10-QPeriod: Q2 FY2025

Fortinet, Inc. Quarterly Report for Q2 Ended Jun 30, 2025

Filed August 8, 2025For Securities:FTNT

Summary

Fortinet, Inc. reported strong performance for the second quarter and first half of 2025, demonstrating consistent revenue growth driven by both its product and service segments. Total revenue increased by 14% year-over-year for both the three and six months ended June 30, 2025. The company's service revenue, in particular, showed robust growth, up 14% in both periods, fueled by security subscriptions and support services, indicating the continued demand for its integrated cybersecurity platform. Operationally, Fortinet managed its expenses effectively, with significant investments in R&D and Sales & Marketing to support future growth. While the operating margin saw a slight decrease quarter-over-quarter due to increased R&D and S&M expenses as a percentage of revenue and a slight dip in gross margin, the year-to-date operating margin improved significantly. The company also maintained a strong liquidity position, with substantial cash, cash equivalents, and investments, and generated robust operating cash flow. Share repurchases continued, reflecting the company's commitment to returning capital to shareholders.

Financial Highlights

53 data points
Beta

Revenue

$1.63B

80.7% Gross Margin

Net Income

$440.10M

27.0% Net Margin

EPS (Diluted)

$0.57

Total Assets

$10.64B

Cash & Equivalents

$3.37B

Free Cash Flow

$284.10M

Financial Statements
Beta
Revenue$1.63B
Cost of Revenue$314.90M
Gross Profit$1.32B
R&D Expenses$209.50M
Operating Expenses$857.10M
Operating Income$458.00M
Net Income$440.10M
EPS (Basic)$0.57
EPS (Diluted)$0.57
Shares Outstanding (Basic)765.50M
Shares Outstanding (Diluted)772.70M

Key Highlights

  • 1Total revenue grew 14% year-over-year in both the three and six months ended June 30, 2025, reaching $1.63 billion and $3.17 billion, respectively.
  • 2Service revenue increased by 14% year-over-year for both periods, driven by strong demand for security subscriptions and support services.
  • 3Operating income increased by 5% to $458.0 million for the three months ended June 30, 2025, and by 20% to $911.8 million for the six months ended June 30, 2025, compared to the prior year periods.
  • 4The company maintained a strong cash position, with total cash, cash equivalents, and investments of $4.67 billion as of June 30, 2025.
  • 5Net cash provided by operating activities was $1.32 billion for the first six months of 2025, a 12% increase year-over-year.
  • 6Fortinet repurchased $401.1 million of its common stock during the first six months of 2025 under its share repurchase program.
  • 7The EMEA region showed the strongest revenue growth, increasing by 18% year-over-year for the three months ended June 30, 2025.

Frequently Asked Questions

Fortinet reported total revenue of $1.63 billion for the three months ended June 30, 2025, representing a 14% increase compared to the same period in the prior year. Product revenue grew 13% to $508.9 million, and service revenue grew 14% to $1.12 billion.

For the three months ended June 30, 2025, operating income was $458.0 million, a 5% increase year-over-year, resulting in an operating margin of 28.1%. For the six months ended June 30, 2025, operating income increased by 20% to $911.8 million, with an improved operating margin of 28.8% compared to 27.2% in the prior year period.

As of June 30, 2025, Fortinet maintained a strong liquidity position with $4.67 billion in cash, cash equivalents, and investments. The company also generated $1.32 billion in net cash from operating activities for the first six months of 2025.

Fortinet expects its service revenue to continue to grow, driven by its expanding deferred revenue balance for security subscriptions and support services, as well as growth opportunities in its unified SASE and SecOps offerings. The company anticipates continued growth in product revenue as well.