Fortinet (NASDAQ:FTNT) Posts Earnings Results, Beats Estimates By $0.15 EPS

Fortinet (NASDAQ:FTNT) announced its quarterly earnings data on Wednesday. The software maker reported $0.90 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.75 by $0.15, FiscalAI reports. Fortinet had a return on equity of 218.88% and a net margin of 28.17%.The company had revenue of $2.05 billion during the quarter, compared to the consensus estimate of $1.89 billion. During the same period in the previous year, the company posted $0.64 EPS. The firm’s revenue was up 25.6% on a year-over-year basis. Fortinet updated its FY 2026 guidance to 3.410-3.470 EPS and its Q3 2026 guidance to 0.830-0.870 EPS.

Here are the key takeaways from Fortinet’s conference call:

• Strong second-quarter performance: Billings increased 33% to $2.37 billion, revenue rose 26% to $2.05 billion, and product revenue surged 52%. Free cash flow more than tripled year over year to $966 million.
• Broad-based demand across strategic pillars: Secure Networking billings grew 34%, Unified SASE grew 35% with FortiSASE billings more than doubling, and AI-driven Security Operations billings increased 25%. OT billings also rose more than 55%, supported by demand from critical infrastructure and industrial customers.
• Raised full-year outlook: Fortinet increased its 2026 guidance for billings to $9.35 billion-$9.55 billion, revenue to $8.02 billion-$8.18 billion, service revenue to $5.18 billion-$5.22 billion, and non-GAAP EPS to $3.41-$3.47.
• Exceptional profitability and capital returns: Non-GAAP operating margin reached a second-quarter record of 38%, while non-GAAP EPS rose 41% to $0.90. The company repurchased $973 million of stock year to date and had approximately $766 million remaining under its authorization.
• Management is positioning its integrated “SASE firewall” as a long-term growth opportunity: Fortinet argues that combining firewall, SASE, SD-WAN, and sovereign/on-premises capabilities on FortiOS can address AI, data privacy, and high-throughput security needs. Executives described the opportunity as potentially larger than cloud-only SASE, though adoption and future growth remain dependent on customer and service-provider investment.

Fortinet Stock Up 4.4%

Shares of NASDAQ FTNT traded up $6.73 during midday trading on Friday, reaching $160.98. 2,931,285 shares of the company’s stock traded hands, compared to its average volume of 6,422,964. Fortinet has a one year low of $70.12 and a one year high of $170.35. The stock’s 50 day simple moving average is $149.94 and its 200-day simple moving average is $108.72. The company has a market cap of $117.94 billion, a price-to-earnings ratio of 56.74, a P/E/G ratio of 4.17 and a beta of 1.09. The company has a quick ratio of 1.07, a current ratio of 1.15 and a debt-to-equity ratio of 0.50.

Insiders Place Their Bets

In other news, VP Michael Xie sold 3,907 shares of the company’s stock in a transaction on Wednesday, June 3rd. The stock was sold at an average price of $146.44, for a total transaction of $572,141.08. Following the transaction, the vice president directly owned 9,923,610 shares of the company’s stock, valued at approximately $1,453,213,448.40. This represents a 0.04% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, COO John Whittle sold 146,015 shares of the business’s stock in a transaction that occurred on Thursday, May 21st. The stock was sold at an average price of $128.41, for a total transaction of $18,749,786.15. Following the sale, the chief operating officer directly owned 94,724 shares in the company, valued at approximately $12,163,508.84. This represents a 60.65% decrease in their position. The SEC filing for this sale provides additional information. Over the last three months, insiders have sold 318,387 shares of company stock valued at $43,403,063. 17.60% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Fortinet

Several hedge funds have recently modified their holdings of the company. Bison Wealth LLC purchased a new stake in Fortinet in the 4th quarter worth $585,000. Brighton Jones LLC lifted its stake in Fortinet by 2.2% in the 4th quarter. Brighton Jones LLC now owns 10,327 shares of the software maker’s stock worth $976,000 after purchasing an additional 221 shares in the last quarter. Elevated Private Wealth LLC purchased a new position in Fortinet during the fourth quarter worth approximately $366,000. Hilltop Holdings Inc. acquired a new position in shares of Fortinet during the 3rd quarter valued at about $353,000. Finally, OpenArc Corporate Advisory LLC acquired a new position in Fortinet in the 4th quarter valued at about $326,000. 83.71% of the stock is owned by hedge funds and other institutional investors.

Key Headlines Impacting Fortinet

Here are the key news stories impacting Fortinet this week:

• Positive Sentiment: Q2 results exceeded expectations: Revenue rose 26% year over year to $2.05 billion, ahead of the roughly $1.89 billion consensus, while adjusted EPS of $0.90 surpassed estimates of $0.75 and increased from $0.64 a year earlier. Fortinet lifts annual revenue forecast on strong cybersecurity demand
• Positive Sentiment: Growth indicators were particularly strong: Product revenue climbed 52% to $773 million, billings increased 33% to $2.37 billion, and operating cash flow reached approximately $1.04 billion. Management cited strong demand across security platforms, including AI infrastructure, SASE Firewall and OT security. FTNT Q2 Earnings Call Highlights SASE Firewall Growth
• Positive Sentiment: Fortinet raised its outlook: Full-year 2026 revenue guidance is now approximately $8.02 billion to $8.18 billion, while third-quarter revenue guidance of $2.01 billion to $2.10 billion and EPS guidance of $0.83 to $0.87 are above consensus expectations. Fortinet Reports Strong Second Quarter 2026 Financial Results
• Positive Sentiment: Analyst targets moved higher: BTIG raised its target to $203 with a Buy rating, Rosenblatt to $195 with a Buy rating, and Citigroup to $185. These revisions suggest analysts are increasing estimates after the earnings beat. Analysts boost forecasts following upbeat Q2 earnings

Analyst Ratings Changes

FTNT has been the subject of a number of analyst reports. Royal Bank Of Canada set a $185.00 price objective on shares of Fortinet and gave the stock a “sector perform” rating in a research note on Thursday. DZ Bank downgraded shares of Fortinet from a “buy” rating to a “hold” rating and set a $125.00 target price for the company. in a report on Tuesday, May 19th. Truist Financial set a $183.00 price objective on Fortinet and gave the company a “buy” rating in a research report on Tuesday, July 21st. Cantor Fitzgerald reaffirmed an “overweight” rating and set a $185.00 price objective (up from $165.00) on shares of Fortinet in a report on Thursday. Finally, Rosenblatt Securities upped their price target on shares of Fortinet from $185.00 to $195.00 and gave the company a “buy” rating in a research note on Thursday. Two equities research analysts have rated the stock with a Strong Buy rating, ten have assigned a Buy rating, twenty-three have given a Hold rating and four have assigned a Sell rating to the stock. According to data from MarketBeat.com, the stock currently has an average rating of “Hold” and an average target price of $150.91.

About Fortinet

Fortinet, Inc (NASDAQ: FTNT) is a multinational cybersecurity company that develops and delivers integrated security solutions for enterprise, service provider and government customers worldwide. Founded in 2000 and headquartered in Sunnyvale, California, the company was co‑founded by Ken Xie and Michael Xie. Ken Xie serves as chairman and chief executive officer, and the company operates through a global sales, channel and services organization to support customers across the Americas, EMEA and Asia‑Pacific.

Fortinet’s product portfolio centers on network security appliances and software, with its FortiGate next‑generation firewalls and the FortiOS operating system forming a core platform.