Check Point Software sees Q2 profit in line with estimates
(Adds Q2 forecast, company comments, analysts' quotes)
By Tova Cohen
TEL AVIV, April 18 (Reuters) - Network security provider
Check Point Software Technologies reported first
quarter net profit that topped expectations by a cent and
forecast second quarter profit in line with estimates.
Check Point earned $1.32 per diluted share excluding
one-time items in the first quarter, up from $1.30 a year
earlier. Revenue grew 4 percent to $472 million, the
Israel-based company said on Thursday.
It was forecast to earn $1.31 a share on revenue of $471.1
million, according to I/B/E/S data from Refinitiv.
For the second quarter it forecast adjusted earnings per
share of $1.32-$1.40 on revenue of $474-$500 million. Analysts
were forecasting EPS of $1.38 and revenue of $487 million.
Its shares were down 5.4 percent to $122.57 in premarket
Nasdaq trade after rising 26 percent so far this year.
"The stock is off on a knee jerk reaction as the bulls were
hoping for a beat rather than an in-line quarter," said Daniel
Ives, managing director of equities research at Wedbush
Edward Jones analyst David Heger said the market was
disappointed that the first quarter did not exceed estimates by
a larger amount, especially in light of the shares' strong
"We continue to feel positive about Check Point's long-term
growth potential," he said.
Chief Executive Gil Shwed said the company posted 13 percent
growth in subscriptions for its advanced security products to
$144 million. These include protection for cloud computing and
mobile phones as well as its Infinity consolidated security
Operating expenses rose as the company spent more on sales
and marketing, including recruiting new staff to help sell new
products. These marketing efforts have not fully trickled down
to the bottom line yet as the new products are on an annual
subscription basis and their effect is delayed, Chief Financial
Officer Tal Payne told reporters.
"The stock has been strong over the last six months as the
Street is anticipating a potential renaissance of growth at the
company, with cloud driving its next leg of growth into the next
12 to 18 months," Ives said.
Check Point said it bought back 2.7 million shares worth
$305 million as part of its share repurchase programme.
(Reporting by Tova Cohen; Editing by Steven Scheer and Mark
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