Fortinet 2025 Q2 Earnings Strong Performance as Net Income Surges 15.9%

Fortinet (FTNT) delivered solid fiscal 2025 Q2 earnings on August 7, 2025, with revenue and net income both rising year over year. The company beat its billings guidance and raised its full-year billings outlook, reflecting robust business momentum and strong market confidence.

Revenue
Fortinet’s total revenue for the second quarter of 2025 increased by 13.6% year over year to $1.63 billion, surpassing the $1.43 billion recorded in the same period of 2024. Product revenue contributed $508.90 million, while service revenue accounted for $1.12 billion, demonstrating continued strength across both core business segments.

Earnings/Net Income
Fortinet’s earnings per share (EPS) rose 14.0% to $0.57 in 2025 Q2, up from $0.50 in the prior year. Net income also climbed to $440.10 million, a 15.9% increase from $379.80 million in 2024 Q2. The company has now sustained profitability for 17 consecutive years, underscoring the stability and resilience of its business model.

Price Action
In the wake of the earnings release, Fortinet’s stock experienced a downturn, with a 0.42% decline on the latest trading day, a 5.04% drop over the past week, and a 9.44% slide month-to-date. Despite this, the company's long-term stock strategy—buying FTNT on earnings beats and holding for 30 days—has historically yielded a strong return of 333.90%, significantly outperforming the benchmark return of 84.41%.

Post-Earnings Price Action Review
The post-earnings stock strategy for Fortinet has historically demonstrated strong performance. A buy-and-hold approach for 30 days following an earnings beat has returned 333.90%, well above the benchmark return of 84.41%. The strategy's Sharpe ratio of 0.81 indicates favorable risk-adjusted returns, and the absence of maximum drawdown shows effective risk management. Although the strategy involves 43.01% volatility, it has effectively captured positive momentum from earnings beats, highlighting its potential for investors seeking growth opportunities in a volatile market.

CEO Commentary
Ken Xie, Founder, Chairman, and CEO of Fortinet, emphasized the company’s strong second-quarter performance and consistent growth driven by innovation and a customer-first strategy. He highlighted exceeding billings guidance and raising the full-year billings outlook. Xie underscored Fortinet’s leadership in network security, including the most deployed firewalls globally, a New-Generation SASE Firewall, and recognition in the 2025 Gartner Magic Quadrant for SASE Platforms. He also emphasized the company’s AI-driven security approach and the strategic advantage of its unified FortiOS operating system, expressing optimism about Fortinet’s business momentum and market position.

Guidance
For the third quarter of 2025, Fortinet expects revenue between $1.670 billion and $1.730 billion, billings between $1.760 billion and $1.840 billion, non-GAAP gross margin between 80.0% and 81.0%, and non-GAAP operating margin between 32.5% and 33.5%. Diluted non-GAAP net income per share is projected to range between $0.62 and $0.64, assuming a non-GAAP effective tax rate of 18%. For the full fiscal year 2025, the company expects revenue between $6.675 billion and $6.825 billion, service revenue between $4.550 billion and $4.650 billion, billings between $7.325 billion and $7.475 billion, non-GAAP gross margin between 79.0% and 81.0%, and non-GAAP operating margin between 32.0% and 33.5%.

Additional News
Fortinet announced several non-earnings related developments within three weeks of its August 7, 2025 earnings report. The company was recognized as a Leader in the 2025 Gartner Magic Quadrant for SASE Platforms and the top performer in the Critical Capabilities for SASE Platforms report. Fortinet also introduced three new natively integrated services to its FortiCloud platform: FortiIdentity, FortiDrive, and FortiConnect. The company was named the Overall Leader in the Westlands Advisory IT/OT Network Protection Platform Navigator 2025 report for the third consecutive year and a Leader in the 2025 Gartner Magic Quadrant for Enterprise Wired and Wireless LAN Infrastructure for the second consecutive year. Additionally, Fortinet was recognized as a Gartner Peer Insights Customers’ Choice for SD-WAN for the sixth consecutive year and for Endpoint Protection for the third consecutive year. The company also surpassed 1,400 issued patents globally, with over 500 AI-related patents, highlighting its ongoing innovation and R&D investment.