Israel Innovation 2.0

Jeff Neal at Optionetics.com posted yesterday that information security solutions provider, Check Point Software Technologies is continuing to experience growth, including in the United States and Europe, despite the economic downturn.

According to Neal,  

“Check Point has solid fundamentals with great return on equity and a healthy cash flow. The latest earnings showed total revenues at $217.6 million, compared to $206.7 million in the fourth quarter of 2007. Net income was $86.5 million compared to $87.9 million in the fourth quarter of 2007. The company also indicated that their share repurchase program bought approximately 3.4 million shares at a total cost of $66.7 million and that they continued to experience good performance from all geographies, including the United States and Europe.”

While other companies, such as SAP Israel and Amdocs have been announcing layoffs, even back in October, Check Point was confident about its sales growth. At the time, which was after Check Point reported third-quarter results that beat estimates, Gil Shwed, the CEO, explained that security was still a sector that companies were investing in,

“We see projects being cancelled but we also see projects being initiated. Clients are buying. It’s not that the world has stopped but they are cutting costs.”

For the most part, Shwed seems to be right. Earlier this week, the UK edition of SC Magazine posted on its website, the SC Top 30: Information security overview 2009. According to the overview, which is based on an interview with Eric Domage, manager, western European security research and consulting at IDC, 

“The European security market will see growth – but at a reduced rate – and activity will not start to pick up until well into 2010.”

It goes on to mention that security software is in decline and most growth is in managed security services providers (MSSPs), which more comapnies are shifting to. Though, according to Domage, activity isn’t expected to really pick up until after 2010,

“the pressures on both customers and suppliers are likely to intensify during 2009 and on into 2010. Security chiefs are going to have to look hard at cost control and justify their spending requirements.” 

Meeting these requirements, Check Point Endpoint Security protects PCs and eliminates the need to deploy and manage multiple agents, reducing total cost of ownership and appealing to security officers. Check Point’s Endpoint Security provides end-to-end security solutions, from a firewall to anticirus protections to program control and full disk encryption. 

Check Point isn’t the only Israeli security company offering cost-saving solutions that is experiencing growth during the economic downturn, Imperva, an application data security company, had a breakout year in 2008.