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Check Point Software Technologies Reports Record Second Quarter 2010 Financial Results

Highlights include $261.1 million in total revenue, an increase of 17 percent
21 July 2010: Check Point Software Technologies Ltd. (NASDAQ: CHKP), the worldwide leader in securing the Internet, today announced record financial results for the second quarter ended June 30, 2010.

“We experienced strong sales growth driven by 25% growth in product revenues. This enabled us to exceed our revenue projections and achieve the top-end of our earning per share projections,” said Gil Shwed, chairman and chief executive officer of Check Point Software Technologies. “The growth in revenues came from all main product lines and geographies.”

Financial Highlights for the Second Quarter of 2010:

Total Revenues: $261.1 million, an increase of 17 percent, compared to $223.6 million in the second quarter of 2009.

GAAP Operating Income: $122.1 million, an increase of 41 percent, compared to $86.7 million in the second quarter of 2009.

Non-GAAP Operating Income: $144.7 million, an increase of 24 percent, compared to $116.4 million in the second quarter of 2009. Non-GAAP operating margin was 55 percent, compared to 52 percent in the second quarter of 2009.

GAAP Net Income and Earnings per Diluted Share: GAAP net income was $102.9 million, an increase of 36 percent, compared to $75.6 million in the second quarter of 2009. GAAP earnings per diluted share was $0.48, an increase of 33 percent, compared to $0.36 in the second quarter of 2009.

Non-GAAP Net Income and Earnings per Diluted Share: Non-GAAP net income was $122.4 million, an increase of 21 percent, compared to $100.9 million in the second quarter of 2009. Non-GAAP EPS was $0.58, an increase of 21 percent compared to $0.48 in the second quarter of 2009.

Cash Flow: Cash flow from operations was $148.9 million, an increase of 32 percent compared to $112.7 million in the second quarter of 2009.

Recent Business Highlights Include:

Introduction of Check Point Data Loss Prevention (DLP) solution – A new product category of network-based solutions that prevents leaks of sensitive data to unintended recipients outside the organization.

Acquisition of Liquid Machines – Acquired the Boston based company, a leader in data security with award-winning products for document encryption, secure sharing and protection of corporate data. The acquisition broadens Check Point’s extensive data security portfolio.

The New SmartEvent Software Blade – A unified security management solution for real-time event visibility across multiple security systems, including Firewall, Intrusion Prevention (IPS), Data Loss Prevention (DLP) and endpoints.

New Free Firewall for Consumers – The new edition of ZoneAlarm Free Firewall includes DefenseNet services that analyze malware automatically through our cloud service. The new ZoneAlarm edition already won key industry awards this quarter (see below).

Mr. Shwed concluded, “Our record second quarter results were a nice conclusion to the first half of the year. We continued to execute and deliver top and bottom line growth while further expanding our product portfolio.”

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