CHKP - Earnings call transcript Q4 2021 | Check Point Software Technologies Ltd.

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Kip Meintzer

I’d like to welcome everyone to our Fourth Quarter and Full Year 2021 Financial Results Video Conference. At this time, all participants are in listen-only mode during the formal presentation, which will be followed by question-and-answer session.

Joining me remotely today on the call are Gil Shwed, Founder and CEO, along with our CFO and COO, Tal Payne.

As a reminder, this video conference is live on our website and is recorded for replay. To access the live conference and replay information, please visit the company’s website at checkpoint.com.

replay available the our convenience, your will on be site. For

after like at please to you’d the kip@checkpoint.com. reach mail If by us call, Relations contact Investor

IT, Check and our our During and with non-GAAP and expectations any related of develop forward-looking website, meaning of from release, non-GAAP as are competition of threats results Securities of Form the to economic statements statements a along Exchange of of customer representatives expectations to XXA except SEC. our in products of the political Exchange XXXX which update in our result forward-looking based and pandemic. Check information our Point’s our statements. as the These Act posted are date fully Act security, hereof, and reasons disclaims on subject XXXX well forward-looking statements, with of initiatives, products been forward-looking as those such and other to GAAP of we on to available and Check including XX-F by Section this checkpoint for and not of capabilities risks filings ability filed the cybersecurity reconciliation acceptance and COVID-XX the for and with and as Securities statements a obligation our certain and XXXX has the and uncertainties, to continuing These including other described on presentation the but make continue related XXE to law. our solutions Point limited forward-looking impact general results, Commission, including as annual The information. Point’s within required present expectations statements In are report press purchase conditions, more the market, and the course of this solutions, any of presentation Section existing regarding develop include to and to business may services regarding to solutions, solutions, presentation, our new platform market Securities

call like Now results. I'd Tal over a review to our to turn Payne financial the of for

Tal Payne

you hear Can me?

Kip Meintzer

Yeah.

Tal Payne

see presentation? you Can the

Kip Meintzer

Wonderful.

Tal Payne

Wonderful.

Earnings you, Thank joining midpoint the reached Good review today. the quarter. which above good to Revenues $X.XX call guidance on pleased of I'm is of our the above end of everyone top guidance. guidance, afternoon us $XX per quarter the $X.XX the top $XXX above nice. is which was to quite begin our million, the Great. of Okay. our and Kip. $X.XX, end the fourth morning share for million,

the Before acquired you compensation results assets in that amortization as I numbers, the stock-based of that financial intangible our proceed presented information applicable, non-GAAP these excluding into as further effects. is related expenses charges, items. as remind mind well acquisition let related tax and include Keep me GAAP

more with revenues. let's for and you year-over-year. Now Revenues increase dive million, $XXX the into the the numbers, I X% can will as start see, quarter,

see to as of growth some $X.XX in the year. right in of XX% revenues billing. growth can you the you very can well, the very $XXX We a growth, strongly our significant grew million, from QX see is Billing On side, billion. the see reaching billing, mirror billing. kind X% acceleration XX% last Deferred

drivers. the into Moving

enterprise wins continued this categories So strength product many seen and first, product year-over-year, let's talk to and nicely large drives subscription $XXX increased about differentiator accelerate, SMB with all X% to products million the We've be quarter. customers. and continued Maestro to security way reaching in with in

XX%. XX% we was products that for expectations, can versus year, to a Subscription continue in our revenues well. see quarter So line as reaching nice the with accelerate, last

the cloud there We $XXX in growth Harmony, areas and see can also the we so on double-digit the main were already the very guide, a in it's focus are, already. nice So million bear growth quarter. double-digit those drivers fruit growth

XX% from XX% Revenues EMEA, to came revenues geographies. from of revenues by and by XX% from Americas geographies, Asia the came Moving Pacific.

I As see you quarter in know and you lower can when see, the growth. and APAC. results revenue will calculate, had a you EMEA America great led

regarding regions. So growth, I'll just booking. results three with the customers grow booking new many with a give countries in great All had a you in a highlight and strong regions great and those

course, delivery revenues the As of timing usual, and there's of a pull customer result or rendering of over to the one the in reasons, a recognize -- the timing of services, booking providing the and product of consumption is period the booking the on of shares. of the the year Infinity gap for the the and service order between revenues. of And need us the the examples to so products, as

Moving on, XX%, remained deliver supply The in to million. profit strong our the nice, $XXX one gross customers margin at higher still is constraint. the very strongest We market. relating the costs to chain of with

that. about bit little a talk let's So

next which As quarter. is in the a believe all the to of to be to go people towards cost supply X.X%, market, think normal, the increased, cost supply X% it's to slightly the situation and between chain on constraint back components of second margin, year, affects you think the maybe lower until many a depends which there's the sold year. leading of end know, higher us, I goods the We most resolved it's next half of in temporary of going

as next into So just for taking part year. that the well as of guidance account

the it's The to great Harmony growth. and Quantum. than on Now Harmony lower our and double-digit CloudGuard part pillars, show with Harmony Therefore, reduction. average Security also this is continue results Connect gross of margin new the on

there's results. lot Operating strong still customers. to taking the a the constraints, And we highlights. meet our while into and target account deliver that fact of expenses very all-in-all, So

as XX% Its can $XXX operating You drivers reached expenses usual. see million, an main two growth.

