Shares of Fortinet Inc. fell more than 16% in late trading today after the cybersecurity company posted reasonable second-quarter results but issued cautious guidance, raising investor concerns about slowing growth momentum.

For the quarter that ended on June 30, Fortinet reported adjusted earnings of 64 cents per share, up from 57 cents per share in the same quarter of 2024, on revenue of $1.63 billion, up 14% year-over-year. The adjusted earnings figure was ahead of the 59 cents per share expected by analysts, while the revenue figure matched expectations.

Billings in the quarter grew 15% year-over-year to $1.78 billion, while annual recurring revenue from its unified security service edge solution grew 22% and its security operations ARR rose 35% year-over-year.

Total remaining performance obligations at of the end of the quarter sat at $6.642 billion, up 12% year-year-over, Unified SASE remaining performance obligations rose 17%, to $1.488 billion, and SecOps remaining performance obligations rose 22% year-over-year, to $660 million.

Business highlights in the quarter included the expansion of Fortinet’s FortiCloud platform with three newly launched, natively integrated services: FortiIdentity, FortiDrive and FortiConnect. The additions strengthen Fortinet’s unified security and networking capabilities, particularly for hybrid and remote-first enterprises.

FortiIdentity focuses on identity and access management, FortiDrive supports secure content storage and collaboration and FortiConnect delivers streamlined, secure onboarding for users and devices, all integrated into FortiCloud’s broader AI-driven security ecosystem.

In addition to product launches, Fortinet crossed a key innovation milestone during the quarter, issuing more than 1,400 patents globally, with more than 500 related to artificial intelligence pending or approved.

Fortinet also expanded its position in operational technology and information technology convergence, with strong adoption of its network protection offerings across industrial and mission-critical environments. The company was recognized for its leadership in IT/OT network protection based on third-party industry assessments while continuing to enhance visibility and segmentation across complex infrastructure.

“Our strong second quarter performance and consistent track record of growth are a direct result of our continued innovation and customer-first strategy, enabling us to beat our billings guidance for the quarter and raise our full year billings outlook,” founder, Chairman and Chief Executive Ken Xie said in the company’s earnings release. “We are the industry leader in network security, with the most deployed firewalls worldwide, a New-Generation SASE Firewall and recognized leadership in the 2025 Gartner Magic Quadrant for SASE Platforms.”

For its fiscal third quarter, Fortinet expects adjusted earnings per share of 62 to 64 cents on revenue of $1.67 billion to $1.73 billion. The earnings outlook was ahead of the 61 cents per share expected by analysts, while revenue was slightly below at the midpoint of an expected $1.71 billion.

For the full year, the company expects adjusted earnings per share of $2.47 to $2.53 on revenue of $6.675 billion to $6.825 billion. Analysts were expecting $2.49 per share and revenue of $6.76 billion.

None of the figures from Fortinet were fundamentally bad, but a few slight misses and no indication of increasing growth were enough to spook investors.

John Whittle, chief operating officer of Fortinet, spoke with theCUBE, SiliconANGLE Media’s live streaming studio, in June, when he discussed Fortinet’s playbook for cybersecurity success and how the company is cementing itself as a cybersecurity innovation powerhouse:

Photo: Fortinet