CHECK POINT SOFTWARE TECHNOLOGIES LTD — Call Transcript 2025

Joining us. We really appreciate you being here with us. I'm Gabriela Borges. My colleague Max Gamperl on stage with me. We cover security here at Goldman. Delighted to have on stage with us Kip Meintzer. I got to do this for Harvard to remember that. Please let's go. Oh, yeah. So, folks, could you close that door, please? So, folks, obviously, with any presentation, there can be forward-looking statements. And with any forward-looking statements, there are lots of risks and uncertainties. If you would like to have some good bedtime reading material, just check out our latest 20-F for a comprehensive view of all those risks and uncertainties. And as with all forward-looking statements, we have no duty to update except for where required by law. Over to you, Gabriela. So I think the place to start here is at the top of the house with Nadav. Yes. Because this time last year, and actually consistently over the last year, there has been so much excitement and energy at Check Point around what Nadav can do with his focus on enterprise selling and executive selling in particular. So maybe I'll start broadly. How's it going? I think it's been going well this year so far. I think Nadav has made an impression out externally and internally. And I think you're seeing the fruits of that. I think the progress we've made so far, you know, you have a little shortfall in billings that everybody was affected by that exogenous liberation day. But, hey, I think we've been very clear that all $18 million shifted to the third quarter. And we're pretty confident in what's to come from the second half of the year. We talked about a very strong pipe and such. But as far as what he's been doing inside the company, level set the management. Now he has everybody reporting directly to him. We've got the whole go-to-market team to where they're interacting. So it's not a pyramid. It's very flat. And he's very aware of everything that's going on. So it's not micromanaged, but, you know, give me the information, right? So it's not plain telephone. And I think that it's being echoed by what you hear from the channel, what you hear from customers, what you hear internally from employees. It's an empowerment that's taking place inside the company, more of an ask for forgiveness, not for permission type of structure. And I think it takes a while for that to make its way through. But it's definitely having its effects. One of the things I know Nadav is particularly good at is spending time at C-level with C-level executives, with board of directors, folks, and talking about strategy, so leveling up Check Point's relationship as more of a strategic security partnership. How do you track and measure that, and I'd love to hear how is Nadav spending time on the road with that cohort of executives? I think, number one, he's meeting with as many CISOs and executive team members that he can from customers and potential customers. And that's to get a better understanding of what their expectations are and also allows him to communicate, you know, where we're going. I think the biggest difference where he's made the immediate effect is on the channel. The channel, the way we've embraced the channel, and the way they've embraced us back. And, you know, it's never perfect, but I think it's a far cry from where it used to be. And it's headed in a direction that's going to be even better. With the effects that our competitors by just intermediating the channel, it just makes our job that much easier and his job that much easier. And I think it's reflected in what we're seeing in the pipeline and beyond. We think those relationships will continue to nurture and expand over time. I'd love to hear more specifics on this progress with the channel. What are you tracking? Is it simply pay more for commissions tied to new business? Maybe be a little more granular here. I think if you look at it, you know, the things we've done around education, certification, things like that. But we've made where we were traditionally very difficult with the channel, all that has been erased. And I think when you look at the aggressiveness, the demand generation, all of the investments were made there and that will continue to make. We just have a new CMO that started a couple of days ago. So hopefully we're going to, you know, get a little more momentum in that area, especially on the demand generation. But I think overall, it's programs to displace competitors. I think those are very effective, especially when you start looking from a total cost of ownership, the efficacy of the solution we deliver, all the key points that people really need to focus on. I mean, things like if you look at Microsoft SharePoint server on-prem hack that, you know, you encountered, what was it, three weeks ago, we were the only product that natively protected. So if you were an organization that had Check Point, you didn't have to worry. The other guys, you know, and you have things like Salesloft that underscore the difference between efficacy and a little bit of sloppiness. So I think these are the things that will drive us further and further and further. Hand in hand with the investment discussion comes a discussion on margins. Oh, yes. Your favorite. You have. I think that's why you downgraded me, if I recall right. So it's really interesting because we had a view that you needed to invest more to grow. And then last quarter, Nadav said that he was willing to trade off a few points of margin for growth. So maybe reconcile these two comments for us. We've put about 40%. Let's start here. [Preach] on us. So margin should go up towards the end of the year. It's a seasonal thing. It's our larger quarters, et cetera. However, next year, because of FX, there's about $60 million added because of the weakening dollar against the shekel and other currencies. So that'll impact 1% to 2%, depending on where revenue is. As far as the trading margin for growth, it goes back to what, you know, Nadav said at our analyst track. Everything we do is responsible. And it's with the goal of growing faster. And so we see a path to that double digits, to that sustainable double digits. And so as we go along that, obviously there's going to be investment that's made, but it's not going to be reckless. It's not like you're going to end up at 30% tomorrow. It's investment that will be, you know, respectful and sustainable. And so when you look at that, obviously it's not something we're ready to talk about today. We're just in the middle of the AOP. But you can guarantee we'll be talking about it at fourth quarter earnings and at any Analyst Day that we might have. Nonetheless, I hear mostly from investors that, yeah, please invest. We want to see you at double digits. We want to see you beyond that, right? And so the nice thing about investing is, you know, revenue accelerates. It can drag margin up, right? Or you can continue to keep it at that level. But that's the great thing about growth. And hopefully we'll grow faster this year than we did last year. And hopefully next year we'll do the same. I agree. It's hard to think of a scenario where we're talking about 30% margins. But tell us about this 40% scenario, meaning I've historically thought about 40% as being the floor. What are the scenarios where that's not the case or what would be the impact? I think the impact from FX, so if you want to keep, you know, constant currency, you know, you throw out the 1%-2%, then you end up at 40% with the 1%-2%, right? The 60%. I gotcha. Yeah. So if you want to keep that in mind, you know, because that can always be a benefit as things turn, right? Yeah. They don't generally, you know, traditionally go just one way for a long period of time. I think the last time they were there, they were there for about 18 months, and then they reverted. That being said, you can't predict FX. So we'll just have to wait and see. But nonetheless, look at it as constant currency and then, you know, take whatever investment we take from there. So does that mean you could go lower? Yes. But it also depends on where revenue is. Absolutely. That's why it's kind of like a moot conversation, right? Because where we come out in the beginning of the year with what we give direction for the year, that's where it's all going to be dependent. Yeah. And you already talked about investment going into the channel. Are there a couple of other areas that we should think about as prioritization, maybe from a product standpoint as well? Definitely from an AI perspective, we've, you know, we had a huge hiring, 500 people that we were looking to add through some programs that we had that started at the beginning of the year based around AI. A lot of that headcount was also directed towards SASE. So a lot of the feature parity that we'll deliver in the fourth quarter already have delivered more or less has been a result of that doubling down on the headcount and driving the maturity of the SASE product. We're still ways to go on the scale. We're still in the tens of thousands. We want to get up to, you know, the higher levels, you know, say 100,000 and beyond. But right now, most of your enterprises that you would address probably don't even have as many people as we can address today. But we're having a great deal of success. I think we said it grew, it doubled year-over-year so far, if I recall right. I think Roei said that on another call. But we're going the right direction. And, you know, it's going to be a driver for growth next year along with workspace. I want to ask one more here before turning it over to Max. AI is a very broad categorization. Can you give us any more specifics on what types of AI hiring you're doing? One way to think about it is we have our AI innovation centers that's now being led by our CTO, Jonathan Zanger. There's a couple of little interviews with him out there on The Wall Street Journal and such. He kind of outlines everything. Whatever you think about AI today, it isn't going to be the same in five years. And so. Five months? Yeah, five months, five days maybe. And so I would say that when you look across the board, obviously we already have our Copilot and we continue to improve it as part of our platform. I think of it as the new command line interface. I mean, you're not using a WYSIWYG anymore, right? You're actually using a prompt to get everything done. So I think it's very effective, very efficient. And, you know, as we see more adoption of it, that'll be great. But we already have, I mean, a testament to the AI utilization that we have is our efficacy, right? I mean, we have over 60+ AI engines that are part of ThreatCloud. And you don't have that efficacy that we have, the prevention, the prediction, all of that without that AI. And so that, I think, first and foremost, is the biggest part that we have today. What comes tomorrow, it's going to come in many different forms, right? There's going to be stuff around runtime, around agentic attacks, you name it. Kip, you mentioned the slipped deals in the second quarter, but also that you have high confidence in reaching the. Say that one more time, Max. Sorry? Say the beginning one more time. The slipped deals in the second quarter? Yes. Yes. You mentioned those, but also that you have high confidence. Did you say slipped in German? Ausrutschen. Ausrutschen, yes. So, but you have high confidence in reaching the upper half of the guide. Yeah, because we already signed the $18 million in the third quarter. So are you talking the guide for the year or the guide? Yeah, for the full year. For the full year, look, we have a strong pipe. You know, we've given our guidance, but you know, Roei, or you know, we've expressed quite a bit that we believe we can, you know, finish out, barring any exogenous stuff, right, that we should be able to finish at the higher end, and I think a lot of people were wondering why we didn't narrow guidance, I think, after the second quarter, and you know, it's not something we normally do. We usually wait till the third quarter, but yeah, we'll see. Any other color on the macro environment? Do you generally see things improving, stable? I mean, look, we haven't seen anything deteriorate by any means, and in fact, I would maybe argue there's signs that it's gone the other way. The linearity this quarter on the pipeline and, you know, closing deals. 3Q or 2Q? In this quarter, Q3. You know, the first two months of the quarter, normally it's much less, and that's excluding the $18 million. So better linearity. Again, you still have to close the quarter, right? You know, you still have most of the quarter happening. You know, 50% of the quarter is still going to happen in the third month of the quarter, and then a lot in the last week, the last day. We have pretty high confidence, and from a macro standpoint, we haven't seen anything yet. Last quarter, you know, I just throw that caution out there. I don't expect anything because we've already had our liberation day already. You know, there could always be some other exogenous shock, but it doesn't look like there will be one. And then for the second half of the year, I would just say, you know, we don't give guidance, you know, in this period on the rest of the year. But we've continually said that the pipe for the second half of the year is very strong. New customer adds is also a key focus. What's working with new logos and any nuance you can add on what's happening in the competitive environment? I think, I think first, you know, remember how we determine a new logo, right? A new logo is somebody that doesn't have an invoice for three years and is an actual new logo. And when you have as many customers as we do, new logos are a little harder to come from. But if you count new logos as a new business unit or anything you run into, like some of our competitors do, I'm sure you, you know, I'm sure we could have those kinds of numbers too. But we have been having success with new logos. And I think a lot of it goes to the fact that, you know, we have the highest efficacy in the market. And, you know, security matters. I think our customers and people that encounter us in the process realize that, you know, we're their biggest advocate to keep them safe. You know, we're not just trying to, you know, extend a contract after you get rid of another vendor and shove a bunch of money in our pocket. We're actually trying to make you safe and, you know, get reimbursed for it at the same time. So it's definitely. We look at our customers as a partnership. We already talked about go-to-market a little bit, but I wanted to ask you about APAC specifically. That region grew 15% in the quarter, much faster than some of the other regions. What's driving that strength and how sustainable is it? That's a good question. You know, seasonally, I think sometimes Asia-Pac, you know, does very well in the second quarter as opposed to other quarters, if I recall from the past. But there's nothing, I think, you know, we have probably, you know, between SASE