were towards the plan we recruit very end of the First, headcount. to successful in our year the

came of the accelerated we Most we X% that and growth year-end. year-over-year it So towards the the for aiming growth. the reached were

see start the Israeli dollar see the And of in as Israel. will you is we effect, run that part we weakened the dollar R&D where year. in this R&D quarter, it the also the results, rate the as currency shekel expenses the can it So also and against next affected mainly higher which the

effect that's see the here. you So

So We resulting but operating results it reached increasing now the this can in see at Operating the expenses start that plan in We $XXX we before, see XX%. operating bookings. XX%. income to be the strong XX% million. We margin, already in also to at only XX%.

it see, the is million. interest of yield the strong you the the X%. income result statute expectation, $XXX also lower the this million, remind the in line breakeven therefore, typical as GAAP provision per cash with our the can Cash was which QX. margin rates, flow income you lapse QX on at And diluted XX%. Financial on lapse provided, our X% a Typically, as year you at net with is also share. at $XX I As bringing a that tax $X.XX lower the around cash rate in of we line very limitation position. income to in net taxes, and guidance is see

operating the income cash of represents hedge cash at the our sheet the the the super X% the we since of operating $XXX every hedge million million. we hedge quarter, It $X It which at increase the X%. year, flow million, Our income more, growth strong very strong. happens cash -- dollar effect, $XX Last even $X.X made effect, includes flow. an flow. balance in cash weakened was exclude year-over-year. It is closed if billion,

that's quite significant. So

average for buy During an X.X used were continued price of our to buyback, the million shares, quarter, we shares $XXX $XXX. million

just shows So moving to original with full the of guidance results XXXX. our year. versus the We're from beginning very the the pleased year. the of This result

of see above the year-over-year, $XX an midpoint the for revenues reached So we $X,XXX of our can million million, the year X% increase guidance.

$X.X Quantum, XX%, non-GAAP actually of digit guidance, mainly fuels Harmony, again, sell was again, year also XX% look XX% end driven for growth, was Harmony the was details, we already the the full CloudGuard showed both two revenues, that focus led our had see the When year. at the for with what double coming digit revenues and above EPS the success. with guidance. year, the at the deferred on XX% at billings year-end. we that and which which we CloudGuard, already a also more The $XXX or three year, triple-digit full which full success top few is of year success, a great growth, high if revenues, pillars and our at this to include for strategy Infinity by the almost customers discussed Looking last the at we the growth Infinity A quite the billion also $X.XX pillars, caused strong the growth the above double growth. which Subscription a of million, we year, that $X.XX, our calculate and great versus $X.XX, reaching full our around from three XX% revenues the subscription. growth are our year-over-year of the

full few increased margin of mind expenses the end income in a highlights. XX.X%. majority by the but increase P&L, at the Gross I of the at don't towards came Bear in repeat just few everything, just the want a to Looking that Operating highlights, strong year. X%. the

margin effects the around P&L to year. just more of the at expect on year. effect in The X%. weakening that -- So a well, is next was $XX probably year the lower the The dollar but effect the towards million on beginning full year rate, come next had item from the next of on

impressive a $XX So when from you that those account into just got are million hit effect. we results of the currency quite take

to on weaken margin always it's strong to on means non-GAAP about, of predict and concerned that course, operating that's During operating reaching against of about be margin. effect Nothing a X% around X.X%, QX, shekel, very our margin. year, operating Still effect the negative margin. continued dollar but operating also fluctuates, the part we XX% with it's next guidance, our the which

you what than interest to financial X.X% completely the used the drop again, portfolio here, Looking lower with we in invested see line and that the Lower at expected. rate, historically. opens we rate the interest have in income

XX% expenses interest index, around So we of was year. for which rates. see ended this than lower result higher the the expected a as everybody Tax

and it next maybe million, income, we $X same, for the next two it. Looking year, quarter or the into the $X guidance to meaning remains expect drop for the that's million financial

no same assuming will be around year the levels, Tax quarter. to XX% it in $X the and the to will expected QX, QX, those for and Average We XX%. to bring year, for lapse predicted on between X%. for $X around QX stabilize XX% as is we the statue reason, a somewhere of million to QX, million be limitation to zero expect there surprises, QX this us in

of of income cash $XXX can X% guidance. $X.XX a with less. was flow look which non-GAAP operating very per net more for it range, and be -- course, $XXX how for is flow. GAAP is the the $X the X% cash our above $X.XX growth line profit. versus or million, with is high share, income talked very Of $X.X about cash at the at and $X.XX year When net the the the income million, much billion, net it diluted full again, year in closed year, strong a we end flow Operating we strong billion, operating almost We

our nice our it's that link the for continues. see P&L, us, we But very it cash So untypical. flow between have and to

strong collection, to costs, excluding the the effect nice is the X%. good DSO, very acquisition-related of see that's there and hedge So healthy

again, year million XX $XXX the just for of very million. $X announced the amount $XXX. that's of about in So quarter, in purchased program shares $X.X billion, the we full last billion, up you of additional for I'm the average expansion the We buyback reminding the to billion, price $X strong.

