Fortinet Falls as Profit Misses EstimatesJordan Robertson
Fortinet Inc., a provider of computer-network security, tumbled the most in almost six months after reporting preliminary first-quarter sales and profit that missed some analyst estimates.
Profit excluding some costs was probably 10 cents a share in the latest quarter, the Sunnyvale, California-based company said in a statement yesterday, compared with the average estimate of 12 cents a share, according to analysts’ projections compiled by Bloomberg. Sales were $134 million to $136 million, versus an estimate for $140.4 million.
The shares fell in extended trading after beginning their decline 15 minutes before yesterday’s close in New York. A weak economic environment in Latin America, Europe, Middle East and Africa, as well as inventory shortages contributed to the results, while demand was strong in Asia and among U.S. companies, Fortinet Chief Executive Officer Ken Xie said in the statement.
“Our financial results were negatively impacted by a few deals in the U.S. service provider segment which did not close as expected,” Xie said, referring to Internet-access providers.
Fortinet declined 13 percent to $18.99 at the close, the steepest drop since Oct. 17. The shares began retreating at 3:45 p.m. in New York yesterday, wiping out an earlier intraday gain of as much as 2.4 percent.
Rick Popko, a spokesman for Fortinet, declined to comment on the share decline. The company will release full first-quarter figures on April 30, it said in the statement.