Sophos has been buying companies like crazy and it is starting to look like more spending is on the way.
Sophos acquired machine-learning security start-up Invincea for $100 million in February, following takeovers of Barricade IO, Mojave Networks, SurfRight and Cyberoam.
CEO Kris Hagerman, has hinted that other purchases are certain to happen.
In recent interviews Hagerman has hinted that the industry should expect more M&A activity in next few years.
He said that there was not an acquisition policy, as the outfit is committed to innovating and spends a lot on R&D.
The idea was to have a mix of organic development and every now splurge on some targeted M&A to help enhance or accelerate Sophos’ own efforts.
Sophos has acquired half a dozen companies over the last four or five years – it’s probably reasonable to expect something in a similar zip code over the next few years, he said.
Security companies have seen their share prices rise sharply amid expected increase in spending on IT security after the WannaCry hack
The ransomware attack that disrupted the NHS and businesses around the world has led to a boom in share prices of cybersecurity companies – even the firm used by the health service to protect it against hackers.
Governments and companies expected to increase spending on IT security after being caught out by the attack, cybersecurity firms have seen their stock market values climb sharply over the past two days.
Sophos, a cloud network security specialist which counts the NHS among its clients, have jumped by about eight percent. Of course, it had to make a few changes. The claim on the company’s website that “the NHS is totally protected with Sophos” was changed to “Sophos understands the security needs of the NHS”.
Last week, the company tweeted its “top five tips for securing NHS organisations”. But its shares have been performing well over recent months because of the increased need for cyber defences.
NCC group added five percent to its share valuation and cyber consultancy group ECSC surged 42 percent. ISE, a fund invested in cybersecurity businesses, added nearly four percent.
All this is because corporates have suddenly woken up to the fact that they need to spend some cash on IT security and it is probably a daft idea to keep all those Windows XP machines running for the great unwashed while top execs get Microsoft Surfaces.
Sophos already gives services to the healthcare industry and is looking to increase selling to the sector in the aftermath of the attack.
FireEye’s prices have risen seven percent, Symantec up more than three per cent and Palo Alto Networks 2.7 percent.
The success of the WannaCry hack could make other attacks more likely in the future amid doubts over governments’ ability to secure “cyberweapons” from theft.
UK insecurity outfit Sophos today reported its interim results which showed that while revenues continued to rise, losses also widened.
Revenue increased to $256.96 million in the six months, up from $234.2 million in the same period last year. Sophos said its billings were up 15 percent while new customer billings were up 20 percent.
That still meant that it had an operating loss of $24.6 million which was an increase from $13.4 million from last year.
Sophos blamed the increased losses on investment into R&D, as well as a continued shift towards subscription-based billing.
Investors appeared largely satisfied first six months of results. The share price crept up by one percent today to 235 pence per share.
Kris Hagerman, chief executive officer said that he was pleased with Sophos’ first half results. They were in-line with Sophos’ outlook, and he was especially pleased with our cash flow performance which was ahead.
“As we enter the second half of the fiscal year we expect continued strong growth, as we benefit from key new product releases in next-generation endpoint and next-generation firewall, and the continued momentum of our Sophos Central cloud management platform,” Hagerman said.
For the year-ending 31 March 2017, the firm said that it expects to deliver mid-teens revenue growth whilst delivering ‘modest’ cash EBITDA margin expansion.
Sophos has ended its relationship with security reseller Quadsys after five of its staffers, including three directors of the company, were sentenced for offences committed under the Computer Misuse Act.
Some vendors were quick to terminate their dealings with Quadsys the moment the arrests were announced but Sophos continued to recommend that customers buy their security software from the reseller. In fact the insecurity outfit promoted Quadsys to a Platinum Partner just nine days after the five entered their guilty pleas.
Sophos said that the reason it hung on to Quadsys for so long was that it was waiting for the full facts of the case to be known and the case was over. Now everything is in the public domain, Sophos feels a bit more confident in ending its business relationship with convicted crims.
It has called on any Sophos users who have the deal with Quadsys, who are worried, to give them a ring and they will explain what it all means.
