | | $ | 427,734 | |

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

F5, INC.

On November 12, 2021, the Company changed its corporate name from F5 Networks, Inc. to F5, Inc. (the "Company").

On January 22, 2021, the Company completed the acquisition of Volterra, Inc. ("Volterra"), a provider of edge-as-a-service platform solutions.

Actual results may differ materially from management's estimates and assumptions due to risks and uncertainties, including uncertainty in the current economic environment due to the global impact of the COVID-19 pandemic.

Realized gains and losses and impairments due to credit losses, in which the fair value of a security is below its amortized cost and management’s intent is to sell the impaired security prior to its recovery, are included in other income (expense).

An allowance for credit losses for the excess of amortized cost over the expected cash flows is recorded in other income, net in the Company's consolidated income statements.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount, net of allowances for credit losses for any potential uncollectible amounts.

The allowance for credit losses is based on the assessment of the collectability of accounts.

Management regularly reviews the adequacy of the allowance for credit losses on a collective basis by considering the age of each outstanding invoice, each customer’s expected ability to pay and collection history, current market conditions, and reasonable and supportable forecasts of future economic conditions to determine whether the allowance is appropriate.

Accounts receivable deemed uncollectible are charged against the allowance for credit losses when identified.

For fiscal years ended September 30, 2021 and 2020, the allowance for credit losses activity was not material.

An allowance for credit losses is recorded for any potential uncollectible amount.

Estimates are used in determining the allowance for credit losses in accordance with the Accounts Receivable policy.

See Note 16 - Segment Information, for disaggregated accounts receivable by significant customer.

Management valued the developed technology using the relief-from-royalty method under the income approach.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Balances, September 30, 2017 | | | | | | 62,594 | | | | | | $ | 17,627 | | | | | $ | (17,997) | | | | | $ | 1,229,762 | | | | | $ | 1,229,392 | |

| Repurchase of common stock | | | | | | (4,074) | | | | | | (203,873) | | | | | | — | | | | | | (396,208) | | | | | | (600,081) | | |

| Net income | | | | | | — | | | | | | — | | | | | | — | | | | | | 453,689 | | | | | | 453,689 | | |

| Cash provided by sale of fixed assets | | | | | | — | | | | | | — | | | | | | 1,000 | | |

On January 24, 2020, the Company completed the acquisition of Shape Security, Inc. ("Shape"), a leader in online fraud and abuse prevention, adding protection from automated attacks, botnets, and targeted fraud to F5's world-class portfolio of application services.

Prior Period Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation in the Consolidated Statements of Cash Flows.

The reclassified amounts are considered immaterial and there was no change to total cash from operating, investing or financing activities as a result.

Actual results and outcomes may differ from management's estimates and assumptions.

In December 2019, a novel strain of coronavirus (“COVID-19“) was first identified, and in March 2020, the World Health Organization categorized COVID-19 as a pandemic.

The Company assessed the impact that COVID-19 had on its results of operations, including, but not limited to an assessment of its allowance for doubtful accounts, the carrying value of short-term and long-term investments, the carrying value of goodwill and other long-lived assets, and the impact to revenue recognition and cost of revenues.

The Company is actively monitoring the impact to the results of its business operations, and may make decisions required by federal, state or local authorities, or that are determined to be in the best interests of its employees, customers, partners, suppliers and stockholders.

As of the filing date, the extent to which the COVID-19 pandemic may impact the Company’s financial condition or results of operations remains uncertain.

Realized gains and losses and declines in value of securities judged to be other than temporary are included in other income (expense).

An allowance for doubtful accounts is recorded to account for potential bad debts.

Estimates are used in determining the allowance for doubtful accounts and are based upon an assessment of selected accounts and as a percentage of remaining accounts receivable by aging category.

In determining these percentages, the Company evaluates historical write-offs, and current trends in customer credit quality, as well as changes in credit policies.

At September 30, 2020, Ingram Micro, Inc. and Synnex Corporation accounted for 14.1% and 11.4% of the Company’s accounts receivable, respectively.

