Managing Director and Senior Equity Research Analyst at Cowen Inc.
Shaul Eyal is a Managing Director and Senior Equity Research Analyst at TD Cowen, specializing in coverage of the technology sector with a focus on cybersecurity, cloud, and enterprise software companies such as Zscaler, CrowdStrike, Palo Alto Networks, Okta, CyberArk Software, and Cloudflare. He is recognized as a top-ranked analyst, holding a #30 position out of nearly 10,000 Wall Street analysts on TipRanks with a 66.8% success rate and an average annual return of 25.1% per rating; his best call yielded a 384.2% return on Cloudflare. Eyal began his analyst career in the early 2000s, previously holding senior research roles at Oppenheimer & Co. for over a decade before joining TD Cowen around 2016. He holds FINRA Series 7, 63, 86, and 87 licenses and is noted for consistently outperforming industry benchmarks with meticulous, actionable insight for institutional investors.
Shaul Eyal asked about the stellar operating margin performance and how SailPoint thinks about second-half hiring plans.
CFO Brian Carolan attributed the margin to top-line growth and disciplined expense management, noting investments in new products and go-to-market.
Shaul Eyal commented on SailPoint's stellar operating margin performance and asked if it was primarily due to a disciplined approach, also inquiring about second-half hiring plans.
Brian Carolan, SailPoint's CFO, attributed the strong margins to top-line growth and disciplined expense management. He noted that the company raised its full-year revenue and adjusted operating income guidance. Carolan explained that Q3 guidance reflects planned investments for new product launches at the Navigate conference and scaling the go-to-market engine for fiscal year 2027.
Shaul Eyal commended the stellar operating margin performance and asked about its drivers, including the top-line beat and disciplined approach, as well as the company's second-half hiring plans.
Brian Carolan, CFO, SailPoint, attributed the strong operating margin to top-line growth and disciplined management, noting a 200 basis point increase in full-year revenue guidance to 22.4% and a 160 basis point increase in adjusted operating margins to 17%. He stated that Q3 margins reflect planned investments in launching new products and modules at the Navigate conference, as well as scaling the go-to-market engine for fiscal year 2027, while reiterating the company's proven ability to expand margins responsibly.
Shaul Eyal inquired about the stellar operating margin performance, asking if it was primarily due to a disciplined approach, and also about second-half hiring plans.
CFO Brian Carolan attributed the margin expansion to top-line growth and disciplined execution. He noted the raised revenue guidance (22.4% for the full year) and adjusted operating margins (17%). Carolan explained that Q3's guidance reflects planned investments for new product launches at the Navigate conference and scaling the go-to-market engine for fiscal year 2027.
Shaul Eyal from TD Cowen inquired about the geographic mix of the business and performance trends, particularly within Europe.
CFO Brian Carolan reported a consistent geographic mix: ~68% from the U.S., ~19% from EMEA, and ~13% from the rest of the world. He noted no specific country was an outlier but highlighted that the EMEA region has shown a strong trend toward adopting SaaS-first solutions over the last one to two years, which benefits SailPoint's offerings.
Shaul Eyal from TD Cowen asked about the strategic partnership with Accenture, its role in the go-to-market strategy, and its potential involvement in driving adoption of Generative AI solutions.
President Matt Mills affirmed that Accenture remains one of their largest and strongest partners, including in the MSP program. CEO & Founder Mark McClain added that they are working with all leading partners, including Accenture, Deloitte, and PwC, to address customer needs around AI agents and expect the global partnership to continue expanding.
Shaul Eyal requested more details on an eight-figure deal with a police force involving SD-WAN, SaaS, and other components, asking for a breakdown of the SD-WAN versus SaaS contribution.
Christiane Ohlgart, CFO, clarified that the eight-figure deal refers to billings and includes a combination of product and services. She noted that the customer is building a sovereign SaaS, which involves purchasing more product (hardware) rather than a cloud-delivered SaaS solution, making it less SaaS-centric and more focused on SD-WAN and SD-Branch. Ken Xie, Founder, Chairman, and CEO, emphasized that sovereign SaaS is a unique Fortinet advantage, especially for government and large enterprises requiring data privacy and control.
