(Reuters) -Cybersecurity firm Fortinet (NASDAQ:FTNT) forecast fourth-quarter revenue below Wall Street estimates on Thursday, as it grapples with weak corporate spending in an uncertain economy, sending its shares down more than 16% in extended trading.
The company is also facing intense competition from companies including Palo Alto Networks (NASDAQ:PANW) and CrowdStrike Holdings (NASDAQ:CRWD) for a slice of the cybersecurity market.
Added to that, analysts have said large customers of cybersecurity companies are opting for short-term deals to ensure safety of their IT systems against online threats as they keep a tight leash on their spending.
Chief Financial Officer Keith Jensen said on an earnings call that Fortinet continues "to see increased deal scrutiny and longer sales cycles, which is constraining (the company's) near-term results."
"We expect these longer sales cycles to continue along with the associated budgetary scrutiny," he added.
The Sunnyvale, California-based company expects current-quarter revenue between $1.38 billion and $1.44 billion, while analysts were expecting $1.50 billion, according to LSEG data.
Fortinet also cut its full-year revenue outlook to a range of $5.27 billion to $5.33 billion, from its prior forecast of $5.35 billion to $5.45 billion.
Meanwhile, high-profile breaches at gambling giants MGM Resorts (NYSE:MGM) International, Caesars (NASDAQ:CZR) Entertainment and the cleaning supplies maker Clorox (NYSE:CLX) underlined the need for robust cyber safety solutions.
Fortinet, however, raised its annual adjusted profit per share outlook in the range of $1.54 to $1.56, from a prior $1.49 to $1.53 per share.
Third-quarter revenue stood at $1.33 billion, falling short of estimates of $1.35 billion.
The company posted an adjusted profit of 41 cents per share, compared with estimates of 36 cents per share.