SOURCE: Fortinet

February 26, 2009 15:00 ET

Fortinet Announces Fourth Quarter and Fiscal Year 2008 Corporate and Financial Highlights

Cost-Effectiveness of Consolidated Security Platform Resonates Strongly With Customers to Fuel Company's Growth and Profit

SUNNYVALE, CA--(Marketwire - February 26, 2009) - Fortinet® -- a market-leading network security provider and worldwide leader of unified threat management solutions -- today announced key corporate and financial highlights that contributed to the company's continued growth and positive financial results in the fourth quarter of 2008 and for the fiscal year ending December 28, 2008. Strong market demand for Fortinet's consolidated security appliances, coupled with sound business execution, led the company to achieve the first ever full-year GAAP profitability. Fortinet increased fourth quarter 2008 revenues by 35 percent to $59 million and billings by 31 percent, compared to the fourth quarter of 2007. Additionally, Fortinet increased fiscal year 2008 revenues by 36 percent to $212 millions and billings by 30 percent to $252 million year over year.

"While many companies are contracting during this economic downturn, Fortinet is experiencing strong growth and experienced our best year to date in 2008," said Ken Xie, founder, president and CEO of Fortinet. "In this cost-conscious environment, efficiency is the new technology must-have. As technological and cost efficiencies are the foundation upon which the Fortinet integrated security platform was built, it has served Fortinet and our customers very well, especially in times of financial uncertainty."

Fortinet's results demonstrate that although spending for critical security technology is not discretionary, defined and measurable value and ROI have become a business imperative for both meeting network integrity and the bottom line. As a result, customers around the globe have increasingly chosen Fortinet's integrated security appliances to secure their networks and applications for strong technology, ease of deployment, and cost effectiveness.

Fourth Quarter 2008 Financial Highlights

Fortinet closed 2008 with financial growth, increasing revenues, billings, cash and profits during the fourth quarter ending December 28, 2008. In the fourth quarter of 2008, the company grew billings 31 percent to $73 million and grew revenues 35 percent to $59 million, compared to the fourth quarter of 2007. In fiscal year 2008, Fortinet grew billings 30 percent to $252 million and grew revenues 36 percent to $212 million, compared to fiscal year 2007. Additionally, deferred revenues grew by 31 percent year over year, contributing to an increase in cash of $34 million and enabling Fortinet to end the year with $124 million in total cash and cash equivalents and investments. Fortinet achieved GAAP operating profit for the full year of 2008, and has been cash flow positive each year since 2005.

Additionally, Fortinet continued to retain and hire key talent during 2008. To meet increasing market demand for its solutions, the company grew employee headcount by 14 percent in 2008, closing the year with more than 1,100 employees.

Fourth Quarter 2008 Corporate Highlights

Fortinet maintained its leadership position in the worldwide Unified Threat Management (UTM) market for the eleventh consecutive quarter, according to analyst firm IDC. Most recent data from the December 2008 IDC Worldwide Quarterly Security Appliance Tracker confirmed Fortinet as the overall leader in UTM factory revenue(1) for the third quarter of 2008, ahead of Check Point, Cisco, Juniper and others, as well as the leader in worldwide factory revenue and unit shipments in the key enterprise ($25K-$49.9K) UTM price band segment for the same time period. This data supports the growing adoption of Fortinet's solutions among enterprises worldwide. To date, the company has shipped more than 400,000 security appliances.

Fortinet also expanded its market-leading FortiGate® multi-threat security product line with the introduction of the FortiGate-620B. Like the popular FortiGate-310B appliances announced in the first half of 2008, the enterprise-class FortiGate-620B appliances also leverage accelerated performance processors and expanded network capabilities typical of Fortinet's highest-end systems, and deliver record-setting performance of up to 16 Gbps firewall and 12 Gbps VPN throughput.

Additionally, during the fourth quarter of 2008, Fortinet and its products garnered the following recognition from notable third-party organizations:

--  Current Analysis, a global research firm, gave a "Five-Star Rating" to
    Fortinet's FortiGate appliances, calling them "very threatening" in the
    firewall market.
--  Butler Group, an EMEA-based analyst firm, performed a hands-on
    technology audit of Fortinet's FortiGate appliances and lauded the products
    for their ability to specifically meet the demanding needs of high-
    performance, high-throughput operating environments.
--  Fortinet was ranked #21 in Deloitte's Silicon Valley Technology Fast
    50 award listing of the region's fastest-growing public and private
--  The company was also awarded Best New Vendor of the Year by Ingram
    Micro, the world's largest technology distributor.

Fortinet Solutions

Delivered via its flagship family of FortiGate appliances, Fortinet provides a flexible platform that enables enterprises and service providers of all sizes to consolidate critical security technology and services to maximize network protection and reduce total cost of ownership. The company's extensive solution set also includes FortiMail™ e-mail security appliances, FortiDB™ database security appliances and software, FortiManager™ security management appliances, FortiAnalyzer™ analysis and logging appliances, and FortiClient and FortiClient™ Mobile end-point security software. FortiGate and FortiMail systems are kept up to date automatically by Fortinet's FortiGuard® subscription services, which provide updates to help protect against the latest viruses, worms, Trojans and other threats -- around the clock and around the world.

For more information on Fortinet products, please visit:

About Fortinet (

Fortinet is the pioneer and leading provider of ASIC-accelerated unified threat management, or UTM, security systems, which are used by enterprises and service providers to increase their security while reducing total operating costs. Fortinet solutions were built from the ground up to integrate multiple levels of security protection -- including firewall, antivirus, intrusion prevention, VPN, spyware prevention and anti-spam -- designed to help customers protect against network and content level threats. Leveraging a custom ASIC and unified interface, Fortinet solutions offer advanced security functionality that scales from remote office to chassis-based solutions with integrated management and reporting. Fortinet solutions have won multiple awards around the world and are the only security products that are certified in six programs by ICSA Labs: Firewall, Antivirus, IPSec VPN, SSL VPN, Network IPS, and Anti-spam. Fortinet is privately held and based in Sunnyvale, California.

Copyright © 2008 Fortinet, Inc. All rights reserved. The symbols ® and ™ denote respectively federally registered trademarks and unregistered trademarks of Fortinet, Inc., its subsidiaries and affiliates. Fortinet's trademarks include, but are not limited to, the following: Fortinet, FortiGate, FortiGuard, FortiManager, FortiMail, FortiClient, FortiCare, FortiAnalyzer, FortiReporter, FortiOS, FortiASIC, FortiWiFi, FortiSwitch, FortiVoIP, FortiBIOS, FortiLog, FortiResponse, FortiDB and FortiWeb. Other trademarks belong to their respective owners. This press release contains forward-looking statements that may involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of Fortinet may differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to any projections of future growth and financial results. Risks, uncertainties and assumptions include macroeconomic and geopolitical trends and events and trends in the network security market. Any forward-looking statements speak only as of the date on which they are made and Fortinet shall be under no obligation to (and expressly disclaims any such obligation to) update or alter such forward-looking statements whether as a result of a new information, future events or otherwise.

(1) IDC defines Factory Revenue as vendor revenue derived from units shipped, exclusive of channel revenue and manufacturing revenue

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