around For starting by XXXX average somewhere to share million expect million. next year-end in year, XXX XXX XXX and we XXX the going somewhere to million, shares be million diluted the around down

So the the shares. of for that's number forecast also

double across have Moving to the in profitability. change see billing to year how Strong, trajectory, guidance. growing focus to new exceeded the digit, is guidance, in which growth many strong the all double and continue the are the summary. revenues nicely cloud customers, strong EPS strong digits, areas, top nice the of part

you. So very with that, his over pleased with I business for will that. insight. Thank turn highlights call to Gil And the and

Gil Shwed

just really, but much, very pleased very results, probably everyone see mean speaking ever, very, and and and I'm you this the external really quarter unusual quarter. very to here especially had our measures this the share, that not I we was we a Thank strongest that as about see internal quarter, internally. amazing about I'm Tal, financial

strategy to real the achievement. Quantum every metrics mean, usually Now quarter about even foothills very probably three actually all that and business turnaround the regions, quarter, getting in business core EMEA, a -- the to pillars, very, our Network presentation, Harmony metrics. really I on going showed and our this amazing the I'm the way, speak good about APAC showed of of last business last Security that's growth growth, Cloud, lot into the of by some XXXX. I dedicate entering very in speak quarter primarily This internal contributed quarter. good business, the the Americas All We're

of we're investment. on with which is year And do XXXX. that, lot we to renewed here energy, a lot So key wanted share a top start the you strategy, with with entering new initiatives a what of a I of

our and one slides accelerating objective, four in a new growth. initiatives, of that's initiatives that I'll course, So each our message, there logo, branding major be continue go We number new for more. will is XX second. I will of mean where these picked with The of and I speak about start. we next new four into that start the with a here

call the We about with are a sales growing a growing, we our with going unprecedented going Point the We're lot price least, Check of and and new to leapfrogging in frontline I'm force. think and Last industry new we're And not our to speak year create starting I and but the innovation. Rocket, with products that performance. structure investment share continuing that. continuing

and, translate end by of the be supporting and growth the reaching goal, hopefully, make actually, this will customers, XXXX. investment customers we'll mainly, results, internal this by to frontline XXXX delivering which Our more into salespeople And is hope course, I more able grow year. in XX%, of

first So initiative let me start with here. the the first or message

branding, new Our security. our best new positioning,

by Now differentiator. been security, always the best way, the has Check Point

the XX what best That’s to that's for important why to reputation. very, think I understanding years, things do important. security. what message do. delivering and And is our to explain the so it's we it we of that's that very That's one everyone, show

attacks a logo see deserve you new years think the to being with new the dependent lot far need cyber I on year a too started don't best we're that, it But log latest when message our how that So on seen much I and changed how dependent ware, so is logo. the is enthusiasm security, But fresh the here, in is all message keep And you time Internet, to ransom we think think I can't it secure. much good that energy. a accepted And to most much that know comes understanding into we why space, it the cybersecurity, first with important XX you is. we're vulnerability we've enough. we get for go says new that of all And important how the I the on us the showed and we showing new important? look that so need

you brand breached. positioning. When each get That At the will same the You C, to want B, will you day, can't qualities all three cybersecurity, can shape. have A, you that's pick the drive destination, same different get I your roughly different the cars brand second brand the you best. not say get roughly prices, the of one case. a car, at to at time, end In

thing small like infected that's you zero-day our you through. there's industry will come almost does entire letting If open If breached. security, one second best get pick or file

get that this there's let how It's today, If best bridged based is believe Again, why. you security. all fifth difference, best try many, ransomware. I on files understand through. two I attack will we through, and take by where these one CPXXXX hours examples many way But of which vendor files Check that won't that’s even to can And delivers experience, that's with actually that's cyber generation huge, and just presentation all summarize us We our only get with to you because register conference you we these And better the one Check slide. Point. the in protect Point, the won't our the these of security let ended differences Check deliver come you'll the the the architecture. now small Point against some can watch Infinity and to

pillars, to where see slide the and and think it you've when same see Point. user what cloud, together, I network Cloud, vulnerability Harmony Now all information the access about the that's the means, seen based before, different and immediate Quantum protection in each all we this translating on the security all working or piece the all platform, coverage you an provide that Check you

look you We not direct and to every scores coverage important, coverage amazing And results test the and that, expanded. you attacks, can deliver unknown full here prevention very which even which e-mail just full and of some servers devices, if mobile, no vector prevention convey. our to we attacks. in for picked and network full at the our your can let's to actually you these best organization also, against And some the deliver cloud, at devices, our the of each whole the web some I Check gets Check competitors, security, we competitors. direct secure. devices and underestimate close to where and e-mail including now servers, that. mobile are and want can every see see in them being can't of Point Only you the and in, and customer to each all that the full feel deserves Point amazing marketplace, best Infinity are vectors, the that comes and attacks, web one here them the malware see that's mean one score give types So protection attack cloud. think spectrum I we day on of attacks. the But to unknown the network corporate And want different players I zero for endpoint the or that of We renew Infinity preventing difference endpoint makes customers we of penetrated that message between get are

different you leaders in in were for years this were years XX company, a to that we vendor, feedback, ago, the actually one security network expansion, we scoring and can be the think audience, sector, the not in And or few a quadrant This in see which market product. for scoring in Gartner now see network firewall we're just quadrant. you now feedback I nine is about GX, the real customers' scoring captures we the known categories. in are firewall security