Shaul Eyal requested more details on an eight-figure deal with a police force involving SD-WAN, SD-Branch, and Sovereign SaaS, specifically asking about the relative contribution of SD-WAN versus SaaS.
Christiane Ohlgart, CFO, clarified that the eight-figure deal was related to billings, combining product and services. She noted that the sovereign SaaS deployment involved more product purchase for self-hosting, making it less SaaS and more SD-WAN and SD-Branch. Ken Xie, Founder, Chairman, and CEO, highlighted sovereign SaaS as a key differentiator and Fortinet's unique advantage for government and large enterprises.
Shaul Eyal from TD Cowen asked if FortiSASE sales are cannibalizing the core appliance business and inquired about the long-term characteristics of the fiscal 2027 firewall refresh cohort.
CEO Ken Xie explained that SASE enhances, rather than replaces, traditional firewalls, creating a new "SASE firewall" category. CFO Christiane Ohlgart added that win/loss data shows SASE is an expansion, not a replacement sale. Regarding the 2027 refresh, Ohlgart noted it involves lower-end units, making it less significant for product revenue but a valuable opportunity for customer upsell conversations.
Shaul Eyal asked about the increasing number of 8-figure transactions, seeking to understand the primary product drivers and whether these deals typically represent the full Fortinet platform stack.
CAO and incoming CFO Christiane Ohlgart explained that a significant driver for these large transactions is enterprise SD-WAN deployments. She noted that these deployments often serve as the starting point for customers to expand their investment into the broader Fortinet Security Fabric and purchase additional solutions.
Shaul Eyal asked about the sustainability of Fortinet's strong U.S. performance into 2025 and the specific plans for the U.S. sales operations.
CEO Ken Xie confirmed that efforts to enhance U.S. enterprise sales began over a year ago, focusing on increasing sales capacity and working closely with channel partners. He stated that the company sees significant room to grow in the U.S. and believes it could be the fastest-growing region in the next few years, leveraging its substantial in-country resources.
Shaul Eyal asked for clarification on the term 'sustained growth' mentioned in the press release, inquiring if it meant low-teens or mid-teens growth.
CFO Keith Jensen declined to provide a specific growth range, stating that the company will discuss 2025 during the February earnings call and that the upcoming Analyst Day will also address future outlook. CEO Ken Xie also deferred the question, pointing to the upcoming Analyst Day in 10 days for more detailed information on their total addressable market and growth strategy.
Shaul Eyal of TD Cowen asked about the potential long-term revenue uplift from customers adopting the Flex offering and whether the company's sales pipeline is currently at record levels.
CFO Barbara Larson stated that while it is still early for the Flex model, the company expects it to have a positive impact on deal sizes, duration, and overall platform adoption. She also confirmed that the business is seeing strong momentum with a 'very healthy' and growing pipeline.
Shaul Eyal of TD Cowen inquired about the company's hiring plans for fiscal 2026, specifically asking for a percentage breakdown between R&D and Sales & Marketing.
CEO Tomer Weingarten stated that while plans are constantly adjusted, a significant portion of hiring is focused on R&D to drive future innovation. He noted the sales force was nearly fully ramped at the start of the year, and further hiring in that area is commensurate with growth objectives.
Shaul Eyal asked for commentary on Remaining Performance Obligation (RPO) trends, which grew slower than in the past, and sought insights into the current pricing environment and contract durations.
CFO Barbara Larson explained that Q3 RPO growth of 25% faced a difficult year-over-year comparison due to several large, long-term contracts signed in the prior year. CEO Tomer Weingarten added that pricing has held steady, as reflected in their high gross margins, despite aggressive discounting from some competitors. He emphasized that SentinelOne focuses on value and cost savings.
Shaul Eyal of TD Cowen asked about the company's capital allocation strategy, noting its $5 billion cash balance and historical focus on tuck-in acquisitions, and inquired about the current thinking on M&A for the second half and beyond.
