《A10 Networks IncNYSE_ATEN_2023(10-K).pdf》由会员分享，可在线阅读，更多相关《A10 Networks IncNYSE_ATEN_2023(10-K).pdf（153页珍藏版）》请在三个皮匠报告上搜索。
1、UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549Form 10-K(Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31,2023ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934
2、For the transition period from to Commission file number:001-36343A10 NETWORKS,INC.(Exact Name of Registrant as Specified in its Charter)Delaware 20-1446869(State or Other Jurisdiction ofIncorporation or Organization)(I.R.S.EmployerIdentification No.)2300 Orchard Parkway,San Jose,California 95131(Ad
3、dress of Principal Executive Offices and Zip Code)(408)325-8668(Registrants Telephone Number,Including Area Code)Securities registered pursuant to Section 12(b)of the Act:Title of Each ClassTrading Symbol Name of Each Exchange on Which RegisteredCommon Stock,$.00001 Par ValueATEN New York Stock Exch
4、angeSecurities registered pursuant to Section 12(g)of the Act:None.Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 1
5、5(d)of the Act.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of1934 during the preceding 12 months(or for such shorter period that the registrant was required to file such reports),and(2)has been
6、 subject tosuch filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant toRule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such sho
7、rter period that the registrant was requiredto submit such files).Yes No 2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm1/153Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerat
8、ed filer,a smaller reporting company,or an emerging growth company.See the definitions of“large accelerated filer,”“accelerated filer,”“smaller reporting company,”and emerginggrowth company in Rule 12b-2 of the Exchange Act.Large accelerated filerAccelerated filerNon-accelerated filerSmaller reporti
9、ng companyEmerging growth companyIf an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition period for complying withany new or revised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check ma
10、rk whether the Registrant has filed a report on and attestation to its managements assessment of the effectiveness of itsinternal control over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accountingfirm that prepared or issued its audit r
11、eport.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of the registrant includedin the filing reflect the correction of an error to previously issued financial statements.Indicate by check mark whether any of those error correc
12、tions are restatements that required a recovery analysis of incentive-based compensationreceived by any of the registrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the
13、Exchange Act).Yes No The aggregate market value of the registrants common stock held by non-affiliates of the registrant as of June 30,2023(the last business day ofthe registrants most recently completed second fiscal quarter)was approximately$1,017.7 million,based upon the closing sale price of suc
14、hstock on the New York Stock Exchange.Solely for purposes of this disclosure,shares of common stock held by executive officers and directors ofthe Registrant as of such date,as well as shares held by entities affiliated with our executive officers and directors,have been excluded becausesuch persons
15、 may be deemed to be affiliates.This determination of executive officers and directors as affiliates is not necessarily a conclusivedetermination for any other purposes.As of February 16,2024,the number of outstanding shares of the registrants common stock,$0.00001 par value per share,was 74,495,333
16、.DOCUMENTS INCORPORATED BY REFERENCEPortions of the registrants definitive Proxy Statement for the 2023 Annual Stockholders Meeting,which the registrant expects to file with theSecurities and Exchange Commission within 120 days of December 31,2023,are incorporated by reference into Part III(Items 10
17、,11,12,13 and14)of this Annual Report on Form 10-K.2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm2/153A10 NETWORKS,INC.ANNUAL REPORT ON FORM 10-KFOR THE YEAR ENDED DECEMBER 31,2023TABLE OF CONTENTS PageNote Regarding Forward-Looking St
18、atements2Risk Factor Summary4PART IItem 1.Business6Item 1A.Risk Factors18Item 1B.Unresolved Staff Comments46Item 1C.Cybersecurity45Item 2.Properties46Item 3.Legal Proceedings46Item 4.Mine Safety Disclosures46PART IIItem 5.Market for Registrants Common Equity,Related Stockholder Matters and Issuer Pu
19、rchases of EquitySecurities48Item 6.Reserved49Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations50Item 7A.Quantitative and Qualitative Disclosures about Market Risk60Item 8.Financial Statements and Supplementary Data61Item 9.Changes in and Disagreements with
20、Accountants on Accounting and Financial Disclosure96Item 9A.Controls and Procedures97Item 9B.Other Information99Item 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections99PART IIIItem 10.Directors,Executive Officers and Corporate Governance100Item 11.Executive Compensation100Item 1
21、2.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters100Item 13.Certain Relationships and Related Transactions,and Director Independence100Item 14.Principal Accountant Fees and Services100PART IVItem 15.Exhibits,Financial Statement Schedules101Item 16.Form
22、10-K Summary103Signatures10412025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm3/153NOTE REGARDING FORWARD-LOOKING STATEMENTS The Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Secur
23、ities Act of1933,as amended,and Section 21E of the Securities Exchange Act of 1934,as amended.The words“believe,”“may,”“will,”“potentially,”“estimate,”“continue,”“anticipate,”“intend,”“could,”“would,”“project,”“plan,”“expect,”and similarexpressions that convey uncertainty of future events or outcome
24、s are intended to identify forward-looking statements.These forward-looking statements include,but are not limited to,statements concerning the following:our ability to provide customers with improved benefits relating to their existing products and applications;our ability to maintain an adequate r
25、ate of revenue growth and other factors contributing to such growth;our ability to successfully anticipate market needs and opportunities;our business plan and our ability to effectively manage our growth and business operations;our plans to strengthen our sales efforts;our expectations with respect
26、 to recognizing revenue related to remaining performance obligations;our plans to introduce new products;loss or delay of expected purchases by our largest end-customers;our ability to further penetrate our existing customer base;our ability to displace existing products in established markets;conti
27、nued growth in markets relating to our networking and network security;our ability to timely and effectively scale and adapt our existing technology;our ability to innovate new products and bring them to market in a timely manner;our ability to conduct business internationally and any related impact
28、 on profitability;the effects of increased competition in our market and our ability to compete effectively;the effects of seasonal trends on our results of operations;our expectations concerning relationships with third parties;our expectations with respect to the realization of our tax assets and
29、our unrecognized tax benefits;our plans with respect to the repatriation of our earnings from our foreign operations;the attraction,retention and growth of qualified employees and key personnel;our ability to maintain profitability while continuing to invest in our sales,marketing,product developmen
30、t,distributionchannel partner programs and research and development teams;our expectations regarding our future costs and expenses;our expectations with respect to liquidity position and future capital requirements;our exploration of strategic alternatives;variations in product mix or geographic loc
31、ations of our sales;our stock repurchase program and our quarterly cash dividends;our expectations regarding our properties and related costs;fluctuations in currency exchange rates;tariffs affecting us;increased cost requirements of being a public company,including related to environmental,social a
32、nd governancematters,and future sales of substantial amounts of our common stock in the public markets;the cost and potential outcomes of litigation;our ability to protect against or adequately remedy security breaches in a timely or capital efficient manner;our ability to maintain,protect,and enhan
33、ce our brand and intellectual property;future acquisitions of or investments in complementary companies,products,services or technologies;and our ability to effectively integrate operations of entities we have acquired or may acquire.These forward-looking statements are subject to a number of risks,
34、uncertainties,and assumptions,including thosedescribed in“Risk Factors”and elsewhere in this Annual Report on Form 10-K.Moreover,we operate in a very competitive andrapidly changing environment,and new risks emerge from time to time.It is not possible for our management to predict all risks,nor can
35、we assess the impact of all factors on our business or the extent to which any factor,or combination of factors,may causeactual results to differ materially from those contained in any forward-looking statements we may make.Important factors thatcould cause our actual results and financial condition
36、 to differ materially from those indicated in the forward-looking statementsinclude,among others,the following:execution risks related to closing key deals and improving our execution;the continuedmarket adoption of our products;our ability to successfully anticipate market needs and opportunities;o
37、ur timely development ofnew products and features;our ability to maintain profitability;any loss or delay of expected purchases by our largest end-customers;our ability to maintain or improve our competitive position;competitive and execution2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/ed
38、gar/data/1580808/000158080824000049/aten-20231231.htm4/15322025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm5/153risks related to cloud-based computing trends;our ability to attract and retain new end-customers and our largest end-consume
39、rs;our ability to maintain and enhance our brand and reputation;changes demanded by our customers in the deployment and paymentmodel for our products;continued growth in markets relating to networking and network security;the success of any futureacquisitions or investments in complementary companie
40、s,products,services or technologies;the ability of our sales and otherteams to execute well;our ability to shorten our close cycles;the ability of our channel partners to sell our products;variations inproduct mix or geographic locations of our sales;risks associated with our presence in internation
41、al markets;any unforeseen needfor capital which may require us to divert funds we may have otherwise used for the dividend program or stock repurchaseprogram;a significant decline in global macroeconomic or political conditions that have an adverse impact on our business andfinancial results;busines
42、s interruptions related to our supply chain;our ability to manage our business and expenses if customerscancel or delay orders;weaknesses or deficiencies in our internal control over financial reporting;and our ability to timely fileperiodic reports required to be filed under the Securities Exchange
43、 Act of 1934,as well as other risks identified in the“RiskFactors”section of this Report.In light of these risks,uncertainties,and assumptions,the forward-looking events and circumstances discussed in thisAnnual Report on Form 10-K may not occur and actual results could differ materially and adverse
44、ly from those anticipated orimplied in the forward-looking statements.You should not rely upon forward-looking statements as predictions of future events.Although we believe that theexpectations reflected in the forward-looking statements are reasonable,we cannot guarantee that the future results,le
45、vels ofactivity,performance or events and circumstances reflected in the forward-looking statements will be achieved or occur.Anyforward-looking statements made by us in this report speak only as of the date of this report,and we do not intend to update theseforward-looking statements after the fili