and the new product offerings we have there, we also have some new leadership from a sales point there that's been on board for, I think, over a year now. Nadav spent a lot of time in Asia. We had a CPX in Thailand. We've had other events over there. So I think there's been some quite a bit of good success there from a channel perspective also. I want to bring it back to more of a product-focused discussion. The double team stuff is just, you know, so much fun. It's a good path back up. Yeah. So I really love how Nadav has taken Check Point's core competency and positioned it as a hybrid mesh. So my question for you is, where does identity fit in hybrid mesh? And to the extent you have opinions on the Palo Alto-CyberArk deal, we'd love to hear them. Oh, no. We don't want to do that. We don't want to talk about competitors. And so hence the very generic, where does identity fit? Yeah. I would just say from an identity perspective, we have our open garden approach. And we believe, you know, my view on identity, I've always believed it's been Switzerland. It's something that needs to be independent and people should be able to utilize freely. So Okta, SailPoint, all these guys. I don't believe it actually belongs. Now, my management could change their mind. This is my opinion. But as far as identity, we've always taken, along with the rest of our, you know, what do you want to call it, our open garden approach, where we have our core competencies and areas that we will play, but we will have an interoperability with everybody. And so I think when you take something and you shut it down to one company, I think there's a lot of risks that are inherent with that. Not only the security, because you kind of adopt the culture of one company or the other, but you also have to deal with the integration aspect. And there's lots of risk, right? Especially with large acquisitions. You know, we tend to do them smaller so we can tightly integrate them into what we do. That's why we've, you know, always made the type of acquisitions we do. It doesn't mean we wouldn't do big ones. But we believe you get it right when you can either build it internally or do it with the help of acquisitions. Not try to take something that's already established and then, you know, try and remake it in your, or how shall we say it, convoluted way of pulling it together. They rarely work. I also want to talk a little bit more about SASE because we talked just a few minutes ago about the incremental investments Check Point is making in SASE. What do you think is driving your differentiation in SASE today? And what are the next technical milestones that you need to hit to level up? So I think the key part of it is, one, it's our efficacy. Two, it's ease of use, ease of installation, and most of all, the up to 10x speed faster than our competitors. And that's because of the way that the product is designed, right? Encryption on the device to go straight out to the internet, go over to the public cloud where necessary, go over to the private cloud to your own data center, et cetera, where it's necessary. So the user doesn't get frustrated with that latency that occurs in other ways. So I think that's what's really beautiful about it. But also the integration where now there's one policy. So one policy between the firewall and the SASE. So it follows your users. It's not an issue. And so I think it's, look, the milestones ahead of us are just to increase capacity. We're in the tens of thousands. We need to get out, you know, to higher levels. Even though it covers most of, you know, the size of enterprises, you know, that's in the bell curve. You know, the outer sides, the other ends of the curve you need to be able to hit. When do you think you'll be able to hit 100k+? I'm sure we'll be able to tell you that at the Analyst Day when we have it. And to be clear, there's an Analyst Day that's in the works that? I would just say that, you know, we've given a little color that, you know, we probably, you've heard us. You know, we did, over the past two years, we did the analyst track. And so what you can expect is probably in the coming year, once, you know, Nadav's had one year under his belt, that we probably want to come out and talk to Wall Street and give them some better ideas of how to view our company and what lies forward, right? What's the expectations that they can have for the years in the future? Let me ask you about firewall refresh. Please do. So you are in year two on Quantum refresh. We've talked about how in any given year, it's 20% of the installed base plus or minus what's up for renewal. Last year, I think, was north of 20%. This year, also tracking north of 20%. How do you think about firewall refresh for your business and specifically the risk that we've now had two above 20% years for Check Point, which means next year might be a below 20% year? So I would say in the first half of the year, we expect to still see strength. And it may even go beyond, right? We'll see what we talk about in the beginning of the year once we finish up this year and have our plans for next year. I think some of the interesting dynamics that are going on in this market is, you know, security matters and people are caring about it. And more so than ever. And, you know, efficacy from a standpoint of critical vulnerabilities. I mean, every, you know, Salesloft event just puts another feather in our cap for, you know, what it's like to have efficacy of our standard. And so what I would say is when it comes to the hardware side, that's really where the cesspool of critical vulnerabilities are. And some of our competitors are worse than others. And I think that creates a great opportunity, especially when you look at the total cost of ownership, when you start adding in how many times you're patching, how many times you're dealing with breaches and things along that line. So I think the potential for us to grow at the market or above the market is definitely there. And again, this is what time will tell. But we think we're uniquely positioned from the product sets that we have and what we've delivered. We're seeing cases today where people are doing refreshes and they're actually refreshing into our competitors' solutions where they have their footprint. And I expect that to continue. But time will tell. You made a really interesting nuance there around first half of next year. Why would 1H next year be stronger for firewall refresh for Check Point versus the second half? Because that's what we can see. Okay. Sorry. It's only that. Just what we can see. All right. I'm going to ask one more on SASE and then we'll go to the audience. We've been trying to triangulate where we are in terms of enterprise SASE adoption. And we had thought that a lot of wood had been chopped during COVID. But actually, it seems like there's some really nice growth in the SASE market today as well. So would love your thoughts. Do you think we're still relatively early on in enterprise SASE adoption? Or is this going to be more of a going from older-gen solutions to newer-gen solutions and now Check Point's competing on the newer-gen solution side? So one, I think it's very, very mildly penetrated when you look at all the number of SASE out there, you know, largest install base. I think you get Zscaler with nine or 10,000. When you look at everybody else and what it counts up to, it's not that much. We have north of 100,000 customers. And I believe the last time I checked, it's somewhere in the 80% do not even have a SASE solution. So that's all greenfield. And anybody that's done an early adopter approach, right, that has, you know, say, one of the guys that have a larger position, once you start having the benefit of having your firewall, all your network, and having one policy that follows your users no matter where they go. So you have that same corporate policy. And it's ease of use in doing it, right? There's not a chance for user error of opening up two different management consoles to try and implement the same policy or anything along that line. So I think, you know, this goes back to security matters. And part of security is how you manage it, right? If you're having to dip into different management consoles, you have things that are loosely coupled together instead of tightly integrated. That's a very different experience. Your nuance here on you can already be best of breed, it sounds like, for tens of thousands of users, if I'm understanding this right. So is it fair to say that there are no barriers or technical reasons why you shouldn't be winning in that mid-market, lower end of the enterprise category today for SASE? I would say once we launch it, right? So that product, the full product that we're talking about. I gotcha. It's being launched in Q4. We're still selling it today, but think of it as beta testers, people taking it on, that type of thing. Okay. Like we've had people that have been our customers for many years that are part and parcel into, you know, endorsing it and building it and telling what's needed. Gotcha. All right. Let's pause. Questions from the audience? Don't all rush at once. I could ask a follow-up on the SASE point. You're never short for words. Yeah. When you say you need to add more capacity, what are we talking about exactly? Are we talking about more points of presence to deliver the product? Scale. Just the scalability of the product. Through the infrastructure or the product? Through the infrastructure, through everything. Through the actual application of it. Got it. So is there any way to quantify the points of presence that you currently have and? I think we have north of 50, but you see our points of presence aren't what makes the difference there, right? You have it going over the public cloud. You have it going through a private fiber, you know, each customer. And then you have what goes straight out to the internet. So it's the application itself that really needs to scale. Got it. That makes sense. Yeah. Coming back to the discussion of AI, AI-first security is a core focus for Check Point. Beyond threat prevention, how do you expect to be able to monetize your AI capabilities and what's the timeline? I think first of all, I think it's early days. But I think, you know, threat prevention, but also threat prediction, right? That's part of the game plan. But, you know, trying to predict what's next. But I think it's early days to be talking about it from my standpoint. I think when we get to early next year, I think we'll have a lot more to say about a lot of different things. How do you think AI is impacting security budgets and strategic conversations, and why might this cycle be different than prior cycles you've mentioned? I don't think, you know, everybody says it's eating software. It's not eating security. If you're not protecting your organization, if you're training, if you're doing anything like that, you need security more than ever. So I don't think it's impacting security budgets whatsoever. I think it actually could enhance them, to be honest with you, in the longer run. But not enhancing them at the moment? I'm not in a position to make that statement, right? We'll see how the next couple of quarters go, right? So I just don't think they're impacting budgets in a negative way. Okay. Yeah. Got it. And you've mentioned AI implementations for internal productivity. What are some of the use cases you're seeing that are driving? It's funny. I found out about one from Roei while we were in New York. Excellent. So, you know, we have them around, you know, engineers. We try to utilize it. And everybody's got an AI project in every part of the company. But Roei told everybody on his team that they don't get to hire anybody until they can show AI improvements. So it was a challenge to his team, which is, "Let's see what kind of efficiencies we can build with leveraging AI throughout the finance org." And I was like, "Interesting. I'm already using AI, so I'm okay." But I can't get any leaner, right? I'm only three people: me, myself, and I. So, yeah. No. So it's interesting. We have embraced it in a very big way. What are the use cases in finance? I don't have those off the top of my head. Okay. I would say they're in the process of implementing them. Let's just say that. What's the use case in your world? Are you going to get rid of Max with AI? Are you going to have one of those little? Impossible. Those little Tesla guys to do Max's job? Impossible. Oh, that's totally true. Oh, thank you. We can obviously talk more offline. We just did a session with our CIO of engineering to chat through some of our AI use cases. But I think we're pretty much at time. So let's ask some more questions from the audience. Please. Clearly, the space is consolidating around large vendors. There's always going to be. Clearly, the space is consolidating around the larger vendors, and certain of your peers, quite a few actually, but certain ones are being more aggressive than others in terms of, you know, how they handle their cash collections, et cetera, organic acquisitions. So what does that, if anything, how are you guys handling that tactically? Are you doing anything differently because of that? From an M&A perspective? Whether it's M&A, whether it's, you know, how you are investing in the business, how are you dealing with customers in terms of getting their feedback, how they feel about some of this stuff? So I think, first of all, we have for feedback from our customers, we have a group that's called CheckMates. And our customers are advocates for the company. And that's how they communicate with the company through these programs. They have meetings. There's online resources, everything. So we've got that down pat. As far as when it comes to M&A or how our competitors are addressing the market, I think that's separate from the way we operate our company. I think we pay attention. And I think we try to understand what they're doing. But it doesn't change us from our North Star. You know, we are flexible and we adapt in what we're doing. And, you know, we're not rigid. We're not just going one way with, you know, blindly. But we definitely, we don't, we have a path that we're following. You know, we're an open garden approach. Nobody else has that approach. You know, we're looking to make our customer's environment as safe as possible. From that perspective, our competitors aren't our competitors. They're our partners. The idea there is the focus should be on the customer and making them safer. That's where, you know, being complementary, that's where we bought the Veriti acquisition. You can see our customer remains, our focus remains on the customer. We take our belief in having the highest efficacy of security we can and doing everything to achieve that. At the same time, trying to make our customer's environment as safe as possible. Whatever we're doing, it's going to be with that goal in mind. We believe that's what's going to take us to the next level. Kip, always a pleasure. Please join us in thanking Kip for his time.

