Software security provider Fortinet posted a near year-over-year quadrupling of net income for the first fiscal quarter of 2018, though a recent surge in its stock price has some investors taking profits out of the company.
Fortinet reported that revenues increased more than 17 percent year-over-year to $399 million in the latest quarter, with growth coming in both products and services. A more moderate increase in expenses helped boost net income from $10.7 million in Q1 2017, to $41.6 million this year.
Those results came in ahead of previous guidance from the company of around $390 million for revenues, and analyst forecasts.
Cloud providers remain a relatively small percentage of the company’s overall revenue picture, though growth in that segment has far outpacing its other segments. Recently installed Fortinet CFO Keith Jensen told investors that the company’s cloud business “experienced triple-digit growth in both on-demand cloud consumption and bring-your-own-license.”
“Across our cloud partners, AWS [Amazon Web Services] continues to be the leader with contributions coming from Azure,” Jensen said, according to transcripts. “Oracle, Google, and IBM each came online with initial billings during the first quarter.”
Fortinet CEO Ken Xie had previously noted that the firm added its FortiGate virtual machine (VM) firewall to Google Cloud Platform.
Investors are not as impressed with the showing. Fortinet’s stock surged in after-hours trading following release of the results, but stumbled out of the block early Friday. The company’s stock was down as much as 5 percent, though managed to recover half of those losses by mid-morning to trade at $54.50 per share. The broader Nasdaq was trading up around 1.4 percent.
It should be noted that the company’s stock did hit a new 52-week high of $57.98 on April 18, and has been trading just below that level since.
Looking ahead, Jensen forecast that Q2 billing and revenues would see a substantial year-over-year increase, with the latter coming in as high as $430 million. That would be more than 18 percent higher than what Fortinet posted in Q2 2017.
The company had previously said it expects full-year 2018 revenues to increase just over 13 percent year-over-year, which would be down from 2017 growth. Billing for 2018 is forecast to come in at less than $2.05 billion, which would be about flat with where it exited 2017.