Reporting by Yamini Kalia in Bengaluru; Editing by Maju Samuel and Arun Koyyur
SUNNYVALE, Calif., Aug. 16, 2023 (GLOBE NEWSWIRE) --
John Maddison, Chief Marketing Officer and EVP, Product Strategy at Fortinet
“We’re pleased that our zero-trust approach to securing the expanding edges of today’s networks is being recognized by Forrester. We believe that the critical convergence of networking and security must be everywhere and are proud to be one of the only vendors to lead in firewall, SD-WAN, and Zero Trust Edge reports. For us, this recognition validates our continuing commitment to developing one of the leading single-vendor SASE solutions on the market.”
Fortinet® (NASDAQ: FTNT), the global cybersecurity leader driving the convergence of networking and security, today announced that Fortinet has been named a Leader in The Forrester Wave™: Zero Trust Edge Solutions, Q3 2023 report. The 32-criterion evaluation identifies the most significant vendors and evaluates their zero-trust edge (ZTE) solutions. Fortinet tied for the highest score in the strategy category.
Secure Networking with ZTE, Also Known as SASE
Also known as secure access service edge (SASE), a ZTE architecture merges and delivers networking and security functions as a service using a combination of zero-trust network access (ZTNA), secure web gateways, and cloud security gateways.
The Fortinet FortiSASE platform converges cloud-delivered security, including secure web gateway, Universal ZTNA, next-generation dual-mode CASB, Firewall-as-a-Service, and Secure SD-WAN networking. Powered by a single operating system, FortiOS, FortiGuard AI-Powered Intrusion Prevention Security Services, and a unified FortiClient agent, FortiSASE helps Excellerate efficiency and delivers consistent security everywhere. By bringing together all of the components needed to converge networking and security, it protects the hybrid workforce with zero implicit trust and helps organizations reduce complexity and consolidate point products. In the report, Forrester points out that Fortinet “differentiated itself in the market by developing and integrating networking functions such as routing into its remote office firewalls, which eases the rollout of its ZTE solution with a unified management interface.”
The Forrester report also states, “Fortinet balances security and networking with eye-popping value.” The report goes on to state, “One of the most compelling aspects of the Fortinet value proposition is its cost. As with its firewalls, the Fortinet option is priced quite literally an order of magnitude lower than the vendor’s most expensive competitors.” FortiSASE can help organizations securely and seamlessly reduce complexity and maximize their return on investment.
How the Forrester Wave™ Results Are Calculated
The Forrester Wave evaluation is an assessment of the top vendors in the market. For the report, Forrester conducts primary research to develop a list of vendors and narrows the list based on the inclusion criteria. Details of product and strategy are gathered through a questionnaire, demos, briefings, and customer reference surveys and interviews.
The evaluation criteria is based on:
Each of the vendors included in the assessment has:
The Fortinet SASE platform provides secure access and high-performance connectivity to users no matter where they are located. By converging networking and security, FortiSASE delivers enterprise-grade security and provides secure remote access to the web, cloud, and applications anywhere. The cloud-delivered solution helps organizations overcome security gaps and integrates with Fortinet FortiManager for visibility and centralized management across on-premises and remote users.
Fortinet (NASDAQ: FTNT) is a driving force in the evolution of cybersecurity and the convergence of networking and security. Our mission is to secure people, devices, and data everywhere, and today we deliver cybersecurity everywhere you need it with the largest integrated portfolio of over 50 enterprise-grade products. Well over half a million customers trust Fortinet's solutions, which are among the most deployed, most patented, and most validated in the industry. The Fortinet Training Institute, one of the largest and broadest training programs in the industry, is dedicated to making cybersecurity training and new career opportunities available to everyone. FortiGuard Labs, Fortinet’s elite threat intelligence and research organization, develops and utilizes leading-edge machine learning and AI technologies to provide customers with timely and consistently top-rated protection and actionable threat intelligence. Learn more at https://www.fortinet.com, the Fortinet Blog, and FortiGuard Labs.