We these in technology coming is categories, Check see, the than of way, nine more leading categories, are and Point in all quadrant. you one many leaders in -- the by there

I We management, are framework continue And access, use in huge capturing and securing Customers that's remote think Infinity intrusion to firewalling, prevention, extended we these drive think cloud, mobile, are areas, that we I architecture entire entire Point a we and the and and our leadership leading innovation. all everything. difference. enterprise love now Check endpoint, the that into to use

Now beginning of would industry. launched XXXX we want will the our one just here point can of that product hours. of But roadmap, important our you course, give if dynamics at another I two the that I change to be that

bit product network if We it's most launched the security call Quantum one a talk important last let about the think And not important, most of that. it little me Lightspeed. I decade. in the

on times focusing data world's center than much are we better price to moves center, security XX XXx data security. competition. the very on very, And in fastest before going where better introduce the better, here, performance latency than and super low Focusing fast, need people fast firewall, the data where data

better Quantum With difference. Point how per And change gap were to if get to and deliver. model. are the itself ASICs I not unbelievable. accelerate That's And So where where by would our second. can until we the see gigabits now, better Lightspeed, by Lightspeed XXX $XX,XXX, gigabits better and here, think in can that's per end Check That's first core in markets and see change try can the that’s XX Paloalto, they leading XX% gigabits for what marketplace almost analogy, lot for way, this almost again, on this that car done come times that huge say differences. you our much vendors gigabits, And you you roughly gives price a Fortinet in to and the low-end $XXX,XXX. XX need than at the the dynamics $XX,XXX. you to that performance, here, time, the better can times huge at built the $XXX,XXX, before, development see three that's the products second our highest Fortinet almost than would three you performance and XXX compromise and don't you Paloalto, in. going That's, team work with XX utilizing of firewalling performance. new the Fortinet, see

And our that and First latency, than that with kind most Check XX no and Quantum product high three in one faster the actually NVIDIA, ASIC per It's with kind of to Lightspeed, these fast of industry terabits before partners the ultra-low hyper for it microseconds. days successful deliver models Point scalability throughput, to XXX can four times performance deliver scalability time line was providers to less world's from gigabits performance. Maestro three gigabit price XX microseconds. XXX it second, for these super with

least can So in we industry. network part the proud very think the very, are data We at the that of changed of dynamics, center that. security

initiative, the good And that's, start next a next very our it to with. call we to So Rockets. initiative then think, the move we year and I place to

organization internal to and a places we for will Rockets. So, strategic, what new potential we invest drive that kind high Rockets is that are want feel in of of there -- what growth. are where are be types

a R&D, growth. tied and marketing. that this new organization, create resources. Point to very growth developers want much be all together, with will one reside and to to and We with to is structures very that unified is want the with focus much move company, direction. areas marketing, moving within It's areas. the these the to have So that in in fast, want align sales not more everything entire agility faster one invest to business was all we to one Check ability If drive to key in sales tied We past, able the

are And trying is market, did much or would that assets. we model prevention. here. cloud, here, emerging I it, the We people, the hundreds new important that's one to a MDR/MPR which a the us, one time, big Harmony new of with start And I and three very customer spend detection kind based this area way automatically on for is next a time areas; managing recently. maybe won't Email, too managed an the of manage we And acquisition that response, like call

needs detect we prevent the things that and that not immediately attacks. are working So

I the This $XXX and a think industry people is in playing industry new starts we Again, that can create revenues. which millions few before. start-up, haven't from here or is is and we the of of tens over a no CloudGuard small on new dollars million. Email been a a Harmony take

trying So model try ways a model. new to in each one different this different

Rocket. a on focus the bit me little CloudGuard Let

we're I CloudGuard of proud delivered very think today. what

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security that think customers what security. challenges and cloud with cloud area the developers, for type with new it the a presence to years, continue the and a has. call our do that that's recent developers in fifth us, to first expanding the I has or new developers coding inside lot of by puts we cloud that We That's acquisition

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only us start new CISOs play time can because community. great that over into product, from developing getting codes. downloads also lets us, the developers the audience, Spectral into they with of XX,XXX is and will and administrators not think version the I support are the the we this security open a source it There's the a to open the of but source We nice get

happy this and very just the acquisition with visual. are we that So announced we completed

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will We keep doing that.

monitoring We sky. profit to keep will the to our and resources go and margin delivering get

-- high further We right and and in to changing growth. the money we make the that all invest And in investment access make and industry. into growing the decided have profit take mode margin the of operating the of actually operation highest the we one

is we about not are focused here. So really to the going And our show think XX% sales what It to we I investment going that but more the can take I all can be make growth deliver mentioned whenever easy. areas. we to goal, create when time Rocket the in we think we our initiatives very faster. think are we -- force. internal grow expand It's results, the will the that can for business optimistic

question, call the that's to projection. time open So for before your the a I

I feel that assumptions we during growing some the have I that billing that we nice keep in already of growing, projections, stated a think the our can rate.