46、ng of this report,except as required by law.Our investor relations website is located at https:/investors.A.We use our investor relations website,ourcompany blog(https:/ our corporate X(formerly Twitter)account(https:/ post important information for investors,including news releases,analyst presenta
47、tions,and supplemental financial information,and as a means of disclosing material non-public information and for complying with our disclosure obligations under RegulationFD.Accordingly,investors should monitor our investor relations website,our company blog and our corporate Twitter account,inaddi
48、tion to following press releases,SEC filings and public conference calls and webcasts.We also make available,free of charge,on our investor relations website under“SEC Filings,”our Annual Reports on Form 10-K,Quarterly Reports on Form 10-Q,Current Reports on Form 8-K and amendments to these reports
49、as soon as reasonably practicable after electronically filing orfurnishing those reports to the SEC.32025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm6/153RISK FACTOR SUMMARYRisks Related to Our Business,Operations and Industryanticipatin
50、g market needs and opportunities,and market adoption of our products;timely development and deployment of new products and features;maintaining profitability;variability in our operating costs and results;our reliance on shipments at the end of the quarter;intense competition and maintaining or impr
51、oving our competitive position;cloud-based computing trends;maintaining and enhancing our brand and reputation;a limited number of end-customers comprise a significant portion of revenue;changes demanded by customers in our deployment and payment models;large end-customers demanding more favorable t
52、erms and conditions;fluctuations in our gross margin;significant revenue from international sources;risks associated with continued expansion of our international operations;hiring,retaining and motivating qualified personnel;exploration of strategic alternatives;adverse economic conditions resultin
53、g in reduced technology spending;our dependence on third-party manufacturers;limited supply sources,supply shortages and changes;real or perceived defects,errors or vulnerabilities in our operations,products or services;warranty claims,returns,liability and defects;undetected software and hardware e
54、rrors;use of open source software;interoperability challenges with systems developed by others;prevention of inventory excesses or shortages;our ability to sell products dependent on quality support and services;maintaining high-quality support and services;product conformity with industry standards
55、,legal and compliance related requirements;our dependence on third-party or other information technology systems;potential future acquisitions;credit risk of distribution partners and customers;risk of cyberattacks and other information or security breaches;andearthquakes,fires,power outages,floods,
56、criminal activities,acts of war and terrorism.Risks Related to Intellectual Property,Litigation,Laws and Regulationslitigation and claims regarding our intellectual property rights;protecting our intellectual property rights;U.K.and other political developments including Brexit and changes of legal
57、requirements;enhanced U.S.tariffs,import/export restrictions,Chinese regulations,trade barriers;protecting and securing confidentiality of data,trade secrets and personally identifiable information;costs of protecting against or otherwise addressing security breaches;adequacy of protection of person
58、al data;sales to governmental organizations;compliance with governmental laws and regulations;governmental export and import controls;environmental laws and regulations;limitations on use of net operating loss carryforwards;changes in tax laws or regulations or,adverse outcomes to tax return examina
59、tions;changes in generally accepted accounting principles;our ability to maintain effective internal controls;our charter and Delaware law could discourage takeover attempts leading to management entrenchment;certain stockholder actions governed by the Court of Chancery of the State of Delaware;and2
60、025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm7/15342025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm8/153increasing attention on environmental,social and governance matters.
61、Risks Related to Capitalization and Financial Marketsfluctuations in foreign currency exchange rates;ownership concentration of our common stock;our ability to raise additional funds and stockholder dilution;volatility of the price of our common stock;potential substantial sales of common stock in t
62、he public markets;reports by security and industry analysts,changes to our dividend program;andour stock repurchase programs.52025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm9/153PART IItem 1.BusinessOverviewWe are a leading provider of
63、networking solutions that enable next-generation networks focused on reliability,availability,scalability and cybersecurity.Our portfolio supports customers operating in the cloud,on-premise or in hybrid environmentsproviding rapid return on their investment as well as investment protection with bes
64、t-in-class technical performance.As cyber-attacks increase in volume and complexity,we integrate security as a key attribute in essentially all our solutions that further enableour customers to continue to adapt to market trends in the cloud,internet of things and the ever-increasing need for more e
65、fficientdata processing,building upon our strong global footprint and leadership in application and network infrastructure.Our customersinclude leading service providers(cloud,telecommunications,multiple system operators,cable),government organizations,andenterprises.Industry Trends&Market DriversTh
66、e digitization of business has made applications a critical ingredient in virtually every aspect of operations.The safetyand efficiency of applications can directly impact business and financial performance,and security shortfalls can impact brandvalue and customer retention.The application networki
67、ng and security industry is experiencing dynamic shifts in the wayapplications are developed,delivered,monetized and protected.Innovation in artificial intelligence(“AI”)is driving new ways togain application delivery efficiency and enhance protection.Our corporate strategy and technology address th
68、ese evolving trendsand the needs of our customers and industry,including:Increased Adoption of Cloud Applications.For decades,businesses operated with applications based in physical,appliance-based data centers.While these traditional applications remain central to businesses around the world,a newg
69、enre of cloud-based applications is emerging,presenting new opportunities and challenges that require organizations toreassess the visibility,performance and security of their applications.Some of these challenges relate to how a businesseffectively manages secure application services across various
70、 data centers and cloud types,whether private,public orhybrid clouds.Over time,more and more applications may be born or provided in the cloud,while some applications thatexisted in traditional data centers may migrate to clouds as well.To address this shift,businesses will need solutions thatbridge
71、 both traditional and cloud-based application environments and centrally manage all secure application servicesholistically in this multi-cloud world.Increased Network Complexity and New Infrastructure Paradigms.Traditional IT vendors may need to shift fromhardware-centric models to software-defined
72、 approaches across several operating environments to improve agility forcritical applications,and subsequently,their business operations.Enabling product portfolios to adapt and diversify toinclude newer virtualized software,container-based software and cloud-based offerings are key factors determin
73、ing futuremarket leadership and competitive landscapes.Growing Importance of Automation,Orchestration.As applications increasingly move to a multi-cloud environment,thedeployment of orchestration and automation tools enable efficient automation for the deployment and operations ofsecurity and applic
74、ation services.There is a need for increased operational efficiency and agility,improved detection andreporting of security anomalies,enhanced end-user experiences and reduced total cost of ownership(“TCO”),simplifiedmanagement of distributed application services,improved capacity planning and optim
75、ized multi-cloud software lifecyclemanagement.By deploying newly developed secure application delivery automation and predictive analytics tools,enterprises can visualize their application performance,detect anomalous trends and automate their application deliveryand network security.The Rise of DDo
76、S Attacks and use of Artificial Intelligence.The cyberthreat landscape continues to plague enterprisesand society as a whole.Malicious actors and cybercriminals such as hacktivists,amateur hackers,and foreign military andintelligence organizations target data centers of every type.Distributed Denial
77、 of Service(“DDoS”)attacks are increasingin size,frequency,complexity and notoriety.IT defenders are faced with the increasing sophistication of adversaries whoare responsible for the size and frequency of these attacks.A DDoS attack seeks to render a target network or website unavailable by orchest
78、rating coordinated attacks from massiveworldwide networks of compromised endpoints,called botnets.Compromised endpoints can be computing devices or“Internet of Things”driven devices like video cameras.Any internet-connected device can be vulnerable to2025/2/11 21:03aten-20231231https:/www.sec.gov/Ar
79、chives/edgar/data/1580808/000158080824000049/aten-20231231.htm10/15362025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm11/153hackers and utilized as part of a botnet.Innovations in AI enable security teams to temper the rise in DDoS attack
80、 signalsand apply techniques that accurately address compromised endpoints in a rapid manner.Rapid growth of TLS,SSL,Encrypted Applications and Hidden Threats.Many applications use Transport LayerSecurity(“TLS”)and Secure Sockets Layer(“SSL”)protocols.Cyber criminals exploit the protocol to hide mal
81、iciousmalware within encrypted channels and carry out attacks against businesses and users.This malicious trend drives demandfor greater visibility within SSL-encrypted channels.Businesses need a way to decrypt traffic and apply outbound securitypolicies efficiently,and require an effective way to i
82、nspect,identify,and remediate malicious traffic,then re-encrypt trafficand deliver it quickly to its destination.Conducting this process efficiently without placing a“security performance tax”on the user experience is a capability valued by our customers.The Advent of 5G Networks and a Smart World.T
83、he growing deployment of commercial 5G networks will bring massiveincreases in network throughput and significant new business opportunities for mobile carriers and others.It will alsorequire a new generation of security infrastructure capable of handling the growing capacity requirements and comple
84、xmanagement needs of 5G networks.Capacity requirements increase dramatically in 5G networks due to substantialincreases in concurrent sessions,lower packet size and higher connections per second.Operators must dramatically lowerlatency,reduce total cost of ownership,and improve efficiency which may
85、require advanced consolidation of networkfunctions at the core.Meanwhile,the scope and size of DDoS attacks may also increase dramatically with the proliferationof connected devices and traffic,due in large part to the expansion of Internet of Things(“IoT”)/Machine-to-Machinetraffic coming from new
86、5G-delivered Smart World applications.To address these requirements,mobile and otheroperators will need new solutions that provide hyperscale and increased performance,richer feature sets,and richautomation,analytics and threat intelligence.Need for Advanced Multi-Cloud Secure Application Service So
87、lutions.To address these challenges,advanced andintegrated solutions for managing secure application services across businesses application environments are needed.Ofthe many solution requirements,some of the more critical include:Ability to Centrally Manage Traditional and Cloud Environments.As mor
