Fortinet Reports Fourth Quarter and Full Year 2024 Financial
Results
Fourth Quarter 2024 Highlights
- Total revenue of $1.66 billion, up 17% year over
year
- Product revenue of $574 million, up 18% year over
year
- Billings of $2.00 billion, up 7% year over
year1
- Record GAAP operating margin of 35%
- Record Non-GAAP operating margin of
39%1
- Unified SASE ARR2 up 28% and
Security Operations ARR2 up 32%, year
over year
- Ranked #7 on the Forbes Most Trusted Companies in America
2025 list, the only cybersecurity company in the top
50
Full Year 2024 Highlights
- Total revenue of $5.96 billion, up 12% year over
year
- Service revenue of $4.05 billion, up 20% year over
year
- Record GAAP operating margin of 30%
- Record Non-GAAP operating margin of
35%1
- Remaining performance obligations of $6.42 billion, up 12%
year over year
- Cash flow from operations of $2.26 billion
- Free cash flow of $1.88
billion1
- Exceeded the ‘Rule of 45’ for the fifth consecutive
year
SUNNYVALE, Calif., Feb. 06, 2025 (GLOBE NEWSWIRE) -- Fortinet®
(Nasdaq: FTNT), a global cybersecurity leader driving the
convergence of networking and security, today announced financial
results for the fourth quarter of 2024 and full year ended
December 31, 2024.
“In the fourth quarter, we successfully balanced growth and
profitability as our non-GAAP operating margin increased 720 basis
points year-over-year to a company record of 39%, while revenue
grew 17%,” said Ken Xie, Founder, Chairman and Chief Executive
Officer of Fortinet. “We continue to execute our strategy of
investing in the high-growth Unified SASE and Security Operations
markets, while strengthening our position in Secure Networking. Our
customers are increasingly recognizing the benefits of a
single-vendor approach to SASE, and we expect to emerge as a leader
in this space, being the only company to natively develop all SASE
functions within a unified operating system, FortiOS, which
seamlessly integrates networking and security capabilities.”
Financial Summary for the Fourth Quarter of
2024
- Revenue: Total revenue was $1.66 billion for
the fourth quarter of 2024, an increase of 17.3% compared to $1.42
billion for the same quarter of 2023.
- Service Revenue: Service revenue was $1.09
billion for the fourth quarter of 2024, an increase of 17.2%
compared to $927.0 million for the same quarter of 2023.
- Product Revenue: Product revenue was $574.0
million for the fourth quarter of 2024, an increase of 17.6%
compared to $488.1 million for the same quarter of 2023.
-
Billings1:
Total billings were $2.00 billion for the fourth quarter of 2024,
an increase of 7.4% compared to $1.86 billion for the same quarter
of 2023.
- Unified SASE
ARR2: Unified SASE
ARR was $1.12 billion for the fourth quarter of 2024, an
increase of 27.9% compared to $875.3 million for the same
quarter of 2023.
- Security Operations
ARR2: Security
Operations ARR was $422.4 million for the fourth quarter of
2024, an increase of 32.2% compared to $319.6 million for the
same quarter of 2023.
- GAAP Operating Income and Margin: GAAP
operating income was $574.1 million for the fourth quarter of 2024,
representing a GAAP operating margin of 34.6%. GAAP operating
income was $385.4 million for the same quarter of 2023,
representing a GAAP operating margin of 27.2%.
- Non-GAAP Operating Income
and
Margin1:
Non-GAAP operating income was $650.9 million for the fourth quarter
of 2024, representing a non-GAAP operating margin of 39.2%.
Non-GAAP operating income was $453.5 million for the same quarter
of 2023, representing a non-GAAP operating margin of 32.0%.
- GAAP Net Income and Diluted Net Income Per
Share: GAAP net income was $526.2 million for the fourth
quarter of 2024, compared to GAAP net income of $310.9 million for
the same quarter of 2023. GAAP diluted net income per share was
$0.68 for the fourth quarter of 2024, based on 775.2 million
diluted weighted-average shares outstanding, compared to GAAP
diluted net income per share of $0.40 for the same quarter of 2023,
based on 772.3 million diluted weighted-average shares
outstanding.
- Non-GAAP Net Income and Diluted Net
Income Per
Share1:
Non-GAAP net income was $571.5 million for the fourth quarter of
2024, compared to non-GAAP net income of $392.0 million for the
same quarter of 2023. Non-GAAP diluted net income per share was
$0.74 for the fourth quarter of 2024, based on 775.2 million
diluted weighted-average shares outstanding, compared to $0.51 for
the same quarter of 2023, based on 772.3 million diluted
weighted-average shares outstanding.
- Cash Flow: Cash flow from operations was
$477.6 million for the fourth quarter of 2024, compared to $191.7
million for the same quarter of 2023.
- Free Cash
Flow1: Free
cash flow was $380.0 million for the fourth quarter of 2024,
compared to $164.8 million for the same quarter of 2023.
Financial Summary for the Full Year 2024
- Revenue: Total revenue was $5.96 billion for
2024, an increase of 12.3% compared to $5.30 billion in 2023.
- Service Revenue: Service revenue was $4.05
billion for 2024, an increase of 19.8% compared to $3.38 billion in
2023.
