Increased demand for secure access service edge (SASE) drove Fortinet’s financial results for the second quarter of 2025, with analysts noting investor concern over long-term firewall revenue.

The security vendor revealed 22% growth in its Unified SASE offering, which combines SD-WAN with security service edge (SSE).

Fortinet hits a firewall. Is SASE the solution?

The firm reported it had shipped half of its global firewall market units. In addition, 650,000 firewall units will reach end of service by 2026, followed by a further 350,000 low-end units in 2027.

“We estimate that we are approximately 40% to 50% of the way through the 2026 upgrade cycle at the end of the second quarter based on the remaining active units and service contracts,” Fortinet CFO Christiane Ohlgart said. “And we expect continued upgrade activity for the remaining devices over the next six quarters.”

While revenue grew 14% year-over-year (YoY) to $1.63 billion for the firm, its share price sank more than 16% after the market closed on Wednesday.

“In my talks with investors, they are concerned that the firewall refresh cycle, which drives much of their business, is already past the halfway point meaning that source of revenue could dry up in the near future,” Zeus Kerravala, principal analyst at ZK Research, told SDxCentral.

The ZK Research view is that Fortinet's current SASE growth – alongside AI and SecOps – should offset any slowdown in firewall, keeping the firm buoyant.

“The security industry is changing and Fortinet is changing with it and investors need to measure the company on more than firewall,” Kerravala added.

Fortinet maps the customer journey as starting with purchase of its firewall, before expanding to its SD-WAN solution and adoption of its single-vendor SASE offering.

This doesn’t seem to spell the end of the traditional firewall, with Fortinet CEO Ken Xie viewing it as “the important control point for all this traffic, especially within the enterprise, within the data center.”

Xie drew parallels with Fortinet introducing antivirus to its firewalls when it first launched, explaining SASE is a way for the traditional firewall to evolve, in confluence with edge, endpoint, and cloud.

“That’s formed the whole protection infrastructure, which really gives much better security for the enterprise user," Xie said.

On the SASE subject, Xie noted that customers include a mix of greenfield deployments and contract renewals, with the latter making up 95% of the base.

“We like to play the long-term game,” Xie explained. “So for SASE, we also invest in the infrastructure, which has a much better cost advantage, also more secure compared to leveraging some other third party.

"[In the future] if our own infrastructure can handle 70% of traffic, and 30% in certain locations still use a third party, that will be the best cost model.”