Copyright © 2023 Fortinet, Inc. All rights reserved. The symbols ® and ™ denote respectively federally registered trademarks and common law trademarks of Fortinet, Inc., its subsidiaries and affiliates. Fortinet’s trademarks include, but are not limited to, the following: Fortinet, the Fortinet logo, FortiGate, FortiOS, FortiGuard, FortiCare, FortiAnalyzer, FortiManager, FortiASIC, FortiClient, FortiCloud, FortiMail, FortiSandbox, FortiADC, FortiAI, FortiAIOps, FortiAntenna, FortiAP, FortiAPCam, FortiAuthenticator, FortiCache, FortiCall, FortiCam, FortiCamera, FortiCarrier, FortiCASB, FortiCentral, FortiConnect, FortiController, FortiConverter, FortiCWP, FortiDB, FortiDDoS, FortiDeceptor, FortiDeploy, FortiDevSec, FortiEdge, FortiEDR, FortiExplorer, FortiExtender, FortiFirewall, FortiFone, FortiGSLB, FortiHypervisor, FortiInsight, FortiIsolator, FortiLAN, FortiLink, FortiMoM, FortiMonitor, FortiNAC, FortiNDR, FortiPenTest, FortiPhish, FortiPlanner, FortiPolicy, FortiPortal, FortiPresence, FortiProxy, FortiRecon, FortiRecorder, FortiSASE, FortiSDNConnector, FortiSIEM, FortiSMS, FortiSOAR, FortiSwitch, FortiTester, FortiToken, FortiTrust, FortiVoice, FortiWAN, FortiWeb, FortiWiFi, FortiWLC, FortiWLM and FortiXDR. Other trademarks belong to their respective owners. Fortinet has not independently Checked statements or certifications herein attributed to third parties and Fortinet does not independently endorse such statements. Notwithstanding anything to the contrary herein, nothing herein constitutes a warranty, guarantee, contract, binding specification or other binding commitment by Fortinet or any indication of intent related to a binding commitment, and performance and other specification information herein may be unique to certain environments.
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Fortinet (NASDAQ:FTNT) is a leading cybersecurity provider servicing businesses of all sizes and governments worldwide by providing secure networking solutions and other cybersecurity products such as Next Generation Firewalls. The company is segmented into two units, Products and Services, in each of which is housed the company's Core Platform and Security Subscription and Technical Support Services, respectively.
Founded in 2000, the company has enjoyed success, and the market has rewarded the company thus.
While the company does not pay a dividend, its price appreciation of more than 480% over the past five years easily dwarfs the wider S&P 500 (SPY) total return of 75%.
The nature of the company's business is a testament to the demand for its products. The impact of cybersecurity is enormous--the Harvard Business Review estimated that the average cost of a cybersecurity breach was over $4 million on a global scale, while in America alone the average cost per breach was more than $9 million. Given the financial impact of a failed cybersecurity solution, one can understand why a company offering a leading product would be in demand.
To this end, Fortinet has seen its quarterly sales grow by more than 700% over a ten-year period, with analysts expecting revenues to continue to grow in by low double digits for the foreseeable future (see chart below).
Fortinet also conducts itself in ways that are unique to technology companies--for example, the company doles out a relatively low amount of stock-based compensation and, according to its most recent 10K, does not capitalize software development costs.
These are important points that we don't simply want to gloss over. A lack of high stock based compensation (Fortinet posted $56 million in stock based comp $1.2 billion in revenues for the first quarter 2023) shows that management isn't eager to overly reward employees at the expense of shareholders. This may also have to do with the fact that Fortinet is still founder-run, with the foundation owned by the co-founders, the Xie brothers, controlling almost 15% of the company's stock, and do not want to see their ownership overly diluted.
The decision to capitalize versus expense software costs is also significant. While most companies would have to expense software, accounting rules dictate that software companies can capitalize development expenses, meaning that instead of paying up front for the cost, they are spread over time. This can mask cash flow issues, especially if software is the principal business. We think that investors should certainly be aware that Fortinet is an outlier in this regard.
Most companies have a checkered past when it comes to meeting analyst expectations. Geopolitical issues, supply chain problems, and inflation can all impact a company's top and bottom line, disrupting forecasts and causing investors to panic in the short term.
