John Eldridge - Director of IR Andy Reinland - Sr. VP and CFO John McAdam - President and CEO Edward Julian Eames - Sr. VP of Business Operations and Global Services M. Thomas Hull - Sr. VP of Worldwide Sales John Rodriguez - Sr. VP and Chief Accounting Officer Christopher P. Lynch - Sr. VP of Data Solutions Dan Matte - Sr. VP of Marketing Karl Triebes - CTO and Sr. VP of Product Development

Samuel Wilson - JMP Securities Mark Sue - RBC Capital Markets Jason Ader - Thomas Weisel Partners Jonathan Curtis - Nollenberger Capital Partners Tim Long - Banc of America Erik Suppiger - Signal Hill Capital Group Saud Masud - UBS Manuel Recarey - Kaufman Brothers Cameron Cooke - Janco Partners Rohit Chopra - Wedbush Morgan Kenneth Muth - Robert Baird Troy Jensen - Piper Jaffray Ehud Gelblum - JP Morgan Matt Robison - Ferris, Baker Watts Paul Mansky - Citigroup

Good afternoon. Welcome to F5 Fourth Quarter Financial Results. All parties would be on a listen-only mode until the question-and-answer session. Today's call is being recorded. If you have any objections, please disconnect. I'd now like to turn the call over to Mr. John Eldridge, Director of Investor Relations. Thank you, sir, you may begin. John Eldridge - Director of Investor Relations: Thank you. Welcome to our conference call for the fourth quarter of fiscal 2007. Speakers on today's call are John McAdam, President and CEO; Andy Reinland, Senior VP and Chief Financial Officer; John Rodriguez, Senior VP and Chief Accounting Officer; Julian Eames, Senior VP of Operations and Global Services; Tom Hull, Senior VP of Worldwide Sales; Chris Lynch, Senior VP of Data Solutions; Dan Matte, Senior VP of Marketing; Karl Triebes, Senior VP of Product Development and CTO, are also with us to answer questions following our prepared comments. If you don't have a copy of today's press release, it's available on our website, www.f5.com. In addition, you can access an archived version of today's live webcast from the Events page of our website, through January 23rd. From 4:30 today until 7:00 PM Pacific Time on October 25th, you can also listen to a telephone replay at 8666-501-8771 or 203-369-1851. During today's call, our discussion will contain forward-looking statements which include words, such as believe, anticipate, expect and target. These forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from those expressed or implied by these statements. Factors that may affect our results are summarized in our quarterly release, and described in detail in our SEC filings. Please note that F5 has no duty to update any information presented in this call. Before we begin I'd like to remind you that we will be holding out Analyst Investor Meeting, on November 2nd, a week from this Friday, at the Intercontinental The Barclay in New York, from 8:00 AM until noon. If you'd like to attend this event, if you haven't already registered, please contact Caroline Burkhardt at 206-272-6590 or send an email to analystmeeting@f5.com. Now, I will turn the call over to Andy Reinland. Andy Reinland - Senior Vice President and Chief Financial Officer: Thank you, John. Q4 was a promising finish to another solid year. Results for the quarter marked our 19th quarter of sequential revenue growth and pushed us to the $0.5 billion mark in annual revenue. We completed the acquisition of Acopia, a move that we believe has very positive implications for our growth in fiscal 2008 and beyond. Including Acopia, we added a total of 225 employees during the quarter, raising our total headcount by nearly 50% for the year. In addition, we generated the record $47.7 million in cash flow from operations this quarter, leaving us with a balance of $475 million in cash and investments at quarter end. During the next few minutes, I will review our results for the fourth quarter, provide guidance for the current quarter and discuss the year ahead. As always, our results and guidance discussed in my remarks are GAAP numbers unless otherwise indicated. Revenue for our fiscal fourth quarter was $145.6 million, up $33.9 million or 30% over the same quarter last year and $13.2 million or 10% from Q3. Our book-to-bill was greater than one. Revenue from applications delivery and networking, security and WAN optimization was $144 million at the top end of the $142 million to $144 million guidance we provided on our July 25th conference call. In addition, we achieved $1.6 million in revenue from Acopia during the quarter. Revenue from our core Big-IP business was $132.5 million or 91% of total revenue. Security revenue was $ 9.6 million, including $2.6 million from Application Security Manager and $6.9 million from FirePass. WAN optimization and acceleration revenue was $2 million. From a geographic perspective, the Americas represented 58% of revenue, EMEA accounted for 18%, Japan 13% and APAC 11%. By vertical, telco and technology each represented 21% of revenue during the quarter. The financial sector accounted for 17%. US federal government generated 7% of revenue and total government was 12%. During Q4 we have two greater than 10% distributors, Ingram Micro, which accounted for 10.4% and Avnet Technologies, which accounted for 13.3%. Product revenue of $107 million represented 73% of total revenue, service revenue of 38.6 million was 27%. Continuing down the income statement, gross margin in Q4 was 77.1%. This includes $750,000 of stock based compensation. Operating expense was $93.3 million including $9.5 million of stock rate compensation expense and a one time $14 million charge for in-process R&D related to Acopia acquisition which we disclosed in our September 15th press release. Operating margin was 13% and non-GAAP operating margin was 29.7%. The effective tax rate for the quarter was 51%. Our non-GAAP effective tax rate excluding stock based compensation and the charge for Acopia's in-process R&D was 32%. GAAP net income for the quarter was $12.9 million or $0.15 per share. This result includes the write-off of Acopia's in-process R&D which reduced EPS by $0.16 a share. Turning to the balance sheet. $47.7 million in cash flow from operations exceeded our target and contributed to cash and investments totaling $475 million at quarter-end. For all of fiscal 2007, cash flow from operations totaled $170 million. Accounts receivable DSO was 57 days. The increase from last quarter's 53 days was due primarily to the strong growth in deferred revenue and the integration of Acopia. Inventory of $10.7 million was up slightly from $9.3 million in the prior quarter. Deferred revenue increased $17.3 million or 21% from Q3 to $100.5 million. Capital expenditures for the fourth quarter were $4.8 million, and depreciation and amortization expense was $3.9 million. We ended the year with 1,580 full time employees including approximately 130, who joined us from Acopia. Moving on to the outlook. For the first quarter of fiscal 2008 ending December 31st, we expect revenue in the range of $154 million to $156 million. Reflecting lower gross margins for Acopia, we expect overall gross margins in the range of 76% to 77%, including approximately of $1 million of stock based compensation expense and $750,000 of amortization of Acopia’s acquired technology. Our operating expense targets are $94 million to $97 million including approximately in $14 million stock based compensation expense. Our effective tax rate for the quarter is expected to be 38%. Excluding stock based compensation, our non-GAAP effective tax rate is expected to be 34%. Our Q1 earnings target is $0.20 to $0.21 per share. We expect to maintain DSOs in the mid 50 day range. Reflecting continued core business growth and the addition of Acopia, we expect inventories in the range of $13 million to $14 million. Our current hiring plans calls for the addition 60 to 80 employees during Q1, and we believe we will generate cash flow from operations in excess of $45 million. Now I would like to talk about our upcoming fiscal year. Although we don’t provide specific annual guidance, I would like to share some general guidelines related to our expectations for fiscal 2008. We expect to achieve sequential growth in revenue for the balance of 2008. We do anticipate slower growth in Q2 due to seasonal weakness in North America. Although we are increasingly optimistic about prospects for our Acopia business, our current annual target for this segment remains $25 million to $30 million. After an initial dip of up to 1%, we expect to see gross margins return to historical levels by year-end. Amortization of Acopia's acquired technology will be 750,000 per quarter. While we anticipate that Acopia related operating expenses will initially reduce our non GAAP operating margins from current levels to the mid 20s, we expect this number to trend up through the year. DSOs should remain stable in the mid 50 day range. We expect stock based compensation expense to approximate trend levels until our next annual grant in August. Capital expenditures are expected to be approximately $8 million to $10 million per quarter. Based on current market rates, we expect to earn between 4.5% and 5% on our cash and investments. We expect our tax rate to be 38% on a GAAP basis and 34% on a non-GAAP basis. With that, I will turn the call over to John McAdam. John McAdam - President and Chief Executive Officer: Thanks, Andy, and good afternoon, everyone, I will take some time to cover some of the many highlights of fiscal year 2007, talk in some detail about the Q4 results and then comment on our outlook and key initiatives going into fiscal 2008. The F5 team should be proud of our progress and achievement in fiscal 2007. With our Q4 performance, we have now delivered sequential revenue growth every quarter for almost five years. 