Fortinet, Inc.

Fortinet’s results for the second quarter were strong and well-rounded across countries, client types, sectors, and use cases, resulting in market share gains and showcasing robust growth from its three core growth drivers. The company matched the revenue expectations of Wall Street as its total service revenue grew by 25% sequentially and it also delivered an earnings beat. Fortinet’s premium cost for performance advantage and integrated platform continue to be valued by large companies. Besides, the management continues to take various measures to solve the supply chain difficulties, such as raising inventory purchase commitments, redesigning products, qualifying more suppliers, and changing prices. Even with these measures, they believe that demand will continue to exceed supply. During the quarter, they introduced the FortiGate 4800F series of hyperscale firewalls to set new benchmarks for security, scale, performance, and innovation to satisfy the needs of hyperscale customers and 5G MNOs. With comprehensive, integrated, and ultimate protection across numerous edges, from the endpoint to the data center to the hybrid cloud environment, the Fortinet security mesh platform has immense growth potential. We give an ‘Outperform’ rating on Fortinet with a revised target price.