SUNNYVALE, Calif., Dec. 17, 2025 (GLOBE NEWSWIRE) -- Fortinet® (NASDAQ: FTNT), the global cybersecurity leader driving the convergence of networking and security, today announced a Secure AI Data Center solution, built in close collaboration with leading technology partner Arista Networks, deployed at Monolithic Power Systems (MPS). This solution unites best-of-breed networking and security to deliver a validated, scalable, zero-trust architecture for the AI data center. “AI infrastructure is advancing fast ...

Core Insights - Fortinet Inc. reported strong third-quarter 2025 results, with both earnings and revenues exceeding expectations and showing year-over-year improvement [1][8] - Non-GAAP EPS for Q3 2025 was 74 cents, surpassing the Zacks Consensus Estimate by 17.46% and growing 17.5% from 63 cents in the same quarter last year [1][8] - Total revenues reached $1.72 billion, beating the consensus mark by 1.34% and reflecting a 14.4% year-over-year increase [2][8] Revenue Breakdown - Total billings increased by 14% year over year to $1.81 billion, driven by 19% growth in Unified SASE and 33% growth in SecOps [3][8] - Product revenues rose 18% year over year to $559.3 million, accounting for 32.4% of total revenues, supported by strong demand for multiproduct deals [4] - Service revenues grew 12.7% year over year to $1.17 billion, making up 67.6% of total revenues, with security subscription revenues increasing by 12.8% [4] Operational Performance - Total gross margin was 81.6%, down 160 basis points year over year but better than expectations, aided by effective cost management [6] - Operating margin expanded by 80 basis points year over year to 36.9%, primarily due to operational efficiencies [6][8] Financial Position - Fortinet ended Q3 2025 with cash and cash equivalents of $3.12 billion, a decrease from $4.56 billion at the end of Q2 2025 [7] - Cash flow from operations was $655.2 million for Q3 2025, up from $451.9 million in the previous quarter [7] Future Guidance - For Q4 2025, Fortinet expects revenues between $1.825 billion and $1.885 billion, with billings estimated between $2.185 billion and $2.285 billion [9] - For the full year 2025, revenues are projected to be in the range of $6.72 billion to $6.78 billion, with non-GAAP EPS anticipated between $2.66 and $2.70 [10]

Core Insights - Fortinet (NASDAQ: FTNT) reported strong Q3 financials, beating earnings expectations by 17.5% with adjusted EPS of $0.74 against an estimate of $0.63, and revenue of $1.72 billion exceeding the $1.70 billion consensus [2][11] - Despite the strong performance, Fortinet's shares fell by over 10% in after-hours trading, indicating market concerns about future guidance and sustainability of momentum [3][4] Financial Performance - Fortinet achieved a record GAAP operating margin of 32%, with non-GAAP operating margin at 37%, reflecting effective cost management and revenue leverage [4][11] - Operating income increased by 16.2% year over year to $547.3 million, while product revenue surged 18% year over year to $559.3 million, indicating strong customer commitment to core offerings [5][6][11] - Net income, however, declined by 12.2% year over year to $473.9 million, raising questions about higher tax expenses or non-operating charges [7][11] Cash Flow and Capital Expenditures - Operating cash flow rose by 7.8% to $655.2 million, with free cash flow reported at $567.5 million [11] - Capital expenditures surged by 141.6% year over year to $87.7 million, suggesting significant investment in infrastructure for future growth [7][11] - Cash and equivalents fell by 19.8%, and shareholders' equity declined by 19%, warranting further scrutiny on the earnings call [8][11] Growth Drivers - Fortinet's FortiSASE is emerging as a key growth driver in the SASE market, positioning the company to benefit from the shift towards cloud-native security architectures [9][11] - The company launched its Secure AI Data Center solution, addressing the intersection of AI infrastructure protection and enterprise security [9] Market Outlook - For Q4, Fortinet guided revenue between $1.825 billion and $1.885 billion, with full-year 2025 revenue expected to be between $6.720 billion and $6.780 billion [12][11] - Non-GAAP EPS guidance for Q4 is projected between $0.73 and $0.75, indicating a potential deceleration in growth typical for software companies during the holiday season [12] Investor Considerations - Fortinet has consistently beaten earnings estimates for five consecutive quarters, raising questions about the accuracy of market estimates versus management execution [15][11] - The significant valuation discount compared to larger peers, despite superior operating margins, highlights the importance of understanding the sustainability of its margin profile for future stock valuation [16][11]

Core Insights - Fortinet reported strong financial results for Q3 2025, with a revenue increase of 14% year-over-year to $1.72 billion, driven by innovation and a customer-first culture [4][5] - The company has established itself as a leader in the SASE market with its FortiSASE solution, which has seen billings grow over 100% year-over-year [5][4] - Fortinet's operating margins reached record levels, with a GAAP operating margin of 32% and a Non-GAAP operating margin of 37% for the third quarter [4] Financial Performance - Revenue for Q3 2025 was $1.72 billion, up 14% from $1.51 billion in Q3 2024 [4][19] - Product revenue increased by 18% year-over-year to $559.3 million [4][19] - Billings grew 14% year-over-year to $1.81 billion [4] - Non-GAAP net income per share is projected to be between $0.73 and $0.75, with a diluted share count of 751 million to 755 million [4] Business Highlights - Fortinet was recognized as a leader in the 2025 Gartner Magic Quadrant for Hybrid Mesh Firewall, ranking highest in ability to execute [5] - The company launched the Secure AI Data Center solution, which offers high-capacity connectivity and up to 69% lower energy consumption compared to alternatives [5] - Fortinet has over 500 issued and pending AI patents, supporting more than 20 AI-driven solutions [5] Guidance - For Q4 2025, Fortinet expects revenue in the range of $1.825 billion to $1.885 billion and billings between $2.185 billion and $2.285 billion [4] - For the fiscal year 2025, revenue is projected to be between $6.720 billion and $6.780 billion, with service revenue expected to be between $4.575 billion and $4.595 billion [4]

Core Insights - Fortinet has launched the Secure AI Data Center solution, the first end-to-end framework designed specifically to protect AI infrastructures, achieving an average power consumption reduction of 69% compared to traditional methods [1][5] - The introduction of the FortiGate 3800G firewall enhances the performance and scalability required for AI workloads, featuring NP7 and SP5 ASICs with 400 GbE connectivity [2][3] - The solution integrates advanced security measures across the entire AI workflow, ensuring data protection, compliance, and performance for high-density GPU environments [3][4] Product Features - The Secure AI Data Center solution combines ASIC-powered firewalls with comprehensive protection for data, applications, and large language models (LLMs), enabling organizations to scale AI securely [3][5] - It enforces zero-trust segmentation and maintains compliance with global standards, ensuring uninterrupted uptime for critical operations [4] - The FortiGate 3800G offers hyperscale throughput of 800 Gbps, with 210 Gbps for IPsec VPN and 200 Gbps for threat protection, supporting 200 million concurrent sessions [8] Market Positioning - Fortinet's Secure AI Data Center solution sets a new benchmark for AI environment protection, emphasizing resilience, trust, and operational simplicity for enterprises [5] - The solution is positioned to address the operational challenges introduced by AI, providing visibility and performance for high-density GPU clusters [6] - Fortinet's offerings are backed by extensive threat intelligence and research capabilities, enhancing the overall security posture for AI workloads [9]