- Product Revenue: Product revenue was $1.91
billion for 2024, a decrease of 1.0% compared to $1.93 billion in
2023.
-
Billings1:
Total billings were $6.53 billion for 2024, an increase of 2.1%
compared to $6.40 billion in 2023.
- Remaining performance obligations: Remaining
performance obligations were $6.42 billion as of December 31,
2024, an increase of 11.7% compared to $5.75 billion as of
December 31, 2023.
- Deferred Revenue: Total deferred revenue was
$6.36 billion as of December 31, 2024, an increase of 10.9%
compared to $5.74 billion as of December 31, 2023.
- GAAP Operating Income and Margin: GAAP
operating income was $1.80 billion for 2024, representing a GAAP
operating margin of 30.3%. GAAP operating income was $1.24 billion
for 2023, representing a GAAP operating margin of 23.4%.
- Non-GAAP Operating Income
and
Margin1:
Non-GAAP operating income was $2.09 billion for 2024, representing
a non-GAAP operating margin of 35.0%. Non-GAAP operating income was
$1.51 billion for 2023, representing a non-GAAP operating margin of
28.4%.
- GAAP Net Income and Diluted Net Income Per
Share: GAAP net income was $1.75 billion for 2024,
compared to GAAP net income of $1.15 billion for 2023. GAAP diluted
net income per share was $2.26 for 2024, based on
771.9 million diluted weighted-average shares outstanding,
compared to GAAP diluted net income per share of $1.46 for 2023,
based on 788.2 million diluted weighted-average shares
outstanding.
- Non-GAAP Net Income and Diluted Net
Income Per
Share1:
Non-GAAP net income was $1.83 billion for 2024, compared to
non-GAAP net income of $1.29 billion for 2023. Non-GAAP diluted net
income per share was $2.37 for 2024, based on 771.9 million
diluted weighted-average shares outstanding, compared to $1.63 for
2023, based on 788.2 million diluted weighted-average shares
outstanding.
- Cash Flow: Cash flow from operations was $2.26
billion in 2024 compared to $1.94 billion in 2023.
- Free Cash
Flow1: Free
cash flow was $1.88 billion in 2024, compared to $1.73 billion in
2023.
Guidance
For the first quarter of 2025, Fortinet currently expects:
- Revenue in the range of $1.500 billion to $1.560 billion
- Billings in the range of $1.520 billion to $1.600 billion
- Non-GAAP gross margin in the range of 80.0% to 81.0%
- Non-GAAP operating margin in the range of 30.0% to 31.0%
- Diluted non-GAAP net income per share in the range of $0.52 to
$0.54, assuming a non-GAAP effective tax rate of 18%. This assumes
a diluted share count of 774 million to 780 million.
For the fiscal year 2025, Fortinet currently expects:
- Revenue in the range of $6.650 billion to $6.850 billion
- Service revenue in the range of $4.575 billion to $4.725
billion
- Billings in the range of $7.200 billion to $7.400 billion
- Non-GAAP gross margin in the range of 79.0% to 81.0%
- Non-GAAP operating margin in the range of 31.0% to 33.0%
- Diluted non-GAAP net income per share in the range of $2.41 to
$2.47, assuming a non-GAAP effective tax rate of 18%. This assumes
a diluted share count of 773 million to 783 million.
These statements are forward looking and actual results may
differ materially. Refer to the Forward-Looking Statements section
below for information on the factors that could cause our actual
results to differ materially from these forward-looking
statements.
Our guidance with respect to non-GAAP financial measures
excludes stock-based compensation, amortization of acquired
intangible assets, charges in connection with litigation
settlement, gain on intellectual property matters, gain on bargain
purchase related to acquisition, non-cash charge of impairment on
an equity method investment and a tax adjustment required for an
effective tax rate on a non-GAAP basis, which differs from the GAAP
effective tax rate. We have not reconciled our guidance with
respect to non-GAAP financial measures to the corresponding GAAP
measures because certain items that impact these measures are
uncertain or out of our control, or cannot be reasonably predicted.
Accordingly, a reconciliation of these non-GAAP financial measures
to the corresponding GAAP measures is not available without
unreasonable effort.
1 A reconciliation of GAAP to
non-GAAP measures has been provided in the financial statement
tables included in this press release. An explanation of these
measures is also included below under the heading “Non-GAAP
Financial Measures”.
2 ARR is defined as the annualized
value of renewable / recurring customer agreements as of the
measurement date, assuming any contract that expires during the
next 12 months is renewed at its existing value.
Conference Call Details
Fortinet will host a conference call today at 1:30 p.m. Pacific
Time (4:30 p.m. Eastern Time) to discuss the earnings results. A
live webcast of the conference call and supplemental slides will be
accessible from the Investor Relations page of Fortinet’s website
at https://investor.fortinet.com and a replay will be archived
and accessible at
https://investor.fortinet.com/events-and-presentations.
First Quarter 2025 Conference Participation
Schedule:
- Morgan Stanley Technology, Media & Telecom
Conference
March 4, 2025
Members of Fortinet’s management team are expected to present at
this conference and discuss the latest company strategies and
initiatives. Fortinet’s conference presentations are expected to be
available via webcast on the company’s website. To access the most
updated information, pre-register and listen to the webcast of each
event, please visit the Investor Presentation & Events page of
Fortinet’s website at
https://investor.fortinet.com/events-and-presentations. The
schedule is subject to change.
