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By | John Leyden 21st April 2016 13:20

Check Point chugs on: Profits and revenues up despite volatile market

CEO warns that he's 'cautious as regards overall IT industry spending'

Check Point’s share price has dipped a touch after the firm reported lacklustre Q1 financial results.

During the first quarter ending 31 March 2016, Check Point’s total revenues came in at $404m, compared to $373m in the first quarter of 2015, a nine per cent increase year-on-year.

Its GAAP net income rose, albeit modestly. The firm's profits were $167.4m in Q1 2016, compared to $160.9m in the first quarter of 2015, a four per cent rise.

The rise comes as Check Point shifts its sales from appliances towards software blades. Hardware sales are booked immediately whereas software sales are deferred and accounted for over a full year.

Check Point is best known for its firewall and UTM appliances but also offers mobile and end-point security technologies. Software blades add functionality such as intrusion prevention and more onto firewall or UTM (hardware) appliances.

Gil Shwed, founder and chief executive officer of Check Point Software Technologies, talked up the success of its recently introduced high-end and data centre security appliances as well as its recently launched small and mid-range appliances. During a conference call he stressed security management as a key differentiator offered by Check Point and singled out the need to protect critical infrastructure and securing the Internet of Things as growth opportunities.

“We see a healthy buying environment in cyber security [but] we are slightly cautious in regards to overall IT industry spending,” Shwed said.

Check Point is predicting Q2 revenues of between $405m to $435m. Its full year outlook is unchanged.

Shares in Check Point Software Technology fell $2.82, or three per cent, to close at $86.06 on Wednesday, following announcement of its results. ®

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