A10 Networks lifts full-year outlook as AI security demand drives Q2 growth
Strong performance in the Americas and disciplined operating metrics allow the company to raise earnings guidance, though supply chain headwinds persist.
A10 Networks, Inc. has reported a 15 per cent year-on-year revenue increase for the second quarter of 2026, marking the fourth consecutive quarter of double-digit growth. The company raised its full-year 2026 revenue guidance to a range of 12 per cent to 14 per cent, up from the previous 10 per cent to 12 per cent estimate. Earnings per share (EPS) growth guidance was also increased to 14 per cent to 16 per cent, reflecting strong visibility into demand for its integrated security and traffic management solutions.
The Americas region accounted for 68 per cent of global revenue, driven by robust AI infrastructure build-outs and strength in the enterprise market. Management noted that AI is blurring the traditional lines between enterprise and service provider network requirements, allowing the company to leverage a single architecture across both segments. This shift has enabled A10 to strengthen its commercial presence, with product revenue serving as a key lead indicator for new business engagements.
Strategic developments included an expanded long-term agreement with Microsoft, featuring mutual performance commitments that align A10 more closely with the technology giant’s infrastructure roadmap. As part of this evolving relationship, new business involving different product sets is now categorised under the enterprise segment, reflecting the diverse applications of A10’s technology within large-scale customers. Additionally, the company completed the acquisition of Troj.ai to integrate AI security layers, specifically addressing governance and vulnerability testing in agentic workflows.
Despite persistent supply chain challenges and memory price constraints, A10 maintained strong operating discipline, resulting in EPS growth that exceeded revenue growth. The company achieved non-GAAP gross margins of 80.3 per cent, though management cautioned that memory price constraints and supply chain volatility are likely to persist for several more quarters. One major customer represented approximately 37 per cent of Q2 revenue due to significant project rollout timelines, a concentration management clarified as the fulfillment of specific project schedules rather than a relocation of future demand.
Looking ahead, A10 anticipates that the shift toward on-premise AI inference and sovereign AI models will drive demand for its flexible form-factor solutions over the next two to three years. The company assumes full-year free cash flow will grow year-over-year from the approximately $65 million generated in 2025. While service provider spending in North America is expected to normalise and improve, management cited macroeconomic pressures in Japan and geopolitical impacts in the EMEA region as ongoing headwinds for international spending cycles.