Our us is to are revenues, has into down supply business growth. capture internal our -- it are we introduction part translate because with us that new growing all Not it. deferred our slow definitely on are Quantum projections some market internal will share the because enable risks for and associated markets for definitely revenues, goals risks in things, chain and subscription because new the Lightspeed, the partly which may and of partly of that immediately of there's can double-digit some great even the others

cannibalization are the Let's price us there the can not XX be to But to we better price bringing times the market do capture when market because win in can also segment. XX away. that to and performance, to forget again, right thing that's hit times this that, to right

can the drive So -- a nice in will more in as booking a we conservative, the well, translation we projected be bit business. in I revenues growth will than to feel a more invest the that may lot much faster we And bit very of past, little we of but mean, we billings little be course. the

start with if So full the year. look we that, for let's the projection at

we wide actually full based economy the about we range. quite have just year, are the For a I the here day. that uncertainty on everything seeing said, And again, plus every

the range for to between million, So billion that's revenue. $X.X the $X,XXX

the the hope EPS be our of X% part, very it you a growth never always know. to potential for GAAP is to even high in is than results and level There's to that's growth That's and challenging. is caveat, of expected worse approximately there a future at $X.XX uncertainty. target as the that projecting my can know, XX% I you projections. expected or to be but less $X.XX high-end. at the full year. If the better EPS translate is I you regular the results that. the mean, range of mid-point Non-GAAP better between Again, $X.XX

the between approximately less. the and $XXX to is non-GAAP EPS GAAP be $X.XX is for be EPS million, expected For expected expected between to range $X.XX, to be is $XXX revenue $X.XX to quarter, to the million

hear conclude So much presentation, questions. our love your very and that's to kind we'd of

So who's going first?

Tal Payne

Well, we're he’s do waiting probably for Kip, going to that.

Kip Meintzer

for hall. your will limit apologies Q&A of question, don't your panellist your you'll Please in Please, as question have for that's be a selected. hand. can out and I list, My the the going the to to many so as that. out be your We get and call name person raise one, also already possible. we asking who’s in everyone call

Our Gregg Mizuho. question Patrick Deutsche will to followed Colville of first going Moskowitz by be is from come from Bank,

Patrick Colville

just and factors you apart kind mix pricing? probably how the excellent of that into I around me those then I results. the the kind for on playing around any was are are cybersecurity on. product the changes gave, already environment, and guess that contributive of factors you pick you, just Kip, congratulations some factors suites having mean, spending the impressive, guidance? and So set can the you colour give us no guidance behind Thank guess, standout you I of Can just thank very doubt.

Gil Shwed

Tal, it's for you.

Tal Payne

Okay.

-- X%, expectation last say we see into when the an year seen came of acceleration. have an seen the with following. I'll So we we've year but the We through year

you If at at look short-term, short-term you if see look growing. both billing the billing you but even and the long-term,

into the So P&L. translate it's starting to

start increasing even X% X% our to from X.X% revenues we to higher the to to X.X% QX. So to X%, see in

more really because a business. in we optimistic came we see nice So

that's but I why three of You look billing see about in actually the strong. weaker some regions other, it talked than finished revenues, the them

we're an So of invest that of the our results investments. some hopefully, see in and CloudGuard to it's Harmony. indication in starting We

it's while effect an from have revenues. numbers, to small So our also starting starting on

So nice that's see that as well. to

QX, was it, So was we that into The problems very So them X%, more there's that see up account, that see how on we to translates, think feel But I whatever to account, them. each point. and new that's something of items, like risk the much because that higher and we moving the QX, range that into all area about closing do issues. of more know of year taking know. take when daily, QX, very comes we the chain them. open right? we're you is And calculate. it We the it that's into working We're very supply the opening, all going hard risk to Gil midpoint solving to sold hard beginning a

assume towards second half. elevate will So very year hoping the the will it We it's first it probably to with continue happen. the and half happen, I'm run start of but it fast will the a in shortages. I'm not sure

hopefully, travel that's and how continue it affect. more COVID, I So stronger to will travel, shortages. full an is We reaction. Macroeconomic, this going assume will the year levels be assumption waves know. to different to know it back, travel a return see much midpoint, didn’t hope but and I XXXX different people more we assume happen. strong. what took different showing don't really of we We We relating will level. don't in up regions in

the rates. the So took Currency, in middle. current somewhere travel is we

expenses. talking will only also it the behaviour customers' if I'm dramatically, with not It change about budgets. changed So their

assuming So about right would stay. we now I'm that what know the currency

So affects expenses, but it hopefully the the on no effect revenues.

