Check Point shares fall 9.93% premarket as revenue reaches $669.8 million
Key Facts
Check Point shares fell 9.93% in premarket trading on November 2 after the company reported third-quarter 2026 revenue of $669.8 million, down 1% year over year. A report published Monday said the selling pressure was tied to fourth-quarter revenue guidance below consensus and management’s remarks about the slow recovery. Chief Executive Nadav Zafrir said the company believes revenue bottomed in the third quarter and expects gradual improvement starting in the fourth quarter. But he acknowledged that the recovery “is taking longer than expected.” That puts management’s recovery outlook against current revenue weakness and the stock’s premarket decline.
The decline in total revenue was limited year over year, but its components showed contraction in products and licenses, as well as software updates, maintenance and services. Revenue from products and licenses was $105.5 million, compared with $130.4 million in the third quarter of 2025. Revenue from software updates, maintenance and services also fell to $225.7 million from $241.7 million. In the second quarter of 2026, total revenue was $674 million, up 1% year over year, while security subscription revenue reached $333 million, growing 12%. These figures provide a close comparison with the slowdown in total revenue in the third quarter, as the company continued to record revenue from security subscriptions.
Third-quarter operating income was $177 million under generally accepted accounting principles, equal to 26% of revenue. On a non-GAAP basis, operating income reached $251 million, with a 37% margin. Diluted earnings per share were $1.82 under GAAP and $2.49 on a non-GAAP basis. In the third quarter of 2025, earnings were $3.28 and $3.94 per share, respectively. The company said a tax settlement signed during that quarter increased earnings per share in the comparison period by about $1.47, affecting how the year-over-year decline in earnings is read.
By contrast, net cash provided by operating activities rose to $264.3 million in the third quarter of 2026, compared with $240.6 million in the same period of 2025. Remaining performance obligations stood at $2.5 billion on September 30, up 5% year over year. The company defines these obligations as the value of contracted, non-cancelable products and services for which revenue has not yet been recorded. It also repurchased about 2.5 million shares for about $325 million during the quarter. Over the past twelve months, the company repurchased about 9 million shares.
The company scheduled an investor conference call for November 2, 2026, at 8:30 a.m. Eastern Time. The call is taking place on the same day the results were announced, alongside the stock’s premarket decline. The company scheduled the BMO Tech Conference on November 12 for its next announced appearance. These dates give management an opportunity to present quarterly results and its expectations for a gradual recovery to investors. The fourth quarter remains the period management has linked to the start of the expected improvement.