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Allot Communications tops second-quarter estimates as it increases focus on network security

The network security company plans to announce a unified security deal for Telefonica Spain in the near future

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Needham analysts recently upgraded the software company’s shares to a Buy from Hold

Allot Communications Ltd (NASDAQ:ALLT) announced its second-quarter results, topping revenue estimates and seeing a narrower-than-expected loss.

The network security company reported a net loss of US$0.04 per share on revenue of US$23mln, compared with a net loss of US$0.07 per share on revenue of US$19.5mln in the previous year’s second quarter.

The Israel-based company beat Wall Street estimates of a net loss of US$0.06 EPS on revenue of $22.35mln.

Shares were up nearly 6% to US$5.67 in Tuesday pre-market trading.

Allot provides network intelligence and security solutions to service providers. Allot Secure, its security-as-a-service platform, is used by over 20 million subscribers throughout the world.

The company ended this year’s second quarter with slightly more cash on hand, totaling US$105.9mln compared with US$104.7mln in 2017.

READ: Needham upgrades Allot Communications shares to Buy, sees profitability by 2019

For the year ahead, revenue is expected to be in the range of US$91mln to US$95mln.

"Much of our growth in the first half of the year came from actionable intelligence use cases and we are pleased with our improvements in this market segment. Furthermore, we are very encouraged by the market traction we are seeing for our security solutions,” said CEO Erez Antebi in the company’s press release.

The company expects to announce a unified security deal for Telefonica Spain in the near future.

Allot’s analytics system was recently chosen by a Tier 1 Northern European mobile operator in an effort to boost customer loyalty and bring in new subscribers.

Needham analysts upgraded the software company’s shares to a Buy from Hold with a price target of US$6.35, citing the company’s encouraging transition from deep-packet inspection technology, or a way of managing network traffic, to service provider network intelligence and security.

Quick facts: Allot Ltd

Price: 10.61 USD

NASDAQ:ALLT
Market: NASDAQ
Market Cap: $367.83 m
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