|Traded as||NASDAQ: FTNT
S&P 400 Component
|Industry||Network security & Computer security|
|Founder||CEO: Ken Xie
CTO: Michael Xie
|Headquarters||Sunnyvale, California, United States|
|Products||FortiGate UTM, Next Generation Firewall, Firewalls, Antivirus programs, Intrusion-prevention system, Antispyware, Antispam, VPN, Wireless security, Application Control, Web Filtering|
|Revenue||US $1.01 billion (2015)|
|US $14.8 million (2015)|
|US $8 million (2015)|
|Total assets||US $1.27 billion (2015)|
|Total equity||US $755.38 million (2015)|
Number of employees
Fortinet is an American multinational corporation headquartered in Sunnyvale, California. It develops and markets cybersecurity software, appliances and services, such as firewalls, anti-virus, intrusion prevention and endpoint security, among others. It is the fourth-largest network security company by revenue.
Fortinet was founded in 2000 by brothers Ken and Michael Xie. It raised about $93 million in funding by 2004 and introduced ten FortiGate appliances. That same year was the beginning of a recurring patent dispute between Fortinet and Trend Micro. The company went public in 2009, raising $156 million through an initial public offering. Throughout the 2000s, Fortinet diversified its product lines, adding products for wireless access points, sandboxing, and messaging security, among others.
Fortinet was founded in Sunnyvale, California in 2000 by brothers Ken and Michael Xie. The founders had previously served in executive positions at NetScreen and ServGate respectively. The company was initially named Appligation Inc., then renamed to Appsecure in December 2000 and later renamed to Fortinet, based on the phrase "Fortified Networks". It spent two years in research and development, before introducing its first product in 2002.
Fortinet raised $13 million in private funding from 2000 to early 2003. An additional $30 million in financing was raised in August 2003, followed by $50 million in March 2004, reaching a total of $93 million in funding. According to Fortinet, its revenues grew ten-fold from 2002 to 2003. Its first channel program was established in October 2003. Westcon Canada started distributing FortiGate products in Canada in December 2003, which was followed by Norwood Adam in the UK in February 2004. The reseller program was re-organized in January 2006 and named "SOC in a BOX". By 2004 Fortinet had offices in Asia, Europe and North America.
In October 2005, a study by OpenNet found that Fortinet's appliances were being used for internet censorship in Myanmar. Fortinet said its products are sold by third party resellers and it respects US embargoes, however photographs were found of a Fortinet salesperson with Burma's Prime Minister.
A German Linux programmer from GPLviolations.org obtained a preliminary injunction against Fortinet's UK subsidiary in April 2005, due to allegations that the company was using encryption to hide its use of Linux kernels that are subject to a General Public License (GPL). The license's terms require disclosure of the source code. The following month Fortinet agreed to make its source code for GPL-licensed elements available upon request, modified its licensing terms and made other changes, ending the dispute.
In May 2004, Trend Micro filed a legal complaint against Fortinet alleging that its antivirus technology infringed Trend Micro's patents on methods for scanning email and internet traffic. That August the International Trade Commission ruled against Fortinet, prohibiting the sale of effected products. Fortinet said Trend Micro's patents were too broad, but it complied with the ruling. Fortinet and Trend Micro reached an agreement with undisclosed terms in January 2006 and Fortinet modified its antivirus products to avoid Trend Micro's patents.
A few years later, an attorney from the International Trade Commission filed an opinion for another case that said he felt the related patents from Trend Micro were invalid. Fortinet made a new legal filing and in December 2010, the US Patent and Trademark Office declared the patents as invalid.
In December 2013 Fortinet sued Sophos under allegations that it was poaching Fortinet employees and infringing on Fortinet patents. The legal dispute was settled two years later in mediation with non-disclosed terms.
In 2008, Fortinet researchers said a Facebook widget from Zango had tricked more than three million users into downloading malicious spyware under the guise of telling users their secret crush. Zango denied the allegations, saying their software was opt-in.
In late 2008, Fortinet acquired the database security and auditing intellectual property of IPLocks, and extended job offers to the company's 28 employees. It acquired the intellectual property and other assets of Woven Systems, an ethernet switching company, in August 2009. According to IDC, by this time it was the largest unified threat management vendor, with a 15.4 percent market-share. The company had been growing steadily and became profitable after losing money from 2004 - 2007. Fortinet was also rising in CRN Magazine's survey-based annual report card (ARC), reaching first place in 2009.
In November 2009, Fortinet had an initial public offering. It was planning to raise $52.4 million through the sale of 5.8 million shares. Many stockholders also sold their shares simultaneously. Just before the first day of trading, Fortinet increased the share price from $9 to $12.50 and the price increased in the market to $16.62 by the end of the first day of trading, raising $156 million in financing.
