By Tova Cohen
TEL AVIV (Reuters) - Network security firm Check Point Software Technologies (O:CHKP) forecast strong fourth-quarter growth after its third-quarter profit and revenue beat expectations thanks to increased demand for products that prevent cyber attacks.
While the Israel-based company's sales grew 6 percent in the third quarter, its SandBlast technology that can identify sophisticated malware, including attacks not seen before, had triple-digit growth.
Rather than just detect network penetration, the SandBlast blocks attacks before they enter an organization, checking files for malware, immediately removing harmful content and only then sending them to the recipient, Chief Executive Gil Shwed told a news conference on Monday.
"Cyber attacks are continuing to increase and the level of sophistication keeps rising," Shwed said.
Check Point shares climbed as much as 4.9 percent to $84.98 in early Nasdaq trade and were up 3 percent at 1428 GMT.
A second focus area for Check Point is mobile protection, which now represents 10 percent of all attacks.
The mobile sector showed strong revenue growth in the third quarter but in absolute numbers was still small, "which highlights the opportunity in the market," Shwed said, noting the market was very fragmented with no one company dominating.
Check Point earned $1.13 per diluted share excluding one-time items in the third quarter, up from $1.04 a year earlier, while revenue rose to $428 million.
Check Point was forecast to earn $1.08 a share on revenue of $423 million, according to Thomson Reuters I/B/E/S.
Revenue from software subscriptions jumped 24 percent in the quarter to $98.6 million, highlighting the industry's shift to a subscription services model, Oppenheimer analyst Shaul Eyal said.
"Overall, Check Point delivered a solid third quarter in a thus far mixed reporting environment, which we view favorably," Eyal said.
FBN Securities raised its target price for Check Point to $100 from $95 following the third-quarter results.
Check Point forecast fourth-quarter adjusted earnings per share (EPS) of $1.20-$1.28 and revenue of $460 million to $490 million. Analysts on average had forecast EPS of $1.23 and revenue of $474 million.
(editing by Steven Scheer and David Clarke)