(Adds CEO, CFO comments, analyst quotes)
By Laharee Chatterjee
May 3 (Reuters) - Fortinet Inc topped Wall Street estimates for first-quarter profit and revenue as more mid-market enterprise customers signed up for its security products and services.
Shares of the cybersecurity company, which has a market value of around $9.4 billion, rose 3.3 percent to $58 after the bell on Thursday.
Revenue from its services business, which accounts for more than half of its revenue, rose around 25 percent to $256.2 million, edging past analysts' estimates of $256.1 million.
"Small emerging businesses have been reacting to the recent hacks and for the last two years the company has been focusing on the mid-enterprises," Chief Financial Officer Keith Jensen told Reuters.
Fortinet like other cybersecurity companies have been ramping up its cloud security offerings to attract companies that are trying to lower costs by shifting to cloud for data storage.
"The company tends to outperform competitors particularly at the mid-market where price tends to be a bigger factor relative to feature set and additional platform solutions," Anne Meisner, analyst at Susquehanna Financial Group said.
Fortinet said billings - an important barometer of the health of the company's business - rose 15 percent to $463.2 million.
The company's product revenue rose 5.5 percent to $142.8 million, beating analysts' estimates of $134.9 million.
"Cloud security continues to be a fastest-growing part of our business," Chief Executive Officer Ken Xie said on a post-earnings call.
Fortinet's net income rose to $41.6 million or 24 cents per share in the quarter ended March 31, from $10.7 million or 6 cents per share, last year, when it reported a restructuring charges of $430,000.
On an adjusted basis, the Sunnyvale, California-based company earned 33 cents per share.
Total revenue rose 17.1 percent to $399 million.
Analysts on an average were expecting the company to report a profit of 24 cents per share and revenue of $390.4 million, according to Thomson Reuters I/B/E/S. (Reporting by Laharee Chatterjee in Bengaluru; Editing by Arun Koyyur)