Key Takeaways:
Fortinet Inc. (FTNT) shares surged more than 17% in after-hours trading after the cybersecurity firm reported first-quarter results that significantly beat Wall Street estimates, fueled by what it called an increasingly complex threat environment.
"Results were driven by the continued convergence of networking and security, an approach Fortinet has led for 26 years," Ken Xie, chief executive officer at Fortinet, said in a statement. He noted that the company is winning market share by using its supply chain to "turn supply-chain challenges into opportunities."
The Sunnyvale, California-based company posted a 20% increase in revenue to $1.85 billion and a 31% jump in billings to $2.09 billion, a key metric for future revenue. Adjusted earnings per share rose 41% from a year earlier to 82 cents, well ahead of the 62-cent consensus view tracked by FactSet.
Shares climbed over 17% in extended trading Wednesday. The strong performance lifted other cybersecurity stocks, with Zscaler Inc. and Palo Alto Networks Inc. also rising in sympathy. Fortinet raised its full-year billings forecast to a range of $8.8 billion to $9.1 billion, up from a previous forecast for $8.4 billion to $8.6 billion.
For the upcoming second quarter, Fortinet expects revenue of $1.83 billion to $1.93 billion and adjusted earnings per share between 72 cents and 76 cents. Both figures top analyst estimates, which called for revenue of $1.82 billion and earnings of 69 cents per share.
The strong guidance suggests Fortinet sees continued robust demand for its security offerings as the rise of artificial intelligence creates new avenues for cyberattacks, a narrative that has gained traction among investors in the sector.
This article is for informational purposes only and does not constitute investment advice.