Speaker 2: Joining us. We really appreciate you being here with us. I'm Gabriela Borges. My colleague Max Gamperl on stage with me. We cover security here at Goldman. Delighted to have on stage with us Kip Meintzer. Joining us. joining us We really appreciate you being here with us. we really appreciate you being here with us I'm Gabriela Borges. i'm gabriela borges My colleague Max Gamperl on stage with me. my colleague max gamperl on stage with me We cover security here at Goldman. we cover security here at goldman Delighted to have on stage with us Kip Meintzer. delighted to have on stage with us kip meintzer

Speaker 3: I got to do this for Harvard to remember that. I got to do this for Harvard to remember that. i got to do this for harvard to remember that

Speaker 2: Please let's go. Please let's go. please let's go

Speaker 3: Oh, yeah. So, folks, could you close that door, please? So, folks, obviously, with any presentation, there can be forward-looking statements. And with any forward-looking statements, there are lots of risks and uncertainties. If you would like to have some good bedtime reading material, just check out our latest 20-F for a comprehensive view of all those risks and uncertainties. And as with all forward-looking statements, we have no duty to update except for where required by law. Over to you, Gabriela. Oh, yeah. oh yeah So, folks, could you close that door, please? so folks could you close that door please So, folks, obviously, with any presentation, there can be forward-looking statements. so folks obviously with any presentation there can be forward-looking statements And with any forward-looking statements, there are lots of risks and uncertainties. and with any forward-looking statements there are lots of risks and uncertainties If you would like to have some good bedtime reading material, just check out our latest 20-F for a comprehensive view of all those risks and uncertainties. if you would like to have some good bedtime reading material just check out our latest 20-f for a comprehensive view of all those risks and uncertainties And as with all forward-looking statements, we have no duty to update except for where required by law. and as with all forward-looking statements we have no duty to update except for where required by law Over to you, Gabriela. over to you gabriela

Speaker 2: So I think the place to start here is at the top of the house with Nadav. So I think the place to start here is at the top of the house with Nadav. so i think the place to start here is at the top of the house with nadav

Speaker 3: Yes. Yes. yes

Speaker 2: Because this time last year, and actually consistently over the last year, there has been so much excitement and energy at Check Point around what Nadav can do with his focus on enterprise selling and executive selling in particular. So maybe I'll start broadly. How's it going? Because this time last year, and actually consistently over the last year, there has been so much excitement and energy at Check Point around what Nadav can do with his focus on enterprise selling and executive selling in particular. because this time last year and actually consistently over the last year there has been so much excitement and energy at check point around what nadav can do with his focus on enterprise selling and executive selling in particular So maybe I'll start broadly. so maybe i'll start broadly How's it going? how's it going

Speaker 3: I think it's been going well this year so far. I think Nadav has made an impression out externally and internally. And I think you're seeing the fruits of that. I think the progress we've made so far, you know, you have a little shortfall in billings that everybody was affected by that exogenous liberation day. But, hey, I think we've been very clear that all $18 million shifted to the third quarter. And we're pretty confident in what's to come from the second half of the year. We talked about a very strong pipe and such. But as far as what he's been doing inside the company, level set the management. Now he has everybody reporting directly to him. We've got the whole go-to-market team to where they're interacting. So it's not a pyramid. It's very flat. And he's very aware of everything that's going on. I think it's been going well this year so far. i think it's been going well this year so far I think Nadav has made an impression out externally and internally. i think nadav has made an impression out externally and internally And I think you're seeing the fruits of that. and i think you're seeing the fruits of that I think the progress we've made so far, you know, you have a little shortfall in billings that everybody was affected by that exogenous liberation day. i think the progress we've made so far you know you have a little shortfall in billings that everybody was affected by that exogenous liberation day But, hey, I think we've been very clear that all $18 million shifted to the third quarter. but hey i think we've been very clear that all $18 million shifted to the third quarter And we're pretty confident in what's to come from the second half of the year. and we're pretty confident in what's to come from the second half of the year We talked about a very strong pipe and such. we talked about a very strong pipe and such But as far as what he's been doing inside the company, level set the management. but as far as what he's been doing inside the company level set the management Now he has everybody reporting directly to him. now he has everybody reporting directly to him We've got the whole go-to-market team to where they're interacting. we've got the whole go-to-market team to where they're interacting So it's not a pyramid. so it's not a pyramid It's very flat. it's very flat And he's very aware of everything that's going on. and he's very aware of everything that's going on So it's not micromanaged, but, you know, give me the information, right? So it's not plain telephone. And I think that it's being echoed by what you hear from the channel, what you hear from customers, what you hear internally from employees. It's an empowerment that's taking place inside the company, more of an ask for forgiveness, not for permission type of structure. And I think it takes a while for that to make its way through. But it's definitely having its effects. So it's not micromanaged, but, you know, give me the information, right? so it's not micromanaged but you know give me the information right So it's not plain telephone. so it's not plain telephone And I think that it's being echoed by what you hear from the channel, what you hear from customers, what you hear internally from employees. and i think that it's being echoed by what you hear from the channel what you hear from customers what you hear internally from employees It's an empowerment that's taking place inside the company, more of an ask for forgiveness, not for permission type of structure. it's an empowerment that's taking place inside the company more of an ask for forgiveness not for permission type of structure And I think it takes a while for that to make its way through. and i think it takes a while for that to make its way through But it's definitely having its effects. but it's definitely having its effects

Speaker 2: One of the things I know Nadav is particularly good at is spending time at C-level with C-level executives, with board of directors, folks, and talking about strategy, so leveling up Check Point's relationship as more of a strategic security partnership. How do you track and measure that, and I'd love to hear how is Nadav spending time on the road with that cohort of executives? One of the things I know Nadav is particularly good at is spending time at C-level with C-level executives, with board of directors, folks, and talking about strategy, so leveling up Check Point's relationship as more of a strategic security partnership. one of the things i know nadav is particularly good at is spending time at c-level with c-level executives with board of directors folks and talking about strategy so leveling up check point's relationship as more of a strategic security partnership How do you track and measure that, and I'd love to hear how is Nadav spending time on the road with that cohort of executives? how do you track and measure that and i'd love to hear how is nadav spending time on the road with that cohort of executives

Speaker 3: I think, number one, he's meeting with as many CISOs and executive team members that he can from customers and potential customers. And that's to get a better understanding of what their expectations are and also allows him to communicate, you know, where we're going. I think the biggest difference where he's made the immediate effect is on the channel. The channel, the way we've embraced the channel, and the way they've embraced us back. And, you know, it's never perfect, but I think it's a far cry from where it used to be. And it's headed in a direction that's going to be even better. With the effects that our competitors by just intermediating the channel, it just makes our job that much easier and his job that much easier. And I think it's reflected in what we're seeing in the pipeline and beyond. I think, number one, he's meeting with as many CISOs and executive team members that he can from customers and potential customers. i think number one he's meeting with as many cisos and executive team members that he can from customers and potential customers And that's to get a better understanding of what their expectations are and also allows him to communicate, you know, where we're going. and that's to get a better understanding of what their expectations are and also allows him to communicate you know where we're going I think the biggest difference where he's made the immediate effect is on the channel. i think the biggest difference where he's made the immediate effect is on the channel The channel, the way we've embraced the channel, and the way they've embraced us back. the channel the way we've embraced the channel and the way they've embraced us back And, you know, it's never perfect, but I think it's a far cry from where it used to be. and you know it's never perfect but i think it's a far cry from where it used to be And it's headed in a direction that's going to be even better. and it's headed in a direction that's going to be even better With the effects that our competitors by just intermediating the channel, it just makes our job that much easier and his job that much easier. with the effects that our competitors by just intermediating the channel it just makes our job that much easier and his job that much easier And I think it's reflected in what we're seeing in the pipeline and beyond. and i think it's reflected in what we're seeing in the pipeline and beyond We think those relationships will continue to nurture and expand over time. We think those relationships will continue to nurture and expand over time. we think those relationships will continue to nurture and expand over time

Speaker 2: I'd love to hear more specifics on this progress with the channel. What are you tracking? Is it simply pay more for commissions tied to new business? Maybe be a little more granular here. I'd love to hear more specifics on this progress with the channel. i'd love to hear more specifics on this progress with the channel What are you tracking? what are you tracking Is it simply pay more for commissions tied to new business? is it simply pay more for commissions tied to new business Maybe be a little more granular here. maybe be a little more granular here

Speaker 3: I think if you look at it, you know, the things we've done around education, certification, things like that. But we've made where we were traditionally very difficult with the channel, all that has been erased. And I think when you look at the aggressiveness, the demand generation, all of the investments were made there and that will continue to make. We just have a new CMO that started a couple of days ago. So hopefully we're going to, you know, get a little more momentum in that area, especially on the demand generation. But I think overall, it's programs to displace competitors. I think those are very effective, especially when you start looking from a total cost of ownership, the efficacy of the solution we deliver, all the key points that people really need to focus on. I think if you look at it, you know, the things we've done around education, certification, things like that. i think if you look at it you know the things we've done around education certification things like that But we've made where we were traditionally very difficult with the channel, all that has been erased. but we've made where we were traditionally very difficult with the channel all that has been erased And I think when you look at the aggressiveness, the demand generation, all of the investments were made there and that will continue to make. and i think when you look at the aggressiveness the demand generation all of the investments were made there and that will continue to make We just have a new CMO that started a couple of days ago. we just have a new cmo that started a couple of days ago So hopefully we're going to, you know, get a little more momentum in that area, especially on the demand generation. so hopefully we're going to you know get a little more momentum in that area especially on the demand generation But I think overall, it's programs to displace competitors. but i think overall it's programs to displace competitors I think those are very effective, especially when you start looking from a total cost of ownership, the efficacy of the solution we deliver, all the key points that people really need to focus on. i think those are very effective especially when you start looking from a total cost of ownership the efficacy of the solution we deliver all the key points that people really need to focus on I mean, things like if you look at Microsoft SharePoint server on-prem hack that, you know, you encountered, what was it, three weeks ago, we were the only product that natively protected. So if you were an organization that had Check Point, you didn't have to worry. The other guys, you know, and you have things like Salesloft that underscore the difference between efficacy and a little bit of sloppiness. So I think these are the things that will drive us further and further and further. I mean, things like if you look at Microsoft SharePoint server on-prem hack that, you know, you encountered, what was it, three weeks ago, we were the only product that natively protected. i mean things like if you look at microsoft sharepoint server on-prem hack that you know you encountered what was it three weeks ago we were the only product that natively protected So if you were an organization that had Check Point, you didn't have to worry. so if you were an organization that had check point you didn't have to worry The other guys, you know, and you have things like Salesloft that underscore the difference between efficacy and a little bit of sloppiness. the other guys you know and you have things like salesloft that underscore the difference between efficacy and a little bit of sloppiness So I think these are the things that will drive us further and further and further. so i think these are the things that will drive us further and further and further