About Fortinet (www.fortinet.com)
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 our customers 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. Collaboration with esteemed
organizations from both the public and private sectors, including
Computer Emergency Response Teams (“CERTs”), government entities,
and academia, is a fundamental aspect of Fortinet’s commitment to
enhance cyber resilience globally. 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 or FortiGuard
Labs.
Copyright © 2025 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, FortiAgent, FortiAI, FortiAIOps,
FortiAntenna, FortiAP, FortiAPCam, FortiAppSec, FortiAuthenticator,
FortiCache, FortiCall, FortiCam, FortiCamera, FortiCarrier,
FortiCART, FortiCASB, FortiCentral, FortiCNP, FortiConnect,
FortiController, FortiConverter, FortiCSPM, FortiCWP, FortiDAST,
FortiDATA, FortiDB, FortiDDoS, FortiDeceptor, FortiDeploy,
FortiDevice, FortiDevSec, FortiDLP, FortiEdge, FortiEDR,
FortiEndpoint, FortiExplorer, FortiExtender, FortiFirewall,
FortiFlex, FortiFone, FortiGSLB, FortiGuest, FortiHypervisor,
FortiInsight, FortiIsolator, FortiLAN, FortiLink, FortiMonitor,
FortiNAC, FortiNDR, FortiPAM, FortiPenTest, FortiPhish, FortiPoint,
FortiPolicy, FortiPortal, FortiPresence, FortiProxy, FortiRecon,
FortiRecorder, FortiSASE, FortiScanner, FortiSDNConnector,
FortiSEC, FortiSIEM, FortiSMS, FortiSOAR, FortiSRA, FortiStack,
FortiSwitch, FortiTester, FortiTIP, FortiToken, FortiTrust,
FortiVoice, FortiWAN, FortiWeb, FortiWiFi, FortiWLC, FortiWLM,
FortiXDR and Lacework FortiCNAPP. Other trademarks belong to their
respective owners. Fortinet has not independently verified
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.
FTNT-F
Forward-Looking Statements
This press release contains forward-looking statements that
involve risks and uncertainties. These forward-looking statements
include statements regarding any indications related to future
growth and market share gains, our strategy going forward, and
guidance and expectations around future financial results,
including guidance and expectations for the first quarter of 2025
and full year 2025, and any statements regarding our market
opportunity and market size, and business momentum. Although we
attempt to be accurate in making forward-looking statements, it is
possible that future circumstances might differ from the
assumptions on which such statements are based such that actual
results are materially different from our forward-looking
statements in this release. Important factors that could cause
results to differ materially from the statements herein include the
following: general economic risks, including those caused by
economic challenges, a possible economic downturn or recession and
the effects of inflation or stagflation, rising interest rates or
reduced information technology spending; supply chain challenges;
negative impacts from the ongoing war in Ukraine and its related
macroeconomic effects and our decision to reduce operations in
Russia; competitiveness in the security market; the dynamic nature
of the security market and its products and services; specific
economic risks worldwide and in different geographies, and among
different customer segments; uncertainty regarding demand and
increased business and renewals from existing customers; sales
execution risks, including risks in connection with the timing and
completion of large strategic deals; uncertainties around continued
success in sales growth and market share gains; uncertainties in
market opportunities and the market size; actual or perceived
vulnerabilities in our supply chain, products or services, and any
actual or perceived breach of our network or our customers’
networks; longer sales cycles, particularly for larger enterprise,
service providers, government and other large organization
customers; the effectiveness of our salesforce and failure to
convert sales pipeline into final sales; risks associated with
successful implementation of multiple integrated software products
and other product functionality risks; risks associated with
integrating acquisitions and changes in circumstances and plans
associated therewith, including, among other risks, changes in
plans related to product and services integrations, product and
services plans and sales strategies; sales and marketing execution
risks; execution risks around new product development and
introductions and innovation; litigation and disputes and the
potential cost, distraction and damage to sales and reputation
caused thereby or by other factors; cybersecurity threats, breaches
and other disruptions; market acceptance of new products and
services; the ability to attract and retain personnel; changes in
strategy; risks associated with management of growth; lengthy sales
and implementation cycles, particularly in larger organizations;
technological changes that make our products and services less
competitive, including advances in artificial intelligence; risks
associated with the adoption of, and demand for, our products and
services in general and by specific customer segments, including
those caused by competition and pricing pressure; excess product
inventory for any reason, including those caused by the effects of
increased inflation and interest rates in certain geographies and
the war in Ukraine; risks associated with business disruption
caused by natural disasters and health emergencies such as
earthquakes, fires, power outages, typhoons, floods, health
epidemics and viruses, and by manmade events such as civil unrest,
labor disruption, international trade disputes, international
conflicts such as the war in Ukraine or tensions between China and
Taiwan, terrorism, wars, and critical infrastructure attacks;
tariffs, trade disputes and other trade barriers, and negative
impact on sales based on geo-political dynamics and disputes and
protectionist policies, including the impact of any future
shutdowns of the U.S. government and the transition in
administrations; and the other risk factors set forth from time to
time in our most recent Annual Report on Form 10-K, our most recent
Quarterly Report on Form 10-Q and our other filings with the
Securities and Exchange Commission (“SEC”), copies of which are
available free of charge at the SEC’s website at
www.sec.gov or upon request from our investor relations
department. All forward-looking statements herein reflect our
opinions only as of the date of this release, and we undertake no
obligation, and expressly disclaim any obligation, to update
forward-looking statements herein in light of new information or
future events.