At September 30, 2019, Synnex Corporation, Ingram Micro, Inc. and Carahsoft Technology accounted for 12.9%, 12.4% and 11.5% of the Company’s accounts receivable, respectively.

No other customers accounted for more than 10% of total receivables as of September 30, 2020 and 2019.

Shipping and Handling

which an indemnification claim can be made and the amount of the claim.

Accrued warranty costs as of September 30, 2020 and 2019 were not material.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09).

ASU 2014-09 and the related amendments outline a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance.

The new model requires revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services.

Refer to Note 2 - Revenue from Contracts with Customers for further discussion.

In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, Leases (Topic 842) (ASU 2016-02), which requires lessees to recognize on the balance sheet a right-of-use asset, representing its right to use the underlying asset for the lease term, and a corresponding lease liability for all leases with terms greater than twelve months.

The Company's leases consist primarily of operating leases for its offices and lab spaces.

The Company does not have finance leases.

The guidance also requires qualitative and quantitative disclosures designed to assess the amount, timing and uncertainty of cash flows arising from leases.

The Company adopted this standard on October 1, 2019 on a modified retrospective basis by applying the new standard to its lease portfolio as of October 1, 2019.

Under the modified retrospective method, financial results reported in periods prior to fiscal 2020 are unchanged.

As a result of the adoption of this standard, the Company recognized lease liabilities and corresponding right-of-use assets for its long-term leases for office space, which had a material impact on its consolidated balance sheets.

The adoption of this standard had no impact on the consolidated income statements and consolidated statements of cash flows.

Refer to Note 8 - Leases for further discussion.

Upon adoption of the standard, the Company elected the package of three practical expedients for existing and expired contracts to not reassess: the existence of additional leases, lease classification, or the treatment of initial direct costs.

The Company also applies the short-term lease exemption for leases with an original expected term of 12 months or less and expenses such leases month-to-month and does not record a right-of-use asset or lease liability.

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of September 30, [removed: 2020] [added: 2021] and, based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of September 30, [removed: 2020.][added: 2021.]

Management conducted an assessment of the effectiveness of our internal control over financial reporting as of September 30, [removed: 2020.][added: 2021.]

Based on the results of this assessment and on those criteria, management concluded that our internal control over financial reporting was effective as of September 30, [removed: 2020.][added: 2021.]

The effectiveness of the Company’s internal control over financial reporting as of September 30, [removed: 2020,] [added: 2021,] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.

Although the [removed: entire] [added: majority of F5's] global [removed: F5] workforce is working remotely as a result of the COVID-19 pandemic, there were no material changes to our existing internal controls over financial reporting as a result of this.

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

Certain information required by this item regarding the Company’s directors and executive officers is incorporated herein by reference to the sections entitled “Board of Directors — Nominees and Continuing Directors,” “Corporate Governance — Committees of the Board — Audit Committee” and “— Code of Ethics for Senior Financial Officers” and “— Director Nomination,” and “Security Ownership of Certain Beneficial Owners and Management — Section 16(a) Beneficial Ownership Reporting Compliance” in the Company’s definitive Proxy Statement that will be furnished to the SEC no later than January 28, [removed: 2021] [added: 2022] (the “Proxy Statement”).

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

[Table of [removed: Contents](#i48e256cb083847579897757c7cad01a8_7)][added: Contents](#i4633b04cec6f4f6683f24458423fe05b_7)]

| 2.1 | | | | | | — | | | [Merger Agreement dated as of March 9, 2019, by and among the Registrant, Nginx, Inc., Neva Merger Sub Limited, and Fortis Advisors [removed: LLC(1)](http://www.sec.gov/Archives/edgar/data/1048695/000119312519070884/d713823dex21.htm)] [added: LLC(1)+](http://www.sec.gov/Archives/edgar/data/1048695/000119312519070884/d713823dex21.htm)] | | |

