ServiceNow and Fortinet sink more than 20% on small misses, dragging software and security peers
CNBC's movers list has the numbers, and Jim Cramer's piece argues the sell-off in peers is guilt by association.
Two software companies fell sharply on October 29 after reporting late on October 28. ServiceNow dropped 26% after adjusted profit of $1 a share missed the $1.02 consensus, while its fourth-quarter subscription revenue guidance of $4.245 billion to $4.255 billion straddled the $4.25 billion estimate. Fortinet fell 21% after its non-GAAP gross margin came in at 79.6% against 80.1% expected, even though revenue and profit beat estimates.
CNBC's Jim Cramer said Fortinet's results pulled down Palo Alto Networks and CrowdStrike, and ServiceNow's weighed on Workday and Salesforce. He argued Fortinet, which is more hardware-focused, has been losing share to those rivals, so its weakness is company-specific rather than a sign of slowing demand for cybersecurity.
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Gross margin
After exploring Stocks making the biggest moves midday: ADT, Alphabet, Caterpillar, Eli Lilly, Chipotle & more, to see why half a point of margin mattered so much, read Gross margin.
Wikipedia defines gross margin as revenue minus the cost of goods sold, divided by revenue and expressed as a percentage.
Wikipedia · Wade · 5 min
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