0001262039-22-000038 | 10-Q | XBRL Viewer

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Defined Contribution Plans (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Retirement Benefits [Abstract]
Matching contribution on employee contributions, Percent			50.00%
Maximum contribution percentage of each employee's eligible earnings, Percent			4.00%
Matching contributions to the RRSP and 401(k) Plans	$ 3.2	$ 2.5	$ 9.8	$ 7.9

Property and Equipment—Net (Tables)

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment - Net

Property and equipment—net consisted of the following (in millions):


	September 30, 2022		December 31, 2021
Land	$	305.7	$	204.5
Buildings and improvements	488.9		416.2
Computer equipment and software	219.3		176.1
Leasehold improvements	49.7		40.1
Evaluation units	16.5		15.6
Furniture and fixtures	31.2		26.9
Construction-in-progress	38.0		19.9
Total property and equipment	1,149.3		899.3
Less: accumulated depreciation	(259.8)		(211.7)
Property and equipment—net	$	889.5	$	687.6

Inventory

9 Months Ended

Sep. 30, 2022

Inventory Disclosure [Abstract]

INVENTORY

Inventory consisted of the following (in millions):


	September 30, 2022		December 31, 2021
Raw materials	$	42.4	$	40.2
Work in process	8.9		9.8
Finished goods	164.5		125.8
Inventory	$	215.8	$	175.8

Equity Plans and Share Repurchase Program (Deficit) , Restricted Stock Units Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Weighted-Average Grant Date Fair Value per Share
Shares withheld for taxes	0.5	0.8	2.2	3.0
Amount withheld for taxes	$ 32.0	$ 42.9	$ 132.1	$ 119.0
Stock-based Compensation Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Remaining shares available for grant under the plans	57.3		57.3
RSUs
Number of Shares
Balance, beginning (shares)			15.7
Granted (shares)			3.4
Forfeited (shares)			(0.9)
Vested (shares)			(6.6)
Balance, ending (shares)	11.6		11.6
Weighted-Average Grant Date Fair Value per Share
Balance, beginning (in dollars per share)			$ 27.06
Granted (in dollars per share)			58.77
Forfeited (in dollars per share)			33.94
Vested (in dollars per share)			23.02
Balance, ending (in dollars per share)	$ 38.18		$ 38.18
Compensation cost not yet recognized	$ 393.3		$ 393.3
Compensation cost not yet recognized period of recognition			2 years 8 months 12 days

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2022	Nov. 04, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	001-34511
Entity Registrant Name	FORTINET, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	77-0560389
Entity Address, Address Line One	899 Kifer Road
Entity Address, City or Town	Sunnyvale
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94086
City Area Code	408
Local Phone Number	235-7700
Title of 12(b) Security	Common Stock, $0.001 Par Value
Trading Symbol	FTNT
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		781,236,011
Entity Central Index Key	0001262039
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31

Commitments and Contingencies (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Inventory purchase commitments	$ 1,456.4	$ 1,140.0
Other contractual commitments and open purchase orders	$ 111.7	126.7
Non-cancelable remaining contract term (in excess of)	1 year
Operating lease liability	$ 73.5	$ 68.9

