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Check Point Press Releases

Check Point Software Technologies Reports 2014 Second Quarter Financial Results


San Carlos, CA  —  Wed, 23 Jul 2014

Check Point® Software Technologies Ltd. (NASDAQ: CHKP), the worldwide leader in securing the Internet, today announced its financial results for the second quarter ending June 30, 2014.

  • Total Revenue: $363 million, representing a 7 percent increase year over year
  • Non-GAAP Operating Income: $207 million, representing 57 percent of revenues
  • Non-GAAP EPS: $0.89, representing an 8 percent increase year over year
  • Deferred Revenues: $660 million, representing a 14 percent increase year over year

“We had a fantastic second quarter. Total revenues from products and software blades subscription delivered 10 percent growth, which was driven by strong demand across industries and business segments.  We saw a nice up-tick in customer wins across the board with several very large customer contracts,” said Gil Shwed, founder, chairman, and chief executive officer of Check Point Software Technologies.

Financial Highlights for the Second Quarter of 2014:

  • Total Revenue: $363 million compared to $340 million in the second quarter of 2013.
  • GAAP Operating Income: $190 million compared to $183 million in the second quarter of 2013.
  • Non-GAAP Operating Income: $207 million compared to $198 million in the second quarter of 2013. Non-GAAP operating margin was 57 percent, compared to 58 percent in the second quarter of 2013.
  • GAAP Net Income and Earnings per Diluted Share: GAAP net income was $160 million compared to $151 million in the second quarter of 2013. GAAP earnings per diluted share were $0.83 compared to $0.76 in the second quarter of 2013.
  • Non-GAAP Net Income and Earnings per Diluted Share: Non-GAAP net income was $172 million compared to $165 million in the second quarter of 2013. Non-GAAP earnings per diluted share were $0.89 compared to $0.83 in the second quarter of 2013.
  • Deferred Revenues: As of June 30, 2014, deferred revenues were $660 million compared to $580 million as of June 30, 2013.
  • Cash Flow: Cash flow from operations was $168 million compared to $205 million in the second quarter of 2013.
  • Share Repurchase Program: During the second quarter of 2014, the company repurchased 3.0 million shares at a total cost of $194 million.
  • Cash Balances, Marketable Securities and Short Term Deposits: $3,643 million as of June 30, 2014, an increase of $72 million, compared to $3,571 million as of June 30, 2013.

For information regarding the Non-GAAP financial measures discussed in this release, as well as a reconciliation of such Non-GAAP financial measures to the most directly comparable GAAP financial measures, please see “Use of Non-GAAP Financial Information” and “Reconciliation of GAAP to Non-GAAP Financial Information.”

Business Highlights

During the second quarter of 2014, Check Point launched new products and services, including:

41000 Security System – New datacenter and telco grade high performance system based on the multi-blade hardware architecture of the 61000. The 41000 has a smaller footprint, enabling more customers to deploy high performance scalable security. The 41000 delivers performance of up to 11,000 SecurityPower™ units (SPU), 40 Gbps of real-life firewall throughput, and 25 Gbps of real-life IPS throughput.

Smart-1 Appliance Family – Upgraded the entire line of the Smart-1 security management appliance family with five new appliances that deliver cyber security management for the era of big data. Smart-1 appliances enable organizations to consolidate security policy, log, and event management. The new Smart-1 Appliances allow for three times more effective storage capacity and report generation is greatly accelerated.

Next-Generation SmartEvent – Announced the availability of Next-Generation SmartEvent, a new and powerful event monitoring solution for real-time processing and storing of threat detection data. Next-Generation SmartEvent offers one single view for all security threats and network components, to more easily manage and analyze big data security, and to make faster and more informed security decisions.

ThreatCloud IntelliStore – The ThreatCloud IntelliStore provides a threat intelligence marketplace that enables organizations to select from a wide range of threat intelligence feeds relevant to them and simultaneously uses this intelligence to proactively stop threats at their Check Point Security Gateways.

Check Point 2014 Security Report – We published our annual industry security report which provides insight into the major security events that occurred in organizations across the world and offers recommendations on how to protect against them. The report is based on collaborative research from our Security Checkup assessments, Threat Emulation sensors, ThreatCloud™ and Endpoint Security reports, and includes in-depth analysis of 200,000+ hours of monitored network traffic from over 9,000 security gateways across 996 organizations of various industries worldwide. The report is available at http://www.checkpoint.com/securityreport.

