Shares of Fortinet (NASDAQ: FTNT) tumbled 5% in after-hours trading on Wednesday, despite the cybersecurity firm reporting better-than-expected second-quarter results. The sharp decline appears to be driven by weaker-than-anticipated guidance for the upcoming quarter.
For the second quarter, Fortinet reported adjusted earnings per share of $0.64, surpassing the analyst consensus estimate of $0.59. Revenue came in at $1.63 billion, slightly above the expected $1.624 billion. The company's billings, a key metric for future revenue, grew 15% year-over-year to $1.78 billion.
However, investors seem to be focusing on Fortinet's third-quarter outlook, which fell short of expectations. The company forecasts adjusted earnings per share between $0.62 and $0.64 for Q3, compared to the $0.65 analysts were expecting. This conservative guidance suggests potential challenges in maintaining its recent growth trajectory amid an increasingly competitive cybersecurity landscape.
Despite the after-hours drop, Fortinet's long-term prospects remain strong. The company announced an expansion of its FortiCloud services, introducing new offerings in identity management, secure file storage, and communication. These additions aim to strengthen Fortinet's position in the rapidly evolving cybersecurity market and could potentially drive future growth.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.