Segment Information (Details) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
Segment Information (Details) $ in Millions	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($) business_activity segment_manager operating_segment reportable_segment	Sep. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Segment Reporting Information [Line Items]
Business activity (in business activities) \| business_activity			1
Segment managers responsible for operations (in segment managers) \| segment_manager			0
Number of operating segments (in operating segments) \| operating_segment			1
Number of reportable segments (in reportable segments) \| reportable_segment			1
Total revenue	$ 1,149.5	$ 867.2	$ 3,134.4	$ 2,378.6
Property and equipment - net	$ 889.5		$ 889.5		$ 687.6
Distributor A \| Customer Concentration Risk \| Revenue
Segment Reporting Information [Line Items]
Concentration (percent)	29.00%	31.00%	29.00%	32.00%
Distributor A \| Customer Concentration Risk \| Accounts Receivable
Segment Reporting Information [Line Items]
Concentration (percent)			32.00%		33.00%
Distributor B \| Customer Concentration Risk \| Revenue
Segment Reporting Information [Line Items]
Concentration (percent)	13.00%	12.00%	13.00%	12.00%
Distributor B \| Customer Concentration Risk \| Accounts Receivable
Segment Reporting Information [Line Items]
Concentration (percent)			12.00%		13.00%
Distributor C \| Customer Concentration Risk \| Revenue
Segment Reporting Information [Line Items]
Concentration (percent)	13.00%		13.00%
Distributor C \| Customer Concentration Risk \| Accounts Receivable
Segment Reporting Information [Line Items]
Concentration (percent)			13.00%		13.00%
Americas
Segment Reporting Information [Line Items]
Total revenue	$ 467.6	$ 350.1	$ 1,263.8	$ 978.0
Property and equipment - net	833.3		833.3		$ 644.9
United States
Segment Reporting Information [Line Items]
Total revenue	344.1	258.4	942.8	722.6
Property and equipment - net	631.8		631.8		472.4
Canada
Segment Reporting Information [Line Items]
Property and equipment - net	200.3		200.3		170.9
Latin America
Segment Reporting Information [Line Items]
Property and equipment - net	1.2		1.2		1.6
Other Americas
Segment Reporting Information [Line Items]
Total revenue	123.5	91.7	321.0	255.4
EMEA
Segment Reporting Information [Line Items]
Total revenue	443.9	323.2	1,181.7	905.1
Property and equipment - net	35.9		35.9		31.0
APAC
Segment Reporting Information [Line Items]
Total revenue	238.0	$ 193.9	688.9	$ 495.5
Property and equipment - net	$ 20.3		$ 20.3		$ 11.7

Financial Instruments and Fair Value , Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 823.5		$ 823.5		$ 1,634.8
Recognized gain (loss) on marketable equity securities	2.6	$ (3.7)	(11.7)	$ (2.9)
Marketable equity securities \| Reported as [Member] \| Recurring Basis [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 26.9		$ 26.9		$ 38.6

Investments in Privately Held Companies	9 Months Ended
Investments in Privately Held Companies	Sep. 30, 2022
Investments, All Other Investments [Abstract]
INVESTMENTS IN PRIVATELY HELD COMPANIES	INVESTMENTS IN PRIVATELY HELD COMPANIES Linksys Holdings, Inc. On March 19, 2021, we invested $75.0 million in cash for shares of the Series A Preferred Stock of Linksys for a 32.6% ownership interest in this privately-held company. On September 24, 2021, we invested an additional $85.0 million in cash for shares of Series A Preferred Stock of Linksys, and as of September 30, 2022 and December 31, 2021, we held 50.8% of the outstanding common stock (on an as-converted basis) of Linksys. Linksys provides router connectivity solutions to the consumer and small business markets. We have concluded that our investment in Linksys is an in-substance common stock investment and that we do not hold an absolute controlling financial interest in Linksys, but that we have the ability to exercise significant influence over the operating and financial policies of Linksys. Determining that we have significant influence but not control over the operating and financial policies of Linksys required significant judgement of many factors, including but not limited to the ownership interest in Linksys, board representation, participation in policy-making processes and participation rights in certain significant financial and operating decisions of Linksys in the ordinary course of business. Therefore, we determined to account for this investment using the equity method of accounting. We record our share of Linksys’ financial results on a three-month lag basis. We determined that there was a basis difference between the cost of our investment in Linksys and the amount of underlying equity in net assets of Linksys. Our share of loss of Linksys’ financial results, as well as our share of the amortization of the basis differences, in total was $6.3 million and $22.9 million for the three and nine months ended September 30, 2022, and was $2.8 million for the three and nine months ended September 30, 2021, and has been recorded in loss from equity method investment on the condensed consolidated statements of income. As of September 30, 2022 and December 31, 2021, the investment was included in other assets on our condensed consolidated balance sheets. Transaction costs related to this investment were not material. Due to the presence of impairment indicators, such as a series of operating losses, we evaluated our equity method investment for an other-than-temporary impairment (“OTTI”) during the three months ended September 30, 2022. We considered various factors in determining whether an OTTI has occurred, including the limited operating history available, our ability and intent to hold the investment until its fair value recovers, the implied revenue valuation multiples compared to guideline public companies, Linksys’ ability to achieve milestones and any notable operational and strategic changes. After the evaluation, we determined that an OTTI has not occurred as of September 30, 2022 and as of the date of this Quarterly Report on Form 10-Q. However, we may be required to recognize an impairment loss in future reporting periods if and when our evaluation of the aforementioned factors indicates that the investment in Linksys is determined to be other than temporarily impaired. Such determination will be based on the prevailing facts and circumstances at that time, including the reported results and disclosures of Linksys.

