RDWR — Radware Ltd.

Radware Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics:

• Q4 Revenue: Increased 10% year-over-year to $80 million.
• Full Year Revenue: Reached $302 million, also a 10% year-over-year growth.
• Non-GAAP EPS: Rose 19% to $0.32 in Q4; for the full year, it increased 32% to $1.15.
• Cloud ARR: Grew 23% year-over-year to $95 million in Q4, contributing significantly to overall growth.
• RPO: Reached a record $400 million, up 14% year-over-year, indicating strong future revenue visibility.
• Adjusted EBITDA: Increased 25% in Q4 to $13.7 million, with a margin of 21.1%. For the full year, it rose 37% to $47.4 million.

2. Strategic Updates and Business Highlights:

• Radware's strategy focuses on expanding market share in cloud security, leveraging AI innovations, and enhancing go-to-market efforts.
• The company launched new products, including an API security service and the Agentic AI Protection Solution, to address emerging security needs.
• Radware secured significant contracts, including a seven-digit deal with a European financial group and an eight-digit deal with a North American government IT services agency.
• Investments in cloud infrastructure continued, with the establishment of a new cloud security center in Singapore.

3. Forward Guidance and Outlook:

• Q1 2026 Revenue Guidance: Expected to be between $78 million and $79 million, reflecting strong demand and backlog.
• Operating Expenses: Anticipated to be between $54 million and $55 million, reflecting ongoing investments in innovation and market expansion.
• Q1 2026 EPS Guidance: Expected to range from $0.28 to $0.29.

4. Bad News, Challenges, or Points of Concern:

• Regional Performance: The Americas region experienced a 4% decline in Q4 revenue, although it grew 6% for the full year. This decline is attributed to tough comparisons from Q4 2024.
• Market Volatility: Concerns about AI disruptions in cloud services and the competitive landscape were highlighted, with increased sophistication of cyberattacks necessitating advanced security measures.
• Financial Income Outlook: Expected to decrease in 2026 due to lower interest rates and share repurchase impacts.

5. Notable Q&A Insights:

• RPO Growth: Driven by strong bookings in both cloud and product subscriptions; expected to grow in line with revenue in 2026.
• Americas Strategy: Despite revenue decline, bookings were strong, and Radware plans to increase investments in the region to drive future growth.
• AI Security Market: Radware is well-positioned to capture growth opportunities in AI security, with a dedicated sales team for the new Agentic AI offering.
• Market Timing: The launch of the Agentic AI product aligns with enterprises moving from proof of concept to production, presenting a timely opportunity for Radware.

Overall, Radware demonstrated strong financial performance in Q4 2025, with a focus on expanding its cloud security offerings and addressing emerging threats in the AI landscape, while also acknowledging challenges in certain regions and market conditions.