Fortinet (FTNT) opened 2026 with Q1 revenue of US$1,849.6 million and basic EPS of US$0.72, alongside net income excluding extraordinary items of US$534.5 million, setting the tone for how its profitability is holding up. Over the past year, the company has seen quarterly revenue move from US$1,539.7 million in Q1 2025 to US$1,849.6 million in Q1 2026, while basic EPS shifted from US$0.56 to US$0.72, giving you a clear view of how top line and EPS trends are feeding into today’s results. With a trailing net margin of 27.5% and growth forecasts that sit below broader market expectations, the story now centers on how resilient those margins look against a softer earnings growth backdrop.

See our full analysis for Fortinet.

With the headline numbers on the table, the next step is to see how they line up with the most common narratives about Fortinet, and where the latest results start to push back against those stories.

TTM earnings growth slows to 4%

• Over the trailing twelve months, net income excluding extraordinary items sits at US$1.95b on revenue of US$7.1b, compared with five year earnings growth of 28.5% per year and a much lower 4% earnings growth over the last year.
• What stands out for the bullish narrative is that, while bulls expect earnings to reach about US$2.8b by 2028 with 15.2% annual revenue growth, the latest trailing numbers highlight a tension between that view and recent data:
  • Recent forecasts in the broader data point to revenue growth of about 9.9% per year and earnings growth of about 9.0% per year, which sit well below the 15.2% revenue growth used in bullish assumptions.
  • With trailing net income at US$1.95b and one year earnings growth of 4%, current performance is below the longer term 28.5% annual growth that bullish investors often lean on.

Bulls argue that Fortinet’s push into higher margin services and SASE can re-accelerate that growth path, and the full bullish thesis sets out what would need to change in the numbers for that to happen 🐂 Fortinet Bull Case.

Net margin edges down to 27.5%

• Trailing net margin of 27.5% is lower than the 30.6% referenced for the prior year, even though trailing revenue rose from US$6.0b to US$7.1b over the same comparison window.
• Bears point out that this margin slip fits their worry that a hardware heavy mix and rising compliance and infrastructure costs could weigh on profitability:
  • The bearish narrative assumes margins move from about 27.3% to 25.8% over the next few years, and the step down from 30.6% to 27.5% in the latest trailing data is directionally consistent with that concern.
  • At the same time, Q1 2026 net income of US$534.5 million on US$1.85b of revenue shows Fortinet is still operating at a relatively high profitability level, which may limit how far those concerns extend for now.

Skeptics warn that if margins drift closer to the 25.8% level used in the bearish case, the valuation debate could shift quickly 🐻 Fortinet Bear Case.

P/E premium with mixed growth signals

• The stock trades on a trailing P/E of 40.4x at a share price of US$107.97, above the US Software industry average of 29.3x but below a peer average of 52.8x, while a DCF fair value of US$104.51 and an analyst price target of US$103.72 in the data sit slightly below the current price.
• Consensus narrative supporters often point to solid long term earnings growth and recurring revenue, yet the current numbers introduce a few checks on that story:
  • Forecast revenue growth of about 9.9% and earnings growth of about 9.0% per year are both below the broader US market figures cited, even though the P/E multiple is higher than the software industry average.
  • The combination of 27.5% trailing net margin and a P/E of 40.4x, alongside a DCF fair value of US$104.51 and a US$103.72 analyst target versus a US$107.97 share price, suggests investors are paying a premium relative to those reference values while recent growth data is more moderate.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Fortinet on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

If the mixed messages on growth, margins, and valuation leave you unsure, use the full data set to pressure test the bullish and bearish narratives. Then review the 2 key rewards.

See What Else Is Out There

Fortinet combines a relatively high 40.4x P/E with slowing 4% TTM earnings growth and softer margin trends, while growth forecasts sit below broader market expectations.

If you are questioning whether that kind of premium still feels comfortable, compare it with companies screened as having stronger value support using the 51 high quality undervalued stocks.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.