that there. additional the shift is in no in Infinity, assumptions CloudGuard, Growth there part Harmony, assumption definitely hope your of question. growth in there. the growth I So the answered

Patrick Colville

Yeah. that’s much. I Thank you so excellent. mean,

Kip Meintzer

All right.

followed we of Next Raymond up, have James. Moskowitz Gregg Adam Tindle by from Mizuho

Gregg Moskowitz

right. great see All you Thank Kip. to the Nice results.

terrific Just at execution I the have if questions, see two improved and Check related to I Point. growth may.

what network believe XXXX. you're that then is competitors I we've said is guess Check And that security, some Gil, perhaps growth my I driving expecting for specifically, are you, is anything double-digit demand? that well. pretty within for So you heard internally, from you And pinpoint there for can doing of billings also stronger your Point question

ramp. Now ability is my question force XX% projection growth obviously, frontline your a But productivity your expand by sales there sales reliant your year? on there's to how is this

Gil Shwed

an that's excellent So question.

people that I X% growth for fast can growth first recruit the to that the we'll the of an one, of not very, XX% and that's very the as a say year. sales to sales do sure not I'm we size, but hire as growth hard to the growth, fast be still I days. the higher the force, sales the able force at numbers mean, to enter people but year. in actually think Again, is many we existing the it. are these you even based force such message my quarter. we And It's This hard but sales -- we on organization that First, message. pushing along when make or to is trivial growth our higher initial Usually, beginning that

work. think works, we everything if very will set but not everything think I to I nice are numbers,

won’t now. all and think we I we recruit the based have think said to that that have what the be we range the be now we I to that put we've we to on we productive. based the people in numbers But get want to able on can all productivity

the our conferences tell conference, very, in APAC had So free kind very feedback, of we one and to excellent CPX employees, is general. in Americas. I going end, European attendees, CPX customers, increase in that's went partners XX% Europe and again, finished excellent the And excellent energy. the for just scores, Today, can in the you, it we well, and

So year I think on the we're the track. starting right

Gregg Moskowitz

Thank you.

Kip Meintzer

sign-up have you'd If I event, register the can CPX video-on-demand. see like we'll everybody highlight for actually if and you to also, can and

we Powell up, by Next ahead Adam. from have Adam Gray BTIG. Tindall, followed Go

Adam Tindle

Thanks Kip.

Gil. then you're six metric. now approaching billings the consecutive with in for question quarter growth clarification a accelerated Tal a Tal, and mid-teens billings, for Just

scepticism there. any want to dispel Just

before quarter part the pull-forward And in you the QX talked February? price XXXX. or I response about here increases some in anything increase early implemented duration. what talk seeing here trends for on early You've also Gil, of just billings broader Thanks. price based there Any how can of price any And that that? be impacted in decision think notable that by Was you're conversation? on partner ahead on increases based you in for if could of customer your billings in sense

Tal Payne

Okay. That I'm I but question. not was long remember a sure I’ll it, try.

the So the was first strong. billing on building,

last was from, think, or XX%, see you you find it You acceleration when think growth, which quarter. I can right? I short-term I them. billing, see double-digit can XX% the you can't also but X% a is also calculate numbers, the calculate an

grows. growth it see is -- the if or you even So short-term that being total you at look billing

which is if a a It's of short-term. because so not can you Long-term increased. always So but even phenomenon. long some but the also phenomenon in that's it it focus, are them good both it it's you [ph], run, good for that always good, the came OTA customers from going with does, see of the accelerated

on effect sell maybe sales don't an the the increase. end if the I or was -- remember Remember, to price of to there distributor, to part the question, partner second sell we users. The

millions, trying it hard some probably say, think million, don't probably the was to will the pricing. effect. what of it effect in might there there hundreds right? very know was the been So it's to But was $XX have I billing. an of increase I cause yeah, avoid maybe

Gil Shwed

our that remember And price start increases from Xst. January will

the proud renewals So of meaningful. the the I But think is that some or we purchases growth a the again, wouldn't little people of be the felt billing bit we maybe earlier. it's impact did unless again,

put way. we it Let's that

As cases, again, billing in every down the because doesn't quarter, we play it are many represent. know, number to you trying

I quarter, very indicators. seen some think good we've This

but impressive. not showing because quarter, I numbers quarter, are So the at if we these because But they next good know seen last quarter, internal are last just metrics. least we've you don't very predict

Adam Tindle

you. Thank

Kip Meintzer

All right.

