Check Point Software Reports 2024 First Quarter Financial Results
April 25 2024 - 5:00AM
Check Point® Software Technologies Ltd. (NASDAQ: CHKP), today
announced its financial results for the quarter ended March 31st,
2024.
First Quarter
2024:
- Total Revenues: $599 million, a 6 percent increase year over
year
- Security Subscription Revenues: $263 million, a 15 percent
increase year over year
- GAAP Operating Income: $194 million, representing 32 percent of
total revenues
- Non-GAAP Operating Income: $252 million, representing 42
percent of total revenues
- GAAP EPS: $1.60, a 5 percent increase year over year
- Non-GAAP EPS: $2.04, a 13 percent increase year over year
“The first quarter yielded great results with revenues and EPS
at the top end of our projections. We delivered strong double-digit
growth in Infinity Platform agreements, now constituting over 13
percent of total revenues. Our aggregate recurring
revenues now represent 83 percent of total revenues,”
stated Gil Shwed, Founder & CEO of Check Point Software
Technologies. “We introduced Quantum Force, a new line of security
gateways empowering organizations of all sizes with next-generation
firewall technology. In addition, we launched new technologies
including Harmony SaaS protecting SaaS platforms and data, and
Infinity AI Copilot, an AI-powered security assistant enhancing
security effectiveness across organizations.”
Financial Highlights for the First Quarter of
2024
- Total Revenues: $599 million compared to $566
million in the first quarter 2023, a 6 percent increase year over
year.
- GAAP Operating Income: $194 million compared
to $200 million in the first quarter 2023, representing 32 percent
and 35 percent of total revenues in the first quarter 2024 and
2023, respectively.
- Non-GAAP Operating Income: $252 million
compared to $238 million in the first quarter 2023, representing 42
percent of total revenues in both the first quarter 2024 and
2023.
- GAAP Taxes on Income: $33
million compared to $35 million in the first quarter 2023.
- GAAP Net Income & Earnings per Diluted
Share: GAAP net income was $184
million same as in the first quarter 2023. GAAP earnings per
diluted share were $1.60 compared to $1.52 in the first quarter
2023, a 5 percent increase year over year.
- Non-GAAP Net Income & Earnings per Diluted
Share: Non-GAAP net income was
$235 million compared to $218 million in the first quarter 2023.
Non-GAAP earnings per diluted share were $2.04 compared to $1.80 in
the first quarter 2023, a 13 percent increase year over year.
- Deferred Revenues: As of March 31, 2024,
deferred revenues were $1,826 million compared to $1,797 million as
of March 31, 2023, a 2 percent increase year over year.
- Cash Balances, Marketable Securities & Short-Term
Deposits: $3,035 million as of March 31,
2024, compared to $2,960 million as of December 31, 2023.
- Cash Flow
from
Operations: Cash flow of $361
million compared to $386 million in the first quarter 2023.
- Share Repurchase Program: During the first
quarter of 2024, the company repurchased approximately 2.0 million
shares at a total cost of approximately $325 million.
For information regarding the non-GAAP financial measures
discussed in this release, as well as a reconciliation of such
non-GAAP financial measures to the most directly comparable GAAP
financial measures, please see “Use of Non-GAAP Financial
Information” and “Reconciliation of GAAP to Non-GAAP Financial
Information.”
Conference Call & Video Cast
Information
Check Point will host a conference call with the investment
community on April 25, 2024, at 8:30 AM ET/5:30 AM PT. To listen to
the live videocast or replay, please visit the website
www.checkpoint.com/ir.