By 2010, Fortinet had $324 million in annual revenues. That November, Bloomberg covered rumors that IBM was considering acquiring the company, which Fortinet denied. In December 2012, Fortinet acquired XDN (formerly known as 3Crowd), which provided an app-hosting service called CrowdDirector. In 2013 Fortinet acquired Coyote Point, an application delivery company, for an undisclosed sum. Coyote had 1,800 employees and $534 million in annual revenue.
Fortinet made changes to its reseller program in July 2013, in order to provide financing and other options for small managed security service vendors. Recently some resellers have complained that Fortinet is competing with its own resellers, whereas Fortinet says it does not do any direct sales.
Fortinet founded the Cyber Threat Alliance with Palo Alto Networks in 2014, in order to share security threat data across vendors. It was joined by McAfee and Symantec later that year. In May 2015, Fortinet acquired the Silicon Valley-based Wi-Fi hardware company, Meru Networks, for $44 million. In late 2015, Fortinet security researchers demonstrated a Fitbit hack that gained access through Bluetooth, then allowed the hacker into synchronized devices.
In June 2016, Fortinet acquired an IT security, monitoring and analytics software vendor, AccelOps for about $28 million. According to ZDNet, the company was best known for its Security Information and Event Management (SIEM) products, products which analyze hardware and software security alerts.
Fortinet develops and markets IT security and networking hardware and software. It is best known for the FortiGate family of security appliances, which combine many cybersecurity functions. According to a 2015 report by IT analyst firm The Dell'Oro Group, Fortinet had an eight percent market-share of the IT security appliance market by revenue in 2014, up from 2.9 percent in 2012. This makes it the fourth-largest vendor in the industry. According to Fortinet, its users are 35% small businesses, 28% enterprises and 37% large companies.
Fortinet's FortiGate family of unified threat management physical and virtual appliances include a number of security functions like firewalls, intrusion prevention, web-filters and protection from malware or spam. The family includes products for small businesses and branch offices, as well as for large enterprises, data centers and internet service providers. It also sells Next Generation Firewalls (NGFW), which Gartner defines as being a product that combines firewall, VPN, intrusion prevention and other security features.
Fortinet's first product was the FortiGate 3000, released in October 2002, which had a throughput of 3 gigabits per second (Gbit/s). The 5000 family was released two years later. According to The International Directory of Company Histories, Fortinet's early products for small businesses and branch offices were well received by the industry.
In early 2013, Fortinet added firewall functionality to the Fortigate appliance, designed for internal networks and relying on special-purpose ASICs. The FortiGate virtual appliance was later added to the Amazon Web Services in 2014. In April 2016, Fortinet announced the Fortinet Security Fabric, which is intended to allow third-party devices to share information with Fortinet appliances and software through APIs. It also introduced the FortiGate 6040E 320Gbit/s firewall, which includes the new CP9 ASIC that takes on some processing tasks from the main CPU, and was used in future FortiGate releases.
Fortinet provides numerous other software and hardware products, including more than one dozen other products for switching, desktops, VOIP services, DNS, user authentication and other applications.
The company's FortiAnalyzer software offers reporting features for Fortinet products, including event logging, security reporting and analysis. FortiClient is an endpoint security product for desktops, phones, and other devices. FortiClient VPN software was first released in April 2004.
The FortiGuard antispam and the FortiMail messaging security products were first released in February 2005. FortiManager, the company's software for data center security, was first introduced in April 2003. Fortinet introduced its database security product family in 2008. Fortinet's FortiSwitch switching platforms were first introduced in 2009 and its application delivery controllers in August 2013. In October 2010, Fortinet released virtual software versions of its FortiGate, FortiManager, FortiAnalyzer and FortiMail appliances. It updated the FortiCloud management system in August 2015. A software-defined networking offering was introduced in September 2015.
Fortinet produces and markets wireless versions of its FortiGate product called FortiWifi, which was first in March 2004. Fortinet introduced a new family of cloud-based wireless access points in August 2015. The FortiDDoS product family was introduced in March 2014.
FortiGuard also provide a visual output of global sample data collected from all FortiGate appliances connected to the FortiGuard labs databases. The threat map is publicly available for sample data and can also be viewed, specific to a single FortiGate appliance within FortiOS.
FortiOS is the operating system that runs Fortinet's equipment using a modified version of Linux kernel as a kernel (derived from version 2.4.37 in FortiOS v.5.4.1) and ext2 as the file system. The web administration interface is using the jinja2 and django frameworks with python backend. In December 2003, Fortinet released FortiOS 2.8, which added 50 new features to the operating system.
Fortinet also runs the FortiGuard Labs internal security research team, which was founded in 2005. It has four research and development centers in Asia, as well as others in the US, Canada and France. Fortinet hosts a certification and training program with eight levels of NSE certification. It runs the Network Security Academy, which was founded in early 2016. It provides resources to universities teaching IT security classes.
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