UPDATED 18:08 EST / FEBRUARY 06 2024

SECURITY

Cybersecurity firms Check Point, Fortinet and Tenable impress investors with strong results

Shares in cybersecurity companies Check Point Software Technologies Ltd., Fortinet Inc. and Tenable Inc. all rose today as they impressed investors with strong results in their latest quarters.

First up was Check Point, which reported earnings at market opening this morning, versus the other two, which reported at the close of regular trading. For the quarter that ended Dec. 31, Check Point reported adjusted earnings per share of $2.57, up 5% year-over-year, on revenue of $644 million, up 4%. Both figures were beats, as analysts had expected adjusted earnings of $2.47 per share on revenue of $662.09 million.

For its full fiscal year 2023, Check Point saw adjusted earnings per share of $8.42, up 14% year-over-year, on revenue of $2.415 billion, up 4%. Growth was driven by security subscriptions, which Check Point saw grow 15% in the fourth quarter, to $266 million, and 14% over the year, to $981 million.

“Our industry-leading AI-powered and cloud-delivered Infinity security platform continued to drive customer adoption and bolstered our 15% growth in security subscription revenues for the quarter,” Gil Shwed, founder and chief executive of Check Point Software, said in the company’s earnings release. “Our R&D organization continues to deliver industry-leading threat prevention rates and innovative AI technologies.”

Check Point shares closed regular trading up 1%.

Schwed also said he will be exiting the CEO role to become executive chairman. “I feel it is the right time for me to focus on the evolution of Check Point and its next stage,” he said in a statement. “I intend to transition into the role of Executive Chairman charting the future of Check Point and the cyber security market. We’re initiating the succession process to hire a new CEO, and once completed I will transition into my new position as Executive Chairman.”

Next up and for the same quarter ending Dec. 31, Fortinet reported adjusted earnings per share of 51 cents, up from 44 cents in the same quarter of last year, on revenue of 1.42 billion, up 10.3% year-over-year. Analysts had expected adjusted earnings of 43 cents per share on revenue of $1.41 billion. For the full fiscal year, Fortinet reported adjusted earnings per share of $1.63 on revenue of $5.30 billion, up 20%.

Fortinet saw its services revenue grow 25% year-over in the quarter, to $927 million, and 28% over the full year to $3.38 billion. Product revenue slumped almost 10% in the fourth quarter, to $540.1 million, but was up 8% over the year, to $1.93 billion.

“Our platform strategy is resonating with enterprises worldwide as we are a leader in Secure Networking and are the No. 1 firewall vendor for units shipped with FortiGates accounting for over half of the global deployment,” Ken Xie, founder, chairman and CEO of Fortinet, said in the company’s earnings release. “Fortinet is well-positioned to consolidate the security capabilities of our over half a million customers onto our integrated FortiOS operating system, which encompasses over 30 networking and security functions spanning on-premises and cloud environments.”

For its fiscal first quarter of 2024, Fortinet expects adjusted earnings per share of 37 cents to 39 cents on revenue of $1.3 billion to $1.6 billion. For the full year, the company expects adjusted earnings of $1.65 to $1.70 on revenue of $5.715 billion to $5.185 billion. Investors liked the figures, as Fortinet shares rose over 11% in late trading.

Last but not least was Tenable, which reported adjusted earnings per share of 25 cents in the quarter ending Dec. 31, up from 12 cents per share a year prior, on revenue of $213.3 million, up 16% year-over-year. Both were beats, as analysts had expected 14 cents and $206.7 million.

Tenable’s growth was driven by new customers, with the company adding 597 new enterprise platform customers in the quarter and 156 net new six-figure customers. “Underpinning our results was strength in Tenable One, driven by strong adoption of cloud and identity, as well as continued traction in OT,” Amit Yoran, chairman and CEO of Tenable, said in the company’s earnings release.

For its fiscal 2024 first quarter, Tenable expects adjusted earnings per share of 16 to 18 cents on revenue of $212 million to $2.14 and for the full year, $1.03 to $1.10 on revenue of $895 million to $905 million. Tenable shares rose 3.5% in late trading.

Image: The Finance Point

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