Check Point Software Technologies (NASDAQ:CHKP) is seeking to move beyond its historical reliance on firewall refresh cycles by reshaping its sales organization and leaning into faster-growing areas such as continuous threat exposure management, SASE and AI security, according to comments from Kip Meintzer, the company’s global head of investor relations, at a Baird-hosted event.
In a discussion moderated by Shrenik Kothari, analyst at Baird, Meintzer described Check Point as a 32-year-old company that has evolved from its roots in firewall technology into a broader cybersecurity platform. He said the company now approaches the market through four pillars: Hybrid Mesh, Workspace, Continuous Threat Exposure Management, or CTEM, and AI.
Firewall Business Still Led by Refresh Activity
He said go-to-market changes made at the beginning of the year were designed to increase the share of revenue coming from new customers, expansion within the existing customer base, cross-selling and upselling. Check Point is now using more of a “hunter-farmer” sales model, with account managers focused on existing customers and separate sales representatives pursuing new logos.
Meintzer acknowledged that the changes disrupted execution earlier in the year, particularly in product revenue. He said the disruption is “pretty much behind” the company, and the focus is now on execution. He also said Check Point’s pipeline is ahead of where it was at the same time last year, though the company has described the second quarter as the most challenging of the remaining quarters this year.
Price Increases Aimed at Hardware Cost Pressure
Kothari asked about supply-side pressure, including rising memory and component costs. Meintzer said Check Point implemented a 5% price increase across products at the beginning of the year and an additional 5% increase on hardware only as of April 1.
He said the company believes those actions are sufficient to offset the pricing pressure it has seen from memory and other bill-of-materials components, including storage and chassis. However, he said Check Point is not assuming a major benefit from the increases in guidance and is taking the year “one quarter at a time.”
CTEM Cited as Fastest-Growing Pillar
Meintzer identified CTEM as Check Point’s fastest-growing pillar and said AI-related risks are helping drive customer interest in exposure management. He said the company reported 96% year-over-year annual recurring revenue growth for CTEM in the prior quarter.
He said he could not specify whether CTEM is unlocking new customer budgets or taking share from other security spending categories. But he described the product as one that can “sell itself” once customers see reports showing their exposure. He added that virtual patching has made the offering more compelling.
Meintzer also said unattached subscription revenue is being driven by areas including email security, CTEM and SASE. He said email, CTEM and SASE are each growing north of 40% and make up a significant portion of that revenue category.
AI Security Opportunity Still Early
On AI, Meintzer said Check Point is still in the early stages of monetizing its AI pillar. Revenue from AI factory protection and large language model protections is not yet visible in overall revenue, he said, but the company sees pipeline building for the second half of the year.
He said the company’s AI pillar includes capabilities from Lakera, which Check Point acquired, including LLM protections, red teaming and runtime protections. He highlighted Lakera’s Gandalf community as a source of threat intelligence around adversarial prompts and runtime guardrails. Meintzer said Gandalf has more than 1.3 million users to date and has been operating for more than four years.
Meintzer also discussed Check Point’s work around AI factory protection, including integration with NVIDIA’s DPU. He said Check Point is positioned to provide a defense plane spanning from DPU-level surveillance with next-generation firewall capabilities to runtime and application protection. He said the company has had “a number of wins” in AI factory deployments, but characterized the market as early for Check Point and the broader industry.
Margins and Growth Priorities
Asked about Check Point’s margin philosophy, Meintzer said the company has already made investments that brought margins to current levels and does not necessarily need to make further investments of the same kind. He said foreign exchange, particularly a weaker dollar versus a strong shekel, and mergers and acquisitions are among the biggest factors affecting margins.
He said recent margin declines have been primarily related to M&A and associated headcount additions. Some of those investments, including AI-related investments, are now positioned to begin contributing revenue after previously being mainly cost centers, he said.
Meintzer said Check Point’s goal is not to expand margins but to grow revenue. If margin expansion comes with revenue growth, he said the company would likely reinvest it to support further growth. He said the company’s objective is sustainable double-digit growth, while emphasizing that execution of the go-to-market changes will be key.
About Check Point Software Technologies (NASDAQ:CHKP)
Check Point Software Technologies Ltd. is an Israeli-founded cybersecurity company that develops, markets and supports a broad portfolio of network, cloud and endpoint security products. Founded in 1993, the company was an early pioneer of stateful inspection firewall technology and later developed a modular “software blade” approach that allowed customers to combine protection capabilities. Check Point’s product set spans physical and virtual security appliances, software and cloud-native services designed to prevent cyberattacks, protect data and simplify security management for enterprises and service providers.
Key product families include Quantum Security Gateways (on-premises and hybrid appliances), CloudGuard (cloud security posture and workload protection), Harmony (endpoint, remote access and unified endpoint security), and SandBlast (advanced threat prevention and sandboxing).