88、e applications are provided in thecloud,and they operate alongside traditional applications supported by on-premise and appliance-based datacenters,application delivery and security solutions will be called upon to span traditional and cloud-basedenvironments.In doing so,solutions must centrally con
89、trol and manage secure application services across anycombination of traditional data centers and a myriad of different clouds.To support data centers and different cloudtypes,solutions require a variety of form factors:hardware,software(i.e.,virtual,bare metal and containers)andcloud-based offering
90、s.Clear Visibility and Sophisticated Analytics.The effectiveness of application performance and security dependsgreatly on the level of visibility a business has into its application traffic.That visibility should effectively span anynumber of data centers and cloud types to provide a holistic view
91、of security threats and performance issuesaffecting applications.The deeper and clearer the visibility,the better the analytics and actionable information thatcan be applied to enhancing application performance and protection.Secure application service solutions shouldprovide solid visibility and pe
92、r-app analytics.Ability to Scale.Performance and security at scale are highly desirable to our customers given todays dynamicapplication environments.Customers want solutions that analyze application traffic quickly and enhanceperformance and security in traditional and cloud-based application envir
93、onments in a centrally managed manner.With the rapid adoption of IoT devices,and the advent of 5G,we believe a solutions ability to perform at scale willbe increasingly important.Sophisticated Security Functionality.Secure application service solutions must leverage machine learning and AIto rapidly
94、 detect and mitigate sophisticated cybersecurity threats,such as malicious threats hiding in encryptedtraffic and DDoS attacks.To defend against the rising volume of sophisticated cyber-attacks,customers wantsolutions that provide exceptional performance and scale without dramatically increasing foo
95、tprint and total cost ofownership.72025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm12/153Product PortfolioOur product portfolio seeks to address many of the aforementioned challenges and solution requirements.The portfolioconsists of six
96、 secure application solutions and two intelligent management and automation tools.Our software solutions are available to be delivered in a variety of form factors,such as embedded in optimized hardwareappliances,as bare metal software,containerized software,virtual appliances and cloud-native softw
97、are.While our revenue to datehas predominantly derived from delivery of our proprietary software on a perpetual license basis embedded in optimized hardware,this model has begun to evolve in various ways including among others,term licenses,subscriptions,and software-only models.Our comprehensive an
98、d flexible application solutions portfolio,combined with our Harmony Controller,positions us to address thegrowing need for shifting workloads to a mix of private clouds and public clouds.A10 Harmony Controller is built onmicroservices and container technologies and offers a multi-tenant,highly scal
99、able controller architecture that incorporates real-time and predictive analytics at the application level and central management and orchestration of secure application servicesacross hybrid environments,from physical data centers to public,private and hybrid clouds.The following is an overview of
100、our portfolio:Secure application solutions:1.Thunder Application Delivery Controller(“ADC”)2.Thunder Carrier Grade Networking(“CGN”)3.Thunder SSL Insight(“SSLi”)4.Thunder Convergent Firewall(“CFW”)Intelligent management and automation tool:1.Harmony ControllerA10 Defend Suite of Products:1.A10 Defen
101、d Threat Control2.A10 Defend Orchestrator(formerly aGalaxy management system)3.A10 Defend Detector4.A10 Defend Mitigator(formerly Thunder TPS)The following is a further overview of our portfolio:Secure Application Solutions1.Thunder Application Delivery Controller.Thunder ADC provides advanced serve
102、r load balancing,including globalserver load balancing,high availability,aFleX scripting,aVCS,ADP multi-tenancy,SSL,offload,acceleration,caching and compression,web application firewall(“WAF”),domain name server(“DNS”)application firewall(“DAF”)and others.ADCs are typically deployed in front of a se
103、rver farm within a data center,including web,application and database servers.2.Thunder Carrier Grade Networking.Thunder CGN extends the life of increasingly scarce IPv4 address blocks andtheir associated infrastructure using Carrier-Grade network address translation(“CGNAT”),and also providestransl
104、ation solutions to the IPv6 addressing standard.Our CGN solution is typically deployed in service providernetworks to provide standards-compliant address and protocol translation services between varying types of IPaddresses.It has been successfully implemented by many large service providers and en
105、terprises around the world.3.Thunder SSL Insight.Thunder SSLi focuses on the inherent blind spots created by SSL encryption by offloadingCPU-intensive SSL decryption functions that enable security devices to inspect and remove malware withinencrypted traffic.Thunder SSLi decrypts SSL-encrypted traff
106、ic and forwards it to a third-party security device,suchas a firewall,for deep packet inspection(“DPI”).Once the traffic has been analyzed and scrubbed,Thunder SSLi re-encrypts the traffic and forwards it to its intended destination.2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/
107、1580808/000158080824000049/aten-20231231.htm13/15382025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm14/1534.Thunder Convergent Firewall.Thunder CFW addresses multiple critical security capabilities in one package byconsolidating multiple
108、security and networking functions in a single appliance,helping customers significantly lowercapital and operating expenses.Its performance and scale deliver superior value to customers,all within a small formfactor,and streamlines customer operations with a cloud-ready programmable platform.Thunder
109、 CFW includes:A high-performance Secure Web Gateway with integrated explicit proxy,URL filtering and SSL visibility,enabling security policy enforcement for outbound HTTP/HTTPS client traffic.Our solution includes a CloudAccess Proxy to provide scalability,performance,and security to overcome deploy
110、ment and operationalchallenges.A high-performance data center firewall with integrated network denial-of-service protection and server loadbalancing,which provides a Layer 4 stateful firewall and Layer 7 application-level gateway functionality forprotecting data center applications from emerging net
111、work and DDoS threats.A high-performance Gi/SGi firewall with integrated network DDoS,CGNAT,ADC and application visibility.The Gi/SGi firewall protects the mobile operator infrastructures from Internet-based DDoS and other securitythreats.A high-performance IPsec VPN,a security product designed to s
112、trengthen security postures and protectapplication data.Intelligent Management and Automation Tool1.Harmony Controller.Harmony Controller provides intelligent management,automation and analytics for secureapplication delivery in multi-cloud environments to help simplify operations.Infrastructure and
113、 applicationoperations teams can centrally manage and automate configuration and application policies for our Thunder andLightning application and security services,such as load balancing,application delivery,web application firewall,SSL decryption,Gi/SGi firewall,Carrier Grade NAT and Cloud Access
114、Proxy solutions.Configuration and controlcan also be automated via application program interface(“API”)and integrated with orchestration systems usedwithin organizations.In addition,the Harmony Controller provides comprehensive infrastructure and per-applicationmetrics and analytics for performance
115、and security monitoring,anomaly detection and faster troubleshooting.Thecontainer-based,microservices architecture allows controller capacity to be scaled without interrupting operations.Our Harmony Controller is available in two deployment models:A10 managed software-as-a-service(“SaaS”),or asa sel
116、f-managed,on-premise deployment.A10 Defend Suite of Products1.A10 Defend Threat Control.A10 Defend Threat Control is a standalone SaaS platform that proactively establishes arobust first layer of defense by offering actionable analytics and blocklists.Defend Threat Control is based onproprietary A10
117、 research.2.A10 Defend Orchestrator(formerly aGalaxy management system).A10 Defend Orchestrator integrates with A10Defend Detector and A10 Defend Mitigator for intelligent and automated DDoS protection,providing a centralizedpoint of control for seamless DDoS defense management and execution.A10 Def
118、end Orchestrator is designed to helplower operational costs by freeing up staff from repetitive tasks while increasing precision and accuracy withcentralized and automated tasks,reducing the potential for human error.A10 Defend Orchestrator highlights includedadvanced workflow and automated defense
119、capabilities.3.A10 Defend Detector.A10 Defend Detector is our high-performance Netflow,Sflow,IPFIX-based DDoS detector andis used to easily manage the scale and heterogenous nature of SP networks,resulting in a unified DDoS protectionsolution.Defend Detector can be used by SPs to deliver DDoS servic
120、es to downstream customers.4.A10 Defend Mitigator(formerly Thunder TPS).A10 Defend Mitigator is our high precision,automated,scalable,andintelligent DDoS mitigation solution that is delivered as hardware or virtual appliances ranging from 1Gbps to over1Tbps.A10 Defend Mitigator is typically deployed
121、 at the perimeter of the networks to protect internal networkresources from large-scale,volumetric and multi-vector attacks.In 2017,we enhanced the A10 Defend Mitigatorsolution with the launch of a dedicated detector function,improved workflow and automation in A102025/2/11 21:03aten-20231231https:/
122、www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm15/15392025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm16/153Defend Orchestrator.In 2018,we enhanced our detection capabilities with the One-DDoS solution,which
123、enablesThunder ADC,CGN,and CFW solutions to act as in-line detectors to enhance application and infrastructuredetection.We also added A10 Defend Mitigator Dynamic Attack Pattern Recognition(“DAPR”)for automatic attacklearning,to identify and thwart zero-day attacks,and enhanced machine learning(“ML”
124、)with always-on adaptivelearning.Defend Mitigator is augmented by the A10 Threat Control and software licensed from ThreatSTOP,Inc.,which can block known bad connections(i.e.,IP addresses)from entering protected networks.Product Form FactorsOur products are offered in a variety of form factors and p
125、ayment models,including physical appliances and perpetual andsubscription-based software licenses,as well as pay-as-you-go licensing models and FlexPool,a flexible consumption-basedsoftware model.FlexPool allows businesses to flexibly allocate and re-distribute capacity across applications,multiple
126、clouds anddata centers.Thunder Series:ADC,CGN,TPS,SSLi,and CFW products are available on the Thunder Series family of physicalappliances.The Thunder Series products support throughput ranges from 200 Mbps to 550 Gbps.The appliance family provides avariety of other security and performance options.vT
127、hunder virtual appliances operate on all major hypervisor platforms,including VMware,Microsoft Hyper-V and LinuxKVM.vThunder is also available from cloud providers like Amazon Web Services(“AWS”),Microsoft Azure,Google CloudCompute(“GCP”)and service providers.The vThunder Series products support thr
128、oughput ranges from 200 Mbps to 100 Gbps.Thunder for Bare Metal is a software version of our ADC and CGN solutions that is designed to run on a variety of Intelx86 servers,allowing the customer to design and select their own hardware platform.Thunder container is software that can be deployed as a c
129、ontainer for cCGN,cADC and cTPS on customers ownhardware platforms and OS stacks.Underlying TechnologySince our inception,our solutions have been known for their high performance and scalability in some of the largest andmost demanding networks.The value and significance of our high-performance offe
