A10 Networks (ATEN) Stock Forecast & Price Target

A10 Networks is well positioned for durable growth because its core secure networking and application delivery portfolio is increasingly tied to higher-value security-led demand, with secure-led sales rising from 63% of product revenue in 2024 to 72% in 2025 and expected to stay above 65% going forward. Its second quarter revenue of $80.1 million beat estimates, product revenue drove the upside, operating income and EPS came in above expectations, and management raised the midpoint of its CY26 revenue outlook to 13% growth from 11%, reflecting stronger visibility and improved execution. The expanded multi-year relationship with Microsoft, now extending into enterprise AI deployments without pre-buys, along with the TrojAI acquisition’s AI red-teaming and runtime security capabilities, supports a longer growth runway while management expects low-teens revenue growth with about 30% EBITDA margins and mid-20s FCF margins.

A10 Networks is facing a fragile fundamental backdrop because its recent growth has been increasingly dependent on enterprise momentum tied in part to the Microsoft agreement, while the market is also focused on the concentration risk rather than the longer-term upside of that relationship. Although enterprise revenue grew to $48.0 million, up 73% year over year in Q2 and equal to 60% of total revenue, service provider revenue fell 23% year over year to $32.1 million, showing that the business mix is being propped up by one segment while another remains under pressure. The outlook is further weakened by management’s own commentary that service provider demand is only normalizing, Japan is still hurt by macro headwinds, and Europe is expected to be roughly flat-to-slightly-worse versus 2025, all of which supports a cautious view on durability, visibility, and cyclical resilience.