Check Point Software Technologies Ltd. (NASDAQ:CHKP) Q3 2023 Earnings Call Transcript

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In several spaces, the biggest one was — is Perimeter 81 for the Quantum SASE. And again I’ll explain that in a second. It’s a $3.4 billion market which is very adjacent and very complementary to our customer base and I think it’s a must for us to play and be strong in that market. And in addition to that, we’ve extended our technology with a small acquisition of Atmosec, a small Israeli startup that will let us provide better technologies for the SaaS security market. Providing a better technology to secure applications that are being run from the cloud. And last and not least, if you remember, at the beginning of the year we launched our Infinity Global Services, an organization that aims to complete a set of services that customers can get from Check Point.

It basically augment the capabilities that each customer has. Infinity Global Services has today more than 30 different services it provides for higher — around 400 security consultant. It’s a pretty big organization, and what we’ve done now is, added to it few additional services. The main one is actually manage firewall service, it plays very well into our installed base and that’s with acquisition of [indiscernible] we completed just a week and half ago. So this is another addition, important addition to our market space. And again, we’ve done all of that in a very short period of time and continue to work even during these days. And so let me jump right in and speak a little bit about the challenge of the SASE, what is SASE. So SASE means Secure Access Service Edge and that’s actually a big name to the new types of connectivity that enterprises need these days.

So if you’re trying to understand what does that mean. For example, if in the past an enterprise was mainly a remote user and data center or corporate — or a few corporate offices, today and enterprise network is far more than, it has — SaaS application, application that are delivered from the cloud. It has cloud applications which are delivered from a private or public cloud. It has many, many branch offices. Talking about what we call SD-WAN branch office security and branch office traffic optimization. We need to secure the access of the remote users, not just when we access the data center, but also when they access the Internet, when they access the cloud application. And these don’t go through the traditional enterprise gateways. So the connectivity becomes a little bit more challenging or a little bit more complicated because, obviously, each element of that has another layer of connectivity and another element of security.

One approach to doing that is running a big part of it from the cloud and managed solutions today, by the way, what they do is, tunnel all the user traffic. Today, when we speak about SASE, it’s mainly about taking remote user traffic and tunneling it through a cloud service, which opens that communication, inspect it and secure it. And we’ve been trying and we’ve been active in this space for long time, but I think now we’ve made a very important step with the acquisition of Perimeter 81 to build the industry best, what we call a game changing architecture solution that addresses all the elements, not just the remote user and not just the branch office [indiscernible]. But addressing all the elements of SASE connectivity in one suite. I think where we’ve started by launching the Quantum SASE last — the week of actually October 8th.

And we will continue in building the architecture [indiscernible] the most complete SASE solutions. So, let me describe what it is and what are the benefits. For example, if we speak about current solution, they tunnel all the traffic through the clouds. So on one hand, you want to get more security, on the other hand, by tunneling it through the cloud is slowing down and mainly jeopardize the privacy, because you take all your communication which you want to keep private and secure, and open it in a single entity that all the customers in the world share. So basically, you’re taking a huge risk to the privacy of the communication. What we do with Quantum SASE. First, we provide twice as fast internet security, because we are operating in what we call the hybrid manner, with own device and cloud network protection.

Again, it’s controlled through the cloud. But most of — in most cases we cannot — we don’t actually need to go through opening and jeopardizing the privacy, but we can do it from the user device and get a much faster and much more secure connectivity. Second is the consolidation. Despite the challenge, and today, if you look at the industry, the customers are using, if they want to get a full SASE architecture or full connectivity architecture they need to run four different solution usually from three plus vendors. In some cases, much more. What we want to do is create a full mesh integrated connectivity from one vendor, one ability to manage it, one ability to deploy and get the highest level of zero trust security which actually works.

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