130、rings reside in our portfolios underlyingsoftware operating system.With the exception of Lightning ADC,our products are built on the Advanced Core Operating System(“ACOS”)platform and leverage its performance optimization and security features.The ACOS platform is optimized for modern 64-bit central
131、 processing units(“CPUs”),which increasingly have multipleparallel processing cores that operate within a single CPU for higher efficiency and performance scalability.To maximize thecapabilities of these increasingly dense multi-core CPUs,ACOS implements a proprietary shared memory architecture that
132、provides all cores with simultaneous access to common memory.This shared memory software architecture enables our products toutilize these multi-core CPUs efficiently and scale performance with increasing CPU cores.As a result,ACOS provides customerswith products that can deliver superior price perf
133、ormance benefits over products that lack these capabilities.ACOS high-performance design enables our products to address a wide range of performance-driven networkingchallenges.The flexible software design of ACOS allows us to apply our portfolio to a variety of markets for a variety of needs.Some n
134、otable details about ACOS include:High Performance and Intelligent Network Input/Output(“I/O”)Processing.In order to maximize the efficiency ofhigh density,multi-core processors,we have developed a high-performance intelligent network I/O technology that canbalance application traffic flows equitabl
135、y across processor cores.Our Flexible Traffic Accelerator logic can beimplemented either as software running within a standard x86 processor or a Field Programmable Gate Array(“FPGA”)semiconductor.Our Flexible Traffic Accelerator(“FTA”)also performs certain hardware-based security checks for eachpac
136、ket and can isolate suspicious traffic before it can impact system performance.Scalable and Efficient Memory Usage.To improve the performance of the multi-core processor architecture,we havedeveloped a shared memory technology to allow processors to share common memory and the state of the systemsim
137、ultaneously.This avoids the overhead associated with Inter-Processor Communication architectures deployed in2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm17/153102025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/158080
138、8/000158080824000049/aten-20231231.htm18/153first-generation approaches.We optimize memory to be visible to processor cores simultaneously,while minimizingcommunication overhead and contention among processors for allocated memory space.All processors share a commonmemory pool,which dynamically allo
139、cates memory space based on application processing requirements withoutconstraints.Customers can achieve greater performance and scalability from memory and processor resources becauseconfigurations,policies and network databases are efficiently stored within a shared memory architecture.Optimized A
140、pplication Networking and Security.Once data is processed and placed into a shared memory,a processorcan begin to apply ACOS common services and function-specific logic.To enable every processor utilized to perform keyfunctions and thereby achieve greater system utilization,ACOS uses processor cores
141、 symmetrically for functions andservices.The ACOS common services perform a set of key operational functions,including configuration management,network I/O,aFleX scripting,Virtual Chassis System(“aVCS”),aXAPI for management integration,Application DeliveryPartitions(“ADPs”),virtualization to enable
142、multi-tenancy,and common resource management such as buffer,systemmemory,timer management and other internal system management tasks.ACOS features a modular software design,which improves reliability by preventing modifications made to one module from causing unwanted side effects on othersystem fun
143、ctions.Other noteworthy ACOS Technologies.ACOS incorporates a number of other technologies to provide a rich environmentfor developing Layer 4-7 application networking solutions,including:aFleX Scripting.aFleX scripting technology is based on industry-standard tool command language and enablescustom
144、ers to write custom scripts to augment the application processing.ADP.ADP enables multi-tenancy in the ACOS common services so that multiple departments of an organization ormultiple customers can share a physical/virtual appliance.aVCS.aVCS enables multiple physical/virtual appliances to be managed
145、 as a single chassis.aXAPI.aXAPI is an industry standard representational state transfer(“RESTful”)program interface to enablemanagement integration for automated management.Support&ServicesOne of our founding principles is to provide excellent customer support.Our global support team,with deep tech
146、nicaldomain expertise,is part of our engineering organization and is trained across all products and solutions and takes completeownership of customer issues from the beginning to the end to achieve rapid response and resolution.Our consistent,high-qualitycustomer service and technical support is a
147、key factor in attracting and retaining customers of all sizes,as well as support servicesthat include installation,phone support,repair and replacement,software updates,online tools,consulting and training services.All customers receive standard warranty support for 90 days with the purchase of our
148、products.We offer four maintenanceoptions-Basic,Basic Plus,Gold and Platinum support programs(Platinum available in select countries).Maintenance contractsmay be purchased in 12-month increments up to five years.The average maintenance contract term is approximately 18 months.We invoice resellers or
149、 customers directly for maintenance contracts at the time of hardware purchase,and all maintenancecontracts are non-cancellable and are generally renewed through the same channel as originally purchased.Software updates areprovided to all customers with a current maintenance contract on a when-and-i
150、f-available basis.We maintain technical supportcenters in the United States,Japan,India and the Netherlands.Thunder TPS features an enhanced support offering that includes access to the A10 DDoS Security Incident ResponseTeam(“SIRT”).Augmenting the standard support,the offering includes access to a
151、dedicated team of DDoS mitigation expertsspecializing in DDoS prevention,offering efficient assistance for mitigating attacks,and a subscription to the A10 ThreatIntelligence Service,leveraging collective intelligence to block known threats.Our professional services team provides a full range of fee
152、-based consulting services,including pre-sale networkassessment,comprehensive network analysis and capacity planning,post-sale migration and implementation services,on-siteinstallation and ongoing support.2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/a
153、ten-20231231.htm19/153112025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm20/153CustomersOur customers operate in a variety of industries,including telecommunications,technology,industrial,government,retail,financial,gaming,and education.O
154、ur customers include the top two United States wireless carriers,four of the top 10 UnitedStates cable providers,and the top four service providers in Japan,in addition to other global enterprises,gaming companies andgovernmental organizations.During the years ended December 31,2023,2022 and 2021,pu
155、rchases from our 10 largest end-customers accounted for approximately 33%,41%and 39%of our total revenue,respectively.In 2023,one distribution channel partner accounted for 19%of our total revenue.In 2022,two distribution channelpartners accounted for 15%and 13%of our total revenue.In 2021,one distr
156、ibution channel partner accounted for 12%of our totalrevenue.CompetitionAs security,5G and cloud trends continue to gain prominence,changes in application delivery needs,cyber securitythreats,and the technology landscape result in evolving customer requirements.These evolving demands have expanded o
157、uraddressable market into cybersecurity including DDoS protection,5G/5G-readiness and hybrid networking,where we competewith a number of companies not included among our traditional competitors of the past.The agility and flexibility of a commonmanagement platform enables us to offer multiple produc
158、t categories that are easier to manage for our customers.Our portfolioalso includes container and microservices-based versions of certain of our comprehensive set of hardware,software and cloudofferings.We do not consider any of these markets to include a single dominant company,nor do we consider t
159、he markets to befragmented.Our main competitors fall into the following categories:Companies that sell network security solutions and services including DDoS protection,such as Arbor Networks Inc.,a subsidiary of Netscout Systems,F5 Networks,Inc.(“F5 Networks”)and Radware,Ltd;Companies that sell net
160、work security products,including Secure Web Gateways,SSL Insight/SSL Intercept,datacenter firewalls and Office 365 proxy solutions;Companies that sell Gi/SGi firewall and CGN products,which were originally designed for other networking purposes,such as edge routers and security appliances from vendo
161、rs like Cisco Systems,Inc.(“Cisco Systems”),JuniperNetworks,Inc.(“Juniper Networks”)and Fortinet,Inc.(“Fortinet”);andCompanies that sell products in the traditional application delivery market,such as F5 Networks,NetScaler fromCloud Software Group,Inc.,VMware from Broadcom(through its acquisition of
162、 Avi Networks)as well as manystartups.The key competitive factors in our markets include:Ability to innovate and respond to customer needs rapidly;Ability to prepare for,detect and mitigate large-scale cyber security threats;Ability for products to scale to facilitate high-speed network traffic;Abil
163、ity to address on-premise and cloud application environments in a secure,centrally managed manner;Ability to accommodate any IT delivery model or combination of models,regardless of form factor and customerconsumption model;Level of customer intimacy and application know-how;Total cost of ownership
164、including ease-of-use and a common platform approach for multiple products;Brand awareness and reputation;and2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm21/153122025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/15808
165、08/000158080824000049/aten-20231231.htm22/153Ability to attract and retain talented employees.Sales and MarketingSalesOur high-touch sales force engages customers directly and through distribution channels.Our sales team is comprised ofinside sales and field sales personnel who are organized by geog
166、raphy and maintain sales presence in 28 countries as of December31,2023,including in the following countries and regions:United States,Western Europe,the Middle East,Japan,Taiwan,SouthKorea,Southeast Asia and Latin America.Our sales organization includes sales engineers with deep technical domain ex
167、pertisewho are responsible for pre-sales technical support,solutions engineering,proof-of-concept work and technical training for ourdistribution channels.Our sales team is also comprised of a channel sales organization that is expanding our market reach throughresellers.We may continue to grow our
168、sales headcount,including in geographies where we currently do not have a sales presence.Some customer sales are originated and completed by our Original Equipment Manufacturer(“OEM”)and distributionchannels with little or no direct engagement by our sales personnel.We fulfill nearly all orders glob
169、ally through our distributionchannels,which include distributors,value added resellers and system integrators.Revenue fulfilled through our distributionchannels accounted for 95%,83%and 89%of our total revenue for the years ended December 31,2023,2022 and 2021,respectively.MarketingOur strategy is f
170、ocused on driving greater demand for our products and services,and enabling sales to win as that demandbroadens.Our marketing drives global demand generation campaigns,as well as additional awareness and demand via jointmarketing campaigns worldwide.Our marketing also drives global awareness through
