Fortinet Inc (NASDAQ:FTNT) stock fell 9.71% (As on May 8, 11:21:49 AM UTC-4, Source: Google Finance) after the company fell short of expectations with its guidance and reported a miss on revenue in its fiscal 2025 first quarter. Through Fortinet’s product lines, product revenue rose 12%, to $459.1 million, and service revenue rose 14%, to $1.08 billion. Total billings rose 14%, to $1.6 billion. Fortinet ended the quarter with a remaining performance obligation of $6.49 billion, up 12% year-over-year. Service revenue was $1.08 billion for the first quarter of 2025, an increase of 14.4% compared to $944.4 million for the same quarter of 2024. Business highlights in the quarter included Fortinet’s expansion of its Operational Technology Security Platform to enhance protection for critical infrastructure. Announced in March, the update introduced deeper OT-specific threat visibility through the FortiGuard OT Security Service, which now supports over 3,300 OT protocol rules, 750 intrusion prevention system rules and 1,500 virtual patching rules.

Additionally, Fortinet unveiled ruggedized hardware, such as the FortiGate Rugged NGFWs and FortiSwitch Rugged models, designed for harsh industrial environments. The enhancements aim to provide comprehensive security solutions tailored for sectors like energy, transportation and manufacturing. The company also introduced significant enhancements to FortiAnalyzer in February, a move described as transforming the service into a turnkey artificial intelligence-driven security operations platform. The updated FortiAnalyzer leverages a unified data lake, FortiGuard Labs threat intelligence and AI-driven capabilities to give midsized enterprises accelerated threat hunting and incident response.

FTNT in the first quarter of FY25 has reported the adjusted earnings per share of 58 cents, beating the analysts’ estimates for the adjusted earnings per share of 53 cents. The company had reported the adjusted revenue growth of 14 percent to $1.54 billion in the first quarter of FY25, missing the analysts’ estimates for revenue of $1.55 billion. Remaining performance obligations were $6.49 billion as of March 31, 2025, an increase of 11.7% compared to $5.81 billion as of March 31, 2024.

For its fiscal second quarter, Fortinet expects adjusted earnings per share of 58 to 60 cents on revenue of $1.59 billion to $1.65 billion. At the midpoint, the revenue outlook fell short of an expected $1.63 billion.

For its full year, the company expects adjusted earnings per share of $2.43 to $2.49 on revenue of $6.65 billion to $6.85 billion. At the midpoint and ever so slightly, the full-year outlook fell short of the $6.76 billion revenue outlook expected by analysts.