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Achieved 15% revenue growth in Q2, marking the fourth double-digit growth quarter in the last five, driven by the increasing relevance of integrated security and traffic management in AI environments.

Expanded the strategic relationship with Microsoft through a long-term agreement featuring mutual performance commitments, aligning A10 more closely with the industry leader's infrastructure roadmap.

Observed that AI is blurring the lines between enterprise and service provider network requirements, allowing A10 to leverage a single architecture and operating model across both segments.

Acquired Troj.ai to integrate AI security layers, including red teaming and real-time protection, addressing the growing need for governance and vulnerability testing in agentic workflows.

Maintained strong operating discipline, resulting in EPS growth exceeding revenue growth despite ongoing supply chain cost and delivery challenges.

Noted a deliberate strategic focus on the Americas, which represented 68% of global revenue, fueled by AI infrastructure build-outs and enterprise market strength.

Increased full-year 2026 revenue guidance to 12%-14% (up from 10%-12%) and EPS growth to 14%-16% (up from 12%-14%) based on strong visibility and demand.

Expects service provider spending in North America to continue normalizing and improving, while anticipating persistent macroeconomic pressures in Japan and geopolitical impacts in EMEA.

Anticipates that the shift toward on-premise AI inference and sovereign AI models will serve as a meaningful demand driver for A10's flexible form-factor solutions over the next 2-3 years.

Assumes full-year free cash flow will grow year-over-year from the approximately $65 million generated in 2025.

Projects that memory price constraints and supply chain volatility will likely persist for several more quarters, requiring continued focus on customer delivery over margin optimization if forced to choose.

High customer concentration remains a factor, with one major customer representing approximately 37% of revenue in the quarter due to significant project rollout timelines.

Geopolitical instability in EMEA and macroeconomic headwinds in Japan continue to impact international service provider spending cycles.

Supply chain challenges related to memory pricing and delivery remain a headwind, though management has successfully navigated these to maintain 80.3% non-GAAP gross margins.

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Management explained that product revenue is a lead indicator for new business, particularly as they strengthen their commercial presence in the enterprise segment.

Growth is being driven by customers engaging in long-term roadmaps for AI deployment, which leads to broader conversations about A10's current product portfolio.

Management clarified that recent high volume was not a relocation of future demand, but rather the fulfillment of specific project timelines that needed completion.

There is no concern that current performance is borrowing demand from outer quarters.

A10 competes against traditional infrastructure companies adding AI features and a wave of startups.

Management believes their advantage lies in being an established partner that large institutions, like banks, can trust with complex data compared to small, unproven teams.

Historically, Microsoft was categorized as a service provider, but new business involving different product sets is now being categorized under the enterprise segment.

This shift reflects the evolving nature of the relationship and the diverse applications of A10's technology within the same large-scale customer.