Check Point tops estimates on computer security demand

Reuters

* Q3 EPS $0.85 vs $0.84 forecast

* Sees Q4 non-GAAP EPS $0.90-$0.98, revenue $365-$395 mln

* Nasdaq shares up 2.8 pct at new year high

By Tova Cohen

TEL AVIV, Oct 21 (Reuters) - Computer security providerCheck Point Software Technologies topped third-quarterprofit and revenue forecasts on Monday and said it sees a strongfourth quarter after a weak start to the year.

One of the global leaders in the corporate fight againstcybercrime and computer viruses said sales were boosted by itsthreat prevention software blades - modular software buildingblocks sold as annual subscriptions.

New product launches and an improving economy in Europe alsohelped lift sales of computer protection technology.

"We have a lot of competition and we need to grow faster,"Chief Executive Gil Shwed told a news conference. "This could bethrough better products and also partly by acquisitions."

Check Point, which has cash of nearly $3.7 billion, isseeking acquisitions that will bring new solutions to itsclients, he said.

Earlier this month rival Cisco Systems bought cybersecurity company Sourcefire Inc for $2.7 billion,a deal that analysts say should spark more acquisitions in theindustry as large vendors seek to profit from growing demand forIT security.

Shwed estimated fourth-quarter revenue of $365-$395 millionand earnings per share excluding one-off items of 90-98 cents.Analysts are estimating EPS of 96 cents and revenue of $385.2billion, according to Thomson Reuters I/B/E/S.

This forecast is consistent with Check Point's full-yearoutlook provided last quarter, Shwed said.

The Israeli company's quarterly forecast would bringadjusted EPS for the year to $3.36-$3.44, slightly narrowing therange it forecast last quarter of $3.33-$3.46.

The company's shares were up 2.8 percent at $61.22 in earlyNasdaq trade, hitting a new year high.

Check Point earned 85 cents a share excluding one-time itemsin the third quarter, up from 79 cents a year earlier. Revenuegrew 4 percent to $344.1 million.

It was forecast to have earned 84 cents a share on revenueof $343.6 million, according to Thomson Reuters I/B/E/S.

Revenue was also boosted by sales of new appliances thatcombine hardware and software both at the high and low end ofthe company's product line.

"The recently launched data centre and small appliancefamilies were received enthusiastically by our customers," Shwedsaid.

A strengthening shekel hurt its bottom line by $3 million,or 1.5 cents per share in the quarter, as local expensesincreased in dollar terms.

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