FireEye Inc. quickly beat Wall Street estimates for quarterly results in each category on Tuesday and increased its outlook for the full year. FireEye FEYE, -0.53% is benefiting from increased security awareness following SolarWinds Corp. SWI attack, -0.22% last year as companies harden their systems. That, however, has led hackers to find other vulnerabilities.
“There are many more zero-day exploits,” CEO Kevin Mandia told MarketWatch in an interview. A zero-day exploit is a computer vulnerability that is exploited as soon as it is discovered by hackers and before a security professional can develop a patch to fix it. “Part of that is good news, it means that security safeguards are improving, they no longer enter the front door.” Mandia said. “That drives our business.” The Milpitas, California-based cybersecurity company reported a first-quarter loss of $ 55.2 million, or 24 cents a share, compared to a loss of $ 76.3 million, or 35 cents a share, on the same period of the previous year. Adjusted earnings, which exclude share-based compensation expense and other items, were 8 cents per share, compared with 7 cents per share in the prior-year quarter. Revenues increased to $ 246.3 million from $ 224.7 million in the prior year quarter. Analysts surveyed by FactSet had forecast adjusted earnings of 6 cents a share on revenue of $ 237 million, based on FireEye’s forecast of 5 cents to 7 cents a share on revenue of $ 235 million to $ 238 million. Cloud-based services became a larger part of FireEye’s revenue stream, increasing to $ 85.9 million from $ 68.4 million in the prior year period. That’s starting to catch up with other products, including subscription and support revenue of $ 97.2 million, down from $ 105.7 million in the prior year period. Analysts had forecast $ 81.7 million in cloud revenue and $ 97.1 million in other product revenue, according to FactSet. Professional services revenue increased to $ 63.3 million from $ 50.6 million in the prior year quarter. Analysts had forecast $ 57.7 million, FactSet reported. Using annual recurring revenue as a metric, FireEye’s cloud business has already outpaced its on-premises business. ARR is a metric often used by software-as-a-service companies to show how much revenue the company can expect based on subscriptions. Total ARR increased to $ 643 million from $ 590.1 million a year ago. FireEye expects second-quarter adjusted earnings of 8 cents to 9 cents a share on revenue of $ 246 million to $ 250 million, while analysts had forecast earnings of 8 cents a share on revenue of $ 244.1 million, according to FactSet. . For the year, FireEye raised its outlook to a range of adjusted earnings of 39 cents to 41 cents a share on revenue of $ 1.01 billion to $ 1.03 billion, from 35 cents to 37 cents a share on revenue of $ 990 million to $ 1.01 billion. Analysts estimated earnings of 36 cents a share on revenue of $ 1 billion, according to FactSet.