| 3.1 | | | | | | — | | | [removed: [Third] [added: [Fourth] Amended and Restated Articles of Incorporation of the [removed: Registrant(](http://www.sec.gov/Archives/edgar/data/1048695/000119312513115123/d504158dex31.htm)[3](http://www.sec.gov/Archives/edgar/data/1048695/000119312513115123/d504158dex31.htm)[)](http://www.sec.gov/Archives/edgar/data/1048695/000119312513115123/d504158dex31.htm)] [added: Registrant(4)](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000041/a31-articlesofincorporatio.htm)] | | |

| 3.2 | | | | | | — | | | [removed: [Seventh Amended] [added: [Eighth](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000041/a32-bylaws11122021.htm) [Amended] and Restated Bylaws [removed: adopted January 21, 2020(4)](http://www.sec.gov/Archives/edgar/data/1048695/000104869520000005/ffiv8-kex31.htm)] [added: adopted](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000041/a32-bylaws11122021.htm) [November 12, 2021(5)](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000041/a32-bylaws11122021.htm)] | | |

| 4.1 | | | [added: *] | | | — | | | [Description of the Registrant's [removed: Securities](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000034/ffiv10kex419302019.htm)[(5)](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000034/ffiv10kex419302019.htm)] [added: Securities](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000044/ffiv10kex419302021.htm)] | | |

| 10.4 | | | | | | — | | | [removed: [Second Amended and Restated Office] [added: [Office] Lease Agreement [removed: dated April 5, 2010,] between the Registrant and [removed: CLP--Elliott West, L.P.(9)](https://www.sec.gov/Archives/edgar/data/1048695/000095012310033159/v55492exv10w39.htm)] [added: Fifth & Columbia Investors, LLC dated May 3, 2017(9)](https://www.sec.gov/Archives/edgar/data/1048695/000119312517155818/d368864dex101.htm)] | | |

| [removed: 10.7] [added: 10.5] | | | | | | — | | | [Form of Indemnification Agreement between the Registrant and each of its directors and certain of its [removed: officers(12)] [added: officers(10)] §](https://www.sec.gov/Archives/edgar/data/1048695/0001047469-99-013872.txt) | | |

| [removed: 10.8] [added: 10.6] | | | | | | — | | | [F5 Networks, Inc. 2011 Employee Stock Purchase Plan (Amended and Restated effective March 14, [removed: 2019)(13)] [added: 2019)(11)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000010/exhibit1022011plan.htm) | | |

| [removed: 10.9] [added: 10.7] | | | | | | — | | | [Form of Change of Control Agreement between the Registrant and the executive [removed: officers(14)] [added: officers(12)] §](https://www.sec.gov/Archives/edgar/data/1048695/000095013409009301/v52332exv10w36.htm) | | |

| [removed: 10.10] [added: 10.8] | | | | | | — | | | [Traffix Communication Systems Ltd. 2007 Israeli Employee Share Option [removed: Plan(15)] [added: Plan(13)] §](https://www.sec.gov/Archives/edgar/data/1048695/000119312512088683/d306389dex101.htm) | | |

| [removed: 10.11] [added: 10.9] | | | | | | — | | | [F5 Networks, Inc. 2014 Incentive Plan, as amended and [removed: restated(1](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000016/exhibit1012014plan.htm)[6](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000016/exhibit1012014plan.htm)[) §](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000016/exhibit1012014plan.htm)] [added: restated(14) §](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000015/exhibit1012014plan.htm)] | | |

| [removed: 10.12] [added: 10.10] | | | | | | — | | | [Nginx, Inc. 2011 Share [removed: Plan(1](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000018/ffivs-8ex991assumednginxin.htm)[7](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000018/ffivs-8ex991assumednginxin.htm)[)] [added: Plan(15)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000018/ffivs-8ex991assumednginxin.htm) | | |

| [removed: 10.13] [added: 10.11] | | | | | | — | | | [Nginx, Inc. Acquisition Equity Incentive [removed: Plan(1](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000018/ffivs-8ex992nginxacquisiti.htm)[7](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000018/ffivs-8ex992nginxacquisiti.htm)[)] [added: Plan(15)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000018/ffivs-8ex992nginxacquisiti.htm) | | |