Second Quarter 2024
Investor Conference Participation Schedule
- 2024 RSA Analyst/Investor Booth ToursMay 7-8,
2024, SF, CA – Group Meetings
- Needham 19th Annual
Technology, Media, and
Consumer ConferenceMay 16, 2024,
Virtual – 1x1’s
- J.P. Morgan
52nd Annual
Technology, Media, and Telecom ConferenceMay 20-22, 2024,
Boston, MA – Fireside Chat & 1x1’s
- Oppenheimer 25th
Annual Israeli ConferenceMay 26, 2024, Tel Aviv,
Israel – Fireside Chat & 1x1’s
- Cowen 52nd Annual TMT
ConferenceMay 29, 2024, NY, NY – Fireside Chat &
1x1’s
- Jefferies Software SummitMay 30, 2024, Newport
Coast, CA – 1x1’s
- Baird 2023 Global Consumer, Technology & Services
ConferenceJune 4, 2024, SF, CA – 1x1’s
- Bank of America Merrill Lynch 2023 Global Technology
ConferenceJune 5-6, 2024, SF, CA – 1x1’s
- Nasdaq Investor ConferenceJune 11, 2024,
London, UK – 1x1’s
Members of Check Point's management team anticipate attending
these conferences and events to discuss the latest company
strategies and initiatives. Check Point’s conference presentations,
if applicable, will be available via webcast on the company’s web
site. To hear these presentations and access the most updated
information please visit the company's web site at
www.checkpoint.com/ir. The schedule is subject to change.
To follow this and other Check Point news
visit:
-
LinkedIn: https://www.linkedin.com/company/check-point-software-technologies
- YouTube: http://www.youtube.com/user/CPGlobal
- Blog: http://blog.checkpoint.com/
- X (Formerly known as
Twitter): http://www.twitter.com/checkpointsw
About Check Point Software Technologies
Ltd.
Check Point Software Technologies Ltd. (www.checkpoint.com) is a
leading AI-powered, cloud-delivered cyber security platform
provider protecting over 100,000 organizations worldwide. Check
Point leverages the power of AI everywhere to enhance cyber
security efficiency and accuracy through its Infinity Platform,
with industry-leading catch rates enabling proactive threat
anticipation and smarter, faster response times. The comprehensive
platform includes cloud-delivered technologies consisting of Check
Point Harmony to secure the workspace, Check Point CloudGuard to
secure the cloud, Check Point Quantum to secure the network, and
Check Point Infinity Core Services for collaborative security
operations and services.
Legal Notice Regarding Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements generally relate to future events or our future
financial or operating performance. Forward-looking statements in
this press release include, but are not limited to, statements
related to our expectations regarding our products and solutions,
and our participation in investor conferences and events during the
second quarter of 2024. Our expectations and beliefs regarding
these matters may not materialize, and actual results or events in
the future are subject to risks and uncertainties that could cause
actual results or events to differ materially from those projected.
These risks include our ability to continue to develop platform
capabilities and solutions; customer acceptance and purchase of our
existing solutions and new solutions; the market for IT security
continuing to develop; competition from other products and
services; the transition of our CEO into the role of Executive
Chairman and the related succession process; and general market,
political, economic and business conditions, including acts of
terrorism or war. The forward-looking statements contained in this
press release are also subject to other risks and uncertainties,
including those more fully described in our filings with the
Securities and Exchange Commission, including our Annual Report on
Form 20-F filed with the Securities and Exchange Commission on
April 2, 2024. The forward-looking statements in this press release
are based on information available to Check Point as of the date
hereof, and Check Point disclaims any obligation to update any
forward-looking statements, except as required by law.
Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with
generally accepted accounting principles, or GAAP, Check Point uses
non-GAAP measures of operating income, net income, and earnings per
diluted share, which are adjustments from results based on GAAP to
exclude, as applicable, stock-based compensation expenses,
amortization of intangible assets and acquisition related expenses
and the related tax affects. Check Point’s management believes the
non-GAAP financial information provided in this release is useful
to investors’ understanding and assessment of Check Point’s ongoing
core operations and prospects for the future. Historically, Check
Point has also publicly presented these supplemental non-GAAP
financial measures to assist the investment community in
visualizing the Company “through the eyes of management,” and
thereby enhance understanding of its operating performance. The
presentation of this non-GAAP financial information is not intended
to be considered in isolation or as a substitute for results
prepared in accordance with GAAP. A reconciliation of the non-GAAP
financial measures discussed in this press release to the most
directly comparable GAAP financial measures is included with the
financial statements contained in this press release. Management
uses both GAAP and non-GAAP information in evaluating and operating
the business internally and has determined that it is important to
provide this information to investors.
