Check Point Software Focuses on Revenue Growth in 2022

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JERUSALEM, April 27 (Reuters) – Check Point Software Technologies Ltd (CHKP.O) said it was cautiously optimistic it remained on track for improved revenue and profit in 2022 after its products cloud protection and its consolidated cybersecurity platforms led to stronger-than-expected first-quarter results.

Israel-based Check Point said it was primarily focused on revenue growth and was in the midst of a hiring spree to increase its sales force by 25% to boost sales in 2023.

He left his estimates for 2022 unchanged, predicting revenue of $2.2 billion to $2.375 billion, from $2.17 billion in 2021, and earnings per share excluding special items of $6.90 to $7.50, against $7.02 last year. Analysts expect revenue of $2.29 billion.

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On a conference call with analysts, chief executive Gil Shwed said he was optimistic, but not overly optimistic, given the various supply chain and other challenges.

“We had a very good start to the year and I hope the rest of the year will show even more of these results stemming from our business pipeline for business bookings to revenue and EPS,” a- he declared.

Check Point said Wednesday it earned $1.57 per diluted share excluding one-time items in the January-March period, up from $1.54 a year earlier. Revenue increased 7% to $543 million, with growth across all regions. The company in 2021 had surpassed $2 billion for a second straight year.

It was expected to earn $1.54 per share on revenue of $534 million, according to I/B/E/S data from Refinitiv.

For the second quarter, it estimated revenue of $545 million to $575 million and ex-one-off EPS of $1.55 to $1.65. Analysts expect revenue of $556 million and ex-EPS items of $1.65.

Shwed noted that a surge in global cyberattacks has prompted companies to turn to more all-in-one cybersecurity products that secure networks, the cloud and remote users.

With a focus on strengthening its workforce to achieve double-digit sales growth, operating expenses increased by 15%. Chief Financial Officer Tal Payne said rising costs had started to pay off, with its security underwriting up more than 10% in the quarter compared to a year ago.

The company still has about $4 billion in cash that Payne says will continue to invest in its business organically and through acquisitions.

Deferred revenue increased 14% in the quarter to $1.67 billion.

Check Point, whose Nasdaq shares have risen 16% so far in 2022, said it repurchased 2.5 million shares during the quarter, worth $325 million, as part of its share buyback program.

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Reporting by Steven Scheer; Editing by Louise Heavens and Jonathan Oatis

Our standards: The Thomson Reuters Trust Principles.

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