Powell BTIG, Gray by have from from we up, Hedberg RBC. Next Matthew followed

Gray Powell

Thanks numbers. great. right, All and on the taking good for the question, congratulations

the And with growth how Did how Avanan? that yeah, XXXX So, of we that the your outlook? improved acquisition QX? meaningfully then in to the about about opportunity should just acquisition upsell context think in billings think contribute we should

Tal Payne

at look the Just total number.

effect, an one. very had but a small Now, they

the small we Harmony in grow a them course, Point part it's significantly they it. Also, year. with Rockets, are it, we will major a Gil course, other Email company. that's But and next They believe why we Security. Email one Check of said, very Security. of announced as definitely that consolidated And Of believe it of

margin believe fast and want anything, it's we to year increased invest we a market. of in a investment, it's it profile fast-growing nice for in which Check believe to and invest next it's plan we different part our very Point, So we is growing we is actually the because want as say it. which than If profit

Gray Powell

Okay. Thank very much. you

Kip Meintzer

RBC Hedberg Matthew Capital of JPMorgan. by followed Markets, Auty Next from up Sterling is

Matthew Hedberg

as about the historically? these looks the Because had? new number love is of great. XX% well, from And maybe but the you've a uptick relate And force curious, lot and that me you to thanks guys days? talk on And Hey, I'm does what finding is targets to strong. target you've that reached factor done I like a really challenge inhibiting logo can the really, how talent branding maybe the the seems sales what the expectation, substantial it's Gil, Kip. is that -- Congrats sales -- results. it way, the growth then an prior by out good

Gil Shwed

It's right. years, them. you're the didn't cases, much, the in than last much First, what we we were In all single-digit numbers achieve bigger few And many before. had growth.

some we them, we achieve didn't of And them because investing. weren't

salespeople, for if they And like sales they force them. the big, general keep the to the of got the budget tendency because support them hiring they themselves. hiring, people some so of like that is help And territories the keep opportunity actually to their very they will for

analyzed our can But help we the more and the the in the last need areas, in over capacity, salespeople. overlays more So our we we years, in actually almost increase didn't of strategic sales, some few growth didn't it in in salespeople. creating the -- products particularly the part form technical to and big Americas, support salespeople, that came it of

change internally. we in only to and change mindset not Yes, our to customers go new So big want a and an Yes, in is it's internally Yes, people. this and a customers. investment want investment all we just go -- attack. it's big and customers the an better, big find we want go serve big the of not from to and segments

Now I think it's doable.

Point. sometimes in But to think and working I've for our on people. that work for good people company, people to do sounds. as quarter. don't We there not working for target is set people lot the quarter. start-ups, understand are I I all the example, yourself hand, in promise, first necessarily for reputation you in that that build Check but the can achieve for as think other of I there's we easy the many your a trying marketplace Many hire I that the the will mean, it think want establish first the all is of

take a probably meaningful. but do we pipeline to hire have good of cadence. will that a salespeople, think be I that, We the it I So think do should change good have time us some

year it we it may of some next and Some lot a of this rely this it of year, year.

Matthew Hedberg

you. Thank

Kip Meintzer

Thanks Matthew.

Sterling Fishbein, followed by Securities. Joel Jr. from Truist is up from JPMorgan, Next Auty P.

Sterling Auty

a like full that, want I name Thanks guys. Kip.

that Tal, of during actions took? light that was guidance gross should that the -- think So I the was help after? the was instituted what you magnitude wasn't instituted What clear the quarter, of how December about can EPS you gave? completely the margins you what in we price us impacting And

Tal Payne

one talk part Actually included of second. it let's that, about right? as So

October beginning, That's the for First, now it's was in December the or of maybe one. in price beginning and the XXXX. increase

Gil Shwed

January to Price quarter, it be the Xst, fourth clear. increase just on in starts

Tal Payne

Yeah.

one. that's So

significantly know in we Secondly, think, increased, do X%. only We many didn't an increase. people increased I I more.

a not it's So huge increase.

shifted $XX just million, might it millions, will you right, why it million, So expectation, question, It's part doing some And but not an that's so increase, -- that's not that's so it hard -- of them I to not of the have but this see was it know. maybe before. to right? like expect $XX XX% start be next have $XX -- put don't be it's So to to million been that. increase, very year, more might the

have one For into on we guidance, the next that. you everything, hand, year account too so

other the regular. competition On you hand, price have, is

higher the higher you -- The You ASP is and cost than have pull costs. X%. Lightspeed, the which might the actually have increase down,

as included part it's right? margin, So the of

Sterling Auty

you. right. All Thank it. Got

Kip Meintzer

right. All

by Junior, from from Philip is Credit caller then and next Winslow Our followed be will it Suisse.

Joel Fishbein

you of your you could hear but be the that potential results? it noise, you right an market? Gil, in also you but overall do really then to made haven't that we LogXj for now. love this Kip. seen impact on bit think from the the how for Thanks prepared remarks, of overall a What is breaches lot hit And a one’s it little has I'd a to for guys of lot accelerator

