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Fortinet helps businesses and government organizations connect their networks while protecting them from cyberattacks. Its FortiGate firewalls serve locations ranging from branch offices to data centers and cloud environments. FortiOS, its common operating system, lets customers manage networking and security together. Fortinet also supplies cloud-delivered security and tools for security operations.
Customers buy hardware or software and often add FortiGuard security subscriptions and FortiCare technical support. Services bring in more revenue than product sales, making new deployments and subscription renewals important to the business. Nearly all revenue reaches Fortinet through channel partners: distributors buy from Fortinet, then sell to resellers and service providers that supply end customers or operate hosted services. A few distributors account for a large share of revenue, with the largest alone contributing a substantial portion.
Fortinet also depends on outside manufacturers, mainly in Taiwan, to supply its hardware. Encryption export controls restrict where some products can be sold and may require licenses. China has instructed domestic companies in certain industries not to use Fortinet and other specified foreign cybersecurity products, limiting access to those customers.
The risk section is the longest, dullest part of the filing. This keeps only what can really hurt you: where it hits, how hard, when it plays out.
Every company claims an edge. Each one is checked against hard numbers like margins and returns: which hold, and which line gives way first.
Palo Alto Networks challenges Fortinet for enterprise customers that want network, cloud and security-operations protection from one integrated platform. Watch its progress in replacing customers’ separate security products with a broader platform—the same consolidation Fortinet pursues.
Check Point Software Technologies competes directly with Fortinet for customers buying network-protection gateways and ongoing security subscriptions, against FortiGate appliances and FortiGuard services. Its security-subscription revenue is the clearest line to watch alongside Fortinet’s subscription business.
Zscaler competes with Fortinet for enterprise and government customers paying to secure access to internet and private applications through the cloud, a service sold as SASE. Watch adoption of Zscaler’s Zero Trust SASE subscriptions against Fortinet’s unified SASE and secure-access services.
Netskope competes with Fortinet for customers paying for cloud-based security and networking, challenging Fortinet’s unified SASE offering. Its Netskope One subscription revenue reflects services delivered over typically one-to-three-year contracts, rather than hardware sales.
Cisco can displace Fortinet appliances when enterprise customers choose security built into the networking hardware and software they already buy from Cisco. Watch bundled network protection: customers with existing Cisco networks and vendor relationships may accept more limited built-in security instead of adding Fortinet equipment.
CrowdStrike competes with Fortinet for enterprise spending on detecting, investigating and responding to security threats. Customers subscribe to its Falcon platform, whose ability to add security functions without deploying more sensors is worth watching against Fortinet’s security-operations offerings.
Hewlett Packard Enterprise competes with Fortinet for enterprise purchases of networking and security products and services, including Fortinet’s secure networking and cloud-based secure access, or SASE. Watch HPE’s Networking business for progress with its end-to-end networking and security portfolio.
Cloudflare competes with Fortinet for businesses buying cloud-delivered application and network protection and secure access, or SASE. Watch customers adding more products to Cloudflare’s integrated suite after starting with one, extending its role in their security spending.
F5 competes with Fortinet for enterprise customers paying to protect applications by filtering web attacks, controlling access and mitigating traffic-flooding attacks, or DDoS. Watch F5’s Distributed Cloud Services for customers choosing subscription-based protection rather than deployed hardware or software.
SentinelOne competes with Fortinet for customers buying protection for computers and servers and tools to run security operations. Its endpoint-protection and security-operations platform challenges Fortinet’s endpoint and SecOps products.
Extreme Networks competes with Fortinet for enterprise purchases of wired, wireless and software-managed wide-area networking, or SD-WAN. Its networking-equipment sales, software subscriptions and maintenance contracts are the revenue lines to watch against Fortinet’s switches, wireless access points and SD-WAN offerings.
F5, Inc. earningsFFIV
F5's report will show whether enterprises are choosing its cloud-based application-protection subscriptions over deployed products, a spending choice that also matters to Fortinet.
Look for F5's update on Distributed Cloud Services and compare it with the broader business. If adoption expands, customers are moving application-protection spending toward cloud subscriptions, increasing pressure on Fortinet's competing products; if progress is limited, there is less evidence of that shift.
Fortinet, Inc. earningsThis company
Fortinet recognizes security subscription and support revenue over time, so this report shows whether new orders are replenishing the business that will drive future revenue.
Read billings, deferred revenue and service revenue together. Billings equals revenue plus the change in deferred revenue; it helps show new business but does not say when revenue will be recognized. Deferred revenue is sold service that has not yet been recognized. If billings and deferred revenue strengthen while service revenue grows, new orders are replenishing future revenue. If the first two weaken while service revenue still grows, past sales are supporting revenue but new business is not keeping pace.
Extreme Networks earningsEXTR
Extreme Networks' report will show enterprise demand for wired, wireless and software-managed networking, where Fortinet sells switches, access points and SD-WAN.
Read Extreme Networks' equipment sales alongside software subscriptions and maintenance. Steady equipment sales with growing recurring services would show that enterprises are buying network gear and continuing to pay to manage it, supporting a broader market for Fortinet's related products. Weak equipment sales and little service growth would point to less support from enterprise network spending.
Check Point Software Technologies Ltd earningsCHKP
Check Point's security-subscription revenue will show whether customers keep paying for network protection, a budget that Fortinet also seeks through FortiGuard.
Focus on the change in Check Point's security-subscription revenue and compare it with the broader business. Growth would show that customers still pay for ongoing network protection, a supportive demand signal for Fortinet's subscription business. If subscriptions weaken even as the broader business grows, demand for recurring protection deserves closer attention.
Cisco Systems, Inc. earningsCSCO
Cisco's report will show whether customers are taking more security bundled with its networking products instead of buying separate Fortinet appliances.
Watch Cisco's comments on security bundled with networking products and whether customers are adopting those offers. If more customers accept Cisco's built-in protection, they may buy fewer separate Fortinet appliances, putting pressure on Fortinet's product sales; limited adoption would mean less pressure from bundling.
Palo Alto Networks, Inc. earningsPANW
Palo Alto Networks' report will show whether enterprises are consolidating separate security products onto one platform, a strategy that competes with Fortinet for security spending.
Look for evidence that more Palo Alto Networks customers are replacing separate security products with its platform, alongside the platform's reported progress. If replacement broadens, enterprises are concentrating security spending on one platform, intensifying competition for Fortinet's integrated offering; limited progress would mean less evidence of that shift.
Zscaler, Inc. earningsZS
Zscaler's report will show enterprise adoption of cloud-based secure-access subscriptions, a service that competes directly with Fortinet's unified SASE.
Read the progress of Zscaler's secure-access subscriptions alongside its broader business. Stronger adoption would show enterprises directing more spending to cloud-based secure access, increasing competition for Fortinet's unified SASE; slowing adoption would provide less evidence of that shift.
CrowdStrike Holdings, Inc. earningsCRWD
CrowdStrike's report will show whether customers are adding more security functions to its Falcon platform, competing for spending that could go to Fortinet's security-operations products.
Watch whether customers add security functions to Falcon without deploying more sensors. If they keep adding functions on the existing platform, CrowdStrike can capture more security-operations spending, increasing competition for Fortinet's related products; limited expansion would be weaker evidence that CrowdStrike is winning that budget.