Speaker 2: Hand in hand with the investment discussion comes a discussion on margins. Hand in hand with the investment discussion comes a discussion on margins. hand in hand with the investment discussion comes a discussion on margins

Speaker 3: Oh, yes. Your favorite. Oh, yes. oh yes Your favorite. your favorite

Speaker 2: You have. You have. you have

Speaker 3: I think that's why you downgraded me, if I recall right. I think that's why you downgraded me, if I recall right. i think that's why you downgraded me if i recall right

Speaker 2: So it's really interesting because we had a view that you needed to invest more to grow. And then last quarter, Nadav said that he was willing to trade off a few points of margin for growth. So maybe reconcile these two comments for us. We've put about 40%. So it's really interesting because we had a view that you needed to invest more to grow. so it's really interesting because we had a view that you needed to invest more to grow And then last quarter, Nadav said that he was willing to trade off a few points of margin for growth. and then last quarter nadav said that he was willing to trade off a few points of margin for growth So maybe reconcile these two comments for us. so maybe reconcile these two comments for us We've put about 40%. we've put about 40%

Speaker 3: Let's start here. Let's start here. let's start here

Speaker 2: [Preach] on us. [Preach] on us. [preach] on us

Speaker 3: So margin should go up towards the end of the year. It's a seasonal thing. It's our larger quarters, et cetera. However, next year, because of FX, there's about $60 million added because of the weakening dollar against the shekel and other currencies. So that'll impact 1% to 2%, depending on where revenue is. As far as the trading margin for growth, it goes back to what, you know, Nadav said at our analyst track. Everything we do is responsible. And it's with the goal of growing faster. And so we see a path to that double digits, to that sustainable double digits. And so as we go along that, obviously there's going to be investment that's made, but it's not going to be reckless. It's not like you're going to end up at 30% tomorrow. It's investment that will be, you know, respectful and sustainable. So margin should go up towards the end of the year. so margin should go up towards the end of the year It's a seasonal thing. it's a seasonal thing It's our larger quarters, et cetera. it's our larger quarters et cetera However, next year, because of FX, there's about $60 million added because of the weakening dollar against the shekel and other currencies. however next year because of fx there's about $60 million added because of the weakening dollar against the shekel and other currencies So that'll impact 1% to 2%, depending on where revenue is. so that'll impact 1% to 2% depending on where revenue is As far as the trading margin for growth, it goes back to what, you know, Nadav said at our analyst track. as far as the trading margin for growth it goes back to what you know nadav said at our analyst track Everything we do is responsible. everything we do is responsible And it's with the goal of growing faster. and it's with the goal of growing faster And so we see a path to that double digits, to that sustainable double digits. and so we see a path to that double digits to that sustainable double digits And so as we go along that, obviously there's going to be investment that's made, but it's not going to be reckless. and so as we go along that obviously there's going to be investment that's made but it's not going to be reckless It's not like you're going to end up at 30% tomorrow. it's not like you're going to end up at 30% tomorrow It's investment that will be, you know, respectful and sustainable. it's investment that will be you know respectful and sustainable And so when you look at that, obviously it's not something we're ready to talk about today. We're just in the middle of the AOP. But you can guarantee we'll be talking about it at fourth quarter earnings and at any Analyst Day that we might have. Nonetheless, I hear mostly from investors that, yeah, please invest. We want to see you at double digits. We want to see you beyond that, right? And so the nice thing about investing is, you know, revenue accelerates. It can drag margin up, right? Or you can continue to keep it at that level. But that's the great thing about growth. And hopefully we'll grow faster this year than we did last year. And hopefully next year we'll do the same. And so when you look at that, obviously it's not something we're ready to talk about today. and so when you look at that obviously it's not something we're ready to talk about today We're just in the middle of the AOP. we're just in the middle of the aop But you can guarantee we'll be talking about it at fourth quarter earnings and at any Analyst Day that we might have. but you can guarantee we'll be talking about it at fourth quarter earnings and at any analyst day that we might have Nonetheless, I hear mostly from investors that, yeah, please invest. nonetheless i hear mostly from investors that yeah please invest We want to see you at double digits. we want to see you at double digits We want to see you beyond that, right? we want to see you beyond that right And so the nice thing about investing is, you know, revenue accelerates. and so the nice thing about investing is you know revenue accelerates It can drag margin up, right? it can drag margin up right Or you can continue to keep it at that level. or you can continue to keep it at that level But that's the great thing about growth. but that's the great thing about growth And hopefully we'll grow faster this year than we did last year. and hopefully we'll grow faster this year than we did last year And hopefully next year we'll do the same. and hopefully next year we'll do the same

Speaker 2: I agree. It's hard to think of a scenario where we're talking about 30% margins. But tell us about this 40% scenario, meaning I've historically thought about 40% as being the floor. What are the scenarios where that's not the case or what would be the impact? I agree. i agree It's hard to think of a scenario where we're talking about 30% margins. it's hard to think of a scenario where we're talking about 30% margins But tell us about this 40% scenario, meaning I've historically thought about 40% as being the floor. but tell us about this 40% scenario meaning i've historically thought about 40% as being the floor What are the scenarios where that's not the case or what would be the impact? what are the scenarios where that's not the case or what would be the impact

Speaker 3: I think the impact from FX, so if you want to keep, you know, constant currency, you know, you throw out the 1%-2%, then you end up at 40% with the 1%-2%, right? The 60%. I think the impact from FX, so if you want to keep, you know, constant currency, you know, you throw out the 1%-2%, then you end up at 40% with the 1%-2%, right? i think the impact from fx so if you want to keep you know constant currency you know you throw out the 1%-2% then you end up at 40% with the 1%-2% right The 60%. the 60%

Speaker 2: I gotcha. Yeah. I gotcha. i gotcha Yeah. yeah

Speaker 3: So if you want to keep that in mind, you know, because that can always be a benefit as things turn, right? So if you want to keep that in mind, you know, because that can always be a benefit as things turn, right? so if you want to keep that in mind you know because that can always be a benefit as things turn right

Speaker 2: Yeah. Yeah. yeah

Speaker 3: They don't generally, you know, traditionally go just one way for a long period of time. I think the last time they were there, they were there for about 18 months, and then they reverted. That being said, you can't predict FX. So we'll just have to wait and see. But nonetheless, look at it as constant currency and then, you know, take whatever investment we take from there. So does that mean you could go lower? Yes. But it also depends on where revenue is. They don't generally, you know, traditionally go just one way for a long period of time. they don't generally you know traditionally go just one way for a long period of time I think the last time they were there, they were there for about 18 months, and then they reverted. i think the last time they were there they were there for about 18 months and then they reverted That being said, you can't predict FX. that being said you can't predict fx So we'll just have to wait and see. so we'll just have to wait and see But nonetheless, look at it as constant currency and then, you know, take whatever investment we take from there. but nonetheless look at it as constant currency and then you know take whatever investment we take from there So does that mean you could go lower? so does that mean you could go lower Yes. yes But it also depends on where revenue is. but it also depends on where revenue is

Speaker 2: Absolutely. Absolutely. absolutely

Speaker 3: That's why it's kind of like a moot conversation, right? Because where we come out in the beginning of the year with what we give direction for the year, that's where it's all going to be dependent. That's why it's kind of like a moot conversation, right? that's why it's kind of like a moot conversation right Because where we come out in the beginning of the year with what we give direction for the year, that's where it's all going to be dependent. because where we come out in the beginning of the year with what we give direction for the year that's where it's all going to be dependent

Speaker 2: Yeah. And you already talked about investment going into the channel. Are there a couple of other areas that we should think about as prioritization, maybe from a product standpoint as well? Yeah. yeah And you already talked about investment going into the channel. and you already talked about investment going into the channel Are there a couple of other areas that we should think about as prioritization, maybe from a product standpoint as well? are there a couple of other areas that we should think about as prioritization maybe from a product standpoint as well

Speaker 3: Definitely from an AI perspective, we've, you know, we had a huge hiring, 500 people that we were looking to add through some programs that we had that started at the beginning of the year based around AI. A lot of that headcount was also directed towards SASE. So a lot of the feature parity that we'll deliver in the fourth quarter already have delivered more or less has been a result of that doubling down on the headcount and driving the maturity of the SASE product. We're still ways to go on the scale. We're still in the tens of thousands. We want to get up to, you know, the higher levels, you know, say 100,000 and beyond. But right now, most of your enterprises that you would address probably don't even have as many people as we can address today. Definitely from an AI perspective, we've, you know, we had a huge hiring, 500 people that we were looking to add through some programs that we had that started at the beginning of the year based around AI. definitely from an ai perspective we've you know we had a huge hiring 500 people that we were looking to add through some programs that we had that started at the beginning of the year based around ai A lot of that headcount was also directed towards SASE. a lot of that headcount was also directed towards sase So a lot of the feature parity that we'll deliver in the fourth quarter already have delivered more or less has been a result of that doubling down on the headcount and driving the maturity of the SASE product. so a lot of the feature parity that we'll deliver in the fourth quarter already have delivered more or less has been a result of that doubling down on the headcount and driving the maturity of the sase product We're still ways to go on the scale. we're still ways to go on the scale We're still in the tens of thousands. we're still in the tens of thousands We want to get up to, you know, the higher levels, you know, say 100,000 and beyond. we want to get up to you know the higher levels you know say 100,000 and beyond But right now, most of your enterprises that you would address probably don't even have as many people as we can address today. but right now most of your enterprises that you would address probably don't even have as many people as we can address today But we're having a great deal of success. I think we said it grew, it doubled year-over-year so far, if I recall right. I think Roei said that on another call. But we're going the right direction. And, you know, it's going to be a driver for growth next year along with workspace. But we're having a great deal of success. but we're having a great deal of success I think we said it grew, it doubled year-over-year so far, if I recall right. i think we said it grew it doubled year-over-year so far if i recall right I think Roei said that on another call. i think roei said that on another call But we're going the right direction. but we're going the right direction And, you know, it's going to be a driver for growth next year along with workspace. and you know it's going to be a driver for growth next year along with workspace

Speaker 2: I want to ask one more here before turning it over to Max. AI is a very broad categorization. Can you give us any more specifics on what types of AI hiring you're doing? I want to ask one more here before turning it over to Max. i want to ask one more here before turning it over to max AI is a very broad categorization. ai is a very broad categorization Can you give us any more specifics on what types of AI hiring you're doing? can you give us any more specifics on what types of ai hiring you're doing

