Varonis Systems PT Raised to $64, RBC Capital Reiterates Outperform

Varonis Systems PT Raised to $64, RBC Capital Reiterates Outperform

Varonis Systems, an Israeli data security company, has announced the acquisition of AI-native email security provider SlashNext for up to $150 million. The deal, finalized on September 2, 2025, expands Varonis' capabilities in email security and enhances its data breach prevention offerings. The acquisition is expected to bolster Varonis' reach in the email security market, which is projected to grow from $5.2 billion in 2025 to $10.7 billion by 2032 [4].

SlashNext, founded by former FireEye architect Atif Mushtaq, specializes in detecting advanced phishing and social engineering attacks with a 99% detection accuracy and 100% detection rate for business email compromise (BEC) and QR code attacks [4]. The acquisition will enable Varonis to integrate SlashNext's advanced email security technology into its existing offerings, connecting the dots between email, identity, and data.

The acquisition follows Varonis' earlier acquisition of Cyral, a database activity monitoring company, in a deal valued at approximately $25 million [3]. These strategic moves underscore Varonis' commitment to enhancing its data security offerings and staying ahead of evolving cyber threats.

Varonis has updated its guidance to reflect the deal expenses. The company now projects Q3 2025 revenues of $163.0-168.0 million (10-13% YoY growth) and full-year 2025 revenues of $616.0-628.0 million (12-14% YoY growth), while maintaining its free cash flow guidance of $120.0-125.0 million [4].

RBC Capital Markets has reiterated its "Outperform" rating on Varonis Systems' stock, citing the company's strong position in the data security market and the strategic value of the SlashNext acquisition. The stock market's reaction to the acquisition reflects investors' immediate concerns about the potential short-term impact on profitability, despite the long-term growth prospects [1].

References:
[1] https://finimize.com/content/varonis-takes-on-extra-costs-with-slashnext-deal
[2] https://www.linkedin.com/posts/rsobers_varonis-is-acquiring-ai-native-email-security-activity-7368658805775122434-Zf0b
[3] https://www.bloomberg.com/news/articles/2025-09-02/varonis-to-buy-email-security-firm-slashnext-for-150-million
[4] https://www.stocktitan.net/news/VRNS/