| [removed: 10.14] [added: 10.12] | | | | | | — | | | [Nginx, Inc. Acquisition Equity Incentive Plan Award [removed: Agreement(](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000030/ffiv10qex1016302019.htm)[1](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000030/ffiv10qex1016302019.htm)[8](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000030/ffiv10qex1016302019.htm)[)] [added: Agreement(16)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869519000030/ffiv10qex1016302019.htm) | | |

| [removed: 10.15] [added: 10.13] | | | | | | — | | | [F5 Networks, Inc. Assumed Shape 2011 Stock [removed: Plan(](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000009/ffivs-8ex991assumedshapese.htm)[19](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000009/ffivs-8ex991assumedshapese.htm)[)] [added: Plan(17)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000009/ffivs-8ex991assumedshapese.htm) | | |

| [removed: 10.16] [added: 10.14] | | | | | | — | | | [F5 Networks, Inc. Shape Acquisition Equity Incentive [removed: Plan(](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000009/ffivs-8ex992shapeacquisiti.htm)[19](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000009/ffivs-8ex992shapeacquisiti.htm)[)] [added: Plan(17)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000009/ffivs-8ex992shapeacquisiti.htm) | | |

| [removed: 10.17] [added: 10.15] | | | | | | — | | | [removed: [F5 Networks, Inc. Shape Acquisition Equity] [added: [Form of 2014] Incentive Plan Award Agreement (Accelerated [removed: Vesting)(2](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000027/ffiv10qex1033312020.htm)[0](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000027/ffiv10qex1033312020.htm)[) §](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000027/ffiv10qex1033312020.htm)] [added: Vesting) as revised October 2017(18) §](https://www.sec.gov/Archives/edgar/data/1048695/000104869517000028/ffiv10kex10189302017.htm)] | | |

| [removed: 10.18] [added: 10.16] | | | | | | — | | | [Form of 2014 Incentive Plan Award Agreement (Accelerated Vesting) as revised [removed: October 2017(2](https://www.sec.gov/Archives/edgar/data/1048695/000104869517000028/ffiv10kex10189302017.htm)[1](https://www.sec.gov/Archives/edgar/data/1048695/000104869517000028/ffiv10kex10189302017.htm)[) §](https://www.sec.gov/Archives/edgar/data/1048695/000104869517000028/ffiv10kex10189302017.htm)] [added: November 2019(19) §](https://www.sec.gov/Archives/edgar/data/0001048695/000104869520000041/ffiv10kex10199302020.htm)] | | |

| [removed: 10.20] [added: 10.21] | | | | | | — | | | [Offer Letter from the Registrant to François [removed: Locoh-Donou(2](https://www.sec.gov/Archives/edgar/data/1048695/000104869517000004/francoislocoh-donouofferle.htm)[2](https://www.sec.gov/Archives/edgar/data/1048695/000104869517000004/francoislocoh-donouofferle.htm)[)] [added: Locoh-Donou(22)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869517000004/francoislocoh-donouofferle.htm) | | |

| [removed: 10.21] [added: 10.22] | | | | | | — | | | [Offer Letter from the Registrant to Francis J. [removed: Pelzer(2](https://www.sec.gov/Archives/edgar/data/1048695/000104869518000015/f5offerletter-frankpelzer.htm)[3](https://www.sec.gov/Archives/edgar/data/1048695/000104869518000015/f5offerletter-frankpelzer.htm)[)] [added: Pelzer(23)] §](https://www.sec.gov/Archives/edgar/data/1048695/000104869518000015/f5offerletter-frankpelzer.htm) | | |

| 21.1 | | | * | | | — | | | [Subsidiaries of the [removed: Registrant](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex2119302020.htm)] [added: Registrant](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000044/ffiv10kex2119302021.htm)] | | |

| 23.1 | | | * | | | — | | | [Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting [removed: Firm](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex2319302020.htm)] [added: Firm](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000044/ffiv10kex2319302021.htm)] | | |

| 31.1 | | | * | | | — | | | [Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex3119302020.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000044/ffiv10kex3119302021.htm)] | | |

| 31.2 | | | * | | | — | | | [Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex3129302020.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000044/ffiv10kex3129302021.htm)] | | |

| 32.1 | | | * | | | — | | | [Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex3219302020.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/1048695/000104869521000044/ffiv10kex3219302021.htm)] | | |

