Check Point Software Technologies (NASDAQ:CHKP) reported what management described as solid fourth-quarter and full-year 2025 results, while outlining a strategy to “lead the AI era of cybersecurity” through a four-pillar platform approach and a mix of organic investment and targeted acquisitions.
Management frames strategy around “securing AI transformation”
Chief Executive Officer Nadav Zafrir said 2025 focused on consistent execution while strengthening the company’s foundation for longer-term growth. He highlighted organizational and go-to-market changes, including an expanded and “flattened” C-suite aligned to Check Point’s operating model and a sharper focus on strategic customers, new logo acquisition, and partner leverage.
“Our mission at Check Point is very clear: We secure our customers’ AI transformation,” Zafrir said, describing a “prevention-first” approach and AI-powered unified management across the portfolio.
Acquisitions and platform buildout: Cyclops and Cyada announced
As part of the exposure management pillar, Zafrir announced the acquisition of Cyclops, which he described as a cyber asset attack surface management company that brings AI-driven asset discovery. He said Cyclops strengthens Check Point’s exposure management platform and supports a CTEM offering that includes threat intelligence, vulnerability scanning and prioritization, and “actionable and safe remediation.”
On AI security, Zafrir said Check Point’s comprehensive AI security stack is designed to protect employee usage, enterprise applications, autonomous agents, and models. He noted that the company acquired Lakera late last year to deliver runtime protection across AI applications and agents, and he announced another acquisition, Cyada, to help discover, understand, and govern autonomous AI agents.
Within workspace security, Zafrir discussed managed service providers (MSPs) as an opportunity and said Check Point acquired the team of Rotate to build momentum in the MSP market and strengthen enablement for MSPs across offerings such as email, endpoint, browser, and SASE for smaller customers through partners.
Fourth-quarter results: revenue up 6%, subscription growth led performance
Chief Financial Officer Roei Golan said fourth-quarter revenue totaled $745 million, representing 6% year-over-year growth and coming $1 million above the midpoint of the company’s projections. He said subscription revenue grew 11% in the quarter and was the primary driver of overall growth.
Non-GAAP EPS was $3.40 per diluted share and exceeded guidance, including a one-time tax benefit of about $0.52 related to a reduction in Israel’s corporate tax rate impacting prior-year income taxes and updates to tax reserves. Excluding the one-time benefit, Golan said EPS exceeded the top end of projections by roughly $0.08.
Golan said deferred revenue grew 9% year-over-year to $2.18 billion. He also highlighted calculated billings of $1.039 billion, up 8% year-over-year, and remaining performance obligation (RPO) of $2.7 billion, up 8%.
On profitability, gross margin in the quarter was 89% on gross profit of $660 million. Operating expenses rose 13% to $358 million (or 11% on a constant-currency basis), which Golan attributed primarily to workforce increases and investment in sales and marketing and channel programs. Non-GAAP operating income was $302 million, representing a 41% operating margin.
Full-year 2025: revenue of $2.725 billion; tax benefit lifted EPS
For 2025, Golan said revenue reached $2.725 billion, which was $15 million above the midpoint of original projections, with revenue up 6% year-over-year. Non-GAAP EPS was $11.89, including a tax benefit of approximately $1.90 tied to the reduced corporate tax rate and updates to tax reserves, including effects related to a tax settlement referenced on the prior quarter’s call. Excluding the one-time benefit, Golan said non-GAAP EPS exceeded the midpoint of projections by about $0.09.
On an annual basis, calculated billings grew 9% to $2.9 billion, while recurring calculated billings (subscription, maintenance, and updates) grew 10%. Regionally, revenue in the fourth quarter was 48% from EMEA (up 5%), 40% from the Americas (up 6%), and 12% from Asia Pacific (up 9%). For the full year, Asia Pacific grew 11% year-over-year, with EMEA up 5% and the Americas up 7%.
Guidance and key factors: pricing dynamics, memory costs, tax changes
Golan said product revenue growth in the fourth quarter was “moderated” largely due to the accounting impact of a July 2025 subscription price increase that shifted more of bundled annual deal value toward subscription. He said this created a $6 million headwind to product revenue in the quarter, with a similar impact expected in Q1 2026 of roughly $4 million to $5 million. He said the benefits should increasingly materialize in subscription revenue during Q1 and throughout 2026. Separately, management discussed a 5% product price increase effective Jan. 1, 2026, with the main revenue impact expected beginning in Q2 due to revenue recognition timing.
For Q1 2026, Check Point guided revenue to $655 million to $685 million and subscription revenue to $318 million to $328 million. For full-year 2026, the company projected revenue of $2.83 billion to $2.95 billion (4% to 8% growth, with a 6% midpoint) and subscription revenue growth of 10% to 14% (12% midpoint).
Non-GAAP EPS guidance was $2.35 to $2.45 for Q1 and $10.05 to $10.85 for full-year 2026. Golan noted the outlook assumes anticipated grants from an Israeli government R&D incentive program that was initially approved in January 2026 and is expected to be finally approved by the end of Q1 2026; he said the potential benefit could be about $50 million to operating income if effective from January 2026. He also said Israel enacted the OECD Pillar Two framework effective for taxes beginning in 2026, and Check Point currently estimates a 2026 tax rate of 16% to 17%.
On margins, Golan said 2026 operating margin assumptions in guidance were 39% to 40%, reflecting headwinds including memory and ASIC costs and the expected benefits from the potential R&D incentives. He estimated memory price increases could reduce gross margin by about 1 percentage point for the full year, with most impact in the second half of 2026 due to existing inventory supporting the first half.
Check Point also guided adjusted free cash flow (operating cash flow minus capex and acquisition-related costs) to $420 million to $460 million for Q1 and $1.15 billion to $1.25 billion for 2026.
In Q&A, Zafrir said the company’s increased emphasis on AI security differs from its approach to cloud security, arguing AI transformation is more foundational and is happening faster. He also reiterated that acceleration is expected to come through execution of the four-pillar approach and go-to-market changes, rather than overnight improvement. Golan said the company’s expectation for total billings growth was “similar to the revenues growth,” around 6% to 7% to achieve the midpoint.
About Check Point Software Technologies (NASDAQ:CHKP)
Check Point Software Technologies Ltd. is an Israeli-founded cybersecurity company that develops, markets and supports a broad portfolio of network, cloud and endpoint security products. Founded in 1993, the company was an early pioneer of stateful inspection firewall technology and later developed a modular “software blade” approach that allowed customers to combine protection capabilities. Check Point’s product set spans physical and virtual security appliances, software and cloud-native services designed to prevent cyberattacks, protect data and simplify security management for enterprises and service providers.
Key product families include Quantum Security Gateways (on-premises and hybrid appliances), CloudGuard (cloud security posture and workload protection), Harmony (endpoint, remote access and unified endpoint security), and SandBlast (advanced threat prevention and sandboxing).
