Fortinet executives reported that geopolitical and economic uncertainties have not weakened customer demand for their cybersecurity solutions. The company anticipates a significant revenue boost from device refreshes in its core firewall business. Despite this, Fortinet’s stock price fell 12.3 percent to $93.57 a share after a quarterly guidance that was slightly below analyst expectations. Fortinet's revenue for Q1 reached $1.54 billion, a 14 percent increase year-over-year, aligning with Wall Street predictions.

The company’s SASE (secure access service edge) segment saw a remarkable 25.7 percent growth in annual recurring revenue, reaching $1.15 billion. Their security operations business also experienced a significant increase, with a 30.3 percent year-over-year growth to $434.5 million. During the analysts' call, Chief Accounting Officer Christiane Ohlgart confirmed the ongoing "record firewall upgrade cycle" and emphasized expectations for momentum to build in the second half of 2025.

Ohlgart addressed the impact of U.S. tariffs, stating that they do not foresee a significant effect on operating margins for the second quarter. She noted that “only a few components are subject to tariff charges” and highlighted that demand for their cybersecurity solutions remains strong, with a growing pipeline and robust sales cycles. For more detailed insights, refer to Fortinet: SASE, SecOps Now Driving $1.5B In ARR.

Impact of Tariffs on Stocks

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The introduction of tariffs has raised concerns among investors, with many stocks taking a hit, including Fortinet. However, experts suggest that certain stocks can still thrive under these conditions. Fortinet serves a critical niche in the cybersecurity sector, making it a potential defensive play amidst tariff uncertainties. Analysts forecast a significant upgrade cycle for Fortinet in 2026 and 2027, which may drive the stock price higher, especially given its robust operating margins.

Market analysts have noted that cybersecurity remains less exposed to tariff risks, positioning companies like Fortinet favorably as demand for cybersecurity solutions continues to grow, driven by advancements in AI. For a deeper analysis on stock resilience amid tariffs, refer to Tariffs Won’t Stop These 3 Stocks From Rising.

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