By Tova Cohen
TEL AVIV, April 18 () - Network security provider Check Point Software Technologies reported first quarter net profit that topped expectations by a cent and forecast second quarter profit in line with estimates.
Check Point earned $1.32 per diluted share excluding one-time items in the first quarter, up from $1.30 a year earlier. Revenue grew 4 percent to $472 million, the Israel-based company said on Thursday.
Its shares were down 5.4 percent to $122.57 in premarket Nasdaq trade after rising 26 percent so far this year.
"The stock is off on a knee jerk reaction as the bulls were hoping for a beat rather than an in-line quarter," said Daniel Ives, managing director of equities research at Wedbush Securities.
Edward Jones analyst David Heger said the market was disappointed that the first quarter did not exceed estimates by a larger amount, especially in light of the shares' strong recent appreciation.
"We continue to feel positive about Check Point's long-term growth potential," he said.
Chief Executive Gil Shwed said the company posted 13 percent growth in subscriptions for its advanced security products to $144 million. These include protection for cloud computing and mobile phones as well as its Infinity consolidated security platform.
Operating expenses rose as the company spent more on sales and marketing, including recruiting new staff to help sell new products. These marketing efforts have not fully trickled down to the bottom line yet as the new products are on an annual subscription basis and their effect is delayed, Chief Financial Officer Tal Payne told reporters.
"The stock has been strong over the last six months as the Street is anticipating a potential renaissance of growth at the company, with cloud driving its next leg of growth into the next 12 to 18 months," Ives said.
Check Point said it bought back 2.7 million shares worth $305 million as part of its share repurchase programme.
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