On this front, Fortinet seems have had virtually no issues. As the chart above illustrates, the company has exceeded top-line estimates for every quarter except one for the last ten years. Its track record with EBITDA and EPS estimates is almost as good, with only a miss here and there.
This track record is, frankly, incredible. On the one hand, it could be interpreted as a testament to the demand for Fortinet's business and services. However, there is one metric which we are keeping an eye on that makes us slightly cautious.
Over the last ten years, Fortinet's days sales outstanding [DSO] has averaged 70.3 days on a quarterly basis. DSO is a ratio between a company's reported revenue and its accounts receivable, and it's important for investors to be aware of because accounts receivable are counted as revenue but have not actually been received. A company that aggressively recognizes revenue may be setting itself up for problems in the future because--if done for too long and in too aggressive a manner--the revenue chickens may eventually come home to roost.
In Fortinet's case, each of the last five quarter's DSO has exceeded the ten-year average, meaning that Fortinet has been taking longer to actually collect the money it has counted in revenue than before. We also remind readers that the 4th quarter, 2022, was the first quarter in ten years where Fortinet missed its top-line analyst estimates.
It is clear to us that Fortinet has a best-in-class business with products that are in high demand. In our view, the principal risks to the company are litigation from clients in the case of a material cybersecurity breach, or the discovery of an existing flaw in Fortinet's products. These risks, however, are inherent in just about every company in the space--in other words, it comes with the territory.
Earnings for the company are set to be announced August 3rd, where analysts are expecting revenue of $1.3 billion, which is a 26% year-over-year change and a 3% sequential quarterly increase. Despite this impressive expected performance, we will be on the fence for now and will wait to see how the company's next few quarters play out, and be watching where the company's DSO levels move to before making any moves. A move downward in Fortinet's DSO would increase our confidence, while an increase would deliver us further pause.
Aug 3 (Reuters) - Cybersecurity firm Fortinet (FTNT.O) cut its annual revenue forecast on Thursday as spending from enterprise clients remained tight amid a turbulent economy, sending its shares down more than 17% after the bell.
Fortinet now expects annual revenue between $5.35 billion and $5.45 billion compared with a prior view of $5.43 billion to $5.49 billion.
Stubborn inflation and rising borrowing costs have made companies cut back on their IT spending.
As customers shift to more long-term investments, Fortinet's near-term revenue growth continues to take a hit while it also faces tough competition from bigger rivals like Palo Alto Networks (PANW.O).
Fortinet's operating margin too has come under pressure from its increased hiring to boost sales and marketing. It expects annual operating margin to range between 25.25% and 26.25% compared to 27.3% in 2022.
It posted total revenue of $1.29 billion for the second quarter and missed expectations of $1.30 billion, according to Refinitiv data.
It earned adjusted profit of 38 cents per share, which beat expectations of 34 cents.
Reporting by Yamini Kalia in Bengaluru; Editing by Maju Samuel and Arun Koyyur
Our Standards: The Thomson Reuters Trust Principles.
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SUNNYVALE, Calif. (AP) — SUNNYVALE, Calif. (AP) — Fortinet Inc. (FTNT) on Thursday reported second-quarter profit of $266.3 million. On…
SUNNYVALE, Calif. (AP) — SUNNYVALE, Calif. (AP) — Fortinet Inc. (FTNT) on Thursday reported second-quarter profit of $266.3 million.
On a per-share basis, the Sunnyvale, California-based company said it had net income of 33 cents. Earnings, adjusted for one-time gains and costs, were 38 cents per share.
The results surpassed Wall Street expectations. The average estimate of 14 analysts surveyed by Zacks Investment Research was for earnings of 34 cents per share.
The network security company posted revenue of $1.29 billion in the period, which missed Street forecasts. Fourteen analysts surveyed by Zacks expected $1.3 billion.
For the current quarter ending in September, Fortinet expects its per-share earnings to range from 35 cents to 37 cents.
The company said it expects revenue in the range of $1.32 billion to $1.38 billion for the fiscal third quarter. Analysts surveyed by Zacks had expected revenue of $1.27 billion.