Industry Accolades:

Leader in the Gartner Magic Quadrant for Enterprise Network FirewallCheck Point is positioned as a Leader in the Gartner Magic Quadrant for Enterprise Network Firewall. The company has been in the Leaders quadrant since 1999.

Top Position in Worldwide Combined Firewall and UTM Appliance Market – Check Point continued to be the number one vendor in worldwide combined Firewall and UTM appliance revenue for Q1 2014, according to the IDC Worldwide Quarterly Security Appliance Tracker Q1 2014.

“We’ve continued to innovate and expand our offerings this quarter with the introduction of our ThreatCloud IntelliStore, which provides customers access to the industry’s best cyber intelligence sources and translates it into real-time prevention. This is the latest layer in our Threat Prevention solution that includes our Intrusion Prevention (IPS), Network Anti-Virus, Web Security, Anti-bot and Threat Emulation,” concluded Shwed.

Third Quarter 2014 Investor Conference Participation Schedule:

  • Needham 2014 Software and Services Conference
    August 5, 2014 – New York, NY
  • Pacific Crest 16th Annual Global Technology Leadership Forum
    August 12, 2014 – Vail, CO
  • Citi 2014 Technology Conference
    September 2, 2014 – New York, NY
  • Deutsche Bank 2014 dbAccess Technology Conference
    September 9, 2014 – Las Vegas, NV

Members of Check Point’s management team will present at these conferences and discuss the latest company strategies and initiatives. Check Point’s conference presentations are expected to be available via webcast on the company’s web site. To view these presentations and access the most updated information please visit the company’s web site at www.checkpoint.com/ir. The schedule is subject to change.

Conference Call and Webcast Information
Check Point will host a conference call with the investment community on July 23, 2014 at 8:30 AM ET/5:30 AM PT.  To listen to the live webcast, please visit the website at: www.checkpoint.com/ir. A replay of the conference call will be available through August 1, 2014 on the company’s website or by telephone at +1.201.612.7415, replay ID number 13586646.

© 2014 Check Point Software Technologies Ltd. All rights reserved

Legal Notice Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements in this press release include, but are not limited to, statements related to our expectations for software-defined protection, Next-Generation SmartEvent and our other new solutions, and our expectations regarding our collaboration with VMware to automate and simplify the provisioning and deployment of network security in private clouds. Our expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected.  These risks include our ability to continue to develop platform capabilities and solutions; customer acceptance and purchase of our existing solutions and new solutions; the market for IT security continuing to develop; competition from other products and services; and general market, political, economic and business conditions.  The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission, including our Annual Report on Form 20-F filed with the Securities and Exchange Commission on March 28, 2014.  The forward-looking statements in this press release are based on information available to Check Point as of the date hereof, and Check Point disclaims any obligation to update any forward-looking statements, except as required by law.

Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Check Point uses non-GAAP measures of net income, operating income, operating margin and earnings per share, which are adjustments from results based on GAAP to exclude stock-based compensation charges, amortization of intangible assets and the related tax affects. Check Point’s management believes the non-GAAP financial information provided in this release is useful to investors’ understanding and assessment of Check Point’s ongoing core operations and prospects for the future. Historically, Check Point has also publicly presented these supplemental non-GAAP financial measures in order to assist the investment community to see the Company “through the eyes of management,” and thereby enhance understanding of its operating performance. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release to the most directly comparable GAAP financial measures is included with the financial statements contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating business internally and as such has determined that it is important to provide this information to investors.

About Check Point Software Technologies Ltd.

Check Point Software Technologies Ltd. (www.checkpoint.com), the worldwide leader in securing the Internet, provides customers with uncompromised protection against all types of threats, reduces security complexity and lowers total cost of ownership. Check Point first pioneered the industry with FireWall-1 and its patented stateful inspection technology. Today, Check Point continues to develop new innovations based on the Software Blade Architecture, providing customers with flexible and simple solutions that can be fully customized to meet the exact security needs of any organization. Check Point is the only vendor to go beyond technology and define security as a business process. Check Point 3D Security uniquely combines policy, people and enforcement for greater protection of information assets and helps organizations implement a blueprint for security that aligns with business needs. Customers include tens of thousands of organizations of all sizes, including all Fortune and Global 100 companies. Check Point’s award-winning ZoneAlarm solutions protect millions of consumers from hackers, spyware and identity theft.