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Check Point Drops 7%: Q4 View Misses on Sales Force Restructuring

Revenue in the three months ended in September rose 22%, year over year, to $455 million, yielding EPS of $1.30, compared to consensus for $450 million and $1.24 per share.

On a conference call following the report, CEO Gil Shwed forecast revenue this quarter of $485 million to $525 million, below consensus for $529 million, citing a restructuring of the company’s U.S. sales force, and saying some revenue had ended up in Q3 that took away from Q4:

As we build projection into the fourth quarter, we took into consideration the normal caveats about the fact that it is hard to predict the future and that there are multiple factors that can result in better or worse results. We also included the effect of the changes that we made in the U.S. sales force this year and the time it will take to reach its full potential. All the new people in key positioins in the U.S., our execution risk becomes higher and it is hard to predict whether we were going to be able to repeat the terrific fourth quarter that we had last year. Also keep in mind that in the third quarter we were able to absorb some of the quarter effects and these numbers that were partly moved from the third quarter to the fourth quarter actually achieved in the third quarter. So we will use some of that, shifted revenues from the Q4 projections.


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