33% annual revenue growth in fiscal 2007 has resulted in F5 being a clear leader in application delivery networking. We start fiscal 2008 with a very strong balance sheet with approximately $475 million in cash and investments and no debt. We believe we are the undisputed technology leader in our core application delivery networking market and expect to increase this leadership in 2008 as we deliver a very rich product roadmap. We are also very pleased that we continue to be the clear leader in the Gartner Magic Quadrant for this market in terms of ability to execute and completeness of vision. We delivered the flagship Big-IP AT/100 system in the first half of 2007, which has proven to be very successful with the large enterprises, telcos and large internet companies. Check out the performance data we include in our research press release, demonstrating that the AT/100 running on our TMOS software, clearly outperforms our competitors. We have also added significance enhancements to our TMOS operating environment including key functionality for the telco market as well as improved usability and performance capabilities. During the year we also delivered many enhancements to FirePass, to our Application Security ASM solution and to our WebAccelerator solutions. We believe these products are now very competitive in their respective market and will be a major contributor to our growth in fiscal 2008. Our WebAccelerator product, which is offered both standalone and as a software module in Big-IP, is a unique best of breed technology, and has been responsible for leveraging a growing proportion of our Big-IP sales. Similarly, our ASM application firewall solution is also responsible for leveraging a growing proportion of the Big-IP sales. WebAccelerator and ASM are now key components of our overall application ready networking strategy, where we partner with large application solution vendors such as Microsoft, SAP and Oracle. We also announced today that our WANJet product running on TMOS as well as a partnership with EMC to market our WANJet product for optimizing EMC's flagship SRDF solution. We believe these two announcements are major steps in our goals to become a key player in the WAN optimization market. Furthermore, we also believe there are significant synergies to be gained by linking our WANJet product with the Acopia solution. From a partnership perspective, we have made great progress in fiscal 2007. We continued to increase our channel with additional premier and gold resellers and distributors as well as increasing our win rate with large systems integrators. We also made excellent progress in our partnerships with the major application solutions partners including Microsoft, SAP and Oracle. Our application ready network strategy has been really well received by these solution partners and we believe that it provides a significant advantage in the marketplace. DevCentral, a developer's website for partners and customers continues to grow with users sharing best practices and iRules solutions. At the end of fiscal 2007, we had approximately 20,000 registered users on DevCentral, up over 70% from last year, clearly demonstrating the value this resource is bringing to the market. I am especially pleased with our acquisition of Acopia Networks. We believe Acopia's network based technology is best of breed in the exciting file virtualization market. The business benefits and return on investment from the Acopia solutions are extremely attractive. And we believe this disruptive technology will prove to be a significant contributor to the continued success of F5. We are convinced there will be continued synergies from this acquisition in terms of channel leverage, account partnership, and especially from a product portfolio perspective. We will go into this in detail at our annual Analyst Investor Meeting on November the 2nd in New York. I'm very delighted to have Chris Lynch join the F5 executive team as Senior VP of Data Solutions. Chris is with us on the call today. As far as Q4 of 2007 was concerned, I was delighted with the performance. Revenue and sales bookings were strong across all geographies. We saw strong performance in Japan at the half year close. EMEA had a solid performance given the usual summer seasonality. And the Asia Pacific continued to deliver quarterly sequential growth. We also experienced solid growth in North America. Our services business once again, proved to be very strong and continued to increase our service to sales revenue backlog. We now have a $100 million of deferred revenue in our balance sheet as we enter fiscal 2008. We have made significant investments in our service business over the year, both in terms of headcount and infrastructure, and we are seeing the results of these investments pay off with increased levels of customer satisfaction. I would now like to comment on some plans we have for our product roadmap. Obviously we will provide much more detail at the Analyst Investor meeting next week, so I will keep my comments brief. Our next generation Big-IP product, Montreal has recently moved to formal customer beta testing phase, which is a major milestone. Montreal is on track for bringing to market at the end of this calendar year. Regarding WAN optimization and Web Acceleration, a recent announcement of the release of WANJet on TMOS brings key functionality to this product including centralized management with an enterprise manager as well as disk caching capability. We believe our WANJet product offers the best data center to data center optimization solutions in the market today, and we are excited about the EMC partnership. As I mentioned earlier we see significant synergies between WANJet and the Acopia solutions. We also believe our WebAccelerator solution is best of breed and offers a compelling value proposition for our customers. We expect to move to customer beta testing with our FirePass SSL VPN solution running TMOS during the quarter. Our goal is to increase the number of supported users on this platform by up to a factor of 10 from the current FirePass solution. We believe this will give FirePass a strong competitive advantage in the marketplace and will be a more attractive solution for the customers looking to replace existing IP set installations. Looking forward to Q1 in fiscal 2008, Andy has indicated that we continue to see sequential growth in our business. And I believe F5 is very well positioned to take advantage of the continued demand for our solutions. As Andy also pointed out, we believe we can grow our business sequentially each quarter during the upcoming year. We have made significant investments in 2007, and we expect to benefit from these investments in fiscal 2008. We issued a press release today indicating that Tom Hull, our Senior VP of Sales has decided to leave F5. Tom is here with us on the call today, and will also be in attendance at our Analyst Investor Meeting in New York next week. I know I am speaking for the entire F5 team when I thank Tom for his significant contribution to F5's success over the last four years. From a personal perspective, I have enjoyed working with Tom, and I wish him all the best for the future. Tom has built a very strong team around him, and I am happy to congratulate Mark Anderson on his promotion to Senior VP of Worldwide Sales and look forward to him joining our executive team. Mark has delivered tremendous results as the VP of North America Sales organization, and I look forward to Mark continuing the success in his new role. Mark will also be present at next week's meeting in New York. Finally I would like to thank the entire F5 team and our partners for their efforts and support in fiscal 2007. And with that we will open our call for Q&A. Question and Answer

