Fortinet Q3: services forecast cut drove a 20% drop even as revenue beat

Fortinet reported a quarter that beat on every headline line and still fell roughly a fifth. The 8-K it furnished on October 28 carried record third quarter revenue of $2.08 billion, up 20% from a year earlier, product revenue of $765 million, up 37%, and total billings of $2.34 billion, up 29%. Non-GAAP EPS of $0.91 cleared the $0.85 to $0.86 analysts expected, and the company raised its full year revenue and billings guidance for the third time this year.

Then the stock dropped about 20% in the next session, to near $139, and the reason sits in one line of that guidance. Fortinet cut its 2026 service revenue forecast to a range of $5.15 billion to $5.17 billion, down from $5.18 billion to $…