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# Fortinet CFO Calls Services Lag 'Really A Timing Issue' As Revenue Grows 13% To $1.31 Billion
- URL: https://www.bullished.co/fortinet-cfo-calls-services-lag-really-a-timing-issue-as-revenue-grows-13-to-1-31-billion-a585f761/
- Published: 2026-10-28T22:07:18.000Z
- Updated: 2026-10-28T22:07:17.000Z
- Description: CFO Christiane Ohlgart defended a better 2027 for services against analyst doubts, citing service billings up 26% in the third quarter.
- Author: Matteo Parrino
- Tags: Earnings, FTNT, Industry: Technology

[Fortinet](https://www.bullished.co/tag/ftnt/)'s slowest-growing business line is a matter of when revenue is booked, not whether customers are buying, CFO Christiane Ohlgart told analysts on the company's third-quarter earnings call on Wednesday. Service revenue grew [13% to $1.31 billion](https://seekingalpha.com/news/4659184-fortinet-falls-despite-strong-q3-results-and-higher-guidance?ref=bullished.co), well behind 37% growth in product revenue.

## Big deals, slow service activations

Fortinet, which sells cybersecurity products that combine networking and security, said large new enterprise customers and expansion deals brought ramped service activations. Some of those deals also folded existing service arrangements into enterprise agreements.

Asked by a TD Cowen analyst whether the softness was a timing matter, Ohlgart answered: "It's really a timing issue." She told a Goldman Sachs analyst that customers rolling out infrastructure may not want to pay for services right away, and that the effect "definitely has some impact on Q4."

The leading indicators she cited were service billings up 26%, total deferred revenue up 19% and short-term deferred revenue up 14.5%, the fastest growth in five quarters. Management guided full-year 2026 service revenue to $5.15 billion to $5.17 billion.

## Analysts challenge the 2027 outlook

Ohlgart said 2027 service revenue should grow faster than in 2026, and that the first quarter of 2026 was the trough for services growth. A Raymond James analyst said investors would ask why management was pointing to a 2027 pickup after promising one for the second half of 2026 that had not appeared.

Ohlgart replied: "I haven't used the word acceleration." She said she had said improved growth rates, and that service billings would convert to revenue over the course of 2027.

A Jefferies analyst asked about attach rates, the share of product buyers who also buy services. Ohlgart said a mix shift toward networking products has lowered them. She added that sovereign deployments are more product-heavy than cloud solutions and so carry less service.

## Hardware strength behind the quarter

Total billings grew 29% to $2.34 billion and total revenue rose 20% to $2.08 billion, with product revenue up 37% to $765 million. Free cash flow grew 52% to $865 million.

For the fourth quarter, Fortinet guided revenue to $2.155 billion to $2.245 billion. For the full year it guided revenue to $8.125 billion to $8.215 billion. The board also approved an increase of about $1.2 billion to the stock buyback program, leaving $2 billion of authorization.

Fortinet said it is too early to give 2027 guidance, so the next test of the services argument is the fourth quarter, when Ohlgart said the delay will still weigh.

### Sources

- [Fortinet falls despite strong Q3 results and higher guidance | Seeking Alpha](https://seekingalpha.com/news/4659184-fortinet-falls-despite-strong-q3-results-and-higher-guidance?ref=bullished.co) — seekingalpha.com
- [Fortinet Stock: Fortinet Earnings Top Views, Revenue Growth Underwhelms | Investor's Business Daily](https://www.investors.com/news/technology/fortinet-stock-ftnt-fortinet-earnings-news-q32026/?ref=bullished.co) — investors.com
- [Fortinet Beats Expectations But Rosier Outlook Apparently Not Rosy Enough](https://www.barrons.com/articles/fortinet-earnings-stock-price-d8c6d982?ref=bullished.co) — Barron's
- [Fortinet Reports Strong Third Quarter 2026 Financial Results](https://finance.yahoo.com/technology/articles/fortinet-reports-strong-third-quarter-200500343.html?ref=bullished.co) — Yahoo Finance
- [The Bet Fortinet Holders Made Before A 138% Jump](https://finance.yahoo.com/markets/stocks/articles/bet-fortinet-holders-made-138-020853722.html?.tsrc=rss&ref=bullished.co) — Yahoo Finance

### More on Fortinet

- [Fortinet Raises 2026 Billings Outlook For The Third Time As Product Revenue Jumps 37%](https://www.bullished.co/fortinet-raises-2026-billings-outlook-for-the-third-time-as-product-revenue-jumps-37-e7a71555/)

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