Founder & CEO George Kurtz acknowledged the incredible balance sheet and stated that the management team spends significant time strategically evaluating the market. He emphasized CrowdStrike's hallmark of thoughtfully integrating acquisitions rather than just stitching them together. While the company has a sweet spot for M&A, he noted they could go outside of it but will remain focused on finding the right team and technology that makes sense for CrowdStrike and its customers, rather than just buying ARR for its own sake.
Shaul Eyal asked about the success of Next-Gen SIEM and inquired which one or two legacy SIEM incumbents are most frequently being displaced by CrowdStrike's offering.
CEO George Kurtz identified Splunk and QRadar as the primary legacy incumbents being displaced. He attributed the success to the product being better, faster, and offering superior value as part of an integrated platform. He also noted that providing a free 10GB tier to all customers makes it easy for them to trial and convert.
Shaul Eyal inquired about the performance of international operations, particularly in Europe, compared to the U.S., and asked for color on the competitive landscape.
Co-CEO and CFO Stephen Vintz reported strong international demand, especially in Europe and the Middle East, which produced some of the quarter's largest deals. He confirmed plans to invest in these growth markets. Regarding competition, Vintz stated the dynamics are largely unchanged, facing traditional VM incumbents and seeing good traction in cloud security, particularly in hybrid environments.
Shaul Eyal of TD Cowen asked about the business performance in July, noting anecdotal reports of trends being ahead of historical seasonality, to gauge the momentum at the start of the third quarter.
CFO and Co-CEO Steve Vintz responded that the company's updated guidance already incorporates all available information, including the business flow in July. He stated that the business rhythm is consistent with prior quarters, where activity concentrates in the final month, and noted that Q3 is a seasonally strong quarter for the U.S. Federal business, which has many sizable opportunities.
Shaul Eyal of TD Cowen inquired about expectations for the Q4 seasonal budget flush and asked for commentary on geographic performance during the quarter.
CFO Steve Vintz stated that Tenable is not expecting a significant budget flush and that any such event would represent upside. He described geographic performance as stable and consistent, highlighting particular strength and a large deal win in the mid-market segment.
Shaul Eyal of Cowen inquired about the momentum behind the enterprise browser and sought clarification on the concept of emerging "browser wars."
CEO Nikesh Arora explained that the browser's importance has surged with the rise of agentic AI. He described the "browser wars" as a consumer-side phenomenon where major tech companies embed AI agents into browsers. This, he argued, creates a security risk that forces enterprises to adopt secure enterprise browsers with necessary controls, making it a critical part of the SASE stack.
Shaul Eyal noted the success of the QRadar replacement and Talon (Prisma Access Browser) initiatives, asking which represented a better acquisition and the larger long-term TAM opportunity.
CEO Nikesh Arora positioned the XSIAM platform (addressing the QRadar space) as the more foundational long-term opportunity. He argued that the future of security will be built on a unified security data lake, which XSIAM provides. While the Prisma Access Browser is a valuable edge device, the underlying data platform is the key to enabling multiple security use cases and defining the future architecture of cybersecurity.
Shaul Eyal inquired about the performance of the QRadar migration and the overall partnership with IBM, asking if the results were in line with or better than initial expectations.
CEO Nikesh Arora described the IBM partnership as "spectacular" and highly successful. He cited strong go-to-market collaboration, joint wins on large deals like the U.K. Home Office contract, and the ability to significantly expand ARR with former QRadar customers, as demonstrated by a major deal with an Asian bank. He concluded that the partnership "couldn't have been better."
Shaul Eyal from Cowen inquired about the company's hiring plans for the remainder of the year and whether the significant increase in revenue guidance implies a corresponding acceleration in Annual Recurring Revenue (ARR).
CFO Chris Kutsor stated that hiring is targeted in R&D and services, with total OpEx expected to remain stable, though a slight uptick for SOX/automation investments is possible. CEO John Kedzierski added that service hiring is related to insourcing field service delivery. On ARR, Kutsor clarified that it would naturally lag total revenue growth due to IP license fees and the upfront revenue recognition from direct purchase deals.
Shaul Eyal of TD Cowen inquired about the primary drivers behind the strong Cybersecurity as a Service (CCaaS) Annual Recurring Revenue (ARR) growth and the reasons for the improved gross margin performance in the quarter.