[removed: (3)Incorporated] [added: (11)Incorporated] by reference from Current Report on Form 8-K dated March [removed: 19, 2013] [added: 14, 2019] and filed with the SEC on March [removed: 19, 2013.][added: 14, 2019.]

[removed: (4)Incorporated] [added: (3)Incorporated] by reference from Current Report on Form 8-K dated January [removed: 21, 2020] [added: 5, 2021] and filed with the SEC on January [removed: 23, 2020.][added: 7, 2021.]

[removed: (5)Incorporated] [added: (18)Incorporated] by reference from Annual Report on Form 10-K for the year ended September 30, [removed: 2019.][added: 2017.]

[removed: (9)Incorporated] [added: (12)Incorporated] by reference from Current Report on Form 8-K dated April [removed: 5, 2010] [added: 29, 2009] and filed with the SEC on [removed: April 8, 2010.][added: May 4, 2009.]

[removed: (10)Incorporated] [added: (4)Incorporated] by reference from Current Report on Form 8-K dated [removed: October 31, 2006] [added: November 15, 2021] and filed with the SEC on November [removed: 3, 2006.][added: 15, 2021.]

[removed: (11)Incorporated] [added: (9)Incorporated] by reference from Current Report on Form 8-K dated May 3, 2017 and filed with the SEC on May 3, 2017.

[removed: (12)Incorporated] [added: (10)Incorporated] by reference from Exhibit 10.1 of Registration Statement on Form S-1, File No. 333-75817.

[removed: (13)Incorporated] [added: (14)Incorporated] by reference from Current Report on Form 8-K dated March [removed: 14, 2019] [added: 11, 2021] and filed with the SEC on March [removed: 14, 2019.][added: 15, 2021.]

[removed: (14)Incorporated] [added: (5)Incorporated] by reference from Current Report on Form 8-K dated [removed: April 29, 2009] [added: November 15, 2021] and filed with the SEC on [removed: May 4, 2009.][added: November 15, 2021.]

[removed: (15)Incorporated] [added: (13)Incorporated] by reference from Registration Statement on Form S-8 File No. 333-179794.

[removed: (16)Incorporated] [added: (17)Incorporated] by reference from [removed: Current Report on] Form [removed: 8-K dated March 12, 2020 and] [added: S-8] filed with the SEC on [removed: March 13,] [added: February 3,] 2020.

[removed: (17)Incorporated] [added: (15)Incorporated] by reference from Registration Statement on Form S-8 File No. 333-231802.

[removed: (18)Incorporated] [added: (16)Incorporated] by reference from Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.

[removed: (20)Incorporated] [added: (19)Incorporated] by reference from [removed: Quarterly] [added: Annual] Report on Form [removed: 10-Q] [added: 10-K] for the [removed: quarter] [added: year] ended [removed: March 31,] [added: September 30,] 2020.

| | | | [removed: F5 NETWORKS,] [added: F5,] INC. | | | | | | | | |

| 2.3 | | | | | | — | | | [Merger Agreement dated as of January 5, 2021, by and among the Registrant, Voyager Merger Sub Corporation, Volterra, Inc., and Shareholder Representative Services LLC(3)](https://www.sec.gov/Archives/edgar/data/0001048695/000114036121000498/nc10018716x1_ex2-1.htm)[+](https://www.sec.gov/Archives/edgar/data/0001048695/000114036121000498/nc10018716x1_ex2-1.htm) | | |

| 10.17 | | | | | | — | | | [F5 Networks, Inc. Assumed Volterra, Inc. Amended and Restated 2017 Stock Plan](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000007/ffivs-8ex991assumedvolterr.htm)[(20) §](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000007/ffivs-8ex991assumedvolterr.htm) | | |