Thank you. [Operator Instructions]. Our first question from Samuel Wilson of JMP Securities. And your line is open. Samuel Wilson - JMP Securities: Good afternoon, everyone. It's a big list, so I won't try and name all of you. But, just three very small questions. First, given sort of all the gyrations in the capital markets over the last few months, I'm just wondering if you saw any sort of change in buyer behavior from the financial services vertical. John, just want to get sort of a generic commentary on sort of the competitive environment out there. Have you noticed in change in competition or on pricing? And then lastly, just sort of some qualitative comments on sort of what the channel feedback has been about the acquisition of Acopia. Thank you. John McAdam - President and Chief Executive Officer: Okay. On the first one, on capital markets. We have seen… we definitely saw some issues in the finance vertical. The actual vertical is 17% which is slightly down on our run rate which normally is about 19%, maybe 20%. So it’s all little bit there. We also, we had some really good wins, but it was actually some kind of a struggle to get those wins out of the customer, though we managed it in most cases. So yes, definitely some concern there and we are going to keep looking at it. That’s obviously been included in our guidance. But nothing, I wouldn’t say, nothing has dropped through the floor or anything like that but definitely, it's slightly tougher. We haven’t really seen in any other environment, it was mainly in finance, in fact mainly in the East Coast to be specific. Compared to the environment we think we are in really good shape there, we have got lot of products, I need to qualify that. And Big-IP we think that absolutely, as I said in the script, was way ahead of the competition. We just finished most of our sales reviews this week. We are actually having a one day sales conference. And we had a very, very high win rate against the competition. And the field definitely don’t have any major concerns in the Big-IP cool [ph] applications space. WebAccelerator, as I mentioned is almost unique in terms of web acceleration. Obviously WAN optimization has not really been a player, but we intend to change that with the announcements that we made today. So there’s not much point commenting on that. And in FirePass, we think that we have a really good product, our main competition is Juniper, we win as many as we lose in that space as the market's still a little bit on the stagnant side. But overall, from a competitive point of view, I think we are in very, very good shape. Acopia, which we don’t have much runway on, well Chris has got a lot more, and he’s here, we think that’s absolute best of breed. And Chris has been introducing niche and some of the already existing customers and we feel pretty excited about that. Christopher P. Lynch - Senior Vice President of Data Solutions: I for one. John McAdam - President and Chief Executive Officer: Alright well on the channel reaction has been awesome to the Acopis acquisition, so has the customer reactions. So has the employee reaction in both companies. It’s almost like I say to Chris, I think yesterday, or the day before we are still in the honeymoon period but frankly it’s very, very exciting. And obviously we think we will get more channel partners because of this. Samuel Wilson - JMP Securities: Right. Thank you very much everyone.

Thank you, our next question, Mark Sue, RBC Capital Markets. Your line is open. Mark Sue - RBC Capital Markets: Thank you. If I strip out Acopia, and I look at your base business, the mid point of your guidance seems to indicate that there may be low sequential rate of growth for the upcoming quarter and historically its range is between 7% and 10% sequentially. And I am just trying to see where that delta is. Is that all financialyticals or is that something else, is it law of large numbers, it doesn’t really seem to be competitive there. If you could help us there, that would be great. John McAdam - President and Chief Executive Officer: Yes. But you are pretty lucid [ph], Mark, I think I got you. We use the same process, every quarter for guidance, and that process has held as well. In terms of your question, I think you said that we normally do 7% to 9%, that is very much on the high side. And I wouldn’t get confused between guidance and actual. But yes, we use the same process, we look at the pipeline, we look at the bottoms-up forecast and that’s what we come up with. And as I said, compared to last year, and we think it's good growth. So that’s the recipe. Mark Sue - RBC Capital Markets: Is your… you get the sense that your base business is slowing a bit or not really, and you are still having a lot of headcount which contradict some of the I mean… John McAdam - President and Chief Executive Officer: Yes, I think in terms of the base business I mean, one thing we are definitely looking for more sales productivity from the hires that we have made and during the year especially for sales and resources within the first six months. And we are paying a lot of focus into doing that. But from a market perspective we feel pretty good about it. Mark Sue - RBC Capital Markets: Okay. That’s helpful, thank you, and good luck, gentlemen. John McAdam - President and Chief Executive Officer: Thanks.