171、 industry analyst engagement,mediaoutreach,blogs,social media and events.ManufacturingWe outsource the manufacturing of our hardware products to original design manufacturers.This approach allows us tobenefit from the scale and experience of our manufacturing partners to reduce our costs,overhead an
172、d inventory while allowing usto adjust more quickly to changing customer demand.Our manufacturers are Lanner Electronics Inc.(“Lanner”),AEWINTechnologies Co.,Ltd.(“AEWIN”)and iBase.These companies manufacture and assemble our hardware products using designspecifications,quality assurance programs an
173、d standards established and owned or licensed by us.Our manufacturers procurecomponents and assemble our products based on our demand forecasts and purchase orders.These forecasts represent our estimatesof future demand for our products based on historical trends and analysis from our sales and prod
174、uct management functions asadjusted for overall market conditions.We have agreements with Lanner with an initial term of one year and AEWIN with an initial term of six years pursuant towhich they manufacture,assemble,and test our products.Each agreement automatically renews for successive one-year t
175、ermsunless either party gives notice that they do not want to renew.We do not have any long-term manufacturing contracts thatguarantee fixed capacity or pricing.Quality assurance and testing is performed at our San Jose,Taiwan and Japan distributioncenters,as well as at our manufacturers locations.W
176、e warehouse and deliver our products out of our San Jose warehouse for theAmericas and direct from Taiwan for APAC and EMEA.We outsource delivery to a third-party logistics provider for deliveries inJapan.BacklogAs of December 31,2023 and 2022,we had product backlog of approximately$3.8 million and$
177、8.1 million,respectively.Backlog represents orders confirmed with a purchase order for products to be shipped generally within 90 days to customers withapproved credit status.Orders may be subject to cancellation,rescheduling by customers and product specification changes bycustomers.Although we bel
178、ieve that the backlog orders are firm,purchase orders may be canceled by the customer prior toshipment without significant cost.For this reason,we believe that our product backlog at any given date is not a reliable indicatorof future revenues.132025/2/11 21:03aten-20231231https:/www.sec.gov/Archive
179、s/edgar/data/1580808/000158080824000049/aten-20231231.htm23/1532025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm24/153For the years ended December 31,2023,2022 and 2021,our total revenue was$251.7 million,$280.3 million,and$250.0million,r
180、espectively,and our gross margin was 80.9%,79.7%,and 78.6%,respectively.We had net income of$40.0 million,$46.9million and$94.9 million for the years ended December 31,2023,2022 and 2021,respectively.Intellectual PropertyWe rely on a combination of patent,copyright,trademark and trade secret laws,an
181、d restrictions on disclosure to protectour intellectual property rights.As of December 31,2023,we had 210 United States(“U.S.”)patents issued,5 U.S.patentapplications pending,79 overseas patents issued and 9 overseas patent applications pending.Our issued U.S.patents,excluding 14patents that we acqu
182、ired,expire between 2024 and 2042.Our issued overseas patents,excluding 5 patents that we acquired,expirebetween 2024 and 2037.Our future success depends in part on our ability to protect our proprietary rights to the technologies usedin our principal products.Despite our efforts to protect our prop
183、rietary rights,unauthorized parties may attempt to copy aspects ofour products or to obtain and use trade secrets or other information that we regard as proprietary.In addition,the laws of someforeign countries do not protect our proprietary rights as fully as do the laws of the United States.Any is
184、sued patent may notpreserve our proprietary position,and competitors or others may develop technologies similar to or superior to our technology.Ourfailure to enforce and protect our intellectual property rights could harm our business,operating results and financial condition.We license software fr
185、om third parties for development of,or integration into,our products,including proprietary andopen source software.We pursue registration of our trademarks and domain names in the United States and other jurisdictions.SeePart I,Item 1A.Risk Factors included in this Annual Report on Form 10-K for add
186、itional information regarding the risks associatedwith protecting our intellectual property.Human CapitalAs of December 31,2023,we had 525 full-time employees,including 236 engaged in research and development andcustomer support,235 in sales and marketing and 54 in general and administrative and oth
187、er activities.None of our employees isrepresented by a labor union or is a party to any collective bargaining arrangement in connection with his or her employment withus.We have never experienced any work stoppages,and we consider our relations with our employees to be good.Corporate ResponsibilityA
188、10 Networks mission is to enable business-critical networks that are secure,available and efficient.In our rapidlyexpanding digital economy,this has never been more relevant and critical.Our customers rely on us to help them drive betterbusiness outcomes now and into the future.With our mission in m
189、ind,we are committed to maintaining the highest standards of ethics and corporate governance,andto fostering a diverse and inclusive workforce and customer and partner ecosystem.We believe these practices will deliver thehighest value for our employees,customers,partners and shareholders.Our global
190、footprint provides an additional level ofsustainability for business performance,and we drive this responsibility across all our global locations.We use as a guide the code of conduct policies set forth by the Responsible Business Alliance,the worlds largest industrycoalition dedicated to corporate
191、social responsibility in global supply chains,and we expect all of our suppliers to do so as well.The alliance sets standards and practices for a social,environmentally sustainable,and ethical supply chains.Our supply chain hassustained audits based on the Validated Assessment Program.Further,we hav
192、e established standards and practices to which our Board of Directors,executives and employees areobligated to adhere,as outlined on our website under Corporate Responsibility.Environmental,Social and Governance(“ESG”)EnvironmentalWe are committed to business practices that preserve the environment
193、upon which our society and economy depend.Weare committed to meeting or exceeding all legal and compliance guidelines for our people,products and operations.In addition,westrive to deliver products and services that minimize the impact to the environment throughout our value chain.2025/2/11 21:03ate
194、n-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm25/153142025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm26/153Our environmental initiatives are aligned with the 1.5C ambition as outlined in th
195、e Paris Agreement,and we have corporate goalsto support the initiative.We work with our contract manufacturers and suppliers to maintain compliance with,for example,RoHS,REACH andWEEE in the EU and elsewhere across the globe for other such environmental requirements.The Companys Conflict MineralsSup
196、ply Chain Policy as well as our Code of Business Conduct and Ethics outlines our practices and procedures with respect tohuman rights to ensure participants in our supply chain do not knowingly contribute to local conflict or human rights abuses.Weexpect our suppliers to comply with our policy on re
197、sponsible sourcing of minerals from conflict-affected and high-risk areas andto cooperate with our diligence inquiries and requests for information and certification as may be required by us to comply withreporting and disclosure obligations to which we are subject from time to time.Our corporate he
198、adquarters in San Jose,California,is compliant with the California Building Energy Efficiency Standards-Title 24 to reduce wasteful and unnecessary energy consumption.The Company has planned for greater use of renewable energyin partnership with the local utility,PG&E.At our headquarters,we offer EV
199、 charging stations to our employees and visitors,andwhere applicable according to local requirements,we offer recycling and we properly dispose of e-waste.SocialDiversity,Inclusion&Equal OpportunityWe are committed to providing a work environment that is free of discrimination and harassment.We are
200、an equal-opportunity employer.We make employment decisions on the basis of a persons qualifications,and our business needs.We believein the richness and quality of a working environment that is informed by people from all walks of life and strive to create agenuinely inclusive environment.We have im
201、plemented Diversity,Equal Opportunity,and Inclusion action planning teams focusedon analysis from diversity surveys and focus groups.We have ongoing outreach efforts to recruit a diverse candidate pool and arebuilding questions into our engagement survey to promote a diverse and inclusive environmen
202、t.We are committed to ensuring our team members are treated with fairness and respect.We believe that a cooperative workenvironment,based on trust and mutual respect,is essential to our success.We embrace the diversity of our workforce andcelebrate the creative value added by individuals with differ
203、ing backgrounds.We expressly prohibit intimidation,hostility,harassment,discrimination and other inappropriate behavior.Furthermore,we expect employees to conduct themselves in aprofessional and dignified manner at all times;in doing so,we seek to avoid making employees feel uncomfortable at work.As
204、 new employees join us,they learn more about our policies and culture through orientation and onboarding,ourEmployee Handbook,Code of Business Conduct and Ethics,and compliance trainings.These all provide guidance on how weexpect to operate in order to foster diversity,equity and inclusion across ou
205、r company.We are an equal opportunity employer and a Vietnam Era Veterans Readjustment Assistance Act(“VEVRAA”)federalsubcontractor.All qualified applicants receive consideration for employment without regard to race,color,religion,sex,sexualorientation,gender identity,national origin,disability sta
206、tus,protected veteran status,or any other characteristic protected by law.We also comply with all applicable state and local laws governing nondiscrimination in employment.Total RewardsWe offer an attractive mix of compensation and benefit plans to support our employees and their families physical,m
207、ental,and financial well-being.We believe that we employ a fair and merit-based total compensation system for our employeesand offer a variable bonus plan for eligible employees.Employees are generally eligible for medical,dental,vision and othercomprehensive benefits,most of which become effective
208、on their start date.Below are some of the types of health and wellnessrelated benefits offered to employees:Medical,dental and vision insurance;Retirement plan with Company matching contribution feature;Flexible Spending Accounts for medical expenses,childcare,parking and transit;Health Savings Acco
209、unt(with employer contribution);Life insurance;2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm27/153152025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm28/153Short&long-term d
210、isability;Paid time off and leave of absences;andEmployee assistance programEmployees have an opportunity for financial inclusion at A10 Networks with an ownership interest in our company.Thereare several programs that provide employees with the ability to own our stock.Generally,more than 75%of our
211、 employeesparticipates in at least one of our stock programs.During their tenure with our company,most employees have an opportunity toreceive an equity award,either upon hire and/or during an annual review process to recognize those with significant impact onachieving our goals.Most employees,wheth
212、er part or full time,also have the ability to participate in our Employee Stock PurchasePlan(“ESPP”).Participants in the ESPP may purchase our stock at a 15%discount to market price.We believe our discountedstock purchase program helps to build an ownership mentality amongst participating employees.