© 2024 Check Point Software Technologies Ltd. All
Rights Reserved
|
CHECK POINT SOFTWARE TECHNOLOGIES LTD. |
CONSOLIDATED STATEMENT OF INCOME |
|
(Unaudited, in millions, except per share amounts) |
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2024 |
|
2023 |
Revenues: |
|
|
|
|
Products and licenses |
|
$ |
100.3 |
|
$ |
108.0 |
Security subscriptions |
|
|
263.4 |
|
|
228.2 |
Total revenues from products and security subscriptions |
|
|
363.7 |
|
|
336.2 |
Software updates and maintenance |
|
|
235.1 |
|
|
230.0 |
Total revenues |
|
|
598.8 |
|
|
566.2 |
|
|
|
|
|
Operating expenses: |
|
|
|
|
Cost of products and licenses |
|
|
19.9 |
|
|
26.2 |
Cost of security subscriptions |
|
|
16.5 |
|
|
12.3 |
Total cost of products and security subscriptions |
|
|
36.4 |
|
|
38.5 |
Cost of Software updates and maintenance |
|
|
28.7 |
|
|
26.8 |
Amortization of technology |
|
|
5.8 |
|
|
2.8 |
Total cost of revenues |
|
|
70.9 |
|
|
68.1 |
|
|
|
|
|
Research and development |
|
|
99.2 |
|
|
91.5 |
Selling and marketing |
|
|
206.2 |
|
|
177.7 |
General and administrative |
|
|
28.6 |
|
|
29.1 |
Total operating expenses |
|
|
404.9 |
|
|
366.4 |
|
|
|
|
|
Operating income |
|
|
193.9 |
|
|
199.8 |
Financial income, net |
|
|
22.6 |
|
|
19.1 |
Income before taxes on income |
|
|
216.5 |
|
|
218.9 |
Taxes on income |
|
|
32.6 |
|
|
34.8 |
Net income |
|
$ |
183.9 |
|
$ |
184.1 |
|
|
|
|
|
|
|
Basic earnings per share |
|
$ |
1.64 |
|
$ |
1.54 |
Number of shares used in computing basic earnings per share |
|
|
112.3 |
|
|
119.8 |
|
|
|
|
|
|
|
Diluted earnings per share |
|
$ |
1.60 |
|
$ |
1.52 |
Number of shares used in computing diluted earnings per share |
|
|
115.2 |
|
|
121.1 |
CHECK POINT SOFTWARE TECHNOLOGIES LTD. |
SELECTED FINANCIAL METRICS |
|
(Unaudited, in millions, except per share amounts) |
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2024 |
|
2023 |
|
|
|
|
|
Revenues |
|
$ |
598.8 |
|
$ |
566.2 |
Non-GAAP operating income |
|
|
252.0 |
|
|
238.4 |
Non-GAAP net income |
|
|
234.5 |
|
|
217.9 |
Non-GAAP diluted earnings per share |
|
$ |
2.04 |
|
$ |
1.80 |
Number of shares used in computing diluted |
|
|
|
|
|
|
Non-GAAP earnings per share |
|
|
115.2 |
|
|
121.1 |
CHECK POINT SOFTWARE TECHNOLOGIES LTD. |
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
INFORMATION |
|
(Unaudited, in millions, except per share amounts) |
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2024 |
|
2023 |
|
|
|
|
|
GAAP operating income |
|
$ |
193.9 |
|
$ |
199.8 |
Stock-based compensation (1) |
|
|
41.6 |
|
|
32.7 |
Amortization of intangible assets and acquisition related expenses
(2) |
|
|
16.5 |
|
|
5.9 |
Non-GAAP operating income |
|
$ |
252.0 |
|
$ |
238.4 |
|
|
|
|
|
GAAP net income |