CEO Eyal Harari attributed the exceptional CCaaS ARR growth to new customer launches, the expansion with Vodafone, and the significant contribution from the new Verizon MyBiz service plan. CFO Liat Nathom explained that the improved gross margin was driven by the higher percentage of revenue from the high-margin CCaaS business and a favorable product mix with more software expansion deals. She noted that margins are expected to remain in the 71% to 73% range.
Shaul Eyal of TD Cowen asked about management's confidence in the U.S. Federal spending recovery and for details on retention rate drivers, particularly any impact from federal agencies.
CEO Thomas Hogan expressed high confidence in a federal recovery, stating he expects it to "turn with a vengeance" due to strong underlying demand. CFO David Barter and CRO Marcus Jewell clarified that a specific large federal contract renewal was delayed, impacting the quarterly retention statistic, but they expect it to be renewed at approximately twice its previous size in the coming quarters.
Shaul Eyal requested quantification of the U.S. Federal deal slippage and asked if any business was canceled. He also inquired about the buyer persona in the Intelligence and Defense sector and the performance of the corporate business.
CFO Dana Gerner clarified that the issue is a deferral of new business decisions, not cancellations, which is why the ARR guide is unchanged while the revenue outlook was adjusted. CRO Marcus Jewell described the D&I buyers as commanders of forward operations in Defense and intelligence chiefs for field agents. For the corporate segment, Jewell stated the business is growing in line with the market, highlighting recent Fortune 50 wins and promising partnerships.
Shaul Eyal inquired about the current status of the CEO search and asked for perspective on the potential impact of U.S. government spending uncertainty on Cellebrite's business, given the company's strong guidance.
Interim CEO Thomas Hogan explained that the CEO search is highly selective, with over 150 initial candidates narrowed to about a dozen interviews, but he declined to provide a specific timeline. Regarding federal spending, he acknowledged 'modest headwinds' from leadership changes but believes the new administration's focus on issues like border control will ultimately be a net positive, viewing current issues as temporary deal delays, not lost opportunities.
Shaul Eyal of TD Cowen inquired about the geographical location for the incoming CEO and asked for the specific revenue contribution from the recent CyTech acquisition.
Executive Chairman Thomas Hogan stated that the CEO search is global and not restricted by geography, with the goal of finding the 'best CEO on the planet.' CFO Dana Gerner clarified that the revenue contribution from the CyTech acquisition was minimal, amounting to slightly less than $0.5 million in the quarter.
Shaul Eyal of Cowen asked if the Harmony Email solution is maintaining its prior growth rates and sought confirmation on the geographic distribution of the deals that slipped from Q2.
CEO Nadav Zafrir confirmed that Harmony Email continues to grow at a 'very healthy rate' and is being integrated into a broader 'Workspace' platform strategy. He also reiterated that the slipped deals were not concentrated in any single geography and have since closed.
Shaul Eyal asked for clarification on the company's cloud strategy following the Wiz partnership, specifically whether Check Point is abandoning CNAPP, and also inquired about the mix of new versus existing customers.
CEO Nadav Zafrir stated directly that Check Point is doubling down on cloud but will partner with Wiz for CNAPP, repurposing internal resources to strategic areas like SASE. CFO Roei Golan added that while most product revenue comes from existing customers, new logo acquisition is seeing an uptick, driven by new appliances and the Workforce division.
Shaul Eyal asked new CEO Nadav Zafrir to identify specific product areas needing more depth and the key improvements required to align Check Point's growth with the broader cybersecurity industry.
CEO Nadav Zafrir highlighted the strategy to consolidate all network security elements—on-prem, cloud, SASE, and browser—into a single platform simplified by AI. He also mentioned enhancing ThreatCloud AI and opening the platform to ingest third-party data to provide a more holistic security view for customers.
Shaul Eyal of TD Cowen questioned the Q3 billings miss, asking about the nature of the slipped deals in EMEA and probed the market view that the incoming CEO might initiate an M&A spree, altering the company's growth and margin profile.
Founder and CEO Gil Shwed clarified that the slipped deals were not indicative of a larger issue, with some already closed in October. He stated that while acquisitions will continue, he does not expect a major short-term strategy shift towards 'mega acquisitions' or a change in the company's focus on healthy, profitable growth and operational discipline.