Non-GAAP Financial Measures
We have provided in this release financial information that has
not been prepared in accordance with U.S. Generally Accepted
Accounting Principles (“GAAP”). These non-GAAP financial and
liquidity measures are not based on any standardized methodology
prescribed by GAAP and are not necessarily comparable to similar
measures presented by other companies. We use these non-GAAP
financial measures internally in analyzing our financial results
and believe they are useful to investors, as a supplement to GAAP
measures, in evaluating our ongoing operational performance. We
believe that the use of these non-GAAP financial measures provides
an additional tool for investors to use in evaluating ongoing
operating results and trends and in comparing our financial results
with peer companies, many of which present similar non-GAAP
financial measures to investors.
Non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, financial information
prepared in accordance with GAAP. Investors are encouraged to
review the reconciliation of these non-GAAP financial measures to
their most directly comparable GAAP financial measures provided in
the financial statement tables below.
Billings (non-GAAP). We define billings as revenue
recognized in accordance with GAAP plus the change in deferred
revenue from the beginning to the end of the period less any
deferred revenue balances acquired from business combination(s)
during the period. We consider billings to be a useful metric for
management and investors because billings drive current and future
revenue, which is an important indicator of the health and
viability of our business. There are a number of limitations
related to the use of billings instead of GAAP revenue. First,
billings include amounts that have not yet been recognized as
revenue and are impacted by the term of security and support
agreements. Second, we may calculate billings in a manner that is
different from peer companies that report similar financial
measures. Management accounts for these limitations by providing
specific information regarding GAAP revenue and evaluating billings
together with GAAP revenue.
Free cash flow (non-GAAP). We define free cash flow as
net cash provided by operating activities minus purchases of
property and equipment. We believe free cash flow to be a liquidity
measure that provides useful information to management and
investors about the amount of cash generated by the business that,
after capital expenditures, can be used for strategic
opportunities, including repurchasing outstanding common stock,
investing in our business, making strategic acquisitions and
strengthening the balance sheet. A limitation of using free cash
flow rather than the GAAP measures of cash provided by or used in
operating activities, investing activities, and financing
activities is that free cash flow does not represent the total
increase or decrease in the cash and cash equivalents balance for
the period because it excludes investing activities other than
capital expenditures and cash flows from financing activities.
Management accounts for this limitation by providing information
about our capital expenditures and other investing and financing
activities on the face of the cash flow statement and under the
caption “Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Liquidity and Capital
Resources” in our most recent Quarterly Report on Form 10-Q and
Annual Report on Form 10-K and by presenting cash flows from
investing and financing activities in our reconciliation of free
cash flow. In addition, it is important to note that other
companies, including companies in our industry, may not use free
cash flow, may calculate free cash flow in a different manner than
we do or may use other financial measures to evaluate their
performance, all of which could reduce the usefulness of free cash
flow as a comparative measure.
Non-GAAP operating income and operating margin. We
define non-GAAP operating income as operating income plus
stock-based compensation, amortization of acquired intangible
assets and charges in connection with litigation settlement, less
gain on intellectual property matter and, when applicable, other
significant non-recurring items in a given quarter. Non-GAAP
operating margin is defined as non-GAAP operating income divided by
GAAP revenue. We consider these non-GAAP financial measures to be
useful metrics for management and investors because they exclude
the items noted above so that our management and investors can
compare our recurring core business operating results over multiple
periods. There are a number of limitations related to the use of
non-GAAP operating income instead of operating income calculated in
accordance with GAAP. First, non-GAAP operating income excludes the
items noted above. Second, the components of the costs that we
exclude from our calculation of non-GAAP operating income may
differ from the components that peer companies exclude when they
report their non-GAAP results of operations. Management accounts
for these limitations by providing specific information regarding
the GAAP amounts excluded from non-GAAP operating income and
evaluating non-GAAP operating income together with operating income
calculated in accordance with GAAP.
Non-GAAP net income and diluted net income per share.
We define non-GAAP net income as net income plus the items noted
above under non-GAAP operating income and operating margin. In
addition, we adjust non-GAAP net income and diluted net income per
share for a gain on bargain purchase related to acquisition, a
non-cash charge of impairment on an equity method investment and a
tax adjustment required for an effective tax rate on a non-GAAP
basis, which differs from the GAAP effective tax rate. We define
non-GAAP diluted net income per share as non-GAAP net income
divided by the non-GAAP diluted weighted-average shares
outstanding. We consider these non-GAAP financial measures to be
useful metrics for management and investors for the same reasons
that we use non-GAAP operating income and non-GAAP operating
margin. However, in order to provide a more complete picture of our
recurring core business operating results, we include in non-GAAP
net income and non-GAAP diluted net income per share, the tax
adjustment required resulting in an effective tax rate on a
non-GAAP basis, which often differs from the GAAP tax rate. We
believe the non-GAAP effective tax rates we use are reasonable
estimates of normalized tax rates for our current and prior fiscal
years under our global operating structure. The same
limitations described above regarding our use of non-GAAP operating
income and non-GAAP operating margin apply to our use of non-GAAP
net income and non-GAAP diluted net income per share. We account
for these limitations by providing specific information regarding
the GAAP amounts excluded from non-GAAP net income and non-GAAP
diluted net income per share and evaluating non-GAAP net income and
non-GAAP diluted net income per share together with net income and
diluted net income per share calculated in accordance with
GAAP.
