Fortinet Raises 2026 Revenue Growth Forecast to 20% After Third-Quarter Revenue Rises 20%
Key Facts
Fortinet reported revenue of $2.08 billion for the third quarter ended September 30, 2026, up 20% year over year, while billings rose 29% to $2.34 billion. The company said in its earnings release that revenue growth in 2026 would be 20%, and CEO Ken Xie raised the annual billings outlook for the third time this year. The results were announced on October 28, with the earnings call scheduled for 4:30 p.m. Eastern time. Ahead of the announcement, analysts expected revenue of $2.06 billion and earnings per share of $0.86, according to a pre-earnings article published by Investing.com. After the results were released, the stock fell 6.05% to $173.33 in after-hours trading, according to a report published by 24/7 Wall St. the same day.
Revenue came in above the pre-earnings estimate, while diluted earnings per share under generally accepted accounting principles matched analysts’ estimate of $0.86. Earnings per share under the company’s excluded measure were $0.91, with an operating margin of 34% under the accepted accounting measure and 38% under the other measure. Cash flow from operations was $946 million, compared with $655.2 million in the third quarter of 2025. Free cash flow reached $864.8 million, versus $567.5 million a year earlier.
By revenue source, product revenue grew 37% to $765 million, while services revenue was $1,313.4 million, compared with $1,165.6 million in the same period a year earlier. The revenue breakdown shows increases in both products and services, alongside higher total annual sales. Unified SASE billings had posted year-over-year growth of 35% in the second quarter, according to an earlier Investing.com article. Analysts were also watching whether the expansion of AI data centers would continue to support demand for Fortinet products.
The quarterly comparison shows annual growth rates slowing in the third quarter from the second quarter, despite revenue increasing from the prior period. In the second quarter, revenue rose 26% to $2.05 billion, and billings increased 33% to $2.37 billion. Product revenue then grew 52% year over year to $773 million, compared with growth of 37% in the third quarter. The annual comparison shows that both revenue and billings rose 14% in the third quarter of 2025, to $1.72 billion and $1.81 billion, respectively. In the current third quarter, year-over-year growth was 20% for revenue and 29% for billings.
The company raised its 2026 annual revenue growth forecast to 20% and set a revenue range of $8.125 billion to $8.215 billion for the year. It also expects annual billings of $9.568 billion to $9.718 billion, and Xie said the billings outlook had been raised for the third time this year. For the fourth quarter, Fortinet expects revenue of $2.155 billion to $2.245 billion and billings of $2.775 billion to $2.925 billion. The company put its diluted earnings-per-share forecast under its excluded measure at $0.93 to $0.95. These ranges constitute the financial guidance announced for the period ahead following the third-quarter results.
Fortinet announced a $1.2 billion increase in its share repurchase authorization, bringing the remaining authorization to $2 billion. The average price target cited in an Investing.com article before the results was $169.45, with 44 analysts covering the stock. The article said analysts were watching the effect of AI data center expansion on demand, as well as growth in Unified SASE billings in the second quarter. The price target and analyst coverage figures predate the results and do not reflect an updated view in light of the stock’s subsequent move. In its investor relations calendar, the company listed participation in the BMO Technology & Innovation Conference on November 12, followed by the UBS Global Technology and AI Conference on December 2, and the Barclays Global Technology Conference on December 9, 2026.