What happened

Fortinet (FTNT -0.98%) shareholders were heading for the exits this morning after the company reported its third-quarter financial results. Based on the severity of the cybersecurity stock's drop today, you'd think the company reported worse-than-expected results, but that wasn't the case. 

Instead, Fortinet's top and bottom lines both beat analysts' consensus estimates. But investors mostly ignored those results and instead focused on management's disappointing billings guidance for the fourth quarter. 

Those projections spooked investors and analysts alike, causing Fortinet's shares to plunge 13.2% as of 11:49 a.m. ET. 

A person standing next to computer servers.

Image source: Getty Images.

So what 

The company's total sales in the third quarter were actually pretty good. Revenue climbed 33% from the year-ago quarter to $1.15 billion, surpassing Wall Street's consensus estimate of $1.12 billion. 

Fortinet's bottom-line results weren't a disappointment either. The company's non-GAAP (adjusted) earnings per share of $0.33 easily beat analysts' average estimate of $0.27 and represented an increase of 65% from the year-ago quarter. 

Investors shrugged their shoulders at those results, though, and instead focused their attention on management's fourth-quarter billings outlook, which is in the range between $1.66 billion to $1.72 billion. Analysts were expecting $1.74 billion. 

Investors are worried that the lower-than-expected billings estimate is an indication that the company is facing macroeconomic headwinds, at least in the near term. Many analysts concurred with that thinking, and at least six analysts cut their price target for Fortinet's stock today.

Now what

Fortinet's management said on the earnings call that as it set guidance for the fourth quarter, it considered several factors, including "the greater macro uncertainty" and "the increased risk of forecasting the timing of certain larger transactions." 

Fortinet's chief financial officer Keith Jensen also said that there's been a "transition to more normalized" customer buying behaviors. 

Those comments didn't exactly instill confidence in investors today, especially considering that many tech investors are already generally concerned about a potential recession