FORTINET, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in millions) |
| |
| |
December 31,
2024 |
|
December 31,
2023 |
| ASSETS |
|
|
|
| CURRENT ASSETS: |
|
|
|
|
Cash and cash equivalents |
$ |
2,875.9 |
|
|
$ |
1,397.9 |
|
|
Short-term investments |
|
1,126.4 |
|
|
|
1,021.5 |
|
|
Marketable equity securities |
|
64.2 |
|
|
|
21.0 |
|
|
Accounts receivable—net |
|
1,463.4 |
|
|
|
1,402.0 |
|
|
Inventory |
|
315.5 |
|
|
|
484.8 |
|
|
Prepaid expenses and other current assets |
|
126.1 |
|
|
|
101.1 |
|
|
Total current assets |
|
5,971.5 |
|
|
|
4,428.3 |
|
| PROPERTY AND
EQUIPMENT—NET |
|
1,349.5 |
|
|
|
1,044.4 |
|
| DEFERRED CONTRACT COSTS |
|
622.9 |
|
|
|
605.6 |
|
| DEFERRED TAX ASSETS |
|
1,335.6 |
|
|
|
868.8 |
|
| GOODWILL AND OTHER INTANGIBLE
ASSETS—NET |
|
350.4 |
|
|
|
161.8 |
|
| OTHER ASSETS |
|
133.2 |
|
|
|
150.0 |
|
| TOTAL ASSETS |
$ |
9,763.1 |
|
|
$ |
7,258.9 |
|
| LIABILITIES AND
STOCKHOLDERS’ EQUITY (DEFICIT) |
|
|
|
| CURRENT LIABILITIES: |
|
|
|
|
Accounts payable |
$ |
190.9 |
|
|
$ |
204.3 |
|
|
Accrued liabilities |
|
337.9 |
|
|
|
423.7 |
|
|
Accrued payroll and compensation |
|
255.7 |
|
|
|
242.3 |
|
|
Deferred revenue |
|
3,276.2 |
|
|
|
2,848.7 |
|
|
Total current liabilities |
|
4,060.7 |
|
|
|
3,719.0 |
|
| DEFERRED REVENUE |
|
3,084.7 |
|
|
|
2,886.3 |
|
| LONG-TERM DEBT |
|
994.3 |
|
|
|
992.3 |
|
| OTHER LIABILITIES |
|
129.6 |
|
|
|
124.7 |
|
|
Total liabilities |
|
8,269.3 |
|
|
|
7,722.3 |
|
| COMMITMENTS AND
CONTINGENCIES |
|
|
|
| STOCKHOLDERS’ EQUITY
(DEFICIT): |
|
|
|
|
Common stock |
|
0.8 |
|
|
|
0.8 |
|
|
Additional paid-in capital |
|
1,636.2 |
|
|
|
1,416.4 |
|
|
Accumulated other comprehensive loss |
|
(26.1 |
) |
|
|
(18.9 |
) |
|
Accumulated deficit |
|
(117.1 |
) |
|
|
(1,861.7 |
) |
|
Total stockholders’ equity (deficit) |
|
1,493.8 |
|
|
|
(463.4 |
) |
| TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY (DEFICIT) |
$ |
9,763.1 |
|
|
$ |
7,258.9 |
|
FORTINET, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited, in millions, except per share
amounts) |
| |
| |
Three Months Ended |
|
Year Ended |
|
|
December 31,
2024 |
|
December 31,
2023 |
|
December 31,
2024 |
|
December 31,
2023 |
| REVENUE: |
|
|
|
|
|
|
|
|
Product |
$ |
574.0 |
|
|
$ |
488.1 |
|
|
$ |
1,908.7 |
|
|
$ |
1,927.3 |
|
|
Service |
|
1,086.1 |
|
|
|
927.0 |
|
|
|
4,047.1 |
|
|
|
3,377.5 |
|
|
Total revenue |
|
1,660.1 |
|
|
|
1,415.1 |
|
|
|
5,955.8 |
|
|
|
5,304.8 |
|
| COST OF REVENUE: |
|
|
|
|
|
|
|
|
Product |
|
178.0 |
|
|
|
197.2 |
|
|
|
652.0 |
|
|
|
763.6 |
|
|
Service |
|
136.5 |
|
|
|
118.7 |
|
|
|
505.6 |
|
|
|
473.6 |
|
|
Total cost of revenue |
|
314.5 |
|
|
|
315.9 |
|
|
|
1,157.6 |
|
|
|
1,237.2 |
|
| GROSS PROFIT: |
|
|
|
|
|
|
|
|
Product |
|
396.0 |
|
|
|
290.9 |
|
|
|
1,256.7 |
|
|
|
1,163.7 |
|
|
Service |
|
949.6 |
|
|
|
808.3 |
|
|
|
3,541.5 |
|
|
|
2,903.9 |
|
|
Total gross profit |
|
1,345.6 |
|
|
|
1,099.2 |
|
|
|
4,798.2 |
|
|
|
4,067.6 |
|
| OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
Research and development |
|
191.1 |
|
|
|
152.5 |
|
|
|
716.8 |
|
|
|
613.8 |
|
|
Sales and marketing |
|
526.5 |
|
|
|
507.4 |
