Earnings: FireEye Inc (NASDAQ:FEYE) Could be Set to Rip on the Beat

FireEye Inc (NASDAQ:FEYE) announced financial results for Q3 on Tuesday afternoon, reporting revenue of $212 million, up 7% from the third quarter of 2017 and above the guidance range of $206 million to $210 million. Billings of $219 million showed an uptick of about 8% from the third quarter of 2017 and were at the high end of the guidance range of $210 million to $220 million. In addition, GAAP gross margin was 68% of revenue, compared to 65% of revenue in the third quarter of 2017. The stock shot higher in after hours.

“We have made tremendous strides in improving productivity and efficiency,” said Kevin Mandia, FireEye chief executive officer. “We have returned FireEye to sustainable growth while increasing profitability and cash flow. At the same time, we have accelerated innovation across our portfolio of product and services. With our expertise and intelligence driving a continuous innovation cycle, this is an exciting time to be at FireEye.”

FireEye Inc (NASDAQ:FEYE) bills itself as a company that provides cybersecurity solutions that allow organizations to prepare for, prevent, respond to, and remediate cyber-attacks.

It offers vector-specific appliance, virtual appliance, and cloud-based solutions to detect and block known and unknown cyber-attacks.

The company provides threat detection and prevention solutions, including network security products, email security solutions, and endpoint security solutions.

It also offers security management and orchestration products, such as Central Management System, FireEye Security Orchestrator, and FireEye Helix platform; and forensics and investigation products, such as Threat Analytics Platform and Enterprise Forensics series of appliances.

In addition, the company provides Security-as-a-Service solutions comprising cloud-based Email Threat Prevention solution and managed Defense/FireEye-as-a-Service offering; threat intelligence subscriptions, such as Dynamic Threat Intelligence cloud and FireEye iSIGHT Intelligence; and customer support and maintenance services.

Further, it offers professional services, including incident response, compromise assessments, and related security consulting services; cyber threat intelligence services; and training services.

The company serves telecommunications providers, financial services entities, Internet search engines, social networking sites, stock exchanges, electrical grid operators, networking vendors, oil and gas companies, healthcare and pharmaceutical companies, and local and international governmental agencies.

FireEye, Inc. provides its products and services through distributors, resellers, and strategic partners in the United States, the Asia Pacific, Japan, Europe, the Middle East, Africa, and other regions. The company was formerly known as NetForts, Inc. and changed its name to FireEye, Inc. in September 2005.

In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($1.1B against $636.8M).


Some Blue Skies?

We started off by noting that FEYE recently hit the wires with the announcement of financial results for Q3 on Tuesday afternoon, vaulting the stock higher despite recording just 7% topline growth. It was still a beat-the-number.

In total, over the past five days, shares of the stock have dropped by roughly -5% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities.

However, tomorrow’s open might be a significantly better view for shareholders.

“Continued strong billings performance translated to an acceleration in revenue growth in the quarter,” said Frank Verdecanna, FireEye chief financial officer and chief accounting officer. “As a result, we exceeded the high end of our operating margin guidance range and delivered non-GAAP operating profit on a year-to-date basis. Operating cash flow increased 75 percent and free cash flow increased 197 percent from the third quarter of 2017, and we are on track to meet our objective of positive free cash flow in 2018. Our confidence in our ability to exceed our original 2018 financial objectives is reflected in our updated guidance for billings, revenue, operating margin, and operating cash flow.”

FireEye Inc (NASDAQ:FEYE) managed to rope in revenues totaling $202.7M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 9.3%, as compared to year-ago data in comparable terms.

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