Business & Technology

A Q&A With Ken Xie About Fortinet Business Momentum, Quarterly Earnings, and Customer Challenges

By Fortinet | August 19, 2022

An evolving threat landscape, an ongoing cybersecurity skills gap and the explosion of the edge with work-from-anywhere (WFA) means traditional network and security architectures no longer work for today’s digital business. Organizations require a hybrid approach that converges networking and security to be able to reduce complexity, while securing and connecting hybrid and remote users to advanced security with superior performance. 

Fortinet is at the forefront of these dynamic changes as a cybersecurity leader for over 20 years.  Fortinet's founder, CEO, and Chairman of the Board, Ken Xie offers his perspective on the cybersecurity industry, important customer trends, Fortinet's business momentum, and how Fortinet is helping to close the global cybersecurity skills gap.

Fortinet recently announced quarterly results. Can you provide a short recap?

Ken Xie: We delivered strong revenue and billings growth in the second quarter of 2022. Customer demand was again strong and broad-based—across geographies, customer sizes, industries, use cases, and security solutions. We delivered our fifth consecutive quarter of at least 35% year-over-year billings growth and also passed the $1 billion milestone in quarterly revenue for the first time in our history. Our better-than-expected performance demonstrates the strong demand for our cybersecurity innovation. Secure SD-WAN bookings grew over 60%, reflecting the need to converge networking and security while providing a solid ROI for our customers. And OT bookings were up over 75%, reflecting the continued elevated threat environment for operational technology environments.

Can you elaborate on why Fortinet continues to grow and take market share?

Ken Xie: Two key market and industry trends, convergence and consolidation, are key drivers of Fortinet’s long-term growth. Also, our broad portfolio of security and networking solutions and unique ability to run traditionally isolated technologies as a single, integrated cybersecurity platform uniquely position us to address these trends. We also continue to see large enterprises favor Fortinet's industry-leading cost/performance advantage enabled by our SPU (ASIC innovation). In addition, we remain focused on securing our customers' entire infrastructure from the data center to the cloud. This ensures that every transaction is secured end-to-end and empowers organizations to build the networks they need to remain competitive without concerns about performance or protection.

How are convergence and consolidation affecting customer decisions right now?

Ken Xie: Traditional network and security architectures, especially rigid systems hidden behind a permanent perimeter, no longer work for today's digital business. The explosion of edge and cloud computing, combined with the rapid transition to work-from-anywhere, requires a hybrid approach that converges networking and security. This enables the agility that today's organizations require. 

Fortinet is at the forefront of networking and security convergence, empowering our customers to reduce complexity while maintaining superior performance. Making this happen requires the consolidation of vendors and technologies. Organizations don't just need fewer vendors to manage but also the consolidation of product functionality. The most effective approach is consolidating point products into a unified cybersecurity platform. Fortinet's innovation strategy, led by our in-house engineering and development teams, primarily located in North America, allows us to maximize this trend towards convergence and consolidation for our customers and partners. For example, the Fortinet Security Fabric mesh platform is designed to provide consistent security for organizations, delivering broad, integrated, and automated protection across multiple edges, from endpoints to data centers and across hybrid cloud environments.

"Fortinet is at the forefront of networking and security convergence, empowering our customers to reduce complexity while maintaining superior performance."

How is Fortinet focused on helping customers secure their operational technology environments?

Ken Xie: As OT leaders increase digital connectivity between their IT and OT network infrastructures, they face an increase in potential security risks. In fact, a recent Fortinet survey showed that 93% of OT organizations experienced an intrusion in the past 12 months. That's because OT and critical infrastructure have become key targets for cybercriminals, especially as OT networks are increasingly exposed. Several high-profile attacks targeting critical infrastructure have made headlines around the world. Similar to other sectors, ransomware attacks against OT are also increasing. Fortinet is committed to addressing OT security challenges in critical infrastructure sectors such as energy, defense, manufacturing, food, and transportation. Our integrated Security Fabric platform, combined with specialized technologies designed for OT environments and systems, addresses the unique OT security requirements that span the entire converged OT-IT network.

How is Fortinet helping to close the cybersecurity skills gap?

Ken Xie: Our 2022 Cybersecurity Skills Gap Report highlighted the ongoing cybersecurity skills gap risks. 80% of organizations surveyed have suffered at least one breach they could attribute to a lack of cybersecurity skills or awareness, while 20% attributed four or more. Fortinet has been focused on tackling the skills gap for many years through Fortinet Training Institute programs that are part of our Training Advancement Agenda (TAA).

This commitment was recently demonstrated at the White House National Cyber Workforce and Education Summit where we announced the expansion of our existing free training offerings, focused on schools as part of our commitment to training one million people in cybersecurity by 2026. We hope to make a significant dent in the skills gap with these and similar initiatives. Fortinet is also forging partnerships across private and public sectors to help drive an inclusive, diverse, and skilled cybersecurity workforce. This includes providing new opportunities for women, minorities, students, and veterans. We also collaborate with world leaders from various sectors, helping shape the future of cybersecurity and build new opportunities in the digital economy. As a founding member of the World Economic Forum's Center for Cybersecurity, we are leading a global effort to combat cybercrime. We also work with the Cyber Threat Alliance (CTA) and organizations like Europol and Interpol.

Find out more about how Fortinet's Training Advancement Agenda (TAA) and Training Institute programs—including the NSE Certification program, Academic Partner program, and Education Outreach program—are helping to solve the cyber skills gap and prepare the cybersecurity workforce of tomorrow.