Companies /Technology

Fortinet Inc

NASDAQ: FTNT Software - Infrastructure
$156.29
▼ $0.07 (−0.04%) today
Markets closed · 9:32pm ET

Q1 2025 Earnings

Reported May 7, 2025, 4:11pm ET · SEC source
$0.58
Beat +8.57%
EPS · est. $0.53
$1.5B
Miss −0.07%
Revenue · est. $1.5B
−2.8%
Trailing market
FTNT vs S&P since report
7 quarters
Consecutive EPS beats

Market Reaction

% change · around the report
−5%0+5%May 7May 8report 4:11pm ETearnings+0.5%−1.4%
−5%0+5%May 7May 8earnings+0.5%−1.4%
FTNT −1.4%S&P 500 +0.5%
−5%0+5%May 7May 8report 4:11pm ETearnings+0.8%−1.4%
−5%0+5%May 7May 8earnings+0.8%−1.4%
FTNT −1.4%NASDAQ +0.8%
−5%0+5%+10%May 6May 15report 4:11pm ETearnings+5.2%+4.1%
−5%0+5%+10%May 6May 15earnings+5.2%+4.1%
FTNT +4.1%S&P 500 +5.2%
−5%0+5%+10%May 6May 15report 4:11pm ETearnings+7.3%+4.1%
−5%0+5%+10%May 6May 15earnings+7.3%+4.1%
FTNT +4.1%NASDAQ +7.3%
−8.41%
Day of report
−0.33%
Next session
+4.93%
One week
+3.98%
30 days

S&P 500 over the same 30 days: +6.73%.

Did FTNT Beat Earnings? Q1 2025 Results

Fortinet posted a strong but mixed first quarter for 2025, delivering an earnings beat that was quickly overshadowed by a cautious forward outlook — sending shares tumbling more than 12% in the aftermath. The cybersecurity giant earned $0.58 per share on a non-GAAP basis, clearing the $0.5342 consensus estimate by 8.57%, while revenue of $1.54 billion grew 13.8% year over year but landed just 0.07% shy of Wall Street's expectations. The headline profit performance was fueled in part by record non-GAAP operating margin expansion of 570 basis points to 34.2%, reflecting disciplined cost controls even as Fortinet accelerated its pivot toward higher-value recurring revenue streams — Unified SASE ARR reached $1.15 billion, up 25.7%, while Security Operations ARR climbed 30.3% to $434.50 million. This pattern of strong fundamentals paired with <a href="https://247wallst.com/investing/2025/11/05/fortinet-shares-down-10-despite-reporting-strong-q3-financials/">market skepticism around guidance</a> is not new for Fortinet; for Q2, management guided revenue of $1.59–$1.65 billion, with full-year 2025 revenue expected in the range of $6.65–$6.85 billion.

Key Takeaways
  • Non-GAAP operating margin expanded 570 basis points year over year to record 34.2%
  • Unified SASE ARR grew 25.7% YoY to $1.15 billion
  • Security Operations ARR grew 30.3% YoY to $434.5 million
  • Service revenue grew 14.4% YoY, comprising ~70% of total revenue
  • Record Q1 free cash flow of $782.8 million
  • Record Q1 cash flow from operations of $863.3 million
  • Remaining performance obligations grew 11.7% to $6.49 billion

“We are pleased to report another strong quarter as non-GAAP operating margin increased 570 basis points year over year to a first quarter record of 34%, while billings grew 14% year over year.”

Fortinet CEO, on the earnings call

Forward Guidance & Outlook

For Q2 2025, Fortinet expects revenue of $1.590–$1.650 billion, billings of $1.685–$1.765 billion, non-GAAP gross margin of 80.0%–81.0%, non-GAAP operating margin of 31.5%–32.5%, and non-GAAP diluted EPS of $0.58–$0.60 (assuming 18% non-GAAP tax rate, 773–777 million diluted shares). For full-year 2025, the company expects revenue of $6.650–$6.850 billion, service revenue of $4.575–$4.725 billion, billings of $7.200–$7.400 billion, non-GAAP gross margin of 79.0%–81.0%, non-GAAP operating margin of 31.5%–33.5%, and non-GAAP diluted EPS of $2.43–$2.49 (assuming 18% non-GAAP tax rate, 769–779 million diluted shares).

FTNT YoY Financials

Q1 2025 vs Q1 2024 · SEC filings Q1 2024 Q1 2025
$0$500.0M$1.0B$1.5B$1.4B$1.5BRevenue$1.0B$1.2BGross Profit$321.2M$453.8MOperating Income$299.3M$433.4MNet Income
$0$500.0M$1.0B$1.5BRevenueGross ProfitOperating IncomeNet Income

FTNT Revenue by Segment

Service Revenue$1.1B+14.4%
Product Revenue$459.1M+12.3%

Figures from SEC filings and company reports. Not investment advice.