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FireEye's (FEYE) Q1 Earnings & Revenues Top Estimates, Up Y/Y

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FireEye, Inc. (FEYE - Free Report) recently reported first-quarter 2021 results, wherein non-GAAP earnings came in at 8 cents per share, beating the Zacks Consensus Estimate of 7 cents. The company’s bottom line also witnessed an improvement from the year-ago quarter’s non-GAAP net loss of 2 cents per share.

Revenues increased 10% year over year to $246 million and surpassed the consensus mark of $237 million. The rally was fueled by growth across each of the company’s categories. FireEye’s overall quarterly results also benefited from increased demand for cybersecurity solutions amid the coronavirus-induced work-and-learn-from-home trend.

FireEye, Inc. Price, Consensus and EPS Surprise

FireEye, Inc. Price, Consensus and EPS Surprise

FireEye, Inc. price-consensus-eps-surprise-chart | FireEye, Inc. Quote

Quarter Details

Segment-wise, product, subscription and support revenues increased 5.13% year over year to $183 million and revenues from professional services were up 25% to $63.3 million.

Moreover, Mandiant Threat Intelligence recorded 25% year-over-year growth and Security Validation solutions reported strong results. Cloud endpoint solutions also witnessed strong traction.

The company closed 30 transactions, valued at more than $1 million each, in the first quarter.

Annualized recurring revenues increased 9% year over year. Quarterly billings recorded an 18% year-on-year rise.

Non-GAAP gross margin expanded 200 basis points year over year to 73% due to a higher mix of incident response and increased margins in cloud-hosted products.

Moreover, non-GAAP operating margin increased to 9% from a negative margin of 1%, mainly due to higher revenues and lower operating expenses.

Balance Sheet & Cash Flow

FireEye exited the first quarter with cash and cash equivalents, and short-term investments of approximately $1.3 billion, flat sequentially.

The company generated an operating cash flow of $21 million in the March quarter.


For second-quarter 2021, FireEye anticipates revenues between $245 million and $250 million. The Zacks Consensus Estimate for revenues currently stands at $244.24 million, suggesting a 6.24% improvement from the year-ago quarter’s reported number.

Services revenues are expected between 15% and 20% year over year.

The company anticipates non-GAAP gross margin of 72-73%. Margins of the services category are expected to decline sequentially.

Non-GAAP operating margin is estimated between 9% and 10%. FireEye expects non-GAAP earnings in a band of 8-9 cents.

The company also raised its revenue and earnings guidance for 2021. FireEye now anticipates revenues in the $1.01-$1.03 billion range, up from the previously anticipated band of $990 million to $1.01 billion.

Moreover, it now expects non-GAAP earnings between 39 cents and 41 cents per share, higher than the earlier guidance of 35-37 cents.

Zacks Rank and Stocks to Consider

FireEye currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the broader technology sector are Lam Research Corporation (LRCX - Free Report) , Micron Technology, Inc. (MU - Free Report) and LG Display Co., Ltd. (LPL - Free Report) , each sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for Lam Research, Micron and LG Display is currently pegged at 32.8%, 15.66% and 29.82%, respectively.

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