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Home/Tech/Fortinet shares drop about 25% after hours despite 20% revenue growth
VERIFIEDBy Xavier Rivera·Wednesday, October 28, 2026 at 8:40 PM AST·1 min read

Fortinet shares drop about 25% after hours despite 20% revenue growth

Fortinet reported third-quarter revenue of $2.08 billion, up 20%, and raised its 2026 outlook, but its shares fell about 25% in extended trading after a gross margin came in below analyst estimates, CNBC reported.

Source:Fortinet
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Fortinet shares drop about 25% after hours despite 20% revenue growth
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TL;DRAI · 60 sec read

Fortinet said Q3 revenue rose 20% to $2.08 billion and billings rose 29% to $2.34 billion, with non-GAAP EPS of $0.91. It raised its 2026 billings guidance for the third time this year. Non-GAAP gross margin of 79.6% missed the 80.1% LSEG estimate, and shares fell about 25% after hours, CNBC reported.

Fortinet reported third-quarter results on Wednesday, Oct. 28, that beat Wall Street's revenue and profit estimates, but its shares fell about 25% in extended trading, CNBC reported.

The quarter

Revenue grew 20% from a year earlier to $2.08 billion, the cybersecurity company said. Product revenue rose 37% to $765 million and billings rose 29% to $2.34 billion.

GAAP earnings were 86 cents a share and non-GAAP earnings were 91 cents a share. GAAP operating margin was 34%, and free cash flow was $865 million.

Why the stock fell
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Fortinet's non-GAAP gross margin came in at 79.6%, below the 80.1% analysts polled by LSEG expected, CNBC reported. Its top- and bottom-line results beat estimates.

Outlook raised

Fortinet now expects 2026 revenue of $8.125 billion to $8.215 billion and billings of $9.568 billion to $9.718 billion. For the fourth quarter, it forecast revenue of $2.155 billion to $2.245 billion. It also added $1.2 billion to its buyback, leaving $2 billion authorized.
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"Our strong momentum is driven by our continued leadership in the AI era," founder and CEO Ken Xie said. He said the results allowed Fortinet to raise its 2026 billings guidance for the third time this year.
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