Thank you. Our next question, Jason Ader, Thomas Weisel. Your line is open. Jason Ader - Thomas Weisel Partners: Yes, thanks. Andy, could you give us the breakdown by product, Big-IP Security and WANJet. You gave it to us I think total, which includes services. Could you give us just the product side? Andy Reinland - Senior Vice President and Chief Financial Officer: Jason, historically, we haven't given that out. We normally just give the complete business out. But I would guide that it's fairly evenly distributed, as compared, the total to the product. Jason Ader - Thomas Weisel Partners: Okay. And then CD, the WANJet contribution over the next few quarters, do you expect it to ramp from the $2 million. How should we be thinking about that? John McAdam - President and Chief Executive Officer: I'm more or less going to be flipping with this answer and I would have to resort to that, Jason. We did that pretty minimal amount of business in WANJet last quarter. Most of the WAN optimization was actually WebAccelerator, the great majority of it was WebAccelerator. And a lot of that is software, by the way. So, it is leveraging a lot of Big-IP business. But the WANJet business was pretty minimal as the sales force quite rightly didn’t focus on it because of the competitive position. And yes, we would expect it, but we are not going to give any guidance on that. The early stages now, with the moving to TMOS, the EMC relationship has just been announced and we'll see how that goes. Jason Ader - Thomas Weisel Partners: And last question, can you take a swing at what kind of organic growth that you might except and when we saw in 2007, fiscal 2007, north of 30% organic growth. I mean is that a reasonable assumption for 2008? John McAdam - President and Chief Executive Officer: Yeah, we don’t give out the yearly growth projections, we only do by quarter, I'm afraid. Jason Ader - Thomas Weisel Partners: Is there any reason to think that that kind of growth rate… is there anything I guess, in the market that could push it up or down, I guess, would be the way to think about it? What are the drivers that push that up or down? John McAdam - President and Chief Executive Officer: Yes I mean the drivers, okay from a comparison point of view, clearly competition would be a driver, one way or another depending on how strong or weak it is. And we feel very, very good about the competitive position. I mentioned the Montreal going into beta phase, that is a big deal with it on track for delivery this year. So in the core business, we think Montreal takes yet another significant step away from the competition. We have mentioned about our excitement in Acopia, we clearly have no new opportunities, we've not had before with WANJet. So there is a number of drivers there that we think could be growth drivers. Jason Ader - Thomas Weisel Partners: And at the March '08 quarter, you kind of made a little bit of a cautious comment on the growth being a little bit slower. Do you not expect the Montreal to make a significant contribution yet? Is that going to ramp… is it sort of going to be more gradual on the Montreal? John McAdam - President and Chief Executive Officer: Yes, in my comments I definitely pointed out to North America. We have seen in the last couple of years, in particular North America slow down, so we wanted to highlight that in our comments. And Montreal, we said is going to be out at the end of the calendar year. And we see a lot of excitement around it and expect it to contribute. But it will be a slow ramp as it's our high-end box that we're coming out with in the market. Jason Ader - Thomas Weisel Partners: Okay, all right, thank you, guys. John McAdam - President and Chief Executive Officer: Thank you.

Your next question Ittai Kidron of CIBC. Your lines are open now. Ittai Kidron - CIBC World Markets: Thank you very much, a couple of questions from me. First, with regards to the business outlook, should we assume then, Andy, as we look at the second quarter, the March quarter of '08, sort of similar behavior to what you have seen in the March '07 where you actually had a decline in GAAP earnings quarter-over-quarter? Andy Reinland - Senior Vice President and Chief Financial Officer: No, I am looking at it, in my guidance, I was commenting on revenue growth. And that’s what I do is, go back and look at what we have seen in terms of behavior across all the theaters and that was what I was pointing to in my revenue guidance. John McAdam - President and Chief Executive Officer: And also, just to be clear, what Andy said was, a little bit cost over Q2 because historically in North America, we've seen budgets particularly in the January quarter being a bit slow at the year-end. We did see, and this is really important, that we expect to do sequential growth every quarter in this fiscal year. Ittai Kidron - CIBC World Markets: But you don’t plan to slow down your hiring because of this potential slowdown? John McAdam - President and Chief Executive Officer: We do that by quarter, we measure that by quarter, and we are capable of doing it this quarter. But as we move into the March quarter, we tend to get very, very strong input from Japan as they come to the financial year end. So there's checks and balances on it, which is why we believe we'll still be sequentially up from the December quarter. Ittai Kidron - CIBC World Markets: Very good. Andy, just to clarify, when you give pro forma estimates, do those also strip out the amortization or is it just like this conversation you are taking out? Andy Reinland - Senior Vice President and Chief Financial Officer: Yes, right now when I'm talking about the guidance, I'm just stripping out stock based compensation. And what we are going to go, going forward is just as with stock based compensation, I am going to talk about GAAP, I will give you the break down of stock based compensation and I'll also give the out the amortization and May type pro forma if we think it's valuable in looking at our business. So you will see similar behavior there on both of those elements. Ittai Kidron - CIBC World Markets: Right. But when you talk pro forma will exclude amortization as well? Andy Reinland - Senior Vice President and Chief Financial Officer: No. Ittai Kidron - CIBC World Markets: Okay, so just stock based. John, with regards to the business environment and the upcoming launch of the Montreal, have you seen any of your customers either delay purchasing in anticipation of this product? Or on the flip side can you tell us what do you see from sort of a pent up demand from the channels and from customers for this type of product? John McAdam - President and Chief Executive Officer: Right. We haven’t seen any delay; and there may be some, but we don’t think it will be material. As, you have seen this in many calls before, we have a very good time records of introducing new products and Montreal is in a sense, similar to the AT/100 from our perspective and of course we did the Buffalo Jump transition. So we feel we know how to mange that. And the nature of the usage model of our products is interesting anyway. And I think I have said this in previous calls, customers when you buy new products tend to keep the existing product. I mean one of the reasons our service business is so high is we still have a massive amount of pre-TMOS service base that are still using it, but they have also got TMOS. So that allows you to have a fairly good transition path. The other thing is that Montreal is a very big product. And as Andy said, we expected to be cautious on the rate of take up of that. And having said that, to your other question, we have some of the other very big telco cum internet companies showing very significant interest, in fact they are involved in the beta test. So there is definitely opportunity there. But I think it will very much be at the high end and I don’t see it slowing down the core product. Ittai Kidron - CIBC World Markets: Would you expect such opportunities to take six, nine months before they evolve into material orders? John McAdam - President and Chief Executive Officer: I’d say that depends, it really depends., it depends on customer needs. Depends on the beta test… I really don’t want to go there yet; we are really just in the stages of doing beta test with customers. Ittai Kidron - CIBC World Markets: Very good. And then lastly, Andy, could you just give us, just this once perhaps the, in your guidance what are you taking into account for Acopia revenue-wise? Andy Reinland - Senior Vice President and Chief Financial Officer: Yes, I have been giving our expectation for the year of $25 million to $30 million. We don’t break out in our guidance book, particular lines of business. John McAdam - President and Chief Executive Officer: And we have never done that in the past. That’s our normal procedure. What we will do is obviously talk about the results Ittai Kidron - CIBC World Markets: Good luck guys. John McAdam - President and Chief Executive Officer: Thank you.