Speaker 3: One way to think about it is we have our AI innovation centers that's now being led by our CTO, Jonathan Zanger. There's a couple of little interviews with him out there on The Wall Street Journal and such. He kind of outlines everything. Whatever you think about AI today, it isn't going to be the same in five years. And so. One way to think about it is we have our AI innovation centers that's now being led by our CTO, Jonathan Zanger. one way to think about it is we have our ai innovation centers that's now being led by our cto jonathan zanger There's a couple of little interviews with him out there on The Wall Street Journal and such. there's a couple of little interviews with him out there on the wall street journal and such He kind of outlines everything. he kind of outlines everything Whatever you think about AI today, it isn't going to be the same in five years. whatever you think about ai today it isn't going to be the same in five years And so. and so Five months? Five months? five months Yeah, five months, five days maybe. And so I would say that when you look across the board, obviously we already have our Copilot and we continue to improve it as part of our platform. I think of it as the new command line interface. I mean, you're not using a WYSIWYG anymore, right? You're actually using a prompt to get everything done. So I think it's very effective, very efficient. And, you know, as we see more adoption of it, that'll be great. But we already have, I mean, a testament to the AI utilization that we have is our efficacy, right? I mean, we have over 60+ AI engines that are part of ThreatCloud. And you don't have that efficacy that we have, the prevention, the prediction, all of that without that AI. Yeah, five months, five days maybe. yeah five months five days maybe And so I would say that when you look across the board, obviously we already have our Copilot and we continue to improve it as part of our platform. and so i would say that when you look across the board obviously we already have our copilot and we continue to improve it as part of our platform I think of it as the new command line interface. i think of it as the new command line interface I mean, you're not using a WYSIWYG anymore, right? i mean you're not using a wysiwyg anymore right You're actually using a prompt to get everything done. you're actually using a prompt to get everything done So I think it's very effective, very efficient. so i think it's very effective very efficient And, you know, as we see more adoption of it, that'll be great. and you know as we see more adoption of it that'll be great But we already have, I mean, a testament to the AI utilization that we have is our efficacy, right? but we already have i mean a testament to the ai utilization that we have is our efficacy right I mean, we have over 60 + AI engines that are part of ThreatCloud. i mean we have over 60 + ai engines that are part of threatcloud And you don't have that efficacy that we have, the prevention, the prediction, all of that without that AI. and you don't have that efficacy that we have the prevention the prediction all of that without that ai And so that, I think, first and foremost, is the biggest part that we have today. What comes tomorrow, it's going to come in many different forms, right? There's going to be stuff around runtime, around agentic attacks, you name it. And so that, I think, first and foremost, is the biggest part that we have today. and so that i think first and foremost is the biggest part that we have today What comes tomorrow, it's going to come in many different forms, right? what comes tomorrow it's going to come in many different forms right There's going to be stuff around runtime, around agentic attacks, you name it. there's going to be stuff around runtime around agentic attacks you name it

Speaker 4: Kip, you mentioned the slipped deals in the second quarter, but also that you have high confidence in reaching the. Kip, you mentioned the slipped deals in the second quarter, but also that you have high confidence in reaching the. kip you mentioned the slipped deals in the second quarter but also that you have high confidence in reaching the

Speaker 3: Say that one more time, Max. Say that one more time, Max. say that one more time max

Speaker 4: Sorry? Sorry? sorry

Speaker 3: Say the beginning one more time. Say the beginning one more time. say the beginning one more time

Speaker 4: The slipped deals in the second quarter? The slipped deals in the second quarter? the slipped deals in the second quarter

Speaker 3: Yes. Yes. yes

Speaker 4: Yes. You mentioned those, but also that you have high confidence. Yes. yes You mentioned those, but also that you have high confidence. you mentioned those but also that you have high confidence

Speaker 3: Did you say slipped in German? Did you say slipped in German? did you say slipped in german

Speaker 4: Ausrutschen. Ausrutschen. ausrutschen

Speaker 3: Ausrutschen, yes. Ausrutschen, yes. ausrutschen yes

Speaker 4: So, but you have high confidence in reaching the upper half of the guide. So, but you have high confidence in reaching the upper half of the guide. so but you have high confidence in reaching the upper half of the guide

Speaker 3: Yeah, because we already signed the $18 million in the third quarter. So are you talking the guide for the year or the guide? Yeah, because we already signed the $18 million in the third quarter. yeah because we already signed the $18 million in the third quarter So are you talking the guide for the year or the guide? so are you talking the guide for the year or the guide

Speaker 4: Yeah, for the full year. Yeah, for the full year. yeah for the full year

Speaker 3: For the full year, look, we have a strong pipe. You know, we've given our guidance, but you know, Roei, or you know, we've expressed quite a bit that we believe we can, you know, finish out, barring any exogenous stuff, right, that we should be able to finish at the higher end, and I think a lot of people were wondering why we didn't narrow guidance, I think, after the second quarter, and you know, it's not something we normally do. We usually wait till the third quarter, but yeah, we'll see. For the full year, look, we have a strong pipe. for the full year look we have a strong pipe You know, we've given our guidance, but you know, Roei, or you know, we've expressed quite a bit that we believe we can, you know, finish out, barring any exogenous stuff, right, that we should be able to finish at the higher end, and I think a lot of people were wondering why we didn't narrow guidance, I think, after the second quarter, and you know, it's not something we normally do. you know we've given our guidance but you know roei or you know we've expressed quite a bit that we believe we can you know finish out barring any exogenous stuff right that we should be able to finish at the higher end and i think a lot of people were wondering why we didn't narrow guidance i think after the second quarter and you know it's not something we normally do We usually wait till the third quarter, but yeah, we'll see. we usually wait till the third quarter but yeah we'll see

Speaker 4: Any other color on the macro environment? Do you generally see things improving, stable? Any other color on the macro environment? any other color on the macro environment Do you generally see things improving, stable? do you generally see things improving stable

Speaker 3: I mean, look, we haven't seen anything deteriorate by any means, and in fact, I would maybe argue there's signs that it's gone the other way. The linearity this quarter on the pipeline and, you know, closing deals. I mean, look, we haven't seen anything deteriorate by any means, and in fact, I would maybe argue there's signs that it's gone the other way. i mean look we haven't seen anything deteriorate by any means and in fact i would maybe argue there's signs that it's gone the other way The linearity this quarter on the pipeline and, you know, closing deals. the linearity this quarter on the pipeline and you know closing deals

Speaker 4: 3Q or 2Q? 3Q or 2Q? 3q or 2q

Speaker 3: In this quarter, Q3. You know, the first two months of the quarter, normally it's much less, and that's excluding the $18 million. So better linearity. Again, you still have to close the quarter, right? You know, you still have most of the quarter happening. You know, 50% of the quarter is still going to happen in the third month of the quarter, and then a lot in the last week, the last day. We have pretty high confidence, and from a macro standpoint, we haven't seen anything yet. Last quarter, you know, I just throw that caution out there. I don't expect anything because we've already had our liberation day already. You know, there could always be some other exogenous shock, but it doesn't look like there will be one. In this quarter, Q3. in this quarter q3 You know, the first two months of the quarter, normally it's much less, and that's excluding the $18 million. you know the first two months of the quarter normally it's much less and that's excluding the $18 million So better linearity. so better linearity Again, you still have to close the quarter, right? again you still have to close the quarter right You know, you still have most of the quarter happening. you know you still have most of the quarter happening You know, 50% of the quarter is still going to happen in the third month of the quarter, and then a lot in the last week, the last day. you know 50% of the quarter is still going to happen in the third month of the quarter and then a lot in the last week the last day We have pretty high confidence, and from a macro standpoint, we haven't seen anything yet. we have pretty high confidence and from a macro standpoint we haven't seen anything yet Last quarter, you know, I just throw that caution out there. last quarter you know i just throw that caution out there I don't expect anything because we've already had our liberation day already. i don't expect anything because we've already had our liberation day already You know, there could always be some other exogenous shock, but it doesn't look like there will be one. you know there could always be some other exogenous shock but it doesn't look like there will be one And then for the second half of the year, I would just say, you know, we don't give guidance, you know, in this period on the rest of the year. But we've continually said that the pipe for the second half of the year is very strong. And then for the second half of the year, I would just say, you know, we don't give guidance, you know, in this period on the rest of the year. and then for the second half of the year i would just say you know we don't give guidance you know in this period on the rest of the year But we've continually said that the pipe for the second half of the year is very strong. but we've continually said that the pipe for the second half of the year is very strong

Speaker 4: New customer adds is also a key focus. What's working with new logos and any nuance you can add on what's happening in the competitive environment? New customer adds is also a key focus. new customer adds is also a key focus What's working with new logos and any nuance you can add on what's happening in the competitive environment? what's working with new logos and any nuance you can add on what's happening in the competitive environment

Speaker 3: I think, I think first, you know, remember how we determine a new logo, right? A new logo is somebody that doesn't have an invoice for three years and is an actual new logo. And when you have as many customers as we do, new logos are a little harder to come from. But if you count new logos as a new business unit or anything you run into, like some of our competitors do, I'm sure you, you know, I'm sure we could have those kinds of numbers too. But we have been having success with new logos. And I think a lot of it goes to the fact that, you know, we have the highest efficacy in the market. And, you know, security matters. I think, I think first, you know, remember how we determine a new logo, right? i think i think first you know remember how we determine a new logo right A new logo is somebody that doesn't have an invoice for three years and is an actual new logo. a new logo is somebody that doesn't have an invoice for three years and is an actual new logo And when you have as many customers as we do, new logos are a little harder to come from. and when you have as many customers as we do new logos are a little harder to come from But if you count new logos as a new business unit or anything you run into, like some of our competitors do, I'm sure you, you know, I'm sure we could have those kinds of numbers too. but if you count new logos as a new business unit or anything you run into like some of our competitors do i'm sure you you know i'm sure we could have those kinds of numbers too But we have been having success with new logos. but we have been having success with new logos And I think a lot of it goes to the fact that, you know, we have the highest efficacy in the market. and i think a lot of it goes to the fact that you know we have the highest efficacy in the market And, you know, security matters. and you know security matters I think our customers and people that encounter us in the process realize that, you know, we're their biggest advocate to keep them safe. You know, we're not just trying to, you know, extend a contract after you get rid of another vendor and shove a bunch of money in our pocket. We're actually trying to make you safe and, you know, get reimbursed for it at the same time. So it's definitely. We look at our customers as a partnership. I think our customers and people that encounter us in the process realize that, you know, we're their biggest advocate to keep them safe. i think our customers and people that encounter us in the process realize that you know we're their biggest advocate to keep them safe You know, we're not just trying to, you know, extend a contract after you get rid of another vendor and shove a bunch of money in our pocket. you know we're not just trying to you know extend a contract after you get rid of another vendor and shove a bunch of money in our pocket We're actually trying to make you safe and, you know, get reimbursed for it at the same time. we're actually trying to make you safe and you know get reimbursed for it at the same time So it's definitely. so it's definitely We look at our customers as a partnership. we look at our customers as a partnership

Speaker 4: We already talked about go-to-market a little bit, but I wanted to ask you about APAC specifically. That region grew 15% in the quarter, much faster than some of the other regions. What's driving that strength and how sustainable is it? We already talked about go-to-market a little bit, but I wanted to ask you about APAC specifically. we already talked about go-to-market a little bit but i wanted to ask you about apac specifically That region grew 15% in the quarter, much faster than some of the other regions. that region grew 15% in the quarter much faster than some of the other regions What's driving that strength and how sustainable is it? what's driving that strength and how sustainable is it