Shaul Eyal requested more detail on a significant healthcare customer win, asking about the number of subscription services or modules a customer of that size would typically utilize.
CEO Yaki Faitelson explained that the win was comprehensive, covering AWS, Azure, Microsoft 365, and on-prem environments, with a key driver being the need to secure Copilot. He noted that customers typically start with their most critical data stores and almost always include Varonis's identity security capabilities.
Shaul Eyal of TD Cowen asked about the headcount added from the Cyral acquisition and if any specific macro trends were observed in the DAG (Defense, Aerospace, and Government) sector.
CFO and COO Guy Melamed stated that the headcount from Cyral was small and that the acquisition would add approximately $4 million in operating expenses for 2025, with no expected ARR or revenue contribution this year. Regarding the federal sector, he noted it's a small part of the business (5% of ARR), Q1 is not a seasonally large quarter, and the guidance does not assume any significant contribution beyond last year's levels.
Shaul Eyal of TD Cowen noted that checks indicate Varonis is seeing tailwinds relative to Microsoft Purview and asked for commentary on the Varonis-Microsoft relationship, particularly in the context of Copilot and its growth potential.
CEO Yaki Faitelson described the relationship with Microsoft as a good partnership that works on a case-by-case basis. He stated that while there is about 20% feature overlap with Purview, Varonis offers a completely different value proposition with its automated remediation, UBA, and threat detection. He emphasized that Varonis and Microsoft work extremely well together, with Varonis using Microsoft's labels, creating a '1 plus 1 equals 5' value proposition for customers.
Shaul Eyal of TD Cowen inquired about the current stage of the AI adoption curve for voice bots, asking if the market is at an inflection point, and what internal steps Verint is taking to ensure consistent execution.
CEO Dan Bodner characterized the current market as being in the 'first inning' of AI adoption. He stated that while customer interest is high and spending is beginning, the market is not yet at an inflection point due to caution stemming from poor results with other vendors' bots. Bodner highlighted Verint's strategy of targeting large, influential brands first to prove value and drive broader market adoption, noting that 90 of the Fortune 500 companies are already using Verint AI.
Shaul Eyal asked for the geographic location of the handful of slipped deals and whether Verint believes it is gaining market share as a result of its AI bot strategy.
CEO Dan Bodner confirmed that the two large slipped deals were with U.S.-based financial services companies. On market share, he asserted that Verint is a leader in CX Automation, stating no other vendor has a comparable scale of AI deployments. He pointed to the rapid 24% ARR growth among Verint's top 25 customers, driven entirely by AI adoption, as clear evidence of market share gains and leadership, emphasizing that Verint's platform is agnostic to customers' underlying infrastructure choices.
Shaul Eyal inquired about whether Verint is gaining market share in the contact center sector amid the AI cycle and asked for details on the financial contribution from the recent tuck-in acquisition.
CEO Dan Bodner asserted that Verint is taking market share by leading the CX automation market, differentiating itself from point solutions and internal IT projects through its open platform and proven business outcomes. Bodner also explained that the small tuck-in acquisition, while technologically significant, contributed about $1 million in Q3 revenue, with the potential for several million in Q4 as they assess the acquired customer contracts.
Shaul Eyal asked if there had been any notable changes in the competitive landscape over the past quarter. He also inquired whether customers were requesting new AI business outcomes or use cases that Verint had not seen previously.
CEO Dan Bodner responded that Verint's platform-agnostic 'Switzerland' approach is becoming more attractive as customers prioritize immediate AI outcomes without disruptive infrastructure changes. He stated this differentiates Verint from competitors, including hyperscalers, who struggle to deliver tangible contact center results. Bodner also confirmed that beyond common use cases, customers are increasingly asking for solutions around agent attrition, fraud prevention, and automated knowledge management.
Shaul Eyal of TD Cowen asked about the rationale for the Red Canary acquisition, seeking the top reasons Zscaler chose this specific MDR provider over others, such as technology, market reach, or client base.
