## Check Point Software Reports Solid Q3 Earnings, Revenue Growth Driven by Security Subscriptions
Check Point Software Technologies Ltd. (CHKP) has announced strong third-quarter financial results, demonstrating continued growth in the cybersecurity sector. The company reported a 7% year-on-year increase in revenue, reaching $635.10 million, narrowly missing analyst estimates of $635.14 million. Despite the slight miss, Check Point’s adjusted earnings per share (EPS) of $2.25 aligned with analyst expectations.
The company’s growth was primarily driven by its Security subscriptions segment, which experienced a robust 11.5% year-over-year increase. Revenue from Products and licenses also saw growth, rising by 4.1% to $118.9 million, while Software updates and maintenance grew by 2.4% to $239.3 million.
While Check Point’s revenue growth was impressive, its adjusted operating margin declined to 43% from 45% in the previous year. This decrease was attributed to a surge in operating expenses, which rose by 12.5% year-over-year, resulting in a drop in the operating margin to 34% from 38% a year ago.
Despite the margin decline, Check Point generated a healthy $248.9 million in operating cash flow, up from $222.3 million in the prior year. The company also maintained a strong cash position, holding $2.87 billion in cash and equivalents as of September-end.
Check Point CEO and founder, Gil Shwed, highlighted the company’s success with its Infinity Platform, noting “double-digit revenue growth in Harmony Email and Infinity Global Services.” Shwed also emphasized Check Point’s expansion into the Security Operation Center (SOC) market through its recent acquisition of Cyberint. This acquisition brings proactive, AI-powered threat intelligence and exposure management capabilities to Check Point’s offerings.
Check Point Software Technologies stock has experienced significant growth, gaining 37% year-to-date. However, shares traded lower by 7.69% at $191.96 premarket on Tuesday following the earnings announcement.
The strong performance of Check Point’s Security subscriptions segment underscores the growing demand for robust cybersecurity solutions. The company’s strategic acquisition of Cyberint further strengthens its position in the evolving SOC market. Investors will be closely watching to see if Check Point can maintain its growth trajectory and address the challenges posed by rising operating expenses in the coming quarters.
