Network security vendors fill their boots

• Past year has a been a network security wake-up call for many enterprises
• Growing investments reflected in vendor earnings reports
• Radware, A10, F5 and Check Point Software amongst those to benefit
• At least there was a slowdown in DDoS attacks in Q2, notes Netscout

Network security has risen in the consciousness of enterprises and consumers in the past 18 months as companies and individuals face increasing volumes of cyber threats and the topic of network security becomes a more political concern. 

That’s bad news for most of us, but provides a silver lining for the network security companies that have developed the products that can help improve cyber defences, and the vendors have, it’s fair to say, been coining it in during recent months if multiple earnings reports from this week are reflective of the sector’s financial health. 

Radware just reported record quarterly revenues of $70 million, up 19% year-on-year, exceeding the high end of its guidance, and operating income of $8.8 million, more than double last year’s operating profits. 

“We had an excellent quarter, driven by our application security and cloud solutions. We delivered record revenue and double-digit growth in revenue and earnings per share, as well as tripled our new customer bookings,” stated Roy Zisapel, the company’s President and CEO.

 “The momentum continues to be strong across our business lines and geographies. The market provides many opportunities as enterprises are accelerating their digital transformation and at the same time experiencing more cyber attacks than ever. Our pipeline is robust, and we are confident in our ability to execute on it,” he added in this press release.

A10 Networks reported a 12.7% year-on-year increase in its second quarter revenues to $59.2 million and adjusted EBITDA of $13.2 million compared to $9.8 million in the second quarter of 2020. 

“Our focus on customer-centric product innovation and on driving improvements in commercial execution is beginning to deliver results, with consolidated revenue growing double-digits in the second quarter and EBITDA growing faster than that rate,” stated President and CEO Dhrupad Trivedi. “We gained market share, adding new customers and expanding our security-led sales with existing customers. As expected, Japan again grew year-over-year during the quarter. Our customer engagements, strength of funnel and improving execution reinforce our confidence in full year growth targets while building a diversified customer base for the future,” he added. 

F5 Networks, meanwhile, reported fiscal third quarter sales of $652 million, up 12% year-on-year, while operating income was up by about 10% to $96.4 million. 

“Our very strong third quarter results demonstrate the powerful alignment of F5’s expanded solution portfolio and our customers’ most important application needs,” said François Locoh-Donou, F5’s President and CEO in this earnings announcement. “Robust software growth and resilient demand for systems drove 12% GAAP revenue growth in our third quarter, and 11% revenue growth versus the prior year’s third quarter non-GAAP revenue.”

Locoh-Donou added: “Customers’ traditional applications are generating more revenue and more engagement than ever before. At the same time, customers also are accelerating adoption of modern application architectures, like Kubernetes, for new applications. With our expanded application security and delivery portfolio, we are uniquely positioned to solve our customers’ most significant modern and traditional application challenges on premises, in the cloud, and across multiple clouds.”

Check Point Software Technologies reported a 4% year-on-year increase in sales for the second quarter to $526 million and operating income of $222 million, pretty much the same as a year ago. 

“We had a good second quarter. Strong execution drove double-digit growth across CloudGuard and Harmony, and triple-digit growth in Infinity platform sales. Overall we grew our security subscription revenues by 12 percent,” noted CEO Gil Shwed in this announcement. “We’ve seen a 93 percent increase in ransomware attacks, as Gen V attacks are now the new norm. We believe organizations can stop the next cyber pandemic by adopting a prevention-first approach to security across the network, cloud and remote users.”

The financial updates come as Netscout reports what might be considered at least some brief respite from the endless concerning trends: It notes in this blog that “the first half of 2021 saw yet another record broken when it comes to global distributed denial-of-service (DDoS) attacks — but that’s not the full picture. After an astonishingly active first quarter of DDoS attack activity, things calmed down a bit for the second quarter of 2021.” 

What that means in numbers, as collated by Netscout’s ATLAS Security Engineering and Response Team (ASERT), is that “threat actors” launched 2,488,048 DDoS attacks in the second quarter, a 13% decrease compared with the “extraordinary number of 2,863,882” attacks launched during the first three months of this year.

And as Netscout notes, “calmed down” is only a relative term, as these numbers mean that approximately 5.4 million DDoS attacks were launched during the first half of 2021, an 11% increase compared with the same period in 2020. That “Any puts the world on track to hit close to 11 million DDoS attacks in 2021,” notes Netscout.

“Adversaries will never turn down an opportunity for innovation—and the COVID-19 pandemic provided an enormous one. As such, the pandemic’s long tail of cyberthreat innovation will likely continue well into 2021 as cybercriminals continue to discover and weaponize new attack vectors that exploit pandemic-related vulnerabilities,” concludes the Netscout team. 

- Ray Le Maistre, Editorial Director, TelecomTV