Our next question Jonathan Curtis of Nollenberger Capital Partners, your line is open Jonathan Curtis - Nollenberger Capital Partners: So the EMC relationship that you have today for the WANJet, is it fair to assume that that’s for more data center optimizations and if so what are you doing to develop your channels to go after, if at all, the larger branch office opportunities? And I have a follow-up question. Dan Matte - Senior Vice President of Marketing: Actually, Jonathan, this is Dan. For the EMC Select relationship, yes it is focused primarily on data center to data center replications, so they use some protocols for their storage systems to move data back and forth in WANJet and it significantly improves the performance of those, and save people a bunch of costs on bandwidth at the same time. So that will get us access to pretty significant sales force through EMC, through the Select program. And so we believe there will be good things coming from there. As far as the branch goes, we also announced today the new version of WANJet being available on TMOS. There’s some significant things in that product announcement that really position us well to plan the multi branch environment. So that’s really the piece where we have been standing on the sidelines and sort of watching the markets go by, with great amount of frustration internally. But now we are there, we are on the playing field. And then the third thing that I would highlight is also think about with Acopia in the mix, next Friday at the Analyst Day, we will be talking a lot about our roadmap and how having that technology is part of our portfolio, can really change the whole WAN optimization game and what’s going on in the multi branch environment too. Jonathan Curtis - Nollenberger Capital Partners: And just back on the branch opportunity, do you feel comfortable with your channels that currently exist to go after that branch opportunity or is there some work that needs to be done to get the channel ready or to bring resellers in to have more of that raw networking experience. Dan Matte - Senior Vice President of Marketing: I think our channel is pretty well suited to go after that. So when we initially did the acquisition of a small lab, our channel was all over those opportunities, and I know that with the revitalized product coming to them they will be right in there again. So I think we are well positioned. Jonathan Curtis - Nollenberger Capital Partners: Fare enough. And just one quick follow up question, in terms of the percentage of your boxes, your Big-IP boxes that go out the door and run pure load balancing and really don’t take advantage of some of the more high end features, have you ever thought about… clearly you probably have some sense of sort of where you are in terms of attach rates for some of the more advanced features. Where are we on that right now and had how is that been trending over time? Dan Matte - Senior Vice President of Marketing: Yes, this is Dan again. They are trending up over time. When we look at our customers and the number of people that you think like iRules and we track attach rates internally for the software nodules, WebAccelerator, the performance packs that we sell, SSL and things like that, we are continually surprised by just how many people use the advanced functionality of the devices. So that continues to increase in importance. And really, I think it speaks to the point of where we are competitively that our products offer people just simply a better solution to offload functions that otherwise would have to be written into the applications or performed on the application servers themselves. Jonathan Curtis - Nollenberger Capital Partners: So in terms of the attach rate, is it below 25%, is it is it significantly above 25% in terms of the boxes that are shipped? Dan Matte - Senior Vice President of Marketing: In terms of iRules, it's definitely above 25% for sure, well above that. In terms of the actual software model attach rates we haven't been disclosing that. Jonathan Curtis - Nollenberger Capital Partners: So is it better to assume it's below 25%? Dan Matte - Senior Vice President of Marketing: We haven't been disclosing it. Jonathan Curtis - Nollenberger Capital Partners: Got it, got it. Okay, thank you, guys.

Our next is Tim Long with Banc of America, your line is open now. Tim Long - Banc of America: Thank you, two questions, if I could. Andy, this is just a follow up on the sales and sales productivity. Can you just talk to us a little bit, you said one of the directions is to increase productivity. First of all, why do you think it's been lagging behind your expectations? How do you plan on improving it? And if it does not improve or it slows… it improves at too slow of a pace, what does that mean for hiring through 2008? And then secondly, on the carrier side of the business, could you talk about that a little bit. It looks just up slightly sequentially. But really only have 10% of the fairly tough compare last year. Any changes there, any concentration issues or any dynamics worth highlighting in the quarter that could have held that business back? Thank you. John McAdam - President and Chief Executive Officer: Yes, on the sales productivity first of all we hired a lot of people very aggressively in 2007, so we have put a huge focus on basically making sure that they have access to all the tools they need to sell. And there is a whole list of actions that needs to take place under that training, web based training, good access to references. So we are spending a lot of time on that. And that feels one-on-one. But we think we can definitely start to see the investment as we do that. But we had very, very aggressive hiring. And regarding the hiring remember we do manage our business quarterly. So we take a view on a quarterly basis in terms of what we are going to set our targets for headcount, and then we check it weekly, and absolutely monthly. So we're very [inaudible] on that. He telco was the last thing. Yes, regarding telco, it was a reasonable quarter. If you remember last quarter we talked about some slips. We did see a fairly reasonable sized one slip into this current quarter that we thought was going to close. And so with that reasonable confidence, it's actually going to close this quarter. But we did actually have one slip, most of the other ones closed. Tim Long - Banc of America: Meaning close in the December quarter? John McAdam - President and Chief Executive Officer: The slip from September… what I am talking about, I am talking about one slipped into this current quarter, December quarter. The other one closed before September. Tim Long - Banc of America: So that slip could help that business grow as a percentage revenue this quarter? John McAdam - President and Chief Executive Officer: It's possible, yes. Tim Long - Banc of America: Okay, thank you.