|
$ |
183.9 |
|
$ |
184.1 |
Stock-based compensation (1) |
|
|
41.6 |
|
|
32.7 |
Amortization of intangible assets and acquisition related expenses
(2) |
|
|
16.5 |
|
|
5.9 |
Taxes on the above items (3) |
|
|
(7.5) |
|
|
(4.8) |
Non-GAAP net income |
|
$ |
234.5 |
|
$ |
217.9 |
|
|
|
|
|
GAAP diluted earnings per share |
|
$ |
1.60 |
|
$ |
1.52 |
Stock-based compensation (1) |
|
|
0.36 |
|
|
0.27 |
Amortization of intangible assets and acquisition related expenses
(2) |
|
|
0.15 |
|
|
0.05 |
Taxes on the above items (3) |
|
|
(0.07) |
|
|
(0.04) |
Non-GAAP diluted earnings per share |
|
$ |
2.04 |
|
$ |
1.80 |
|
|
|
|
|
Number of shares used in computing diluted Non-GAAP earnings per
share |
|
|
115.2 |
|
|
121.1 |
|
|
|
|
|
(1) Stock-based compensation: |
|
|
|
|
Cost of products and licenses |
|
$ |
0.1 |
|
$ |
0.1 |
Cost of software updates and maintenance |
|
|
2.2 |
|
|
1.2 |
Research and development |
|
|
14.7 |
|
|
10.6 |
Selling and marketing |
|
|
15.9 |
|
|
11.3 |
General and administrative |
|
|
8.7 |
|
|
9.5 |
|
|
|
41.6 |
|
|
32.7 |
|
|
|
|
|
(2) Amortization of intangible assets and acquisition related
expenses: |
|
|
|
|
Amortization of technology-cost of revenues |
|
|
5.8 |
|
|
2.8 |
Research and development |
|
|
1.6 |
|
|
1.9 |
Selling and marketing |
|
|
9.1 |
|
|
1.2 |
|
|
|
16.5 |
|
|
5.9 |
|
|
|
|
|
|
|
(3) Taxes on the above items |
|
|
(7.5) |
|
|
(4.8) |
|
|
|
|
|
|
|
Total, net |
|
$ |
50.6 |
|
$ |
33.8 |
CHECK POINT SOFTWARE TECHNOLOGIES LTD. |
CONDENSED CONSOLIDATED BALANCE SHEET DATA |
(In millions) |
ASSETS |
|
|
|
March 31, |
|
December 31, |
|
|
2024(Unaudited) |
|
2023(Audited) |
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
536.6 |
|
$ |
537.7 |
Marketable securities and
short-term deposits |
|
|
1,065.8 |
|
|
992.3 |
Trade receivables, net |
|
|
386.3 |
|
|
657.7 |
Prepaid expenses and other
current assets |
|
|
79.1 |
|
|
70.0 |
Total current assets |
|
|
2,067.8 |
|
|
2,257.7 |
|
|
|
|
|
Long-term assets: |
|
|
|
|
Marketable securities |
|
|
1,432.9 |
|
|
1,429.7 |
Property and equipment,
net |
|
|
79.6 |
|
|
80.4 |
Deferred tax asset, net |
|
|
91.4 |
|
|
81.8 |
Goodwill and other intangible
assets, net |
|
|
1,735.0 |
|
|
1,748.5 |
Other assets |
|
|
99.9 |
|
|
97.4 |
Total long-term assets |
|
|
3,438.8 |
|
|
3,437.8 |
|
|
|
|
|
Total assets |
|
$ |
5,506.6 |
|
$ |
5,695.5 |
LIABILITIES AND SHAREHOLDERS’ EQUITY |
Current liabilities: |
|
|
|
|
Deferred revenues |
|
$ |
1,347.0 |
|
$ |
1,413.8 |
Trade payables and other
accrued liabilities |
|
|
433.9 |
|
|
502.3 |
Total current liabilities |
|
|
1,780.9 |
|
|
1,916.1 |
|
|
|
|
|
Long-term liabilities: |
|
|
|
|
Long-term deferred
revenues |
|
|
478.9 |
|
|
493.9 |
Income tax accrual |
|
|
446.0 |
|
|