Speaker 3: That's a good question. You know, seasonally, I think sometimes Asia-Pac, you know, does very well in the second quarter as opposed to other quarters, if I recall from the past. But there's nothing, I think, you know, we have probably, you know, between SASE and the new product offerings we have there, we also have some new leadership from a sales point there that's been on board for, I think, over a year now. Nadav spent a lot of time in Asia. We had a CPX in Thailand. We've had other events over there. So I think there's been some quite a bit of good success there from a channel perspective also. That's a good question. that's a good question You know, seasonally, I think sometimes Asia-Pac, you know, does very well in the second quarter as opposed to other quarters, if I recall from the past. you know seasonally i think sometimes asia-pac you know does very well in the second quarter as opposed to other quarters if i recall from the past But there's nothing, I think, you know, we have probably, you know, between SASE and the new product offerings we have there, we also have some new leadership from a sales point there that's been on board for, I think, over a year now. but there's nothing i think you know we have probably you know between sase and the new product offerings we have there we also have some new leadership from a sales point there that's been on board for i think over a year now Nadav spent a lot of time in Asia. nadav spent a lot of time in asia We had a CPX in Thailand. we had a cpx in thailand We've had other events over there. we've had other events over there So I think there's been some quite a bit of good success there from a channel perspective also. so i think there's been some quite a bit of good success there from a channel perspective also

Speaker 2: I want to bring it back to more of a product-focused discussion. I want to bring it back to more of a product-focused discussion. i want to bring it back to more of a product-focused discussion

Speaker 3: The double team stuff is just, you know, so much fun. The double team stuff is just, you know, so much fun. the double team stuff is just you know so much fun

Speaker 2: It's a good path back up. It's a good path back up. it's a good path back up

Speaker 3: Yeah. Yeah. yeah

Speaker 2: So I really love how Nadav has taken Check Point's core competency and positioned it as a hybrid mesh. So my question for you is, where does identity fit in hybrid mesh? And to the extent you have opinions on the Palo Alto-CyberArk deal, we'd love to hear them. So I really love how Nadav has taken Check Point's core competency and positioned it as a hybrid mesh. so i really love how nadav has taken check point's core competency and positioned it as a hybrid mesh So my question for you is, where does identity fit in hybrid mesh? so my question for you is where does identity fit in hybrid mesh And to the extent you have opinions on the Palo Alto-CyberArk deal, we'd love to hear them. and to the extent you have opinions on the palo alto-cyberark deal we'd love to hear them

Speaker 3: Oh, no. We don't want to do that. We don't want to talk about competitors. Oh, no. oh no We don't want to do that. we don't want to do that We don't want to talk about competitors. we don't want to talk about competitors

Speaker 2: And so hence the very generic, where does identity fit? And so hence the very generic, where does identity fit? and so hence the very generic where does identity fit

Speaker 3: Yeah. I would just say from an identity perspective, we have our open garden approach. And we believe, you know, my view on identity, I've always believed it's been Switzerland. It's something that needs to be independent and people should be able to utilize freely. So Okta, SailPoint, all these guys. I don't believe it actually belongs. Now, my management could change their mind. This is my opinion. But as far as identity, we've always taken, along with the rest of our, you know, what do you want to call it, our open garden approach, where we have our core competencies and areas that we will play, but we will have an interoperability with everybody. And so I think when you take something and you shut it down to one company, I think there's a lot of risks that are inherent with that. Yeah. yeah I would just say from an identity perspective, we have our open garden approach. i would just say from an identity perspective we have our open garden approach And we believe, you know, my view on identity, I've always believed it's been Switzerland. and we believe you know my view on identity i've always believed it's been switzerland It's something that needs to be independent and people should be able to utilize freely. it's something that needs to be independent and people should be able to utilize freely So Okta, SailPoint, all these guys. so okta sailpoint all these guys I don't believe it actually belongs. i don't believe it actually belongs Now, my management could change their mind. now my management could change their mind This is my opinion. this is my opinion But as far as identity, we've always taken, along with the rest of our, you know, what do you want to call it, our open garden approach, where we have our core competencies and areas that we will play, but we will have an interoperability with everybody. but as far as identity we've always taken along with the rest of our you know what do you want to call it our open garden approach where we have our core competencies and areas that we will play but we will have an interoperability with everybody And so I think when you take something and you shut it down to one company, I think there's a lot of risks that are inherent with that. and so i think when you take something and you shut it down to one company i think there's a lot of risks that are inherent with that Not only the security, because you kind of adopt the culture of one company or the other, but you also have to deal with the integration aspect. And there's lots of risk, right? Especially with large acquisitions. You know, we tend to do them smaller so we can tightly integrate them into what we do. That's why we've, you know, always made the type of acquisitions we do. It doesn't mean we wouldn't do big ones. But we believe you get it right when you can either build it internally or do it with the help of acquisitions. Not try to take something that's already established and then, you know, try and remake it in your, or how shall we say it, convoluted way of pulling it together. They rarely work. Not only the security, because you kind of adopt the culture of one company or the other, but you also have to deal with the integration aspect. not only the security because you kind of adopt the culture of one company or the other but you also have to deal with the integration aspect And there's lots of risk, right? and there's lots of risk right Especially with large acquisitions. especially with large acquisitions You know, we tend to do them smaller so we can tightly integrate them into what we do. you know we tend to do them smaller so we can tightly integrate them into what we do That's why we've, you know, always made the type of acquisitions we do. that's why we've you know always made the type of acquisitions we do It doesn't mean we wouldn't do big ones. it doesn't mean we wouldn't do big ones But we believe you get it right when you can either build it internally or do it with the help of acquisitions. but we believe you get it right when you can either build it internally or do it with the help of acquisitions Not try to take something that's already established and then, you know, try and remake it in your, or how shall we say it, convoluted way of pulling it together. not try to take something that's already established and then you know try and remake it in your or how shall we say it convoluted way of pulling it together They rarely work. they rarely work

Speaker 2: I also want to talk a little bit more about SASE because we talked just a few minutes ago about the incremental investments Check Point is making in SASE. What do you think is driving your differentiation in SASE today? And what are the next technical milestones that you need to hit to level up? I also want to talk a little bit more about SASE because we talked just a few minutes ago about the incremental investments Check Point is making in SASE. i also want to talk a little bit more about sase because we talked just a few minutes ago about the incremental investments check point is making in sase What do you think is driving your differentiation in SASE today? what do you think is driving your differentiation in sase today And what are the next technical milestones that you need to hit to level up? and what are the next technical milestones that you need to hit to level up

Speaker 3: So I think the key part of it is, one, it's our efficacy. Two, it's ease of use, ease of installation, and most of all, the up to 10x speed faster than our competitors. And that's because of the way that the product is designed, right? Encryption on the device to go straight out to the internet, go over to the public cloud where necessary, go over to the private cloud to your own data center, et cetera, where it's necessary. So the user doesn't get frustrated with that latency that occurs in other ways. So I think that's what's really beautiful about it. But also the integration where now there's one policy. So one policy between the firewall and the SASE. So it follows your users. It's not an issue. And so I think it's, look, the milestones ahead of us are just to increase capacity. So I think the key part of it is, one, it's our efficacy. so i think the key part of it is one it's our efficacy Two, it's ease of use, ease of installation, and most of all, the up to 10x speed faster than our competitors. two it's ease of use ease of installation and most of all the up to 10x speed faster than our competitors And that's because of the way that the product is designed, right? and that's because of the way that the product is designed right Encryption on the device to go straight out to the internet, go over to the public cloud where necessary, go over to the private cloud to your own data center, et cetera, where it's necessary. encryption on the device to go straight out to the internet go over to the public cloud where necessary go over to the private cloud to your own data center et cetera where it's necessary So the user doesn't get frustrated with that latency that occurs in other ways. so the user doesn't get frustrated with that latency that occurs in other ways So I think that's what's really beautiful about it. so i think that's what's really beautiful about it But also the integration where now there's one policy. but also the integration where now there's one policy So one policy between the firewall and the SASE. so one policy between the firewall and the sase So it follows your users. so it follows your users It's not an issue. it's not an issue And so I think it's, look, the milestones ahead of us are just to increase capacity. and so i think it's look the milestones ahead of us are just to increase capacity We're in the tens of thousands. We need to get out, you know, to higher levels. Even though it covers most of, you know, the size of enterprises, you know, that's in the bell curve. You know, the outer sides, the other ends of the curve you need to be able to hit. We're in the tens of thousands. we're in the tens of thousands We need to get out, you know, to higher levels. we need to get out you know to higher levels Even though it covers most of, you know, the size of enterprises, you know, that's in the bell curve. even though it covers most of you know the size of enterprises you know that's in the bell curve You know, the outer sides, the other ends of the curve you need to be able to hit. you know the outer sides the other ends of the curve you need to be able to hit

Speaker 2: When do you think you'll be able to hit 100k+? When do you think you'll be able to hit 100k+ ? when do you think you'll be able to hit 100k+

Speaker 3: I'm sure we'll be able to tell you that at the Analyst Day when we have it. I'm sure we'll be able to tell you that at the Analyst Day when we have it. i'm sure we'll be able to tell you that at the analyst day when we have it

Speaker 2: And to be clear, there's an Analyst Day that's in the works that? And to be clear, there's an Analyst Day that's in the works that? and to be clear there's an analyst day that's in the works that

Speaker 3: I would just say that, you know, we've given a little color that, you know, we probably, you've heard us. You know, we did, over the past two years, we did the analyst track. And so what you can expect is probably in the coming year, once, you know, Nadav's had one year under his belt, that we probably want to come out and talk to Wall Street and give them some better ideas of how to view our company and what lies forward, right? What's the expectations that they can have for the years in the future? I would just say that, you know, we've given a little color that, you know, we probably, you've heard us. i would just say that you know we've given a little color that you know we probably you've heard us You know, we did, over the past two years, we did the analyst track. you know we did over the past two years we did the analyst track And so what you can expect is probably in the coming year, once, you know, Nadav's had one year under his belt, that we probably want to come out and talk to Wall Street and give them some better ideas of how to view our company and what lies forward, right? and so what you can expect is probably in the coming year once you know nadav's had one year under his belt that we probably want to come out and talk to wall street and give them some better ideas of how to view our company and what lies forward right What's the expectations that they can have for the years in the future? what's the expectations that they can have for the years in the future

Speaker 2: Let me ask you about firewall refresh. Let me ask you about firewall refresh. let me ask you about firewall refresh

Speaker 3: Please do. Please do. please do

Speaker 2: So you are in year two on Quantum refresh. We've talked about how in any given year, it's 20% of the installed base plus or minus what's up for renewal. Last year, I think, was north of 20%. This year, also tracking north of 20%. How do you think about firewall refresh for your business and specifically the risk that we've now had two above 20% years for Check Point, which means next year might be a below 20% year? So you are in year two on Quantum refresh. so you are in year two on quantum refresh We've talked about how in any given year, it's 20% of the installed base plus or minus what's up for renewal. we've talked about how in any given year it's 20% of the installed base plus or minus what's up for renewal Last year, I think, was north of 20%. last year i think was north of 20% This year, also tracking north of 20%. this year also tracking north of 20% How do you think about firewall refresh for your business and specifically the risk that we've now had two above 20% years for Check Point, which means next year might be a below 20% year? how do you think about firewall refresh for your business and specifically the risk that we've now had two above 20% years for check point which means next year might be a below 20% year