213、Health,Safety and WellnessWe are committed to maintaining a healthy,safe,and secure work environment that protects our employees and the publicfrom harm.We use a multi-faceted approach to ensure the health and safety of our employees,from our Code of Business Conductand Ethics to our policies govern
214、ing the way we act within and outside of our company.We comply with applicable health,safety,and environmental laws as well as related company policies and procedures.We have a zero-tolerance policy against aggressivebehavior,violence,direct and indirect threats,harassment,intimidation,and possessio
215、n of weapons on company property.Moreover,we strive to conduct our everyday business activities in an environmentally sustainable way through wellness programsand webinars through our health insurance providers.GovernanceOur Board of Directors believes that our board should be a diverse body,and our
216、 Nominating and Corporate GovernanceCommittee considers a broad range of backgrounds and experiences when selecting nominees for our board.Sixty percent of ourdirectors currently self-identify as being from one or multiple diverse groups,including gender.We continuously review and improve our corpor
217、ate governance guidelines in response to changing requirements andfeedback from employees,customers,partners,vendors and shareholders.The Nominating and Corporate Governance Committeesof the Board of Directors,consisting entirely of independent directors,evaluates the appropriate governance practice
218、s as defined bylaw and industry best practice and takes those recommendations to the Board of Directors.Currently,four of five Board membersare independent and three of five have less than five years of tenure.A10 engages with an independent audit firm to ensure the Company complies with relevant re
219、quirements such as the 2002Sarbanes-Oxley Act.The Companys governance and code of conduct policies are outlined in the Code of Business Conduct and Ethics,Corporate Governance Guidelines,Whistleblower Policy and the Employee Handbook.Employees may submit concerns or via the Companys third-party hotl
220、ine as noted the Employee Handbook.Corporate InformationA10 Networks,Inc.was incorporated in the State of California in 2004 and subsequently reincorporated in the State ofDelaware in March 2014.Our website is located at www.A,and our investor relations website is located athttps:/investors.A.The fo
221、llowing filings are available through our investor relations website after we file themwith the SEC:Annual Reports on Form 10-K,Quarterly Reports on Form 10-Q,Current Reports on Form 8-K,as well as anyamendments to such reports and all other filings pursuant to Section 13(a)or 15(d)of the Securities
222、 Act.These filings are alsoavailable for download free of charge on our investor relations website.Additionally,copies of materials filed by us with the SECmay be accessed at the SECs website at www.sec.gov.We announce material information to the public about the Company,our products and services an
223、d other matters through avariety of means,including our website(www.A),the investor relations section of our website(https:/investors.A),press releases,filings with the Securities and Exchange Commission,public conference calls,and social media,including our corporate X(formerly Twitter)account(A10N
224、etworks)and our corporate Facebook page(https:/ provided includes press releases and other information about financialperformance,information on environmental,social and governance and details related to the Companys annual2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/00
225、0158080824000049/aten-20231231.htm29/153162025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm30/153meeting of shareholders.The contents of our website and social media contents are not intended to be incorporated by referenceinto this Annua
226、l Report on Form 10-K or in any other report or document we file with the SEC,and any references to our websitesare intended to be inactive textual references only.We encourage investors and others to review the information we make public inthese locations,as such information could be deemed to be m
227、aterial information.Please note that this list may be updated fromtime to time.172025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm31/153Item 1A.RISK FACTORSInvesting in our common stock involves a high degree of risk.You should carefully
228、consider the risks and uncertaintiesdescribed below,together with all of the other information contained in this report and in our other public filings.The risks anduncertainties described below are not the only ones we face.Additional risks and uncertainties that we are unaware of,or that wecurrent
229、ly believe are not material,may also become important factors that affect us.If any of the following risks occur,ourbusiness,financial condition,operating results,and prospects could be materially harmed.In that event,the trading price of ourcommon stock could decline,perhaps significantly.The order
230、 of presentation is not necessarily indicative of the level of risk thateach factor poses to us.Risks Related to Our Business,Operations and IndustryIf we do not successfully anticipate market needs and opportunities or if the market does not continue to adopt our applicationdelivery solutions,our b
231、usiness,financial condition and results of operations could be significantly harmed.The application delivery market is rapidly evolving and difficult to predict.Technologies,customer requirements,securitythreats and industry standards are constantly changing.As a result,we must anticipate future mar
232、ket needs and opportunities andthen develop new products or enhancements to our current products that are designed to address those needs and opportunities,andwe may not be successful in doing so.We continuously seek to enhance and improve our solutions we make available to our customers.However,eve
233、n if we areable to anticipate,develop and commercially introduce new products and enhancements that address the markets needs andopportunities,there can be no assurance that new products or enhancements will achieve widespread market acceptance.Forexample,organizations that use other conventional or
234、 first-generation application delivery solutions for their needs may believethat these solutions are sufficient.In addition,as we launch new product offerings,organizations may not believe that such newproduct offerings offer any additional benefits as compared to the existing application delivery s
235、olutions that they currently use.Accordingly,organizations may continue allocating their IT budgets for existing application solutions and may not adopt oursolutions,regardless of whether our solutions can offer superior performance or security.If we fail to anticipate market needs and opportunities
236、 or if the market does not continue to adopt our application deliverysolutions,then market acceptance and sales of our current and future application delivery solutions could be substantially decreasedor delayed,we could lose customers,and our revenue may not grow or may decline.Any of such events w
237、ould significantly harmour business,financial condition and results of operations.Our success depends on our timely development of new products and features to address rapid technological changes andevolving customer requirements.If we are unable to timely develop and successfully introduce new prod
238、ucts and features thatadequately address these changes and requirements,our business and operating results could be adversely affected.Changes in application software technologies,data center and communications hardware,networking software andoperating systems,and industry standards,as well as our e
239、nd-customers continuing business growth,result in evolving applicationnetworking needs and requirements.Our continued success depends on our ability to identify,develop and introduce in a timelyand successful manner,new products and new features for our existing products that meet these needs and re
240、quirements.Our future plans include significant investments in research and development and related product opportunities.Developing our products and related enhancements is time-consuming and expensive.We have made significant investments in ourresearch and development team in order to address thes
241、e product development needs.Our investments in research and developmentmay not result in significant design and performance improvements or marketable products or features,or mayresult in products that are more expensive than anticipated.We may take longer to generate revenue,or generate less revenu
242、e,thanwe anticipate from our new products and product enhancements.We believe that we must continue to dedicate a significant amountof resources to our research and development efforts to maintain our competitive position.We continuously seek to enhance and improve our solutions.However,if we are un
243、able to develop new products andfeatures to address technological changes and new customer requirements in the application networking or security markets,or ifour investments in research and development do not yield the expected benefits in a timely manner,our business and operatingresults could be
244、adversely affected.2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm32/153182025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm33/153We have experienced net losses in the past an
245、d may not maintain profitability in future periods.If we cannot maintainprofitability,our financial performance will be harmed and our business may suffer.We may not be able to increase our quarterly revenue or maintain profitability in the future or on a consistent basis,andwe may incur significant
246、 losses in the future for a number of possible reasons,including our inability to develop products thatachieve market acceptance,general economic conditions,increasing competition,decreased growth in the markets in which weoperate,regulatory or other governmental actions over which we have no contro
247、l,or our failure for any reason to capitalize ongrowth opportunities.Additionally,we may encounter unforeseen operating expenses,difficulties,complications,delays and otherunknown factors that may result in losses in future periods.If these losses exceed our expectations or our revenue growthexpecta
248、tions are not met in future periods,our financial performance will be harmed and our stock price could be volatile ordecline.Our operating results have varied and are likely to continue to vary significantly from period to period and may beunpredictable,which could cause the trading price of our com
249、mon stock to decline.Our operating results,in particular,revenue,margins and operating expenses,have fluctuated in the past,and we expectthis will continue,which makes it difficult for us to predict our future operating results.The timing and size of sales of our productsare highly variable and diff
250、icult to predict and can result in significant fluctuations in our revenue from period to period.This isparticularly true of sales to our largest end-customers,such as service providers,enterprise customers and governmentalorganizations,who typically make large and concentrated purchases and for who
251、m close or sales cycles can be long,as a result oftheir complex networks and data centers,as well as requests that may be made for customized features.Our quarterly results mayvary significantly based on when these large end-customers place orders with us and the content of their orders.Our operatin
252、g results may also fluctuate due to a number of other factors,many of which are outside of our control andmay be difficult to predict.In addition to other risks listed in this“Risk Factors”section,factors that may affect our operatingresults include:fluctuations in and timing of purchases from,or lo
253、ss of,large customers;the budgeting cycles and purchasing practices of end-customers;changes in end-customer preferences,practices or personnel;our ability to attract and retain new end-customers;our ability to provide and enhance efficient operations;changes in demand for our products and services,