Erik Suppiger of Signal Hill, your line is open now. Erik Suppiger - Signal Hill Capital Group: Good afternoon. On Acopia, can you tell us what Acopia's total sales for Q4 were? Andy Reinland - Senior Vice President and Chief Financial Officer: We said we did $1.6 million in business. Erik Suppiger - Signal Hill Capital Group: Was that for the fourth quarter, was that just--? Andy Reinland - Senior Vice President and Chief Financial Officer: That was just for the two weeks that they were a part of F5. And we are not discussing a fill quarter or prior to F5, what their business was. Erik Suppiger - Signal Hill Capital Group: And you don’t want to break it out in terms of what you are assuming for Q1? Andy Reinland - Senior Vice President and Chief Financial Officer: We have never done that and we will give you that… break it out in the results next quarter. Erik Suppiger - Signal Hill Capital Group: All right. And I presume, no insights into what dilution that would have in Q1 either? Andy Reinland - Senior Vice President and Chief Financial Officer: We talked about that we expected… in terms of our operating margin, that it would take it to the mid-20s like we talked about; so still that same range. Erik Suppiger - Signal Hill Capital Group: Okay. On the EMC relationship, is there any incentive… or are the EMC sales people incented to sell the WANJet products that they're going to have? Dan Matte - Senior Vice President of Marketing: Yes, absolutely, this is Dan, they receive both commission and quota-linked on it. Erik Suppiger - Signal Hill Capital Group: Okay, so it’s a standard product from their perspective? Dan Matte - Senior Vice President of Marketing: Correct. Yes. Erik Suppiger - Signal Hill Capital Group: Okay, how is it positioned, is it a part of a broader solution for storage replication or how does it fit into their platforms? Dan Matte - Senior Vice President of Marketing: Absolutely. It's positioned as a broader part of the solution for them, so really with their Symmetrix business and specifically the protocols that those systems use to move data back and forth between the systems. It's where WANJet comes into play, to really speed that up and save people bandwidth costs there. So the way WANJet is being positioned to their field force, is as a great tool to be able to go in and solve these type problems for their customers who are interested in Symmetrix. Erik Suppiger - Signal Hill Capital Group: Did you get access to proprietary protocols that they have that other players in the States wouldn’t have? Dan Matte - Senior Vice President of Marketing: Yes, absolutely. We worked very closely in joint engineering and obviously all the testing that goes along with that to certify the solution. Erik Suppiger - Signal Hill Capital Group: So arguably there aren't any other products in the market that would be able to achieve what you are doing? Dan Matte - Senior Vice President of Marketing: To the best of knowledge, no. Erik Suppiger - Signal Hill Capital Group: And then lastly, what opportunities did you take Acopia into EMC? Is there any overlap for the existing product or VMWare or anything like that, are they looking at that as well? Dan Matte - Senior Vice President of Marketing: I think there are a couple of interesting angles to that. Largely complementary in terms of what goes on with EMC. It does overlap with the one portion of the portfolio as well. But I think, as we see that relationship evolve and we'll look into what happens on the WANJet side, there going to be some interesting discussions in the future. Erik Suppiger - Signal Hill Capital Group: Very good. Thank you. Dan Matte - Senior Vice President of Marketing: Sure.

Next from Saud Masud of UBS, your line is open now. Saud Masud - UBS: Great, thank you, can you hear me? Dan Matte - Senior Vice President of Marketing: Yes. Saud Masud - UBS: Great. Guys, I just have a question on 4Q, traditionally you guys were able to beat the guidance light handedly and one would expect with the slippage in 3Q, again a 4Q would be, the quarters should be easily beatable. Can you maybe provide some color on, is there any fundamental change in competitive dynamics from the last two to three months that may have added incremental pressure that are legit to come in line with guidance or at the high end of the guidance, instead of beating that? John McAdam - President and Chief Executive Officer: We haven’t seen any change in competitive pressure except on the positive side from our perspective. I made a reference to those performance tests that we did that we made public, we're hearing from the field that we're replacing and most of our key competitors, including Cisco and including Citrix, Acteva. So in the core group, we are very, very strong Saud Masud - UBS: Okay. And just a clarification on Acopia, I'm sure you will provide more details at the Analyst ay, but after six weeks of Acopia under the F5 umbrella, you're still sticking with $25 million to $30 million in revenue potential for '08 and the dilutive impact is about $0.15 or 4 percentage points of operating margins. I just wanted to clarify that. John McAdam - President and Chief Executive Officer: Yes, we're still a the same guidance. I mean as you know, we are increasingly positive about the Acopia story and the integration and our ability to manage our expectations. But for now, that’s our guidance that we are putting out there. Saud Masud - UBS: Okay, thank you.

Our next is from Manny Recarey, Kaufman Brothers. Your line is open. Manuel Recarey - Kaufman Brothers: Thanks, actually my questions were just answered on the dilution from Acopia, is there any change there. Thanks.

And then the next is the Cameron Cooke from Janco Partners, your line is open Cameron Cooke - Janco Partners: Could you talk a little bit about, or expand on the increase in win rates with integrators and sort of that dovetails with your sales force productivity? Dan Matte - Senior Vice President of Marketing: Sure, this is Dan, Cameron. In terms of the integrators from CFC, EDS, some folks like that, we are seeing definitely an increase in business with that. Many of the projects that they work on are pretty big and take a while to sort of percolate through the system especially some of the larger government ones. But that is definitely increasing for us as a part of our business and does definitely help in term of the sales productivity part of our business. Cameron Cooke - Janco Partners: So, that was a function of sales that were already in the pipeline? John McAdam - President and Chief Executive Officer: A lot more of it that they bring to us, that’s the beauty of the system integrators, because A, they might be in control of a very large project or they are outsourcing the project. And once you prove you can get some trust with them and some loyalty, they tend to bring you into market schedules. A good example of that would have been the law of system integrator business. In fact, the one way [ph] sales conference is being held this week. I'm not sure who, but one of the big systems integrators are actually speaking to their sales force about the joint campaigns we have been doing. Cameron Cooke - Janco Partners: And as you guys, since you now support disk cache on the WANJet product, can you talk a little bit about a GAAP analysis relative to Riverbed maybe and the sales cycle on that product. Karl Triebes - Chief Technology Officer and Senior Vice President of Product Development: This is Karl. Just real quick. Yes, what we feel with this recent release of disk caching and TMOS, is that this allows us to actually execute well in the branch office. But by no means are we necessarily on a one by one feature parity basis comparable to the Riverbed feature set at the moment. However, the joint solution between the WANJet and the Acopia ARS actually gives us advantages where we can do file optimization, based on locality at the branch office. So we see some unique aspects of this solution, it actually gives us advantage over necessarily supporting caching and a number of other types of proxies that are available on the Riverbed product. John McAdam - President and Chief Executive Officer: And we'll get into a lot of detail next Friday in New York. Cameron Cooke - Janco Partners: Sounds like a great product. Thanks.