Speaker 3: So I would say in the first half of the year, we expect to still see strength. And it may even go beyond, right? We'll see what we talk about in the beginning of the year once we finish up this year and have our plans for next year. I think some of the interesting dynamics that are going on in this market is, you know, security matters and people are caring about it. And more so than ever. And, you know, efficacy from a standpoint of critical vulnerabilities. I mean, every, you know, Salesloft event just puts another feather in our cap for, you know, what it's like to have efficacy of our standard. And so what I would say is when it comes to the hardware side, that's really where the cesspool of critical vulnerabilities are. And some of our competitors are worse than others. So I would say in the first half of the year, we expect to still see strength. so i would say in the first half of the year we expect to still see strength And it may even go beyond, right? and it may even go beyond right We'll see what we talk about in the beginning of the year once we finish up this year and have our plans for next year. we'll see what we talk about in the beginning of the year once we finish up this year and have our plans for next year I think some of the interesting dynamics that are going on in this market is, you know, security matters and people are caring about it. i think some of the interesting dynamics that are going on in this market is you know security matters and people are caring about it And more so than ever. and more so than ever And, you know, efficacy from a standpoint of critical vulnerabilities. and you know efficacy from a standpoint of critical vulnerabilities I mean, every, you know, Salesloft event just puts another feather in our cap for, you know, what it's like to have efficacy of our standard. i mean every you know salesloft event just puts another feather in our cap for you know what it's like to have efficacy of our standard And so what I would say is when it comes to the hardware side, that's really where the cesspool of critical vulnerabilities are. and so what i would say is when it comes to the hardware side that's really where the cesspool of critical vulnerabilities are And some of our competitors are worse than others. and some of our competitors are worse than others And I think that creates a great opportunity, especially when you look at the total cost of ownership, when you start adding in how many times you're patching, how many times you're dealing with breaches and things along that line. So I think the potential for us to grow at the market or above the market is definitely there. And again, this is what time will tell. But we think we're uniquely positioned from the product sets that we have and what we've delivered. We're seeing cases today where people are doing refreshes and they're actually refreshing into our competitors' solutions where they have their footprint. And I expect that to continue. But time will tell. And I think that creates a great opportunity, especially when you look at the total cost of ownership, when you start adding in how many times you're patching, how many times you're dealing with breaches and things along that line. and i think that creates a great opportunity especially when you look at the total cost of ownership when you start adding in how many times you're patching how many times you're dealing with breaches and things along that line So I think the potential for us to grow at the market or above the market is definitely there. so i think the potential for us to grow at the market or above the market is definitely there And again, this is what time will tell. and again this is what time will tell But we think we're uniquely positioned from the product sets that we have and what we've delivered. but we think we're uniquely positioned from the product sets that we have and what we've delivered We're seeing cases today where people are doing refreshes and they're actually refreshing into our competitors' solutions where they have their footprint. we're seeing cases today where people are doing refreshes and they're actually refreshing into our competitors' solutions where they have their footprint And I expect that to continue. and i expect that to continue But time will tell. but time will tell

Speaker 2: You made a really interesting nuance there around first half of next year. Why would 1H next year be stronger for firewall refresh for Check Point versus the second half? You made a really interesting nuance there around first half of next year. you made a really interesting nuance there around first half of next year Why would 1H next year be stronger for firewall refresh for Check Point versus the second half? why would 1h next year be stronger for firewall refresh for check point versus the second half

Speaker 3: Because that's what we can see. Because that's what we can see. because that's what we can see

Speaker 2: Okay. Sorry. Okay. okay Sorry. sorry

Speaker 3: It's only that. Just what we can see. It's only that. it's only that Just what we can see. just what we can see

Speaker 2: All right. I'm going to ask one more on SASE and then we'll go to the audience. We've been trying to triangulate where we are in terms of enterprise SASE adoption. And we had thought that a lot of wood had been chopped during COVID. But actually, it seems like there's some really nice growth in the SASE market today as well. So would love your thoughts. Do you think we're still relatively early on in enterprise SASE adoption? Or is this going to be more of a going from older-gen solutions to newer-gen solutions and now Check Point's competing on the newer-gen solution side? All right. all right I'm going to ask one more on SASE and then we'll go to the audience. i'm going to ask one more on sase and then we'll go to the audience We've been trying to triangulate where we are in terms of enterprise SASE adoption. we've been trying to triangulate where we are in terms of enterprise sase adoption And we had thought that a lot of wood had been chopped during COVID. and we had thought that a lot of wood had been chopped during covid But actually, it seems like there's some really nice growth in the SASE market today as well. but actually it seems like there's some really nice growth in the sase market today as well So would love your thoughts. so would love your thoughts Do you think we're still relatively early on in enterprise SASE adoption? do you think we're still relatively early on in enterprise sase adoption Or is this going to be more of a going from older-gen solutions to newer-gen solutions and now Check Point's competing on the newer-gen solution side? or is this going to be more of a going from older-gen solutions to newer-gen solutions and now check point's competing on the newer-gen solution side

Speaker 3: So one, I think it's very, very mildly penetrated when you look at all the number of SASE out there, you know, largest install base. I think you get Zscaler with nine or 10,000. When you look at everybody else and what it counts up to, it's not that much. We have north of 100,000 customers. And I believe the last time I checked, it's somewhere in the 80% do not even have a SASE solution. So that's all greenfield. And anybody that's done an early adopter approach, right, that has, you know, say, one of the guys that have a larger position, once you start having the benefit of having your firewall, all your network, and having one policy that follows your users no matter where they go. So you have that same corporate policy. And it's ease of use in doing it, right? So one, I think it's very, very mildly penetrated when you look at all the number of SASE out there, you know, largest install base. so one i think it's very very mildly penetrated when you look at all the number of sase out there you know largest install base I think you get Zscaler with nine or 10,000. i think you get zscaler with nine or 10,000 When you look at everybody else and what it counts up to, it's not that much. when you look at everybody else and what it counts up to it's not that much We have north of 100,000 customers. we have north of 100,000 customers And I believe the last time I checked, it's somewhere in the 80% do not even have a SASE solution. and i believe the last time i checked it's somewhere in the 80% do not even have a sase solution So that's all greenfield. so that's all greenfield And anybody that's done an early adopter approach, right, that has, you know, say, one of the guys that have a larger position, once you start having the benefit of having your firewall, all your network, and having one policy that follows your users no matter where they go. and anybody that's done an early adopter approach right that has you know say one of the guys that have a larger position once you start having the benefit of having your firewall all your network and having one policy that follows your users no matter where they go So you have that same corporate policy. so you have that same corporate policy And it's ease of use in doing it, right? and it's ease of use in doing it right There's not a chance for user error of opening up two different management consoles to try and implement the same policy or anything along that line. So I think, you know, this goes back to security matters. And part of security is how you manage it, right? If you're having to dip into different management consoles, you have things that are loosely coupled together instead of tightly integrated. That's a very different experience. There's not a chance for user error of opening up two different management consoles to try and implement the same policy or anything along that line. there's not a chance for user error of opening up two different management consoles to try and implement the same policy or anything along that line So I think, you know, this goes back to security matters. so i think you know this goes back to security matters And part of security is how you manage it, right? and part of security is how you manage it right If you're having to dip into different management consoles, you have things that are loosely coupled together instead of tightly integrated. if you're having to dip into different management consoles you have things that are loosely coupled together instead of tightly integrated That's a very different experience. that's a very different experience

Speaker 2: Your nuance here on you can already be best of breed, it sounds like, for tens of thousands of users, if I'm understanding this right. So is it fair to say that there are no barriers or technical reasons why you shouldn't be winning in that mid-market, lower end of the enterprise category today for SASE? Your nuance here on you can already be best of breed, it sounds like, for tens of thousands of users, if I'm understanding this right. your nuance here on you can already be best of breed it sounds like for tens of thousands of users if i'm understanding this right So is it fair to say that there are no barriers or technical reasons why you shouldn't be winning in that mid-market, lower end of the enterprise category today for SASE? so is it fair to say that there are no barriers or technical reasons why you shouldn't be winning in that mid-market lower end of the enterprise category today for sase

Speaker 3: I would say once we launch it, right? So that product, the full product that we're talking about. I would say once we launch it, right? i would say once we launch it right So that product, the full product that we're talking about. so that product the full product that we're talking about

Speaker 2: I gotcha. I gotcha. i gotcha

Speaker 3: It's being launched in Q4. We're still selling it today, but think of it as beta testers, people taking it on, that type of thing. It's being launched in Q4. it's being launched in q4 We're still selling it today, but think of it as beta testers, people taking it on, that type of thing. we're still selling it today but think of it as beta testers people taking it on that type of thing

Speaker 2: Okay. Okay. okay

Speaker 3: Like we've had people that have been our customers for many years that are part and parcel into, you know, endorsing it and building it and telling what's needed. Like we've had people that have been our customers for many years that are part and parcel into, you know, endorsing it and building it and telling what's needed. like we've had people that have been our customers for many years that are part and parcel into you know endorsing it and building it and telling what's needed

Speaker 2: Gotcha. All right. Let's pause. Questions from the audience? Gotcha. gotcha All right. all right Let's pause. let's pause Questions from the audience? questions from the audience

Speaker 3: Don't all rush at once. Don't all rush at once. don't all rush at once

Speaker 4: I could ask a follow-up on the SASE point. I could ask a follow-up on the SASE point. i could ask a follow-up on the sase point

Speaker 3: You're never short for words. You're never short for words. you're never short for words

Speaker 4: Yeah. When you say you need to add more capacity, what are we talking about exactly? Are we talking about more points of presence to deliver the product? Yeah. yeah When you say you need to add more capacity, what are we talking about exactly? when you say you need to add more capacity what are we talking about exactly Are we talking about more points of presence to deliver the product? are we talking about more points of presence to deliver the product

Speaker 3: Scale. Just the scalability of the product. Scale. scale Just the scalability of the product. just the scalability of the product

Speaker 4: Through the infrastructure or the product? Through the infrastructure or the product? through the infrastructure or the product

Speaker 3: Through the infrastructure, through everything. Through the actual application of it. Through the infrastructure, through everything. through the infrastructure through everything Through the actual application of it. through the actual application of it

Speaker 4: Got it. So is there any way to quantify the points of presence that you currently have and? Got it. got it So is there any way to quantify the points of presence that you currently have and? so is there any way to quantify the points of presence that you currently have and

Speaker 3: I think we have north of 50, but you see our points of presence aren't what makes the difference there, right? You have it going over the public cloud. You have it going through a private fiber, you know, each customer. And then you have what goes straight out to the internet. So it's the application itself that really needs to scale. I think we have north of 50, but you see our points of presence aren't what makes the difference there, right? i think we have north of 50 but you see our points of presence aren't what makes the difference there right You have it going over the public cloud. you have it going over the public cloud You have it going through a private fiber, you know, each customer. you have it going through a private fiber you know each customer And then you have what goes straight out to the internet. and then you have what goes straight out to the internet So it's the application itself that really needs to scale. so it's the application itself that really needs to scale

Speaker 4: Got it. That makes sense. Got it. got it That makes sense. that makes sense

