FireEye (FEYE) To Report Q1 Earnings: What's In The Cards?

FireEye, Inc. (NASDAQ:FEYE) is scheduled to report first-quarter 2019 results on Apr 30.

The company is benefiting from its turnaround efforts, which include shifting the business model to a subscription-based one.

The Zacks Consensus Estimate for first-quarter earnings is pegged at a loss of 3 cents, indicating 25% improvement from the year-ago reported figure.

FireEye anticipates revenues to be between $208 million and $212 million. The Zacks Consensus Estimate for revenues is pegged at $210.3 million, suggesting a 5.56% increase from the year-ago reported figure.

Let's see how things are shaping up for the upcoming announcement.

Factors at Play

FireEye’s quarterly results should benefit significantly from strong demand of its products, given the healthy environment of the global security market.

The introduction of subscription pricing model for network, email and Endpoint security is helping FireEye witness an increase in subscription. This, in turn, is likely to drive its first-quarter top line.

FireEye is gaining customer accounts, which are driving revenue growth. The company is optimistic about strength in Managed Defense, stand-alone iSIGHT Threat Intelligence, Helix subscriptions and cloud e-mails, which are witnessing strong adoption.

Innovation in its Network and Email Security products is boosting adoption of cloud and virtual appliances, as reflected in the growing number of new and renewal customers. This is expected to boost the company’s first-quarter revenues.

Moreover, FireEye’s engagements with major cloud providers like Microsoft (NASDAQ:MSFT) Azure, AWS, Google (NASDAQ:GOOGL) and Oracle (NYSE:ORCL) Cloud to develop solutions which will incorporate their technologies, bode well.

However, it faces stiff competition from the likes of Fortinet (NASDAQ:FTNT) and Qualys (NASDAQ:QLYS) . Billings for the to-be-reported quarter are also expected to be under pressure due to seasonality.

Moreover, operating expenses are expected to jump between 5% and 6% sequentially, leading to an expected operating margin range of negative 3-1% in the to-be-reported quarter.

FireEye currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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