FireEye Q2 results disappoint investors

FireEye, one of the world’s largest security firms, reported a year over year revenue growth of 8% in Q2 as the company adjusts following the sale of a major part of its business.

Earnings for the quarter came to .09 cents on revenue of $248 million, an increase of $2 million compared to the first quarter of 2021.

Wall Street was expecting earnings of $0.09 per share on revenue of $249.07 million. The report sent FireEye shares down 10.75% in late trading.

FireEye sold its FireEye Products business to a consortium led by Symphony Technology Group for $1.2 billion on June 2, dramatically changing the company’s outlook. The all-cash deal is expected to close at the end of the fourth quarter.

FireEye said that the deal separates the company’s network, email, endpoint and cloud security products from Mandiant’s software and services. FireEye Products and Mandiant Solutions will continue to be one entity until the transaction closes. Symphony Technology Group and FireEye will maintain reselling and collaboration agreements.

CEO Kevin Mandia said in June that the deal was made because FireEye wants to scale its software platforms. But they projected that its products and related subscriptions and support revenue would fall 10% to 11% in 2021 compared to 2020.

“The Mandiant Solutions business continued to deliver strong growth in revenue and annualized recurring revenue for the second quarter ended June 30, 2021,” Mandia said.

The earnings report was split into two parts, one that included revenue from discontinued operations and one that did not. 

The revenue for the continuing operations this quarter was $114 million, with a non-GAAP operating margin of negative 26 percent. There would be a non-GAAP net loss per basic share of $0.14.

For the third quarter of fiscal 2021, FireEye expects non-GAAP net income between $0.05 and $0.07. It gave a revenue outlook between $118 million and $122 million. 

In December, the company disclosed that it was the target of a massive international cyber espionage campaign. 

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