Fortinet, Inc. reported a total revenue of $5.96 billion for the fiscal year ended December 31, 2024, marking a 12% increase from $5.30 billion in 2023. The company's net income rose significantly to $1.75 billion, a 52% increase compared to $1.15 billion in the previous year. This growth was driven primarily by a 20% increase in service revenue, which reached $4.05 billion, while product revenue saw a slight decline of 1%, totaling $1.91 billion. The overall gross profit for the year was $4.80 billion, resulting in a gross margin of 80.6%, up from 76.7% in 2023.
In terms of operational developments, Fortinet's customer base expanded, with approximately 80% of Fortune 100 companies and 72% of Global 2000 companies utilizing its services. The company also reported a total employee headcount of 14,138 as of December 31, 2024, reflecting a 4% increase from the previous year. Geographically, revenue was well-diversified, with the Americas contributing 41%, EMEA 40%, and APAC 19% to total revenue. The company anticipates that product revenue growth rates will improve in 2025, following a challenging comparison to 2023, which benefited from a higher backlog contribution.
Strategically, Fortinet made significant acquisitions in 2024, including Lacework, a cloud security company, and Next DLP, a data loss prevention firm, for $152.3 million and $105 million, respectively. These acquisitions are expected to enhance Fortinet's offerings in the cloud security and data loss prevention markets. The company also reported that revenue from these acquisitions contributed $33.5 million to total revenue in the latter half of 2024.
The filing also highlighted the company's focus on managing supply chain challenges and inventory levels, which have been impacted by global component shortages. As of December 31, 2024, Fortinet had $591.1 million in inventory purchase commitments, a decrease from the previous year, indicating improved supply chain conditions. The company expects to continue investing in its workforce and infrastructure to support growth, with capital expenditures projected between $380 million and $430 million for 2025.
Looking ahead, Fortinet expressed optimism about its growth trajectory, particularly in service revenue, which is expected to continue expanding due to the increasing demand for unified SASE and SecOps offerings. However, the company acknowledged potential challenges, including macroeconomic factors such as inflation and geopolitical tensions, which could impact customer spending and overall market conditions.
About Fortinet, Inc.
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