Fortinet expects full-year earnings in the range of $1.49 to $1.53 per share, with revenue ranging from $5.35 billion to $5.45 billion.
Copyright © 2023 The Associated Press. All rights reserved. This material may not be published, broadcast, written or redistributed.
Fortinet FTNT is scheduled to report second-quarter 2023 results after market close on Aug 3.
The cybersecurity firm projects revenues between $1.28 billion and $1.32 billion. The Zacks Consensus Estimate for the same is pegged at $1.30 billion, suggesting year-over-year growth of 26.4%.
The company forecasts second-quarter non-GAAP earnings in the range of 33-35 cents per share. The consensus mark is pinned at 34 cents per share, implying growth of 41.7% from the year-ago figure of 24 cents.
Fortinet’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 16.4%.
Fortinet, Inc. price-eps-surprise | Fortinet, Inc. Quote
For the April-June quarter, Fortinet anticipates billings in the band of $1.56-$1.60 billion. The heightened demand for its security and networking products amid the post-pandemic reality of remote working and the accelerated emergence of digital technologies might have benefited the to-be-reported quarter’s performance. Our model estimates for Billings in the second quarter are pegged at $1.57 billion, suggesting year-over-year growth of 20.4%.
The rapid adoption of FortiGate-based secure Software-Defined Wide Area Network (SD-WAN) offerings is likely to have supported FTNT’s Product segment. Our model estimates for Product revenues in the June-end quarter are pegged at $479.7 million, suggesting year-over-year growth of 19.7%.
FortiGuard security subscriptions and FortiCare technical support services are likely to have gained solid traction, favoring the company’s Services segment. Our model estimates for quarterly Services revenues are pegged at $804.2 million, indicating a year-over-year improvement of 27.8%.
Fortinet’s second-quarter performance is likely to have gained from higher global cybersecurity spending. The growing adoption of SD-WAN solutions might have acted as a tailwind. Per MarketsandMarkets, the market size for SD-WAN solutions is likely to reach $13.7 billion by 2027 from $3.4 billion in 2022, witnessing a CAGR of 31.9%.
As one of the broadest security service providers globally, Fortinet’s FortiTrust, a unified solution with a single user-based licensing model for flexible consumption across networks, endpoints and clouds, has been witnessing solid traction. This might have driven the company’s private and public cloud billings.
However, softness in overall IT spending is likely to negatively impact FTNT’s second-quarter results. Organizations are pushing back their big and expensive IT investments amid growing recessionary concerns.
Our proven model does not conclusively predict an earnings beat for Fortinet this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here.
Although FTNT sports a Zacks Rank #1 at present, it has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Per our model, Twilio TWLO, Celsius CELH and Inter Parfums IPAR have the right combination of elements to post an earnings beat in upcoming releases.
Twilio has an Earnings ESP of +6.90% and carries a Zacks Rank #2 at present. The company is scheduled to report second-quarter 2023 results on Aug 8. TWLO’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 138.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for TWLO’s quarterly earnings is pegged at 29 cents per share, suggesting a year-over-year increase of 363.6%. Its quarterly revenues are estimated to increase 4.4% year over year to $984.5 million.
Currently, Celsius has an Earnings ESP of +50.64% and carries a Zacks Rank #2. The company is likely to report its second-quarter 2023 results on Aug 8. CELH’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters, missing once and delivering an average negative earnings surprise of 99%.
The Zacks Consensus Estimate for CELH’s second-quarter earnings is pegged at 31 cents per share, implying a year-over-year surge of 158.3%. The company is estimated to report revenues of $278.9 million, which suggests a surge of 81.1% from the year-ago quarter.
Inter Parfums has an Earnings ESP of +11.74% and a Zacks Rank #1 at present. The company is expected to report its second-quarter 2023 results on Aug 8. IPAR’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters, missing once, the average surprise being 37.2%.
The Zacks Consensus Estimate for Inter Parfums’ second-quarter earnings is pegged at 88 cents per share, indicating a 2.3% increase from the year-ago quarter’s earnings of 86 cents. The consensus mark for revenues is pegged at $309.1 million, suggesting a year-over-year increase of 26.3%.
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