254、including seasonal variations in customer spending patterns or cyclicalfluctuations in our markets;our reliance on shipments at the end of our quarters;variations in product mix or geographic locations of our sales,which can affect the revenue we realize for those sales;the timing and success of new
255、 product and service introductions by us or our competitors;our ability to increase the size of our distribution channel and to maintain relationships with important distributionchannels;our ability to improve our overall sales productivity and successfully execute our marketing strategies;the effec
256、t of currency exchange rates on our revenue and expenses;2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm34/153192025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm35/153changes
257、 in legal requirements,our compliance obligations and/or relevant tax schemas;the cost and potential outcomes of existing and future litigation;expenses related to our facilities,networks,and network operations;the effect of discounts negotiated by our largest end-customers for sales or pricing pres
258、sure from our competitors;changes in the growth rate of the application networking or security markets or changes in market needs;inventory write downs,which may be necessary for our older products when our new products are launched and adoptedby our end-customers;our ability to expand international
259、ly and domestically;andour third-party manufacturers and component suppliers capacity to meet our product demand forecasts on a timely basis,or at all.Any one of the factors above or the cumulative effect of some of these factors may result in significant fluctuations in ourfinancial and other opera
260、ting results.This variability and unpredictability could result in our failure to meet our or our investors orsecurities analysts revenue,margin or other operating results expectations for a particular period,resulting in a decline in thetrading price of our common stock.Reliance on shipments at the
261、 end of the quarter could cause our revenue for the applicable period to fall below expected levels.As a result of end-customer buying patterns and the efforts of our sales force and distribution channels to meet or exceedtheir sales objectives,we have historically received a substantial portion of
262、purchase orders and generated a substantial portion ofrevenue during the last few weeks of each quarter.We may be able to recognize such revenue in the quarter received,however,only if all of the requirements of revenue recognition are met by the end of the quarter.Any significant interruption in ou
263、rinformation technology systems,which manage critical functions such as order processing,revenue recognition,financial forecasts,inventory and supply chain management,could result in delayed order fulfillment and thus decreased revenue for that quarter.Ifexpected revenue at the end of any quarter is
264、 delayed for any reason,including the failure of anticipated purchase orders tomaterialize(including delays by our customers or potential customers in consummating such purchase orders),our third-partymanufacturers inability to manufacture and ship products prior to quarter-end to fulfill purchase o
265、rders received near the end of thequarter,our failure to manage inventory to meet demand,our inability to release new products on schedule,any failure of oursystems related to order review and processing,or any delays in shipments or achieving specified acceptance criteria,our revenuefor that quarte
266、r could fall below our,or our investors or securities analysts expectations,resulting in a decline in the trading priceof our common stock.For example,in 2023,we experienced longer sales cycles and customer uncertainty that resulted in delayedorders.We face intense competition in our market,especial
267、ly from larger,well-established companies,and we may lack sufficientfinancial or other resources to maintain or improve our competitive position.The application networking and security markets are intensely competitive,and we expect competition to increase in thefuture.To the extent that we sell our
268、 solutions in adjacent markets,we expect to face intense competition in those markets as well.We believe that our main competitors fall into the following categories:Companies that sell products in the traditional ADC market such as F5 Networks,Inc.(“F5 Networks”)and CitrixSystems,Inc.(“Citrix Syste
269、ms”);Companies that sell open source,software-only,cloud-based ADC services,such as Avi Networks Inc.(“Avi Networks”),NGINX Inc.(“NGiNX”),and HAProxy Technologies,Inc.(“HAProxy”)as well as many startups;2025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/ate
270、n-20231231.htm36/153202025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm37/153Companies that sell CGN products,which were originally designed for other networking purposes,such as edge routersand security appliances from vendors like Cisco
271、 Systems,Inc.(“Cisco Systems”),Juniper Networks,Inc.(“JuniperNetworks”)and Fortinet,Inc.(“Fortinet”);Companies that sell traditional DDoS protection products,such as Arbor Networks,Inc.,a subsidiary of NetScoutSystems,Inc.(“Arbor Networks”)and Radware,Ltd.(“Radware”);Companies that sell SSL decrypti
272、on and inspection products,such as Symantec Corporation(through its acquisition ofBlue Coat Systems Inc.in 2016)and F5 Networks;andCompanies that sell certain network security products,including Secure Web Gateways,SSL Insight/SSL Intercept,datacenter firewalls and Office 365 proxy solutions.Many of
273、 our competitors are substantially larger and have greater financial,technical,research and development,sales andmarketing,manufacturing,distribution and other resources and greater name recognition.In addition,some of our largercompetitors have broader products offerings and could leverage their cu
274、stomer relationships based on their other products.Potential customers who have purchased products from our competitors in the past may also prefer to continue to purchase fromthese competitors rather than change to a new supplier regardless of the performance,price or features of the respective pro
275、ducts.We could also face competition from new market entrants,which may include our current technology partners.As we continue toexpand globally,we may also see new competitors in different geographic regions.Such current and potential competitors may alsoestablish cooperative relationships among th
276、emselves or with third parties that may further enhance their resources.Many of our existing and potential competitors enjoy substantial competitive advantages,such as:longer operating histories;the capacity to leverage their sales efforts and marketing expenditures across a broader portfolio of pro
277、ducts and servicesat a greater range of prices including through selling at zero or negative margins;the ability to incorporate functionality into existing products to gain business in a manner that discourages users frompurchasing our products,including through product bundling or closed technology
278、 platforms;broader distribution and established relationships with distribution channel partners in a greater number of worldwidelocations;access to larger end-customer bases;the ability to use their greater financial resources to attract our research and development engineers as well as otheremploy
279、ees of ours;larger intellectual property portfolios;andthe ability to bundle competitive offerings with other products and services.Our ability to compete will depend upon our ability to provide a better solution than our competitors at a competitiveprice.We may be required to make substantial addit
280、ional investments in research and development,marketing and sales in order torespond to competition,and there is no assurance that these investments will achieve any returns for us or that we will be able tocompete successfully in the future.We also expect increased competition if our market continu
281、es to expand.Moreover,conditionsin our market could change rapidly and significantly as a result of technological advancements or other factors.212025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm38/153In addition,current or potential comp
282、etitors may be acquired by third parties that have greater resources available.As aresult of these acquisitions,our current or potential competitors might take advantage of the greater resources of the largerorganization to compete more vigorously or broadly with us.In addition,continued industry co
283、nsolidation might adversely impactend-customers perceptions of the viability of smaller and even medium-sized networking companies and,consequently,end-customers willingness to purchase from companies like us.As a result,increased competition could lead to fewer end-customer orders,price reductions,
284、reduced margins and loss ofmarket share.Cloud-based computing trends present competitive and execution risks.We are experiencing an industry-wide trend of customers considering transitioning from purely on-premise networkarchitectures to a computing environment that may utilize a mixture of existing
285、 solutions and various new cloud-based solutions.Concurrently with this transition,pricing and delivery models are also evolving.Many companies in our industry,including someof our competitors,are developing and deploying cloud-based solutions for their customers.In addition,the emergence of newclou
286、d infrastructures and artificial intelligence or other tools may enable new companies to compete with our business.These newcompetitors may include large cloud providers who can provide their own ADC functionality as well as smaller companiestargeting applications that are developed exclusively for
287、delivery in the cloud.We are dedicating significant resources to developand offer our customers new cloud-based solutions and are training our sales teams as necessary to adapt to market trends.Also,some of our largest customers are cloud providers that utilize our existing solutions,and we believe
288、that as cloud infrastructurescontinue to grow our existing solutions may provide benefits to other cloud providers.While we believe our expertise anddedication of resources to developing new cloud-based solutions,together with the benefits that our existing solutions offer cloudproviders,represent a
289、dvantages that provide us with a strong foundation to compete,it is uncertain whether our efforts to developnew cloud-based and related solutions or our efforts to market and sell our existing solutions to cloud providers will attract thecustomers or generate the revenue necessary to successfully co
290、mpete in this new business model.Nor is it clear when or in whatmanner this new business model will evolve,and this uncertainty may delay purchasing decisions by our customers or prospectivecustomers.Whether we are able to successfully compete depends on our execution in a number of areas,including
291、maintaining theutility,compatibility and performance of our software on the growing assortment of cloud computing platforms and the enhancedinteroperability requirements associated with orchestration of cloud computing environments.We will also need to enhance anddevelop the infrastructure necessary
292、 to support the delivery of these services as well as the skills of our personnel who sell,provideand maintain them.Any failure to adapt to these evolving trends may reduce our revenue or operating margins and could have amaterial adverse effect on our business,results of operations and financial co
293、ndition.If we are not able to maintain and enhance our brand and reputation,our business and operating results may be harmed intangible or intangible ways.We believe that maintaining and enhancing our brand and reputation are critical to our relationships with and our ability toattract,new end-custo
294、mers,technology partners and employees.The successful promotion of our brand will depend largely uponour ability to continue to develop,offer and maintain high-quality products and services,our marketing and public relations efforts,and our ability to differentiate our products and services successf
295、ully from those of our competitors.Our brand promotion activitiesmay not be successful and may not yield increased revenue.In addition,extension of our brand to products and uses different fromour traditional products and services may dilute our brand,particularly if we fail to maintain the quality
