Check Point's (CHKP) Q2 Earnings & Sales Beat Expectations
Check Point Software Technologies CHKP reported second-quarter 2023 results, wherein both the bottom line and the top line surpassed the Zacks Consensus Estimate and improved year over year.
The IT security solutions provider reported non-GAAP earnings of $2.00 per share, beating the Zacks Consensus Estimate of $1.89. The bottom line increased 22% from the year-ago quarter’s earnings of $1.64 per share.
Check Point’s quarterly revenues climbed 3% year over year to $589 million, which surpassed the Zacks Consensus Estimate of $588 million. The upside was driven by double-digit growth in Security subscription revenues.
Check Point Software Technologies Ltd. Price, Consensus and EPS Surprise
Check Point Software Technologies Ltd. price-consensus-eps-surprise-chart | Check Point Software Technologies Ltd. Quote
Quarterly Details
Security subscription revenues were $239 million, increasing 14% year over year on double-digit revenue growth in Quantum, CloudGuard and Harmony solutions. According to our model estimates, Security subscription revenues were likely to grow 7.3% to $225.1 million.
Products and licenses revenues decreased 12% year over year to $117 million. Our estimates for Products and licenses revenues were pegged at $127.7 million, suggesting a 4.1% year-over-year decline. Products, which are currently in the process of transitioning to cloud solutions, have been included in the subscription line.
Total revenues from product and security subscriptions were $355.8 million, up 3.7% year over year.
Software updates and maintenance revenues increased to $232.9 million from $228 million reported in the year-ago quarter. The estimates from our model were pegged at $233.1 million for Software updates and maintenance revenues.
As of Jun 30, 2023, deferred revenues were $1.77 billion, up 7% year over year.
Non-GAAP operating income for the second quarter of 2023 totaled $263 million, up from $249 million in the year-ago quarter. Non-GAAP operating margin expanded 150 basis points from 43.5% to 45%.
Balance Sheet & Other Details
Check Point exited the second quarter with cash and cash equivalents, marketable securities and short-term deposits of $3.52 billion compared with the previous quarter’s $3.62 billion.
The company generated cash worth $191 million from operational activities during the second quarter of 2023.
It repurchased 2.6 million shares for about $325 million during the reported quarter.
Zacks Rank & Other Stocks to Consider
Currently, Check Point carries a Zacks Rank #2 (Buy). Shares of CHKP have gained 5.1% over the past year.
Some other top-ranked stocks from the broader Computer and Technology sector are Salesforce CRM, NVIDIA Corporation NVDA and Meta Platforms META. While Salesforce and NVIDIA sport a Zacks Rank #1 (Strong Buy), Meta carries a Zacks Rank #2 at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Salesforce’s second-quarter fiscal 2024 earnings has been revised northward by a penny to $1.90 per share over the past 30 days. For fiscal 2024, earnings estimates have moved up by 2 cents to $7.44 in the past 30 days.
CRM's earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 15.5%. Shares of the company have gained 25.1% in the past year.
The Zacks Consensus Estimate for NVIDIA’s second-quarter fiscal 2024 earnings has been revised northward from $1.04 to $2.04 per share over the past 60 days. For fiscal 2024, earnings estimates have moved up by 2 cents to $7.66 in the past 30 days.
NVDA's earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 0.26%. Shares of the company have soared 155.5% in the past year.
The Zacks Consensus Estimate for Meta Platforms' second-quarter 2023 earnings has been revised upward by a penny to $2.83 per share over the past seven days. For 2023, earnings estimates have moved north by 3 cents to $11.97 in the past seven days.
META’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 15.5%. Shares of the company have surged 76% in the past year.
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