01—Abstract
Summary
Summary of the 10-Q filed May 8, 2026. Cited figures are marked; the original filing is the authoritative source.
Fortinet, Inc. reported strong financial results for the first quarter of 2026, demonstrating significant year-over-year growth across key metrics.
Total revenue reached $1.85 billiona, a 20% increase, driven by robust performance in both product and service segments. Product revenue saw a substantial 41% jump to $645.1 million, while service revenue grew 11% to $1.20 billion. This top-line growth translated into improved profitability, with operating income rising 28% to $580.0 million and operating margin expanding to 31.4%.
The company also generated strong operating cash flow of $1.08 billionb, highlighting operational efficiency and solid cash generation capabilities. While gross margin experienced a slight decrease of 0.7 percentage points to 80.3%, primarily due to a favorable shift in revenue mix towards product sales, the company's overall financial health remains robust.
Fortinet continues to invest strategically in research and development and sales and marketing to support future growth. The company also actively returned capital to shareholders through a significant share repurchase program, demonstrating confidence in its financial position and future prospects.
02—Key points
Key Highlights
- Total revenue increased by 20% year-over-year to $1.85 billion, driven by a strong 41% growth in product revenue and 11% growth in service revenue.
- Operating income increased by 28% year-over-year to $580.0 million, with operating margin expanding to 31.4% from 29.5%.
- Cash flow from operations was robust at $1.08 billion, a 25% increase compared to the prior year's period.
- The company repurchased $826.9 million of its common stock during the quarter, demonstrating a commitment to returning capital to shareholders.
- Deferred revenue grew by 3% sequentially to $7.35 billion, indicating strong future revenue potential.
- Despite a slight decrease in gross margin to 80.3%, this was attributed to a favorable shift in revenue mix towards product sales, with product gross margin improving slightly.
- The company ended the quarter with a strong liquidity position, holding $3.63 billion in cash, cash equivalents, and investments.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Fortinet, Inc. kept $0.29.
- Revenue$1.85B100.0%
- Cost of revenue−$364.5M19.7%
- Gross profit$1.49B80.3%
- Operating costs−$905.1M48.9%
- Operating income$580.0M31.4%
- Interest, other & tax−$45.5M2.5%
- Net income$534.5M28.9%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed May 8, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $1.85B$1.54B | +20.1% |
| Cost of Revenue | $364.50M$293.10M | +24.4% |
| Gross Profit | $1.49B$1.25B | +19.1% |
| R&D Expenses | $214.00M$198.60M | +7.8% |
| Operating Expenses | $905.10M$792.80M | +14.2% |
| Operating Income | $580.00M$453.80M | +27.8% |
| Net Income | $534.50M$433.40M | +23.3% |
| EPS (Basic) | $0.72$0.56 | +28.6% |
| EPS (Diluted) | $0.72$0.56 | +28.6% |
| Shares Outstanding (Basic) | 738.80M768.30M | −3.8% |
| Shares Outstanding (Diluted) | 742.80M776.80M | −4.4% |
05—Questions
Frequently Asked Questions
What was Fortinet's total revenue for the first quarter of 2026 and how does it compare to the previous year?
Fortinet's total revenue for the first quarter of 2026 was $1.85 billion, an increase of 20% compared to $1.54 billion in the same period last year.
How did Fortinet's product and service revenues perform in Q1 2026?
Product revenue increased by 41% to $645.1 million, while service revenue grew by 11% to $1.20 billion in the first quarter of 2026.
What is the company's profitability performance in Q1 2026?
Fortinet reported an operating income of $580.0 million, a 28% increase year-over-year. The operating margin also improved to 31.4% from 29.5% in the prior year's period.
How much cash did Fortinet generate from operations, and what is its liquidity position?
Fortinet generated $1.08 billion in cash flow from operating activities in Q1 2026, a 25% increase year-over-year. The company's total cash, cash equivalents, and investments stood at $3.63 billion as of March 31, 2026.
06—Continue