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‘Eye-popping’ Fortinet financials win industry praise

30 Jul 15

Fortinet has ‘over performed’ in its second quarter 2015 financial results, posting record billings growth and better than expected revenue, profitability and cash flow.

The security vendor logged billings of US$297.2 million for the quarter ending 30 June, up 40% over the same quarter last year. Revenue was up 30% year on year to US$239.8 million, with cash flow from operations of US$84.3 million.

Within the US$239.8 million total revenue was US$114.8 million in product revenue, up 34% year on year, while service revenue accounted for $125.0 million, a 27% increase.

The results were labelled ‘eye-popping’ and ‘stupendous’ by some industry analysts, with FBR & Co analyst Daniel Ives noting the ‘eye-popping June quarter results’ – on the heels of a strong of robust quarterly performances – shows ‘there are no signs the company is slowing its product/service growth proliferation in the fast growing next-generation cybersecurity arena’.

“In a nutshell, Fortinet delivered another stellar quarter/outlook and remains well positioned for the next chapter of growth, with improved profitability on the horizon over the coming years, in our view, as managemet scales the business and looks to leverage investments (sales and marketing) as it continues to fire on all cylinders and take marketshare,” FBR & Co wrote.

Ken Xie, Fortinet founder, chairman and executive officer, says the results show that the security vendor’s investment strategy is continuing to pay off.

“Our over-performance was driven by the combination of our customer focus and strong competitive technology position, return on our sales and marketing investments, momentum with our partners, the robust security market and our ability to land new customers as well as expand within our existing accounts,” Xie says.

He says the company is well positioned to maintain momentum and gain market share globally as it moves forward.

The results saw Fortinet stock- which was up more than 75% in the past year - upgraded by some firms including JP Morgan.

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