Fortinet (NASDAQ:FTNT) Issues Quarterly Earnings Results, Beats Expectations By $0.15 EPS

Fortinet (NASDAQ:FTNT) posted its earnings results on Wednesday. The software maker reported $0.90 EPS for the quarter, topping analysts’ consensus estimates of $0.75 by $0.15, FiscalAI reports. The business had revenue of $2.05 billion during the quarter, compared to the consensus estimate of $1.89 billion. Fortinet had a net margin of 27.49% and a return on equity of 160.08%. The firm’s revenue was up 25.6% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.64 EPS. 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 Performance

Shares of FTNT stock traded up $0.53 during trading hours on Thursday, reaching $153.75. 5,874,167 shares of the company traded hands, compared to its average volume of 6,410,155. The firm has a 50-day moving average price of $149.45 and a 200 day moving average price of $108.19. The company has a market cap of $112.64 billion, a P/E ratio of 59.22, a P/E/G ratio of 4.08 and a beta of 1.09. The company has a debt-to-equity ratio of 0.50, a current ratio of 1.15 and a quick ratio of 1.07. Fortinet has a 12-month low of $70.12 and a 12-month high of $170.35.

Insider Buying and Selling

In other news, VP Michael Xie sold 3,907 shares of the stock in a transaction on Wednesday, June 3rd. The shares were sold at an average price of $146.44, for a total value of $572,141.08. Following the completion of the sale, the vice president directly owned 9,923,610 shares of the company’s stock, valued at $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 available at 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 firm’s stock in a transaction on Thursday, May 21st. The shares were sold at an average price of $128.41, for a total transaction of $18,749,786.15. Following the sale, the chief operating officer owned 94,724 shares in the company, valued at $12,163,508.84. The trade was a 60.65% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last ninety days, insiders sold 318,387 shares of company stock valued at $43,403,063. 17.60% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Fortinet

Institutional investors and hedge funds have recently bought and sold shares of the business. Brighton Jones LLC lifted its holdings 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. Bison Wealth LLC bought a new stake in shares of Fortinet during the fourth quarter valued at approximately $585,000. HUB Investment Partners LLC raised its position in shares of Fortinet by 29.1% during the second quarter. HUB Investment Partners LLC now owns 5,299 shares of the software maker’s stock valued at $560,000 after buying an additional 1,193 shares during the last quarter. Diversify Advisory Services LLC purchased a new position in shares of Fortinet in the second quarter worth $1,136,000. Finally, Quantinno Capital Management LP boosted its position in shares of Fortinet by 27.4% during the second quarter. Quantinno Capital Management LP now owns 144,989 shares of the software maker’s stock worth $15,328,000 after acquiring an additional 31,202 shares during the last quarter. 83.71% of the stock is owned by institutional investors.

Fortinet News Summary

Here are the key news stories impacting Fortinet this week:

• Positive Sentiment: Quarterly results exceeded expectations. Fortinet reported adjusted EPS of $0.90 versus the $0.75 consensus estimate and revenue of approximately $2.05 billion versus expectations of $1.89 billion. Revenue grew 26% year over year, while GAAP net income rose to $606.3 million. Fortinet lifts annual revenue forecast on strong cybersecurity demand
• Positive Sentiment: Growth indicators were particularly strong. Product revenue jumped 52% to $773 million, billings increased 33% to $2.37 billion, and demand remained strong across AI infrastructure, SASE, firewall and operational-technology security offerings. Management highlighted expanding platform adoption and AI-security momentum. FTNT Q2 Earnings Call Highlights SASE Firewall Growth
• Positive Sentiment: Fortinet raised its outlook. Full-year 2026 revenue guidance was increased to roughly $8.02 billion-$8.18 billion, with EPS guidance of $3.41-$3.47, above the prior analyst consensus. Third-quarter revenue guidance of $2.01 billion-$2.10 billion and EPS guidance of $0.83-$0.87 also exceeded consensus estimates. Fortinet Reports Strong Second Quarter 2026 Financial Results
• Positive Sentiment: Analysts became more constructive. BTIG raised its price target to $203 from $186, Rosenblatt increased its target to $195 from $185, and BMO lifted its target to $185 from $170. BTIG and Rosenblatt maintained Buy ratings, reinforcing optimism about Fortinet’s growth trajectory.
• Neutral Sentiment: A broader rebound in technology stocks and Nasdaq futures provided a supportive market backdrop, although Fortinet’s gains were primarily driven by its earnings and guidance rather than general market conditions.
• Negative Sentiment: Valuation remains a risk. After a roughly 152% five-year run, FTNT trades at a premium valuation, requiring continued execution to justify further upside. Separately, reported insider activity showed substantial selling and no insider purchases over the past six months.

Analyst Ratings Changes

FTNT has been the subject of several research analyst reports. The Goldman Sachs Group reaffirmed a “buy” rating and issued a $190.00 price objective on shares of Fortinet in a report on Thursday. DZ Bank downgraded Fortinet from a “buy” rating to a “hold” rating and set a $125.00 price target for the company. in a research note on Tuesday, May 19th. Wolfe Research set a $175.00 price target on shares of Fortinet in a research report on Thursday. HSBC cut shares of Fortinet from a “hold” rating to a “reduce” rating and set a $102.00 price objective on the stock. in a research note on Monday, June 29th. Finally, Compass Point set a $100.00 target price on shares of Fortinet in a research report on Monday, May 4th. Two equities research analysts have rated the stock with a Strong Buy rating, ten have assigned a Buy rating, twenty-three have assigned a Hold rating and four have assigned a Sell rating to the stock. According to data from MarketBeat, Fortinet currently has a consensus rating of “Hold” and a consensus target price of $148.94.

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.