Speaker 3: Yeah. Yeah. yeah

Speaker 4: Coming back to the discussion of AI, AI-first security is a core focus for Check Point. Beyond threat prevention, how do you expect to be able to monetize your AI capabilities and what's the timeline? Coming back to the discussion of AI, AI-first security is a core focus for Check Point. coming back to the discussion of ai ai-first security is a core focus for check point Beyond threat prevention, how do you expect to be able to monetize your AI capabilities and what's the timeline? beyond threat prevention how do you expect to be able to monetize your ai capabilities and what's the timeline

Speaker 3: I think first of all, I think it's early days. But I think, you know, threat prevention, but also threat prediction, right? That's part of the game plan. But, you know, trying to predict what's next. But I think it's early days to be talking about it from my standpoint. I think when we get to early next year, I think we'll have a lot more to say about a lot of different things. I think first of all, I think it's early days. i think first of all i think it's early days But I think, you know, threat prevention, but also threat prediction, right? but i think you know threat prevention but also threat prediction right That's part of the game plan. that's part of the game plan But, you know, trying to predict what's next. but you know trying to predict what's next But I think it's early days to be talking about it from my standpoint. but i think it's early days to be talking about it from my standpoint I think when we get to early next year, I think we'll have a lot more to say about a lot of different things. i think when we get to early next year i think we'll have a lot more to say about a lot of different things

Speaker 4: How do you think AI is impacting security budgets and strategic conversations, and why might this cycle be different than prior cycles you've mentioned? How do you think AI is impacting security budgets and strategic conversations, and why might this cycle be different than prior cycles you've mentioned? how do you think ai is impacting security budgets and strategic conversations and why might this cycle be different than prior cycles you've mentioned

Speaker 3: I don't think, you know, everybody says it's eating software. It's not eating security. If you're not protecting your organization, if you're training, if you're doing anything like that, you need security more than ever. So I don't think it's impacting security budgets whatsoever. I think it actually could enhance them, to be honest with you, in the longer run. I don't think, you know, everybody says it's eating software. i don't think you know everybody says it's eating software It's not eating security. it's not eating security If you're not protecting your organization, if you're training, if you're doing anything like that, you need security more than ever. if you're not protecting your organization if you're training if you're doing anything like that you need security more than ever So I don't think it's impacting security budgets whatsoever. so i don't think it's impacting security budgets whatsoever I think it actually could enhance them, to be honest with you, in the longer run. i think it actually could enhance them to be honest with you in the longer run

Speaker 4: But not enhancing them at the moment? But not enhancing them at the moment? but not enhancing them at the moment

Speaker 3: I'm not in a position to make that statement, right? We'll see how the next couple of quarters go, right? So I just don't think they're impacting budgets in a negative way. I'm not in a position to make that statement, right? i'm not in a position to make that statement right We'll see how the next couple of quarters go, right? we'll see how the next couple of quarters go right So I just don't think they're impacting budgets in a negative way. so i just don't think they're impacting budgets in a negative way

Speaker 4: Okay. Yeah. Got it. And you've mentioned AI implementations for internal productivity. What are some of the use cases you're seeing that are driving? Okay. okay Yeah. yeah Got it. got it And you've mentioned AI implementations for internal productivity. and you've mentioned ai implementations for internal productivity What are some of the use cases you're seeing that are driving? what are some of the use cases you're seeing that are driving

Speaker 3: It's funny. I found out about one from Roei while we were in New York. It's funny. it's funny I found out about one from Roei while we were in New York. i found out about one from roei while we were in new york

Speaker 2: Excellent. Excellent. excellent

Speaker 3: So, you know, we have them around, you know, engineers. We try to utilize it. And everybody's got an AI project in every part of the company. But Roei told everybody on his team that they don't get to hire anybody until they can show AI improvements. So it was a challenge to his team, which is, "Let's see what kind of efficiencies we can build with leveraging AI throughout the finance org." And I was like, "Interesting. I'm already using AI, so I'm okay." But I can't get any leaner, right? I'm only three people: me, myself, and I. So, yeah. No. So it's interesting. We have embraced it in a very big way. So, you know, we have them around, you know, engineers. so you know we have them around you know engineers We try to utilize it. we try to utilize it And everybody's got an AI project in every part of the company. and everybody's got an ai project in every part of the company But Roei told everybody on his team that they don't get to hire anybody until they can show AI improvements. but roei told everybody on his team that they don't get to hire anybody until they can show ai improvements So it was a challenge to his team, which is, "Let's see what kind of efficiencies we can build with leveraging AI throughout the finance org." And I was like, "Interesting. so it was a challenge to his team which is "let's see what kind of efficiencies we can build with leveraging ai throughout the finance org." and i was like "interesting I'm already using AI, so I'm okay." But I can't get any leaner, right? i'm already using ai so i'm okay." but i can't get any leaner right I'm only three people: me, myself, and I. i'm only three people me myself and i So, yeah. so yeah No. no So it's interesting. so it's interesting We have embraced it in a very big way. we have embraced it in a very big way

Speaker 2: What are the use cases in finance? What are the use cases in finance? what are the use cases in finance

Speaker 3: I don't have those off the top of my head. I don't have those off the top of my head. i don't have those off the top of my head

Speaker 2: Okay. Okay. okay

Speaker 3: I would say they're in the process of implementing them. Let's just say that. What's the use case in your world? Are you going to get rid of Max with AI? Are you going to have one of those little? I would say they're in the process of implementing them. i would say they're in the process of implementing them Let's just say that. let's just say that What's the use case in your world? what's the use case in your world Are you going to get rid of Max with AI? are you going to get rid of max with ai Are you going to have one of those little? are you going to have one of those little

Speaker 2: Impossible. Impossible. impossible

Speaker 3: Those little Tesla guys to do Max's job? Those little Tesla guys to do Max's job? those little tesla guys to do max's job

Speaker 2: Impossible. Impossible. impossible

Speaker 3: Oh, that's totally true. Oh, that's totally true. oh that's totally true Oh, thank you. Oh, thank you. oh thank you

Speaker 2: We can obviously talk more offline. We just did a session with our CIO of engineering to chat through some of our AI use cases. But I think we're pretty much at time. So let's ask some more questions from the audience. Please. We can obviously talk more offline. we can obviously talk more offline We just did a session with our CIO of engineering to chat through some of our AI use cases. we just did a session with our cio of engineering to chat through some of our ai use cases But I think we're pretty much at time. but i think we're pretty much at time So let's ask some more questions from the audience. so let's ask some more questions from the audience Please. please Clearly, the space is consolidating around large vendors. There's always going to be. Clearly, the space is consolidating around large vendors. clearly the space is consolidating around large vendors There's always going to be. there's always going to be Clearly, the space is consolidating around the larger vendors, and certain of your peers, quite a few actually, but certain ones are being more aggressive than others in terms of, you know, how they handle their cash collections, et cetera, organic acquisitions. So what does that, if anything, how are you guys handling that tactically? Are you doing anything differently because of that? Clearly, the space is consolidating around the larger vendors, and certain of your peers, quite a few actually, but certain ones are being more aggressive than others in terms of, you know, how they handle their cash collections, et cetera, organic acquisitions. clearly the space is consolidating around the larger vendors and certain of your peers quite a few actually but certain ones are being more aggressive than others in terms of you know how they handle their cash collections et cetera organic acquisitions So what does that, if anything, how are you guys handling that tactically? so what does that if anything how are you guys handling that tactically Are you doing anything differently because of that? are you doing anything differently because of that

Speaker 3: From an M&A perspective? From an M&A perspective? from an m&a perspective Whether it's M&A, whether it's, you know, how you are investing in the business, how are you dealing with customers in terms of getting their feedback, how they feel about some of this stuff? Whether it's M&A, whether it's, you know, how you are investing in the business, how are you dealing with customers in terms of getting their feedback, how they feel about some of this stuff? whether it's m&a whether it's you know how you are investing in the business how are you dealing with customers in terms of getting their feedback how they feel about some of this stuff So I think, first of all, we have for feedback from our customers, we have a group that's called CheckMates. And our customers are advocates for the company. And that's how they communicate with the company through these programs. They have meetings. There's online resources, everything. So we've got that down pat. As far as when it comes to M&A or how our competitors are addressing the market, I think that's separate from the way we operate our company. I think we pay attention. And I think we try to understand what they're doing. But it doesn't change us from our North Star. You know, we are flexible and we adapt in what we're doing. And, you know, we're not rigid. We're not just going one way with, you know, blindly. But we definitely, we don't, we have a path that we're following. So I think, first of all, we have for feedback from our customers, we have a group that's called Check Mates. so i think first of all we have for feedback from our customers we have a group that's called check mates And our customers are advocates for the company. and our customers are advocates for the company And that's how they communicate with the company through these programs. and that's how they communicate with the company through these programs They have meetings. they have meetings There's online resources, everything. there's online resources everything So we've got that down pat. so we've got that down pat As far as when it comes to M&A or how our competitors are addressing the market, I think that's separate from the way we operate our company. as far as when it comes to m&a or how our competitors are addressing the market i think that's separate from the way we operate our company I think we pay attention. i think we pay attention And I think we try to understand what they're doing. and i think we try to understand what they're doing But it doesn't change us from our North Star. but it doesn't change us from our north star You know, we are flexible and we adapt in what we're doing. you know we are flexible and we adapt in what we're doing And, you know, we're not rigid. and you know we're not rigid We're not just going one way with, you know, blindly. we're not just going one way with you know blindly But we definitely, we don't, we have a path that we're following. but we definitely we don't we have a path that we're following You know, we're an open garden approach. Nobody else has that approach. You know, we're looking to make our customer's environment as safe as possible. From that perspective, our competitors aren't our competitors. They're our partners. The idea there is the focus should be on the customer and making them safer. That's where, you know, being complementary, that's where we bought the Veriti acquisition. You can see our customer remains, our focus remains on the customer. We take our belief in having the highest efficacy of security we can and doing everything to achieve that. At the same time, trying to make our customer's environment as safe as possible. Whatever we're doing, it's going to be with that goal in mind. We believe that's what's going to take us to the next level. You know, we're an open garden approach. you know we're an open garden approach Nobody else has that approach. nobody else has that approach You know, we're looking to make our customer's environment as safe as possible. you know we're looking to make our customer's environment as safe as possible From that perspective, our competitors aren't our competitors. from that perspective our competitors aren't our competitors They're our partners. they're our partners The idea there is the focus should be on the customer and making them safer. the idea there is the focus should be on the customer and making them safer That's where, you know, being complementary, that's where we bought the Veriti acquisition. that's where you know being complementary that's where we bought the veriti acquisition You can see our customer remains, our focus remains on the customer. you can see our customer remains our focus remains on the customer We take our belief in having the highest efficacy of security we can and doing everything to achieve that. we take our belief in having the highest efficacy of security we can and doing everything to achieve that At the same time, trying to make our customer's environment as safe as possible. at the same time trying to make our customer's environment as safe as possible Whatever we're doing, it's going to be with that goal in mind. whatever we're doing it's going to be with that goal in mind We believe that's what's going to take us to the next level. we believe that's what's going to take us to the next level

Speaker 2: Kip, always a pleasure. Please join us in thanking Kip for his time. Kip, always a pleasure. kip always a pleasure Please join us in thanking Kip for his time. please join us in thanking kip for his time