296、of products and services inthese new areas.We have in the past,and may in the future,become involved in litigation and/or operational difficulties that couldnegatively affect our brand.If we do not successfully maintain and enhance our brand and reputation,our growth rate may decline,we may have red
297、uced pricing power relative to competitors with stronger brands or reputations,and we could lose end-customersor technology partners,all of which would harm our business,operating results and financial condition.A limited number of our end-customers,including service providers,make large and concent
298、rated purchases that comprise asignificant portion of our revenue.Any loss or delay of expected purchases by our largest end-customers could adversely affectour operating results.As a result of the nature of our target market and the current stage of our development,a substantial portion of our reve
299、nuein any period comes from a limited number of large end-customers,including service providers.During the years ended December31,2023,2022 and 2021,purchases by our ten largest end-customers accounted for approximately 33%,41%and 39%of our totalrevenue,respectively.The composition of the group of t
300、hese ten largest end-customers changes from period to period,but oftenincludes service providers and enterprise customers.During the years ended December 31,2023,222025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm39/1532022 and 2021,servi
301、ce providers accounted for approximately 58%,66%and 63%,of our total revenue,respectively,andenterprise customers accounted for approximately 42%,34%and 37%of our total revenue,respectively.Sales to these large end-customers have typically been characterized by large but irregular purchases with lon
302、g initial salescycles.After initial deployment,subsequent purchases of our products typically have a more compressed sales cycle.The timing ofthese purchases and of the requested delivery of the purchased product is difficult to predict.As a consequence,any acceleration ordelay in anticipated produc
303、t purchases by or requested deliveries to our largest end-customers could materially affect our revenueand operating results in any quarter and cause our revenue and operating results to fluctuate from quarter to quarter.We cannot provide any assurance that we will be able to sustain or increase our
304、 revenue from our largest end-customersnor that we will be able to offset any absence of significant purchases by our largest end-customers in any particular period withpurchases by new or existing end-customers in that or a subsequent period.We expect that sales of our products to a limitednumber o
305、f end-customers will continue to contribute materially to our revenue for the foreseeable future.The loss of,or asignificant delay or reduction in purchases by,a small number of end-customers could have a material adverse effect on ourconsolidated financial position,results of operations or cash flo
306、ws.Our business could be adversely impacted by changes demanded by our customers in the deployment and payment models forour products.Our customers have traditionally demanded products deployed in physical,appliance-based on-premise data centers thatare paid in full at the time of purchase and inclu
307、de perpetual licenses for our software products.While these products remaincentral to our business,new deployment and payment models are emerging in our industry that may provide some of our customerswith additional technical,business agility and flexibility options.These new models include cloud-ba
308、sed applications provided asSaaS and software subscription licenses where license and service fees are ratable and correlate to the type of service used,thequantity of services consumed or the length of time of the subscription.These models have accounting treatments that may requireus to recognize
309、revenue ratably over an extended period of time.If a substantial portion of our customers transition from on-premise-based products to such cloud-based,consumption and subscription-based models,this could adversely affect our operatingresults and could make it more difficult to compare our operating
310、 results during such transition period with our historical operatingresults.Some of our large end-customers demand favorable terms and conditions from their vendors and may request price or otherconcessions from us.As we seek to sell more products to these end-customers,we may agree to terms and con
311、ditions that mayhave an adverse effect on our business.Some of our large end-customers have significant purchasing power and,accordingly,may request from us and receivemore favorable terms and conditions,including lower prices than we typically provide.As we seek to sell products to this class ofend
312、-customer,we may agree to these terms and conditions,which may include terms that reduce our gross margin and have anadverse effect on our business.Our gross margin may fluctuate from period to period based on the mix of products sold,the geographic location of ourcustomers,price discounts offered,r
313、equired inventory write downs and exchange rate fluctuations.Our gross margin may fluctuate from period to period in response to a number of factors,such as the mix of our productssold and the geographic locations of our sales.Our products tend to have varying gross margins in different geographic r
314、egions.Wealso may offer pricing discounts from time to time as part of a targeted sales campaign or as a result of pricing pressure from ourcompetitors.In addition,our larger end-customers may negotiate pricing discounts in connection with large orders they place withus.The sale of our products at d
315、iscounted prices could have a negative impact on our gross margin.We also must manage ourinventory of existing products when we introduce new products.If we are unable to sell the remaining inventory of our older products prior to or following the launch of such new productofferings,we may be forced
316、 to write down inventory for such older products,which could also negatively affect our gross margin.Our gross margin may also vary based on international currency exchange rates.In general,our sales are denominated in U.S.Dollars;however,in Japan they are denominated in Japanese Yen.Changes in the
317、exchange rate between the U.S.Dollar and theJapanese Yen has,in the past,and may in the future affect our actual revenue and gross margin.Changes in foreign exchange rates,especially between the U.S.Dollar and the Japanese Yen,could impact the purchasing decisions of our customers.232025/2/11 21:03a
318、ten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm40/1532025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/data/1580808/000158080824000049/aten-20231231.htm41/153We generate a significant amount of revenue from sales to distributors,resellers,a
319、nd end-customers outside of the UnitedStates,and we are therefore subject to a number of risks that could adversely affect these international sources of our revenue.A significant portion of our revenue is generated in international markets,including Japan,Western Europe,Taiwan andSouth Korea.During
320、 the years ended December 31,2023,2022,and 2021,approximately 55%,54%and 60%of our total revenue,respectively,was generated from customers located outside of the United States.If we are unable to maintain or continue to growour revenue in these markets,our financial results may suffer.As a result,we
321、 must hire and train experienced personnel to staff and manage our foreign operations.To the extent that weexperience difficulties in recruiting,training,managing and retaining an international staff,and specifically sales management andsales personnel,we may experience difficulties in sales product
322、ivity in foreign markets.We also seek to enter into distributor andreseller relationships with companies in certain international markets where we do not have a local presence.If we are not able tomaintain successful distributor relationships internationally or recruit additional companies to enter
323、into distributor relationships,our future success in these international markets could be limited.Business practices in the international markets that we serve maydiffer from those in the United States and may require us in the future to include terms in customer contracts other than ourstandard ter
324、ms.To the extent that we may enter into customer contracts in the future that include non-standard terms,our operatingresults may be adversely impacted.We have a significant presence in international markets and plan to continue to expand our international operations,whichexposes us to a number of r
325、isks that could negatively affect our future business.We have personnel in numerous countries including in the following countries and regions:the United States,WesternEurope,India,the Middle East,Japan,Taiwan,South Korea,Southeast Asia and Latin America.As we maintain our internationaloperations,we
326、 are subject to a number of risks,including the following:greater difficulty in enforcing contracts and accounts receivable collection and possible longer collection periods;increased expenses incurred in establishing and maintaining office space and equipment for our international operations;greate
327、r difficulty in recruiting local experienced personnel,and the costs and expenses associated with such activities;general economic and political conditions in these foreign markets;economic uncertainty around the world,including continued economic uncertainty as a result of sovereign debt issues inE
328、urope,the United Kingdoms exit from the European Union(commonly referred to as“Brexit”),the war between Russiaand Ukraine,and tensions between China and Taiwan;management communication and integration problems resulting from cultural and geographic dispersion;risks associated with trade restrictions
329、 and foreign legal requirements,including the importation,certification,andlocalization of our products required in foreign countries;greater risk of unexpected changes in regulatory practices,tariffs,and tax laws and treaties;the uncertainty of protection for intellectual property rights in some co
330、untries;greater risk of a failure of foreign employees to comply with both U.S.and foreign laws,including antitrust regulations,the U.S.Foreign Corrupt Practices Act(“FCPA”),and any trade regulations ensuring fair trade practices;and242025/2/11 21:03aten-20231231https:/www.sec.gov/Archives/edgar/dat
331、a/1580808/000158080824000049/aten-20231231.htm42/153heightened risk of unfair or corrupt business practices in certain geographies and of improper or fraudulent salesarrangements that may impact financial results and result in restatements of,or irregularities in,financial statements.Because of our
332、worldwide operations,we are also subject to risks associated with compliance with applicableanticorruption laws.One such applicable anticorruption law is the FCPA,which generally prohibits U.S.companies and theiremployees and intermediaries from making payments to foreign officials for the purpose o
333、f obtaining or keeping business,securingan advantage,or directing business to another,and requires public companies to maintain accurate books and records and a systemof internal accounting controls.Under the FCPA,U.S.companies may be held liable for actions taken by directors,officers,employees,agents,or other strategic or local partners or representatives.As such,if we or our intermediaries,such
0731-84720580
sgpjbg002
工作日 9:30 - 18:00
研报
新质生产力
DeepSeek
低空经济
大模型
AI Agent
AI Infra
具身智能
自动驾驶
宠物
银发经济
人形机器人
企业出海
算力
微短剧
薪酬
白皮书
创新药
人工智能
AI产业
信息科技
互联网
消费经济
汽车交通
电商零售
传媒娱乐
医药健康
投资金融
能源环境
地产建筑
传统产业
英文报告
其它
最新报告
中英对照
全文搜索
报告精选
PDF上传翻译
多格式文档互转
入驻&报告售卖
会员权益
机构报告
券商研报
财报库
专题合集
英文报告
数据图表
会议报告
其他资源
行业聚焦
芯片产业
热点概念
全球咨询智库
人工智能
500强
新质生产力
会议峰会
新能源汽车
企业年报
互联网
公司研究
行业综观
消费教育
科技通信
医药健康
人力资源
投资金融
汽车产业
物流地产
电子商务
传统产业
传媒营销
其它
2025低空经济/低空产业报告合集（共49套打包）
2025年智算中心/AIDC/AI数据中心研究报告合集（共37套打包）
AI、科技与通信
广告、传媒与营销
消费、零售与支付
HR、文化与旅游
金融、保险与投资
能源、环境与工业
医疗制药与大健康
物流、地产与建筑
其他行业
AI ▪ 科技 ▪ 通信
数字化
金融财经
智能制造
电商传媒
地产建筑
医疗医学
能源化工
其他行业
收藏
下载
2025-05-20
AI查数
行业数据
政策法规
商业模式
产业链
竞争格局
市场规模
产业概述
其它
2025年
AI读财报
年报
一季报
半年报
三季报
IPO招股书
社会责任报告
A股
IPO申报
港股
美股&全球
新三板
扫码登录
手机快捷登录
账号登录