CEO Jay Chaudhry explained the decision was to accelerate Zscaler's vision for the SOC market. He cited three key factors: 1) Red Canary's talented detection and threat intelligence engineers; 2) its sophisticated and production-ready agentic AI technology, which he noted was a key differentiator from competitors; and 3) its experienced go-to-market team that can serve as a specialist sales force for Zscaler.
Shaul Eyal from TD Cowen noted Okta's strong performance in March and April, which contrasted with reports from other companies. He asked how business trended in May, the first month of the second quarter.
CEO Todd McKinnon responded that while the forward-looking 'feelings' in the market became more negative, Okta's actual performance numbers and pipeline build in May remained consistent with Q1 trends. CFO Brett Tighe added a reminder that Okta's quarters are typically back-end loaded, so the first month is not always indicative of the full quarter's results.
Shaul Eyal requested a profile of Okta Identity Governance (OIG) customers, asking if they are typically new or existing, enterprise or SMB, and if the wins are greenfield or displacements.
CEO Todd McKinnon stated that the vast majority of OIG customers are existing customers upselling from Access Management, reinforcing the move toward a unified platform. He noted a surprising number of competitive takeouts, especially from legacy on-premise systems that were sold but never fully implemented. CFO Brett Tighe added that Okta also pursues side-by-side implementations, a strategy that proved successful for its core Access Management business, allowing them to demonstrate value and earn the right to displace the incumbent over time.
Shaul Eyal asked for more detail on machine identity pricing relative to competitors and sought clarification on whether the shortened certificate lifecycle is a recommendation or a mandate.
CEO Matt Cohen reiterated that the key metric is total deal size, which he expects to be 3-5x larger for a fully deployed machine identity customer compared to a human-only deal. He also confirmed that the change in certificate lifecycles to 47 days is a mandate from the CA/Browser Forum, a governing body, which is compelling enterprises to address the issue now.
Shaul Eyal asked about the potential impact of U.S. federal government spending uncertainty on CyberArk's business, given concerns raised by other cybersecurity firms.
CEO Matt Cohen stated that CyberArk is in an 'enviable position.' He noted that global government is about 10% of ARR, with only half being U.S. federal, and that business is spread broadly across agencies. Most importantly, he argued that CyberArk's FedRAMP-authorized offerings are a 'must-have' that can also help the government save money, making them less susceptible to budget scrutiny. No meaningful impact was factored into the guidance.
Shaul Eyal asked for commentary on the performance of the public sector vertical during the quarter and for an update on business linearity trends in Q2 and into July.
CEO Matt Cohen reported that the public sector vertical, which is about 10% of ARR, showed solid and evenly distributed performance. He described business linearity as a typical 'hockey stick' pattern, with the quarter being back-end loaded, but noted that Q3 had started strong.
Shaul Eyal from TD Cowen asked for elaboration on how potential tariffs on hardware could be a 'final straw' for on-premise holdouts and how Cloudflare manages its own network supply chain.
CEO Matthew Prince highlighted Cloudflare's world-class, flexible supply chain, which is not dependent on any single vendor and utilizes strategies to mitigate trade risks. He confirmed that they are hearing from customers, especially in finance and healthcare, whose plans for on-premise hardware refreshes are being slowed by tariff uncertainty, pushing them to consider cloud-based SASE services like Cloudflare's.
Shaul Eyal asked if Cloudflare is assisting larger customers with financing activities as deal sizes increase.
CEO Matthew Prince and CFO Thomas Seifert both confirmed that Cloudflare does not offer customer financing. They stated it has not been a topic of discussion with customers, attributing this to the company's high-ROI, consumption-based SaaS model, which differs from hardware-centric businesses.
Shaul Eyal of TD Cowen asked about the market dynamics and demand drivers Cognyte is currently observing in its markets outside of the United States.
CEO Elad Sharon responded that global demand drivers remain healthy, fueled by growing data volumes, the need to convert data into insights, and the increasing sophistication of adversaries using technologies like cryptocurrency. He highlighted that AI presents both a risk (used by criminals) and a significant opportunity for customers to uncover hidden insights and improve investigator efficiency, reinforcing Cognyte's position for continued growth.
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