Fortinet, Inc. FTNT

The business

Fortinet builds the network security boxes (FortiGate firewalls) and the software that runs on them, plus an expanding SASE and security-operations layer on top. It monetizes through hardware product sales and recurring service subscriptions, where product is the leading indicator for service ARR over the following 12 months as new boxes drive subscription attach.

What changed in Q1 2026, reported May 6: revenue $1.85B up 20%, an acceleration from Q4 FY25's +14%, with product revenue $645M up 41% and service revenue $1.21B up 11%. Billings were $2.09B up 31%, service billings reaccelerated to +27%, and deferred revenue grew 15%. Non-GAAP operating margin was 36% and GAAP 31%. Adjusted EPS was $0.82, beating the $0.62 consensus by 32%, the largest beat in the company's modern history, alongside record operating cash flow of $1.08B and record FCF of $1.01B. SASE adoption among large enterprises moved from 16% to 18% sequentially, secure-networking billings grew 32%, and OT (operational technology) billings grew over 70%. Fortinet introduced FortiOS 8.0 with AI-driven security, next-generation SASE, and quantum-safe capabilities. Management raised FY26 guidance to revenue $7.71B-$7.87B (from $7.30B-$7.50B), service revenue $5.09B-$5.15B, billings $8.80B-$9.10B, non-GAAP operating margin 33%-36%, and non-GAAP EPS $3.10-$3.16.