Cybersecurity firms are proving their worth on Wall Street, with several well-known providers posting strong financial results this week that comfortably topped expectations.
The rise in the number of people working from home predictably led to a strong boost in sales for companies that sell the hardware those people need to do their jobs. Companies such as Dell Technologies Inc., which sells laptops and personal computers, and Advanced Micro Devices Inc., which makes computer chips to power those machines, have been natural beneficiaries of this trend. Cloud infrastructure giants such as Amazon Web Services Inc. have done well too.
Joining the party this week are cybersecurity providers that sell tools to secure people who work from home. That’s not really a surprise either, as enterprises have become increasingly wary of the risk posed by spreading their workers so thin.
Those fears explain the solid performances of companies such as Proofpoint Inc., Fortinet Inc. and NortonLifeLock Inc., which all posted strong financial results today.
The best performer of the day was Proofpoint, which sells tools for securing email and social media accounts and mobile devices, among other offerings. The company reported a fourth-quarter profit before certain costs such as stock compensation of 51 cents per share on revenue $275.1 million, easily beating Wall Street’s forecast of 42 cents per share in earnings and $269.1 million in revenue.
“We saw exceptional demand for our services by new and existing customers in the fourth quarter, with solid momentum across our core email security and growing portfolio of emerging products,” Proofpoint Chief Financial Officer Paul Auvil said.
Fortinet, which sells firewalls, antivirus software, intrusion prevention systems and endpoint security components, reported a fourth-quarter profit of $1.06 per share on revenue of $748 million, up 21% from the same period a year ago. That too surpassed expectations, with Wall Street modeling earnings of 97 cents a share on revenue of $722.4 million.
As for NortonLifeLock, which sells systems for securing devices and preventing identify theft, it posted solid fiscal third-quarter earnings of 38 cents per share on revenue of $639 million, up 3%. Wall Street had forecast a profit of 37 cents on revenue of just $630.53 million.
Another strong performance came Wednesday afternoon from Check Point Software Ltd., which sells tools that protect enterprise data, networks, cloud and mobile deployments. For its fourth-quarter financial results, Check Point posted a profit of $2.17 per share on revenue of $563.8 million, versus Wall Street’s forecast of $2.11 per share in earnings and $555.57 million in revenue.
That followed FireEye Inc.’s financial results on Monday which also beat expectations with its record-breaking fourth quarter revenues. FireEye said at the time it’s also hoping to break the $1 billion revenue barrier in 2021.
NortonLifeLock Chief Executive Vincent Pilette summed up the fortunes of cybersecurity providers best of all, saying that the growth in the industry was thanks to rising awareness of the importance of digital security during the pandemic. “Our vision to protect and empower everyone to live their digital lives safely has never been more relevant than it is today,” Pilette said.
Photo: arthur_bowers/Pixabay
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