Fortinet is strengthening its position in AI-driven cybersecurity as enterprises increasingly turn to artificial intelligence-powered solutions to combat rising digital threats.
Fortinet’s revenue rose 17 percent to $1.66 billion in Q4 2024. Product revenue rose 18 percent to $574 million, marking the highest growth rate in six quarters. Service revenue increased 17 percent to $1.09 billion, accounting for 65 percent of total revenue.
SaaS solutions, including Lacework, saw 130 percent growth, along with strong growth in Unified SASE and SecOps. Revenue from software licenses and software services, including cloud, Lacework, and SaaS security solutions, increased 41 percent, achieving an annual run rate of over $1 billion.
“We continue to execute our strategy of investing in the high-growth Unified SASE and Security Operations markets, while strengthening our position in Secure Networking,” Ken Xie, Founder, Chairman and Chief Executive Officer of Fortinet, said in the company’s earnings report.
Fortinet has added a record 6,900 new logos due to its strong alignment with channel partners. Total billings grew 7 percent to $2 billion, including double-digit security operations and Unified SASE growth, with RPO increasing 12 percent to $6.4 billion.
ARR growth was strong, with SecOps growing 32 percent and Unified SASE increasing by 28 percent to a combined total of over $1.5 billion. Within Unified SASE, ARR growth was 96 percent, driven by early success in upselling FortiSASE to Fortinet’s large SD-WAN customer base.
SASE deals increased over 60 percent, and the pipeline was up 90 percent. Over 70 percent of large enterprise customers have adopted Fortinet’s SD-WAN functionality and are poised to expand to FortiSASE, with penetration rates increasing to 10 percent, up two points since November Analyst Day.
Deals between $5 million and $10 million increased over 90 percent, with SMB being the top-performing customer segment, growing over 30 percent. EMEA was the best-performing geography, driven by over 25 percent growth in international emerging markets.
Among top verticals, worldwide government and service providers grew over 20 percent, while financial services faced challenges due to difficult year-over-year comparisons involving seven- and eight-figure deals from Q4 2023.
Fortinet’s AI-powered security
Fortinet’s AI solutions enhance security across multiple domains. FortiGuard AI-powered security services provide real-time threat intelligence, helping organizations combat known, unknown, zero-day, and AI-based threats.
FortiAI Ops reduces time spent diagnosing network issues by analyzing network trends and logs across the Fortinet Security Fabric. In NOC and SOC environments, FortiAI leverages natural language and generative AI to simplify and automate analyst activities.
FortiAI is integrated into seven network and security operation products, with additional integrations planned. Fortinet’s AI-based DLP services actively identify and block sensitive information from being uploaded or shared with AI systems, mitigating LLM leakage risks.
Fortinet’s AI-powered security, unified management, and single-agent approach provide consistent protection across all locations and devices, ensuring full control, visibility, and simplified deployment while offering the industry’s simplest licensing and 3x to 5x better performance per user. Secure operations accounted for 11 percent of total billing, while ARR grew 32 percent.
The acquisition of Perception Point enhances Fortinet’s security portfolio, strengthening end-to-end cybersecurity by extending protection beyond email to the entire modern workspace. This move addresses the growing advanced threat risks in today’s elevated threat environment.
Fortinet continues to lead in secure networking with a convergence and consolidation strategy, a focus that has driven its operations for 25 years. Industry forecasts predict secure networking will surpass traditional networking by 2026.
As the No. 1 secure networking vendor, Fortinet has secured over half of all global firewalls and leads the convergence trend. Fortinet remains the only vendor leveraging a single operating system, FortiOS, across five secure networking Gartner Magic Quadrants.
Customers increasingly recognize that Fortinet’s FDS and ASIC technology deliver 5x to 10x better performance than competitors while enhancing security effectiveness and reducing total cost of ownership. This impact is particularly evident in operational technology, where OT sales approached $1 billion in 2024.
Total gross margin increased 340 basis points to 81.9 percent. Product gross margin reached 69.3 percent. Service gross margin increased 50 basis points to a quarterly record of 88.6 percent, as service revenue growth outpaced labor and hosting cost increases while benefiting from a mix shift toward higher-margin FortiGuard security subscription services and early AI-related savings.
For Q1, Fortinet projects billings between $1.520 billion and $1.600 billion, reflecting 11 percent growth. Revenue is expected to range between $1.500 billion and $1.560 billion, reflecting 13 percent growth. Infrastructure investments are expected to be between $80 million and $100 million.
For the full year, Fortinet expects billings between $7.2 billion and $7.4 billion, reflecting 12 percent growth, with revenue projected between $6.65 billion and $6.85 billion, reflecting 13 percent growth. Infrastructure investments are expected to range between $380 million and $430 million.
