Check Point delivers strong quarterly revenue growth but stock drops – Business
Shares in Check Point Software Technologies Ltd. closed down 5% in regular trading today despite the cybersecurity company beating expectations in its latest quarterly earnings report.
For the quarter that ended on March 31, Check Point reported adjusted earnings per share of $2.04, up 13% year-over-year, on revenue of $599 million, up 6% year-over-year. Both were beats, as analysts had been expecting adjusted earnings of $2.01 per share on revenue of $594.94 million.
Check Point’s revenue from security subscriptions was $263 million in the quarter, up 15% year over year and adjusted operating income was $252 million, up 6%. As of the end of the quarter, the company had deferred revenues of $1.826 billion, up 2%, and Check Point had $3.035 billion in cash, marketable securities, and short-term deposits, up from $2.96 billion as of the end of December.
Check Point Infinity, an artificial intelligence cloud-delivered cybersecurity platform that offers enterprise-grade security across the data center, network, cloud, branch office and remote users, also saw strong growth in the quarter. New customers signing up to Infinity included W.W. Grainger Inc., Virgin Media O2 Ltd., C. & J. Clark International Ltd., Vector Ltd. and 90 new government agencies across 40 countries.
The quarter included the launch of Quantum Force, a new line of security gateways that offer organizations next-generation firewall technology. Check Point also revealed new technologies, including Harmony SaaS, which protects software-as-a-service platforms and data and Infinity AI Copilot, an AI-powered security assistant that is claimed to enhance security effectiveness across organizations.
“The first quarter yielded great results with revenues and EPS at the top end of our projections,” Gil Shwed, founder and chief executive officer of Check Point Software Technologies, said in the company’s earnings release. “We delivered strong double-digit growth in Infinity Platform agreements, now constituting over 13 percent of total revenues. Our aggregate recurring revenues now represent 83 percent of total revenues.”
For its fiscal second quarter, Check Point expects adjusted earnings per share to come in $2.10 to $2.20 on revenue of $607 million to $637 million. According to Seeking Alpha, both were relatively in line with the analysts’ consensus of adjusted earnings per share of $2.16 and revenue of $623 million.
