How did Fortinet perform in terms of revenue growth during this period?

Fortinet demonstrated strong revenue growth. For the three months ended June 30, 2015, total revenue increased by 30% to $239.8 million, with product revenue up 34% and service revenue up 27%. For the six-month period ended June 30, 2015, total revenue grew by 28% to $452.7 million.

What is the company's cash position and liquidity like?

Fortinet maintains a strong liquidity position. As of June 30, 2015, the company had $1.15 billion in cash, cash equivalents, and investments. Operating cash flow for the first half of 2015 was robust at $148.9 million, a 42% increase year-over-year, indicating healthy cash generation capabilities.

What are the key drivers for the increase in deferred revenue?

The increase in deferred revenue, which grew 18% to $657.6 million, is primarily driven by the unamortized portion of services revenue from FortiGuard security subscription and FortiCare technical support contracts sold to an expanding customer base, particularly large enterprise clients, as well as renewals of these contracts.

Can you comment on the company's profitability and gross margin trends?

Fortinet saw an improvement in gross margin, reaching 71.0% for the three months ended June 30, 2015, up from 68.6% in the prior year. This improvement was driven by a higher mix of high-end product sales and scaling efficiencies in service offerings. While operating expenses increased due to investments in sales, marketing, and R&D, the gross margin expansion is a positive sign.

FTNT 10-Q Quarterly Report Q2 FY2015 — Revenue, Net Income, EPS

Summary

Fortinet, Inc. (FTNT) reported solid financial results for the second quarter and first half of 2015, demonstrating continued strong growth and operational improvements. Total revenue for the three months ended June 30, 2015, reached $239.8 million, a 30% increase year-over-year, driven by a 34% rise in product revenue and a 27% increase in service revenue. For the six-month period, total revenue grew 28% to $452.7 million. The company's financial health remains robust, with cash, cash equivalents, and investments increasing to $1.15 billion as of June 30, 2015. Deferred revenue also saw a healthy increase of 18% to $657.6 million, indicating strong future revenue potential from subscription and support services. Operating cash flow for the first half of the year was particularly strong, up 42% to $148.9 million, showcasing effective cash generation. The company also announced the acquisition of Meru Networks, Inc. for approximately $44.0 million to enhance its secure wireless offerings.

Financial Highlights

51 data points

Beta

Revenue

$239.78M

0.7% Gross Margin

Net Income

$792K

0.0% Net Margin

EPS (Diluted)

$0.00

Total Assets

$1.60B

Cash & Equivalents

$481.39M

Free Cash Flow

$84.31M

Financial Statements

Beta

Revenue	$239.78M
Cost of Revenue	$69.50M
Gross Profit	$170.29M
R&D Expenses	$37.39M
Operating Expenses	$167.34M
Operating Income	$2.95M
Net Income	$792K
Shares Outstanding (Basic)	849.65M
Shares Outstanding (Diluted)	881.17M

Key Highlights

1Total revenue increased by 30% year-over-year to $239.8 million for the three months ended June 30, 2015.
2Product revenue grew 34% and Service revenue grew 27% year-over-year for the three months ended June 30, 2015.
3Cash, cash equivalents, and investments grew to $1.15 billion as of June 30, 2015.
4Deferred revenue increased by 18% to $657.6 million as of June 30, 2015.
5Operating cash flow for the six months ended June 30, 2015, increased by 42% to $148.9 million.
6Fortinet acquired Meru Networks, Inc. in July 2015 for approximately $44.0 million to expand its secure wireless solutions.
7Gross margin improved to 71.0% for the three months ended June 30, 2015, up from 68.6% in the prior year.

Fortinet, Inc. Quarterly Report for Q2 Ended Jun 30, 2015

Summary

Financial Highlights

Key Highlights

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