Our next is Rohit Chopra, Wedbush Morgan, your line is open Rohit Chopra - Wedbush Morgan: Thank you. I had three questions. First one ism can you just talk about linearity, how back-end loaded was the quota compared to last year or the year before? John McAdam - President and Chief Executive Officer: I can tell you that it was pretty consistent with what we've seen historically. We were little less than 50% in the third month. And I don’t have the information in front of me but I think it's pretty consistent with the last couple of years. Rohit Chopra - Wedbush Morgan: Yes, and no change there. And them I'm going to ask an Acopia question. But I think this is simple, can you spread out the revenue that you indicated for Acopia between products and services? John McAdam - President and Chief Executive Officer: No we are not going to do that. Rohit Chopra - Wedbush Morgan: Okay, not for this quarter. And then, I have question for Chris Lynch, and this is just based on an article where he was quoted in Dow Jones about a year ago. I just wanted to understand what impeded the progress to break even for the business last year and how does F5 change the equation? Christopher P. Lynch - Senior Vice President of Data Solutions: Excuse me. I think that, I don’t view that we had any impeding, that didn’t drive the relationship. I think that we have a very significant technology advantage. And we need to weigh all options to grow into the market. And when we looked at you know creating our own channel or marketing direct, and the time we take to do that and the money we take to do that and the opportunity to leverage a brand and channel like F5, we thought that was an opportunity we couldn’t pass up to take advantage of the lead that we have in the market with our technology. And that was really what drove us as opposed to any sort of financial metrics that I was looking at, as Acopia independently. Rohit Chopra - Wedbush Morgan: Okay, thank you

Our next, Ken Muth of Robert Baird, your line is open Kenneth Muth - Robert Baird: Hi, thanks. Andy, you have mentioned, as you were going through the sequential growth through the year, Q2 build was slower, that by the end of the fiscal '08, your gross margins would be back to more of a historical level implying kind of 78% number. Can you imply also with that comment that you have made that your operating margins would get back to that same level? Andy Reinland - Senior Vice President and Chief Financial Officer: Yes, Ken, when I talking about the gross margins, in particular, we spent a lot of time, at F5 improving our gross margins over time, and those will be efforts that we continue and we think we have advantage from that. We're also going to apply that to Acopia and we believe that and everything from discounting to supply chain, we see some opportunity to bring their margins up as well. So my comment there was looking at the combined organization now. Working both sides there, we believe we can get back up to those historical levels. And I wasn't meaning to imply that operating margins would get back to historical levels at one point. Kenneth Muth - Robert Baird: Yes Andy Reinland - Senior Vice President and Chief Financial Officer: But we will see them improve through the year. John McAdam - President and Chief Executive Officer: Right. And also, remember that obvious, and I actually feel [ph] that top line revenues, the gross margin we talk with both of them, we think we can grow sequentially each quarter, we think we can get the gross margin off. And then the meter [ph] on operating margin headcount, so the operating margins are going to be very, very much linked to the decisions we make during the year in terms of the investment in the headcount. Kenneth Muth - Robert Baird: Okay, dependent, actually fiscal '08, you would expect that kind of gross margin level even with Acopia hires, I assume you are talking on a combined basis, that you would be at that kind of, call it, 78% gross margin. Andy Reinland - Senior Vice President and Chief Financial Officer: Yes, I mean, we are usually initially between 77% and 78%. And that’s when I talked about historical levels, that’s what I am referring to, so that 1% range there. Kenneth Muth - Robert Baird: Okay, thank you. Andy Reinland - Senior Vice President and Chief Financial Officer: Yes.

Our next question from Troy Jensen, Piper Jaffray, your line is open now. Troy Jensen - Piper Jaffray: Hey, good Afternoon, gentlemen. A quick question for Andy here, could you give us Acopia expenses in the quarter? Andy Reinland - Senior Vice President and Chief Financial Officer: For Q4, troy? Troy Jensen - Piper Jaffray: Yes, pleaser. Andy Reinland - Senior Vice President and Chief Financial Officer: I don’t know specifically what they were but roughly our revenue and their gross margin which we've said has been in the lower 60s, that was roughly breakeven. Troy Jensen - Piper Jaffray: Okay. And then how about, I guess, what I would like to know is, what would the gross margins or operating margins be, ex-Acopia in the quarter? Do you happen to have that with you? Andy Reinland - Senior Vice President and Chief Financial Officer: For Q4, the effect of Acopia was pretty small, it less than 1%. So I still think, we're right around the 29% level. Troy Jensen - Piper Jaffray: Okay, perfect. Last one on finances, just one for John. And I think, what $10.2 million in stock based comp here in the September quarter, correct? Andy Reinland - Senior Vice President and Chief Financial Officer: Yes. Troy Jensen - Piper Jaffray: Now you guided for next quarter, it was $14 million stock based comp? Andy Reinland - Senior Vice President and Chief Financial Officer: It's $14 million in OpEx and then approximately $1 million for COGS. Troy Jensen - Piper Jaffray: So I guess why the $5 million jump in stock based compensation? Andy Reinland - Senior Vice President and Chief Financial Officer: The majority of it is, as we do our annual grant in August and we did that and then we also had Acopia come on board, which has contributed to the increase. And then to a small extent, just our overall headcount growth, outside of that. Troy Jensen - Piper Jaffray: All right, fair. And then to John, I apologize if I missed this, but can you give any update on how Big-IP 8800 performed in the quarter? I mean, the 8400 and 8800, I'd be interested. John McAdam - President and Chief Executive Officer: We don’t break revenue by product. But what I said in my introduction was that we're very happy with the 8800 and how the interest level with the large enterprises and the telcos and the large internet companies, so it's been pretty good. And 8400 similarly. And 8800, as you know this was a flagship and is the key one for those big customers Troy Jensen - Piper Jaffray: Right. Good luck, guys. Andy Reinland - Senior Vice President and Chief Financial Officer: And Troy, just one last point, if you didn’t pick it up in my comments was that we expected the stock based compensation to remain at that level until our next annual grant in August. Troy Jensen - Piper Jaffray: Got you. And I just thought of another one, if I could. Could you just re-give us the US Fed and overall government number, because I just missed it. Andy Reinland - Senior Vice President and Chief Financial Officer: Yes, US Fed was 7%, and overall was 12%. Troy Jensen - Piper Jaffray: Perfect. See you next week, guys.