Gil Shwed

reasons. We relying growth. for easy an of But will found, on an market. any one because effect specific only It's the accelerator have ever break for vulnerabilities it not challenging our -- not as are the on a few it's most

it's First, exploit. to easy

protection. level many, One interfaces on web interfaces string exploit. Many a that center, many Second, web code but is are are that closed really But doors that causes to execution. and every internal there's a behind are of services it's and outside there, the almost -- remote on higher vulnerabilities to are open. and server on every easy data it's CloudXJ

that's So part. the worst

think Now by XX are day. every there don't the maybe an don't But that you being hours, way, XX exploits lot most rarely, We CloudXJ, and industry variants see don't and but exploit them, that see different are vulnerabilities the used find saw we the the so of created evident. we you industry. like I them inside a Usually, see of -- see exploits. exploitations. within you In that's

was it to attack to how easy very, very systems. to that understand use So

because managing they're so there think and be nobody look it at I'll with nobody attackers steps. and years -- day Maestro the day for because, touched, just and it, enterprises when servers which because know right the do in I one, patched not you attack and how thing they how maybe great. think but to to are on do again, out remain there many it tens is that that explain model, shows nobody they and will there's the source fix works. around on, nobody millions that of knows I model, of handling. infections showed that's the or On multiple one. the things There's try they But of there And world the probably

collecting intelligence. is first So

and with point malicious entry it inflecting the the finding is Second malware. the very

the it point. industry. point and It's and many this on impact many used by in So by sure future the entry will easy it's used, hacking whether entry an is the criminals, I'm be and new this it will be can have groups,

Joel Fishbein

Thank you.

Kip Meintzer

right. All

of Our & Ho by Jonathan next from is followed William Philip question Company. Blair Winslow,

Philip Winslow

my Great. well. a for to question question. Thanks you taking cloud see for are doing Great on you’re all Gil, security.

we've rates just from cloud, the particular And But also from in you past you just the Point great? single to more cloud, about mission of are the a If hyperscalers shift the criticality clouds. Check just commentary could that in customers? just you on When not and call be what maybe of the of the multiple quarters, shifting, but through the impact that think in of if accelerating security attach give hearing are it couple colour the CloudGuard had that workloads seen the cloud. workloads would about you us some you think

Gil Shwed

for not every plenty is at I a it The of interaction. It's it's customer. by multiple Microsoft, moment, for think security conference, up. that and big that. every and Google targeting how high the industry cloud every providers, We very giant start-ups will see cloud priority are There Amazon it that a is directions. or shake way, investing are unclear, in the

that. and now industry The Even responsibility. one application. because part whole think our good everything. care to doing in their of the platform of the in business. providers be also the we customer of blind are That's investing They cases, we making in some way, by of one usually cloud big their arguments is making deal multi-cloud They thing on in that are I making the we with job making secure. -- are environments taking the investing of not shouldn't customer the will securing But investment security top for the big confusions. creating in are and in are --

So there there. is an investment

is up? think enough. still don't that a seen taken know. still it I to very that important I I'll in it give very companies need a but good have security example mean, think not people to evident how for investing are for example. I of opportunity we've protect, mobile in important area it's markets that marketplace, me invest, will the I shake market you security Mobile a another a remains us

whole the we still are very that company. that important. different a connecting it's fact connecting It's individual the It's much think interesting and It's that very of is an change Point structural And bigger. elements. assets. cloud the fact will to the a I impact Check challenging private cloud we the it device. the I because The the whole public the think are much, of remain But benefits that market. cloud, all very not

invest expecting we're good And evolution so in think to that And I some mean, we'll continue marketplace. in I that.

Philip Winslow

Thank Great. you.

Kip Meintzer

is Philip. you Blair. of Go come question William Thank to Jonathan. from Last Ho Jonathan ahead, going

Jonathan Ho

play, as that And don't thing congratulations little Lightspeed ever Thank game. one And want wanted in. squeezing a quarter. I the around to Point better, I've I performance you touch price strong you echo well me me think cannibalization for my I Check on made. let did comments bit to on understand the a

own shift your Thank about with you. And something the does so in how And ratio shift given going forward? this do -- just changes potential signal strategy think impact, that Lightspeed? like you dramatically the

Gil Shwed

we that first, centers, with by -- we other big especially of data business. the So been financials, companies that not for performance competitive. and are win very our we've head-to-head the lease competing big many been on way, price, of in the are And when necessarily making we but but we only price have compete

far and love and that, change don't than with performance us, in bigger from they change it market. XX put the think market in data risk so put we many market a on. center contain that's price. for five the cannibalization now, they XXXX, cloud when know, that the to us, have it's is So us move I or security. for there's the for in reason cloud The measures dynamics. but -- or use it we right Again, lower feel XX that the sell some many, try customers, can It that I more today, you we times and place Lightspeed win there the In XX data overall, is know to price the it's And the same much behavior. center -- think security the and ours. But for is We can bigger more years to I the again, of times and for want a times example, then, way. we opportunity hundreds let's because,

So expanding is the our important market center data opportunity. an share in

Kip Meintzer

days you to revisit We ahead would All very sign-up. in after if with CPX, right, speaking the you We'll go guys. coming today. look guys and Thank like to Again, you the forward and much. and attending call you appreciate weeks.

for on We missed of you Thank it weeks. video-on-demand in see those we'll have you the that and it, coming you.

Gil Shwed

Thank you very much.

Tal Payne

Thank you.

Check Point Software Technologies (CHKP) 3 Feb 222021 Q4 Earnings call transcript