|
|
|
2,044.8 |
|
|
|
2,006.0 |
|
|
General and administrative |
|
55.1 |
|
|
|
55.1 |
|
|
|
237.8 |
|
|
|
211.3 |
|
|
Gain on intellectual property matter |
|
(1.2 |
) |
|
|
(1.2 |
) |
|
|
(4.6 |
) |
|
|
(4.6 |
) |
|
Total operating expenses |
|
771.5 |
|
|
|
713.8 |
|
|
|
2,994.8 |
|
|
|
2,826.5 |
|
| OPERATING INCOME |
|
574.1 |
|
|
|
385.4 |
|
|
|
1,803.4 |
|
|
|
1,241.1 |
|
| INTEREST INCOME |
|
42.3 |
|
|
|
30.5 |
|
|
|
155.2 |
|
|
|
119.7 |
|
| INTEREST EXPENSE |
|
(4.9 |
) |
|
|
(5.4 |
) |
|
|
(20.0 |
) |
|
|
(21.0 |
) |
| GAIN ON BARGAIN PURCHASE |
|
— |
|
|
|
— |
|
|
|
106.3 |
|
|
|
— |
|
| OTHER INCOME
(EXPENSE)—NET |
|
6.9 |
|
|
|
5.1 |
|
|
|
13.6 |
|
|
|
(6.1 |
) |
| INCOME BEFORE INCOME TAXES AND
LOSS FROM EQUITY METHOD INVESTMENTS |
|
618.4 |
|
|
|
415.6 |
|
|
|
2,058.5 |
|
|
|
1,333.7 |
|
| PROVISION FOR INCOME
TAXES |
|
86.7 |
|
|
|
95.2 |
|
|
|
283.9 |
|
|
|
143.8 |
|
| LOSS FROM EQUITY METHOD
INVESTMENTS |
|
(5.5 |
) |
|
|
(9.5 |
) |
|
|
(29.4 |
) |
|
|
(42.1 |
) |
| NET INCOME |
$ |
526.2 |
|
|
$ |
310.9 |
|
|
$ |
1,745.2 |
|
|
$ |
1,147.8 |
|
| Net income per share: |
|
|
|
|
|
|
|
|
Basic |
$ |
0.69 |
|
|
$ |
0.41 |
|
|
$ |
2.28 |
|
|
$ |
1.47 |
|
|
Diluted |
$ |
0.68 |
|
|
$ |
0.40 |
|
|
$ |
2.26 |
|
|
$ |
1.46 |
|
| Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
766.5 |
|
|
|
764.9 |
|
|
|
764.4 |
|
|
|
778.6 |
|
|
Diluted |
|
775.2 |
|
|
|
772.3 |
|
|
|
771.9 |
|
|
|
788.2 |
|
FORTINET, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
(Unaudited, in millions) |
| |
| |
Year Ended |
|
|
December 31,
2024 |
|
December 31,
2023 |
| CASH FLOWS FROM OPERATING
ACTIVITIES: |
|
|
|
|
Net income |
$ |
1,745.2 |
|
|
$ |
1,147.8 |
|
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
Stock-based compensation |
|
257.9 |
|
|
|
249.0 |
|
|
Amortization of deferred contract costs |
|
293.7 |
|
|
|
266.3 |
|
|
Depreciation and amortization |
|
122.8 |
|
|
|
113.4 |
|
|
Amortization of investment discounts |
|
(48.8 |
) |
|
|
(27.7 |
) |
|
Loss from equity method investments |
|
29.4 |
|
|
|
42.1 |
|
|
Gain on bargain purchase |
|
(106.3 |
) |
|
|
— |
|
|
Other |
|
(15.2 |
) |
|
|
18.5 |
|
|
Changes in operating assets and liabilities, net of impact of
business combinations: |
|
|
|
|
Accounts receivable—net |
|
(45.4 |
) |
|
|
(146.4 |
) |
|
Inventory |
|
131.2 |
|
|
|
(253.5 |
) |
|
Prepaid expenses and other current assets |
|
(13.7 |
) |
|
|
(27.6 |
) |
|
Deferred contract costs |
|
(311.1 |
) |
|
|
(353.5 |
) |
|
Deferred tax assets |
|
(223.2 |
) |
|
|
(301.9 |
) |
|
Other assets |
|
(11.0 |
) |
|
|
17.7 |
|
|
Accounts payable |
|
(10.2 |
) |
|
|
(43.1 |
) |
|
Accrued liabilities |
|
(106.7 |
) |
|
|
137.4 |
|
|
Accrued payroll and compensation |
|
— |
|
|
|
23.4 |
|
|
Other liabilities |
|
(8.3 |
) |
|
|
(21.7 |
) |
|
Deferred revenue |
|
577.8 |
|
|
|
1,095.3 |
|
|
Net cash provided by operating activities |
|
2,258.1 |
|
|
|
1,935.5 |
|
| CASH FLOWS FROM INVESTING
ACTIVITIES: |
|
|
|
|
Purchases of investments |
|
(1,948.6 |
) |
|
|
(1,855.8 |
) |
|
Sales of investments |
|
0.5 |
|
|
|
4.0 |
|
|
Maturities of investments |
|
1,891.7 |
|
|
|
1,414.8 |
|
|
