Fortinet, a leader in network security, saw its stock price plummet significantly after hours, with core business revenue growth in Q3 dropping to its lowest level in a decade.

Fortinet Inc., a well-known American cybersecurity company, saw its stock price drop more than 12% in after-hours trading on Wednesday following the release of its latest financial results. The company's service revenue did not meet market expectations, and it unexpectedly lowered its revenue guidance for the 2025 fiscal year. According to the financial report, the California-based cybersecurity company's largest business segment saw a 13% year-over-year growth in the third quarter ending on September 30th, reaching $1.17 billion, slightly below the average Wall Street analyst expectations. This was also the slowest quarterly growth in service revenue for Fortinet in at least a decade. The company's total revenue for the third quarter of 2025 was approximately $1.72 billion, a 14% year-over-year increase, with diluted earnings per share of $0.62 after Q3, compared to $0.70 in the same period last year. In after-hours trading, Fortinet's stock price dropped by as much as 12%. At the close of trading on Wednesday, the stock was at $85.99, up about 1% for the day. Year-to-date, the stock has only increased by 2%, significantly underperforming the S&P 500 index. An analyst from Bloomberg Intelligence mentioned in a report before the quarterly results that due to Fortinet's limited presence in some of the fastest-growing areas of the cybersecurity market, such as AI cybersecurity workloads and Secure Access Service Edge (SASE), the market already anticipated that the growth in the service revenue segment would remain at a low level. Fortinet also slightly lowered the upper end of its full-year revenue guidance from $6.83 billion to $6.78 billion. Fortinet is a cybersecurity company that focuses on a combination of "security + networking," with a model that leans towards "hardware + subscription services." Its core product lines include FortiGate firewall/security gateway series, SD-WAN, secure switches, wireless access, as well as email/web security gateways, WAF, DDoS protection, and more. In terms of revenue generation models, the company has product-type revenue (hardware + software) and service revenue categories (making the largest contribution to total revenue, such as subscription security feature libraries, cloud sandboxing, support services, etc.). Overall, Fortinet is considered to be in the top tier of enterprise network security/firewall providers. However, when it comes to positioning and planning in the emerging fields of cloud security, AI security, SASE, XDR, they are seen as lagging behind competitors like Palo Alto Networks and Zscaler.