Check Point Subscription Revenue Weakens, Oppenheimer Questions Outlook
Translated & summarized from TheMarker by baba
Check Point's subscription revenue, previously its sole growth driver, is now showing weakness, according to Oppenheimer. The investment firm questions the cybersecurity company's aggressive annual forecast, citing distributor reports of declining subscription activity. This comes as Check Point's legacy firewall sales continue to fall, contributing to a 30% stock value drop this year.
The story in 5 lines · by baba
- Check Point's subscription revenue, its only growth source, is now weakening.
- Oppenheimer questions Check Point's aggressive annual revenue forecast.
- Distributors report weakness in Check Point's subscription activity.
- Legacy firewall sales continue to decline for the company.
- Check Point's stock value has decreased by approximately 30% this year.
Check Point's subscription-based products were a bright spot in its recent first and second quarter reports, providing the only growth in revenue, albeit minimal. These subscription revenues helped offset a decline in sales of its legacy firewall products, which still account for about half of the company's income. Investment firm Oppenheimer, however, has identified weakness even in this area, suggesting that subscription revenue is tied to licenses and that "distributors report weakness in subscription activity in the second half." Oppenheimer believes the company's annual forecast is overly aggressive and warns that the downturn in revenue may continue, despite Check Point's assertion that the revenue low point has passed. The company's stock value has fallen by approximately 30% over the past year.