Purchases of property and equipment |
|
(378.9 |
) |
|
|
(204.1 |
) |
|
Purchase of investment in privately held company |
|
— |
|
|
|
(8.5 |
) |
|
Payments made in connection with business combinations, net of cash
acquired |
|
(275.5 |
) |
|
|
— |
|
|
Purchases of marketable equity securities |
|
(16.7 |
) |
|
|
— |
|
|
Other |
|
0.1 |
|
|
|
0.3 |
|
|
Net cash used in investing activities |
|
(727.4 |
) |
|
|
(649.3 |
) |
| CASH FLOWS FROM FINANCING
ACTIVITIES: |
|
|
|
|
Repurchase and retirement of common stock |
|
(0.6 |
) |
|
|
(1,500.5 |
) |
|
Proceeds from issuance of common stock |
|
63.1 |
|
|
|
43.8 |
|
|
Taxes paid related to net share settlement of equity awards |
|
(100.9 |
) |
|
|
(112.5 |
) |
|
Other |
|
(11.7 |
) |
|
|
(1.2 |
) |
|
Net cash used in financing activities |
|
(50.1 |
) |
|
|
(1,570.4 |
) |
| EFFECT OF EXCHANGE RATE
CHANGES ON CASH AND CASH EQUIVALENTS |
|
(2.6 |
) |
|
|
(0.8 |
) |
| NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS |
|
1,478.0 |
|
|
|
(285.0 |
) |
| CASH AND CASH
EQUIVALENTS—Beginning of year |
|
1,397.9 |
|
|
|
1,682.9 |
|
| CASH AND CASH EQUIVALENTS—End
of year |
$ |
2,875.9 |
|
|
$ |
1,397.9 |
|
Reconciliations of non-GAAP results of operations measures
to the nearest comparable GAAP measures
(Unaudited, in millions, except per share
amounts) |
Reconciliation of GAAP operating income to non-GAAP
operating income, operating margin, net income and diluted net
income per share
| |
Three Months Ended |
|
Year Ended |
|
|
December 31,
2024 |
|
December 31,
2023 |
|
December 31,
2024 |
|
December 31,
2023 |
| Reconciliation of
non-GAAP operating income: |
|
|
|
|
|
|
|
|
GAAP operating income |
$ |
574.1 |
|
|
$ |
385.4 |
|
|
$ |
1,803.4 |
|
|
$ |
1,241.1 |
|
| GAAP operating
margin |
|
34.6 |
% |
|
|
27.2 |
% |
|
|
30.3 |
% |
|
|
23.4 |
% |
| Add
back: |
|
|
|
|
|
|
|
|
Stock‐based compensation |
|
66.5 |
|
|
|
64.0 |
|
|
|
260.2 |
|
|
|
251.6 |
|
|
Amortization of acquired intangible assets |
|
11.5 |
|
|
|
5.3 |
|
|
|
23.1 |
|
|
|
18.9 |
|
|
Litigation-related matter (a) |
|
— |
|
|
|
— |
|
|
|
3.2 |
|
|
|
— |
|
|
Gain on intellectual property matter |
|
(1.2 |
) |
|
|
(1.2 |
) |
|
|
(4.6 |
) |
|
|
(4.6 |
) |
| Non‐GAAP operating income |
$ |
650.9 |
|
|
$ |
453.5 |
|
|
$ |
2,085.3 |
|
|
$ |
1,507.0 |
|
| Non‐GAAP operating
margin |
|
39.2 |
% |
|
|
32.0 |
% |
|
|
35.0 |
% |
|
|
28.4 |
% |
| |
|
|
|
|
|
|
|
| Reconciliation of
non-GAAP net income: |
|
|
|
|
|
|
|
| GAAP net income |
$ |
526.2 |
|
|
$ |
310.9 |
|
|
$ |
1,745.2 |
|
|
$ |
1,147.8 |
|
| Add
back: |
|
|
|
|
|
|
|
|
Stock‐based compensation |
|
66.5 |
|
|
|
64.0 |
|
|
|
260.2 |
|
|
|
251.6 |
|
|
Amortization of acquired intangible assets |
|
11.5 |
|
|
|
5.3 |
|
|
|
23.1 |
|
|
|
18.9 |
|
|
Litigation-related matter (a) |
|
— |
|
|
|
— |
|
|
|
3.2 |
|
|
|
— |
|
|
Gain on intellectual property matter |
|
(1.2 |
) |
|
|
(1.2 |
) |
|
|
(4.6 |
) |
|
|
(4.6 |
) |
|
Gain on bargain purchase (b) |
|
— |
|
|
|
— |
|
|
|
(106.3 |
) |
|
|
— |
|
|
Tax adjustment (c) |
|
(31.5 |
) |
|
|
13.0 |
|
|
|
(95.9 |
) |
|
|
(128.1 |
) |
|
Non-cash charge on equity method investment (d) |
|
— |
|
|
|
