Big Orders Fuel 2Q Profit Gain For Check Point

For the quarter ended June 30, Check Point&'s profit totaled $78 million, or 31 cents a share, a 30 percent gain from earnings of $63.3 million, or 24 cents a share, a year earlier. The Redwood City, Calif., company&'s second-quarter 2005 sales came in at $144.6 million, up nearly 14 percent from $126.9 million a year before.

Much of the earnings gain was driven by “a few licensing orders over $1 million," according to Eyal Desheh, executive vice president and CFO at Check Point. Some of that revenue was recognized during the second quarter, and the rest will be recognized over the next several quarters, he said.

Desheh added that while "orders of this magnitude may fluctuate due to many factors, we do expect this trend to continue for the next few quarters."

Check Point Chairman and CEO Gil Shwed said the company's new NGX platform didn&'t necessarily contribute a large amount of new revenue growth because, as an upgrade, it&'s part of the software subscription for current customers.

But going forward, every new version of NGX should drive new software subscriptions because customers will be attracted to the platform&'s functionality, Shwed said. Overall, the company is ahead of schedule in rolling out its dozen or so emerging products, he said.

"The activity level remains high, the channel is engaged and the opportunity for continued success is positive," Check Point Vice Chairman Jerry Ungerman said.