| 10.18 | | | | | | — | | | [F5 Networks, Inc. Volterra Acquisition Equity Incentive Plan(20) §](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000007/ffivs-8ex992volterraacquis.htm) | | |

| 10.19 | | | | | | — | | | [F5 Networks, Inc. Assumed Volterra, Inc. 2019 Restricted Stock Unit Sub-Plan France (sub-plan to the F5 Networks, Inc. Assumed Volterra, Inc. Amended and Restated 2017 Stock Pl](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000007/ffivs-8ex993assumedvolterr.htm)[an)](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000007/ffivs-8ex993assumedvolterr.htm)[(20) §](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000007/ffivs-8ex993assumedvolterr.htm) | | |

| 10.20 | | | | | | — | | | [F5 Networks, Inc. Threat Stack Acquisition Equity Incentive Plan(21)](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000037/ffivs-8ex991threatstackacq.htm) [](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000037/ffivs-8ex991threatstackacq.htm)[§](https://www.sec.gov/Archives/edgar/data/0001048695/000104869521000037/ffivs-8ex991threatstackacq.htm) | | |

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

(20)Incorporated by reference from Registration Statement on Form S-8 File No. 333-252616.

(21)Incorporated by reference from Registration Statement on Form S-8 File No. 333-260656.

[Table of Contents](#i4633b04cec6f4f6683f24458423fe05b_7)

| By: | | | | | | /S/ MICHAEL MONTOYA | | | | | | Director | | | | | | November 16, 2021 | | |

| | | | | | | Michael Montoya | | | | | | | | | | | | | | |

| 10.5 | | | | | | — | | | [Office Lease Agreement between the Registrant and Selig Real Estate Holdings XXV, L.L.C. dated October 31, 2006(10](https://www.sec.gov/Archives/edgar/data/1048695/000095012406006416/v24724exv10w1.txt)[)](https://www.sec.gov/Archives/edgar/data/1048695/000095012406006416/v24724exv10w1.txt) | | |

| 10.6 | | | | | | — | | | [Office Lease Agreement between the Registrant and Fifth & Columbia Investors, LLC dated May 3, 2017(11)](https://www.sec.gov/Archives/edgar/data/1048695/000119312517155818/d368864dex101.htm) | | |

| 10.19 | | | * | | | — | | | [Form of 2014 Incentive Plan Award Agreement (Accelerated Vesting) as](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex10199302020.htm) [revised November 2019](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex10199302020.htm) [§](https://www.sec.gov/Archives/edgar/data/1048695/000104869520000041/ffiv10kex10199302020.htm) | | |

| 10.22 | | | | | | — | | | [Separation Agreement and General Release of all Claims between the Registrant and John DiLullo(2](https://www.sec.gov/Archives/edgar/data/1048695/000104869518000015/f5separationagreement-john.htm)[3](https://www.sec.gov/Archives/edgar/data/1048695/000104869518000015/f5separationagreement-john.htm)[) §](https://www.sec.gov/Archives/edgar/data/1048695/000104869518000015/f5separationagreement-john.htm) | | |

(19)Incorporated by reference from Form S-8 filed with the SEC on February 3, 2020.

(21)Incorporated by reference from Annual Report on Form 10-K for the year ended September 30, 2017.

| | | | | | | | | | | | | | | | | | | | | |

| By: | | | | | | /S/ A. GARY AMES | | | | | | Director | | | | | | November 13, 2020 | | |

| | | | | | | A. Gary Ames | | | | | | | | | | | | | | |

| By: | | | | | | /S/ DEBORAH L. BEVIER | | | | | | Director | | | | | | November 13, 2020 | | |

| | | | | | | Deborah L. Bevier | | | | | | | | | | | | | | |

| By: | | | | | | /S/ MICHEL COMBES | | | | | | Director | | | | | | November 13, 2020 | | |

| | | | | | | Michel Combes | | | | | | | | | | | | | | |