— |
|
|
|
8.0 |
|
|
|
— |
|
| Non-GAAP net income |
$ |
571.5 |
|
|
$ |
392.0 |
|
|
$ |
1,832.9 |
|
|
$ |
1,285.6 |
|
| |
|
|
|
|
|
|
|
| Non-GAAP net income
per share, diluted |
|
|
|
|
|
|
|
| Non-GAAP net income |
$ |
571.5 |
|
|
$ |
392.0 |
|
|
$ |
1,832.9 |
|
|
$ |
1,285.6 |
|
|
Non-GAAP shares used in diluted net income per share
calculations |
|
775.2 |
|
|
|
772.3 |
|
|
|
771.9 |
|
|
|
788.2 |
|
| Non-GAAP net income per share,
diluted |
$ |
0.74 |
|
|
$ |
0.51 |
|
|
$ |
2.37 |
|
|
$ |
1.63 |
|
| |
|
|
|
|
|
|
|
| Reconciliation of
non-GAAP net income per share, diluted |
|
|
|
|
|
|
|
| GAAP net income per share,
diluted |
$ |
0.68 |
|
|
$ |
0.40 |
|
|
$ |
2.26 |
|
|
$ |
1.46 |
|
| Add
back: |
|
|
|
|
|
|
|
|
Non-GAAP adjustments to net income per share |
|
0.06 |
|
|
|
0.11 |
|
|
|
0.11 |
|
|
|
0.17 |
|
| Non-GAAP net income per share,
diluted |
$ |
0.74 |
|
|
$ |
0.51 |
|
|
$ |
2.37 |
|
|
$ |
1.63 |
|
(a) To exclude a $3.2 million adjustment for a litigation
settlement in the three months ended September 30, 2024.
(b) To exclude a $106.3 million gain on bargain purchase related to
our acquisition of Lacework Inc in the three months ended September
30, 2024.
(c) Non-GAAP financial information is adjusted to an effective tax
rate of 17% in the three months and year ended December 31,
2024 and 2023, respectively, on a non-GAAP basis, which differs
from the GAAP effective tax rate.
(d) To exclude an $8.0 million non-cash charge of impairment
on our equity method investment in Linksys.
Reconciliation of net cash provided by operating
activities to free cash flow
| |
Three Months Ended |
|
Year Ended |
| |
December 31,
2024 |
|
December 31,
2023 |
|
December 31,
2024 |
|
December 31,
2023 |
|
Net cash provided by operating activities |
$ |
477.6 |
|
|
$ |
191.7 |
|
|
$ |
2,258.1 |
|
|
$ |
1,935.5 |
|
|
Less: Purchases of property and equipment |
|
(97.6 |
) |
|
|
(26.9 |
) |
|
|
(378.9 |
) |
|
|
(204.1 |
) |
| Free cash flow |
$ |
380.0 |
|
|
$ |
164.8 |
|
|
$ |
1,879.2 |
|
|
$ |
1,731.4 |
|
| Net cash used in investing
activities |
$ |
(79.9 |
) |
|
$ |
(71.6 |
) |
|
$ |
(727.4 |
) |
|
$ |
(649.3 |
) |
| Net cash used in financing
activities |
$ |
(8.8 |
) |
|
$ |
(910.1 |
) |
|
$ |
(50.1 |
) |
|
$ |
(1,570.4 |
) |
Reconciliation of total revenue to total billings
| |
Three Months Ended |
|
Year Ended |
| |
December 31,
2024 |
|
December 31,
2023 |
|
December 31,
2024 |
|
December 31,
2023 |
|
Total revenue |
$ |
1,660.1 |
|
|
$ |
1,415.1 |
|
|
$ |
5,955.8 |
|
|
$ |
5,304.8 |
|
|
Add: Change in deferred revenue |
|
349.2 |
|
|
|
449.7 |
|
|
|
625.9 |
|
|
|
1,094.7 |
|
|
Less: Deferred revenue balance acquired in business
acquisitions |
|
(6.8 |
) |
|
|
— |
|
|
|
(49.2 |
) |
|
|
— |
|
| Total billings |
$ |
2,002.5 |
|
|
$ |
1,864.8 |
|
|
$ |
6,532.5 |
|
|
$ |
6,399.5 |
|
|
Investor Contact: |
Media Contact: |
| |
|
| Aaron Ovadia |
Michelle Zimmermann |
| Fortinet, Inc. |
Fortinet, Inc. |
| 408-235-7700 |
408-235-7700 |
| investors@fortinet.com |
pr@fortinet.com |
Fortinet (LSE:0IR9)
과거 데이터 주식 차트
부터 1월(1) 2025 으로 2월(2) 2025
Fortinet (LSE:0IR9)
과거 데이터 주식 차트
부터 2월(2) 2024 으로 2월(2) 2025
