Fortinet, Inc. Q2 FY2024 results: revenue $1.4 billion, up 10.9% on the year

Fortinet, Inc. (FTNT) reported revenue of $1.4 billion for Q2 FY2024, the quarter ended 30 June 2024, up 10.9% on the same quarter a year earlier. Net income was $380 million, up 42.6% on the year, and diluted earnings per share $0.49. The figures are the company's own, from the 10-Q it filed with the SEC on 8 August 2024.

Revenue$1.4 billionup 10.9%

Net income$380 millionup 42.6%

Diluted EPS$0.49

QuarterQ2 FY2024ended 30 June 2024

The quarter, against the one before and a year earlier

Line	Q2 FY2024	Q1 FY2024	A year earlier	Change on the year
Revenue	1,434	1,353	n/a	n/a
Cost of revenue	275	305	n/a	n/a
Gross profit	1,159	1,049	n/a	n/a
Gross margin	80.8%	77.5%	n/a
Research and development	165	173	n/a	n/a
Operating income	437	321	n/a	n/a
Operating margin	30.5%	23.7%	n/a
Interest expense	5.0	5.1	n/a	n/a
Pre-tax income	468	345	n/a	n/a
Income tax	76.5	39.5	n/a	n/a
Effective tax rate	16.3%	11.4%	n/a
Net income	380	299	n/a	n/a
Net margin	26.5%	22.1%	n/a
Diluted EPS	$0.49	$0.39	n/a	n/a

$ million except per share. Free cash flow is operating cash flow less capital expenditure; the effective tax rate is income tax over pre-tax income; margins are the line over revenue. Gross profit is revenue less cost of revenue, and operating income is revenue less the company's own total costs, where the statement does not print those lines. Those four are arithmetic on the filed numbers; everything else is as filed. Money is in $ million as the company files it, or in $ billion by the switch above the tables; per share figures and share counts are as they are.

Cash flow and capital returned

Line	Q2 FY2024	Q1 FY2024	A year earlier	Change on the year
Operating cash flow	342	830	n/a	n/a
Capital expenditure	23.1	222	n/a	n/a
Free cash flow	319	608	n/a	n/a
Free cash flow margin	22.2%	45.0%	n/a
Depreciation and amortisation	29.2	28.6	n/a	n/a
Share-based compensation	64.3	62.3	n/a	n/a
Diluted shares, weighted	770m	770m	n/a	n/a
Shares outstanding at period end	764m	763m	n/a	n/a

Cash flow lines for the quarter; where the company files them year to date, the quarter is the difference between two filings.

Balance sheet at quarter end

Line	Q2 FY2024	Q1 FY2024	A year earlier	Change on the year
Total assets	8,053	7,662	n/a	n/a
Cash and equivalents	2,203	1,926	n/a	n/a
Receivables	1,083	996	n/a	n/a
Inventory	383	440	n/a	n/a
Goodwill	128	129	n/a	n/a
Long-term debt	993	993	n/a	n/a
Borrowings, as the company tags them	1,000	1,000	n/a	n/a
Shareholders' equity	288	-138	n/a	n/a

Quarterly results, the last 12 quarters

	Q3 FY2023	Q4 FY2023 *	Q1 FY2024	Q2 FY2024	Q3 FY2024	Q4 FY2024 *	Q1 FY2025	Q2 FY2025	Q3 FY2025	Q4 FY2025 *	Q1 FY2026	Q2 FY2026
Revenue	1,335	1,415	1,353	1,434	1,508	1,660	1,540	1,630	1,725	1,905	1,850	2,048
Cost of revenue	318	316	305	275	263	314	293	315	332	389	364	405
Gross profit	1,017	1,099	1,049	1,159	1,245	1,346	1,247	1,315	1,393	1,516	1,485	1,643
Gross margin	76%	78%	77%	81%	83%	81%	81%	81%	81%	80%	80%	80%
R&D	157	152	173	165	187	191	199	210	202	205	214	225
Operating income	303	385	321	437	471	574	454	458	547	626	580	689
Operating margin	23%	27%	24%	30%	31%	35%	29%	28%	32%	33%	31%	34%
Interest expense	5.4	5.4	5.1	5.0	5.0	4.9	4.9	4.6	6.2	4.4	4.2	3.2
Pre-tax income	328	416	345	468	626	618	519	517	595	651	657	720
Tax rate	-0%	23%	11%	16%	13%	14%	19%	15%	20%	22%	19%	16%
Net income	323	311	299	380	540	526	433	440	474	506	534	606
Net margin	24%	22%	22%	26%	36%	32%	28%	27%	27%	27%	29%	30%
Diluted EPS	$0.41	$0.41	$0.39	$0.49	$0.70	$0.68	$0.56	$0.57	$0.62	$0.67	$0.72	$0.82
Operating cash flow	551	192	830	342	608	478	863	452	655	620	1,077	1,044
Capital expenditure	70.1	26.9	222	23.1	36.3	97.6	66.5	168	87.7	42.8	70.6	78.0
Free cash flow	481	165	608	319	572	380	797	284	568	577	1,006	966
Buybacks	604	896	n/a	n/a	0.6	n/a	0.0	401	1,832	57.2	823	150
Shares outstanding	776m	761m	763m	764m	766m	767m	769m	766m	743m	743m	734m	734m
Filing	10-Q	10-K	10-Q	10-Q	10-Q	10-K	10-Q	10-Q	10-Q	10-K	10-Q	10-Q

* The fourth quarter is the full year less the first three quarters, because the company files the year and not the quarter on its own. Money is in $ million as the company files it, or in $ billion by the switch above the tables; per share figures and the share count are as they are. Free cash flow is operating cash flow less capital expenditure; the effective tax rate is income tax over pre-tax income; margins are the line over revenue. Gross profit is revenue less cost of revenue, and operating income is revenue less the company's own total costs, where the statement does not print those lines. Cash flow lines filed year to date are the difference between two filings. Shares outstanding are at the period end where the balance sheet tags them, otherwise the count on the filing's cover page. A derived fourth-quarter EPS is left blank when a split in the year makes the arithmetic meaningless.

Source

10-Q for the period ended 30 June 2024, filed 8 August 2024, accession 0001262039-24-000037: the filing on EDGAR. All of Fortinet, Inc.'s filings: EDGAR company page.

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