Quadsys staff were arrested after Sensitive data, including pricing information, was stolen from a rival security reseller.
Oxfordshire security outfit Sophos has seen its shares jump after its sales figures for its first financial year as a publicly traded company shot through the roof.
Shares in Sophos went up by four per cent after it announced its first set of financial results as a publicly traded company. The security company floated on the London Stock Exchange last year and has drifted into billings growth of 19.7 per cent to $534.9 million in the 12 months ended March 31.
Cash earnings before interest, taxation, depreciation and amortisation were up 31.6 per cent, to $120.9 million.
Sophos chief executive Kris Hagerman said that he was jolly pleased of the outfit’s strong performance during our first year as a public company.”
“The year has been marked by sustained strength across all major regions and product categories, with our financial and operational performance exceeding the Board’s expectations set at the start of the year and at the upper-end of our revised outlook.
“Our leading product portfolio, innovation to drive our strategy of synchronised security, commitment to ‘security made simple’ and ‘channel first’ sales strategy enabled us to grow our billings and revenue across both new and existing customers,” he added.
A Crown court judge has dismissed an abuse of process application made by three former directors of Sophos reseller Quadsys, who are facing trial over allegations of hacking into a rival’s database to steal customer and pricing info.
Thames Valley Police charged five men at Quadsys including owner Paul Streeter, Managing Director Paul Cox, director Alistair Barnard, account manager Steve Davies and security consultant Jon Townsend with conspiracy to commit fraud by false representation.
In a plea and case management hearing (PCMH) in March, the defendants pleaded not guilty to one count of securing unauthorised access to computer material with intent, contrary to section 1 of the Computer Misuse Act 1990. Another count of securing unauthorised access to computer material without intent was also added.
Streeter, Cox and Barnard had asked the judge presiding over the case at the PCMH several months ago to throw out the charges relating to Section One of the Computer Misuse Act, which carry a minimum sentence of five years if guilt is proven.
Three applications were refused by the judge but no reasons were given. The five will face trial on 5 September.
Sophos is rumoured to be grinding the axe for another round of job cuts.
According to The Next Web around 150 people will be handed their pink slips as the company moves to restructure and focus on its highest growing and strategic business arms.
Although Sophos would not confirm the number, it hinted that the rumours were more than a whisper with a spokesman telling the Next Web that it was in discussion with those affected employees. It said some could also be given a lifeline and shifted into other roles.
“While it is difficult to make any reductions in our team, we are confident these actions will help to drive our long-term success, and allow us to drive greater value for our customers and partners,” Sophos said in an earlier statement.
It follows a similar round of job cuts in September last year, when 35 employees were expected to lose their jobs.
The axe grinding comes as Sophos announced job cuts earlier this year.
New broom at insecurity outfit Sophos, Michael Valentine, has warned that he plans to shake up the company’s channel, just 24 hours after he first put his bottom on his seat.
Valentine has just started his job as Sophos’ senior veep and will manage the global channel programme. He wants to apply his own philosophy to the company’s channel, with subtle changes aimed at reigniting business, particularly in the US and Canada.
He thinks that Sophos needs to attract new partners, particularly if it wants to get money out of the US which has been a lacklustre market.
Talking to CRN in the US, Valentine said that the North American space is where Sophos was doing the least amount of business, and the gap is absolutely huge. Sophos has the product set and the new management allowed to run it and it needs an enriched channel program, he claimed.
In addition to antivirus software, Sophos’ endpoint security platform provides software for encryption, vulnerability monitoring, data loss prevention and mobile device management. It also has unified threat management appliances and firewalls to sell following the acquisition of Astaro in 2011.
Valentine said it was too early to provide any details on changes to the Sophos partner program, but he wants to strengthening Sophos’ three-tiered program with additional support and attention to partners.
This will be yet another shake-up for the Sophos Solution Provider Partner Programme which was rejigged under Emmanuelle Skala, vice president of global channels. There is also a new redesigned partner portal also provides deal registration, product and promotion information.