436.1 |
Other long-term
liabilities |
|
|
34.0 |
|
|
28.4 |
|
|
|
958.9 |
|
|
958.4 |
|
|
|
|
|
Total liabilities |
|
|
2,739.8 |
|
|
2,874.5 |
|
|
|
|
|
Shareholders’ equity: |
|
|
|
|
Share capital |
|
|
0.8 |
|
|
0.8 |
Additional paid-in
capital |
|
|
2,808.0 |
|
|
2,732.5 |
Treasury shares at cost |
|
|
(13,354.6) |
|
|
(13,041.2) |
Accumulated other
comprehensive gain |
|
|
(39.4) |
|
|
(39.2) |
Retained earnings |
|
|
13,352.0 |
|
|
13,168.1 |
Total shareholders’
equity |
|
|
2,766.8 |
|
|
2,821.0 |
|
|
|
|
|
|
|
Total liabilities and
shareholders’ equity |
|
$ |
5,506.6 |
|
$ |
5,695.5 |
Total cash and cash
equivalents, marketable securities, and short-term deposits |
|
$ |
3,035.3 |
|
$ |
2,959.7 |
CHECK POINT SOFTWARE TECHNOLOGIES LTD. |
SELECTED CONSOLIDATED CASH FLOW DATA |
|
(Unaudited, in millions) |
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2024 |
|
2023 |
Cash flow from operating activities: |
|
|
|
|
Net income |
|
$ |
183.9 |
|
$ |
184.1 |
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
Depreciation of property and equipment |
|
|
7.3 |
|
|
6.9 |
Amortization of intangible assets |
|
|
13.5 |
|
|
3.3 |
Stock-based compensation |
|
|
41.6 |
|
|
32.7 |
Decrease in trade and other receivables, net |
|
|
265.4 |
|
|
285.1 |
Decrease in deferred revenues, trade payables and other accrued
liabilities |
|
|
(140.6) |
|
|
(127.1) |
Deferred income taxes, net |
|
|
(10.1) |
|
|
0.6 |
Net cash provided by operating activities |
|
|
361.0 |
|
|
385.6 |
|
|
|
|
|
Cash flow from investing activities: |
|
|
|
|
Investment in property and equipment |
|
|
(6.5) |
|
|
(4.2) |
Net cash used in investing activities |
|
|
(6.5) |
|
|
(4.2) |
|
|
|
|
|
Cash flow from financing activities: |
|
|
|
|
Proceeds from issuance of shares upon exercise of options |
|
|
45.6 |
|
|
34.1 |
Purchase of treasury shares |
|
|
(325.0) |
|
|
(324.9) |
Payments related to shares withheld for taxes |
|
|
(1.1) |
|
|
(1.0) |
Net cash used in financing activities |
|
|
(280.5) |
|
|
(291.8) |
|
|
|
|
|
Unrealized gain on marketable securities, net |
|
|
1.6 |
|
|
26.6 |
|
|
|
|
|
Increase in cash and cash equivalents, marketable securities, and
short-term deposits |
|
|
75.6 |
|
|
116.2 |
|
|
|
|
|
Cash and cash equivalents, marketable securities, and short-term
deposits at the beginning of the period |
|
|
2,959.7 |
|
|
3,503.2 |
|
|
|
|
|
Cash and cash equivalents, marketable securities, and
short-term deposits at the end of the period |
|
$ |
3,035.3 |
|
$ |
3,619.4 |
INVESTOR CONTACT: |
MEDIA CONTACT: |
Kip E. Meintzer |
Gil Messing |
Check Point Software |
Check Point Software |
+1.650.628.2040 |
+1.650.628.2260 |
ir@checkpoint.com |
press@checkpoint.com |
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