Our next is from Ehud Gelblum with JP Morgan, your line is open, sir. Ehud Gelblum - JP Morgan: Hi, thank you. Most of my questions have been answered. Couple of questions, though. Andy, you reiterated the guidance for top line for Acopia for next year. On the original conference call, you have also given guidelines, I assume they are still consistent, but just wanted to make sure that’s true low 60s gross margin. And I think you were talking around $8.5 million in OpEx per quarter. Is that still what we should be looking at unchanged for next year? Andy Reinland - Senior Vice President and Chief Financial Officer: Yes. Ehud Gelblum - JP Morgan: Okay, great. When you are looking at… you said you did the hiring on a quarter-to-quarter basis, a lot of the hiring in this quarter, 285 new employees, should we expect that given the levels of efficiency you are looking out of them, should we expect that to come down next quarter and maybe take a quarter or two, as you need to adjust these, before you continue hiring or do you expect to continue hiring at this new higher pace now for next quarter? John McAdam - President and Chief Executive Officer: First of all, 325 last quarter, I think was the number. And then obviously that included Acopia. So just by definition we would expect the same number as we move in. We actually gave some guidance for the quarter, which was I think 60 to 80 in this current quarter. Ehud Gelblum - JP Morgan: Okay. I apologize, I was looking at the wrong number. And you expect that again to be… is that perhaps geographically split in any way, a little stronger maybe in Europe or Asia or across the board? Andy Reinland - Senior Vice President and Chief Financial Officer: I think break down of that will be consistent with what has been in line with our break out of revenue. And we get pretty granular on that as we go through the quarters. And if we see more opportunity on one theater, we'll make a shift. But for the most part, it's pretty evenly distributed. Ehud Gelblum - JP Morgan: Okay, helpful. Two more things again. You mentioned again that after the gross margin takes a dip on the addition of Acopia, it should come back to historical levels. What are you basing that off of? Is that volumes in Acopia, just getting more efficiency from your suppliers? Or is that, you expect costs to come down in Acopia products or do you expect pricing there to be a little firmer as time goes on. What will bring the… I assume Acopia does nothing but become a larger percentage of your revenue as time goes on. If all goes well, so how you get the margin back up again? Andy Reinland - Senior Vice President and Chief Financial Officer: In my comments, so just to be clear on what I said, that we think it'll drop down about 1%, and that was our guidance. And then we'll see them improve through the year. And it's a number of things. We think we can solidify pricing and lower discounting per se that we have seen there. And the supply chain issues, we are constantly working on new platforms that will come out with. All those things we need to believe that that we will be able to get back to its historical levels. And maybe, with both on, we will still keep focused on improving margins on the F5 side as well. So the combination of those two will get it back up to historical levels. Ehud Gelblum - JP Morgan: Right, but your F5 gross margins have been rock solid for a long time. So one would imagine that there is not much…I mean you've been doing it at fabulous level over there, there's not much more you can do there. On the Acopia side though, it sounds as though better supply chain management, they managed to do on their own. And lower discounting, have there been discounting in the past and do you expect that to be able to go away, am I understanding that correctly? Andy Reinland - Senior Vice President and Chief Financial Officer: Frankly I don’t have facts and figures on it, but as a start up company in the nascent market, I think at times you have bigger discounting and we've talked that and we think we see ways to improve that given the combined company and the strengths of the F5 brand. Ehud Gelblum - JP Morgan: Okay, great. And Chris, while you are here, it would be great to ask you a question, I am assuming you agree with this $25 million to $30 million top line that Andy is talking about from you for next year. When you look at that, and you look at your competitors, several of which have been bought over the last year, year and a half by larger companies as well do you expect… what kind of share do you think of this market do you expect that $25 million to $30 million to be, you expect to be 50% of the market or do you expect to be a fairly small player in a $200 million or $300 million or $400 million market and someone else is getting a lot of opportunity to grow? Or do you think you will be defining the market and that $25 million to $30 million will be the 600-pound grower in this market next year? Christopher P. Lynch - Senior Vice President of Data Solutions: I agree with it. We are the market leader today and that the market has been small to growing, and we see significant momentum in market growth. We will maintain our leadership position, and by doing that, obviously we will enjoy significant growth as the market grows John McAdam - President and Chief Executive Officer: You will see this next week when we talk about it in detail, I know Chris is going to present. But is a nascent market, so talking about market share, I wouldn’t say it's premature but it’s very, very early days. But what’s interesting to me and you'll see next week is, if you look at the Acopia installed base for example, in the financial vesicle in New York, pretty amazing. I mean they almost own it. So obviously that’s not the whole market share, but they have some really, really premium customers. But you'll get better feel for that next week Ehud Gelblum - JP Morgan: Okay, appreciate it. And lastly, John, when you said financials were slightly weak, was that essentially in your application installation and any types of related areas? Or are you seeing that financial's perhaps in general overall weak? John McAdam - President and Chief Executive Officer: That’s the overall budget spending. Ehud Gelblum - JP Morgan: So across the board, the financial's a little bit weaker. John McAdam - President and Chief Executive Officer: Yes, a little, a little. Ehud Gelblum - JP Morgan: Okay, interesting, thanks so much, see you next week.

Our next question is from Matt Robison of Ferris, Baker Watts, your line is open. Matt Robison - Ferris, Baker Watts: Hi, thank you very much guys. Actually all my questions have been answered. Good luck.

Our last question at this time, from Paul Mansky from Citigroup. Your line’s open. Paul Mansky - Citigroup: Thanks, getting under the wire here. Just wanted to go back to the EMC for a second. I know SRDF is kind of a bread and butter application over there. So being brought into the portfolio is certainly a validationary part. So congratulations on that. The question is, I'm wondering if you were ever approached or you ever considered to take that Select relationship to actually a branded relationship with EMC via their Connectrix program? Dan Matte - Senior Vice President of Marketing: Paul, this is Dan. First step, Select, we'll see what happens from there. But that’s what we've got today. John McAdam - President and Chief Executive Officer: Yes, we haven't been in any discussions about that, and we're pretty comfortable with what we've got. Paul Mansky - Citigroup: Great, thank you very much. John Eldridge - Director of Investor Relations: Okay, well, thank you all for joining us on today's call, and we hope we'll see many of you at our Analyst Meeting in New York next week. John McAdam - President and Chief Executive Officer: Thank you.