Net Income Per Share

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

NET INCOME PER SHARE

Basic net income per share is computed by dividing net income attributable to Fortinet, Inc., by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share is computed by dividing net income attributable to Fortinet, Inc. by the weighted-average number of shares of common stock outstanding during the period, plus the dilutive effects of restricted stock units (“RSUs”) and stock options. Dilutive shares of common stock are determined by applying the treasury stock method.

A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income per share attributable to Fortinet, Inc. is as follows (in millions, except per share amounts):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Numerator:
Net income including non-controlling interests	$	231.1	$	163.2	$	542.8	$	407.9
Net income (loss) attributable to non-controlling interests	(0.5)		0.1		(0.7)		0.1
Net income attributable to Fortinet, Inc.	$	231.6	$	163.1	$	543.5	$	407.8

Denominator:
Basic shares:
Weighted-average common stock outstanding-basic	786.2		817.7		795.0		816.5
Diluted shares:
Weighted-average common stock outstanding-basic	786.2		817.7		795.0		816.5
Effect of potentially dilutive securities:
RSUs	4.9		11.8		6.6		11.0
Stock options	7.5		9.1		8.2		7.9
Weighted-average shares used to compute diluted net income per share attributable to Fortinet, Inc.	798.6		838.6		809.8		835.4
Net income per share attributable to Fortinet, Inc.:
Basic	$	0.29	$	0.20	$	0.68	$	0.50
Diluted	$	0.29	$	0.19	$	0.67	$	0.49

The following weighted-average shares of common stock were excluded from the computation of diluted net income per share attributable to Fortinet, Inc. for the periods presented, as their effect would have been antidilutive (in millions):


	Three Months Ended		Nine Months Ended
	September 30, 2022	September 30, 2021	September 30, 2022	September 30, 2021
RSUs	2.5	0.3	1.1	0.9
Stock options	1.6	0.1	1.4	1.4
Total	4.1	0.4	2.5	2.3

Financial Instruments and Fair Value

9 Months Ended

Sep. 30, 2022

Financial Instruments and Fair Value [Abstract]

FINANCIAL INSTRUMENTS AND FAIR VALUE

Available-for-sale Securities

The following tables summarize our available-for-sale securities (in millions):


	September 30, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Corporate debt securities	$	342.5	$	—	$	(6.2)	$	336.3
U.S. government and agency securities	292.2		—		(6.2)		286.0
Commercial paper	141.3		—		(0.4)		140.9
Certificates of deposit and term deposits	55.5		—		(0.2)		55.3
Municipal bonds	5.2		—		(0.2)		5.0
Total available-for-sale securities	$	836.7	$	—	$	(13.2)	$	823.5


	December 31, 2021
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Corporate debt securities	$	540.7	$	—	$	(1.2)	$	539.5
U.S. government and agency securities	356.1		—		(1.0)		355.1
Commercial paper	566.0		—		(0.2)		565.8
Certificates of deposit and term deposits	169.1		—		(0.1)		169.0
Municipal bonds	5.4		—		—		5.4
Total available-for-sale securities	$	1,637.3	$	—	$	(2.5)	$	1,634.8

The following tables show the gross unrealized losses and the related fair values of our available-for-sale securities that have been in a continuous unrealized loss position (in millions):


	September 30, 2022
	Less Than 12 Months				12 Months or Greater				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Corporate debt securities	$	251.5	$	(4.4)	$	84.8	$	(1.8)	$	336.3	$	(6.2)
U.S. government and agency securities	218.0		(4.1)		68.0		(2.1)		286.0		(6.2)
Commercial paper	140.9		(0.5)		—		—		140.9		(0.5)
Certificates of deposit and term deposits	43.0		(0.2)		1.5		—		44.5		(0.2)
Municipal bonds	5.0		(0.1)		—		—		5.0		(0.1)
Total available-for-sale securities	$	658.4	$	(9.3)	$	154.3	$	(3.9)	$	812.7	$	(13.2)


	December 31, 2021
	Less Than 12 Months				12 Months or Greater				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Corporate debt securities	$	494.4	$	(1.2)	$	—	$	—	$	494.4	$	(1.2)
U.S. government and agency securities	334.2		(1.0)		—		—		334.2		(1.0)
Commercial paper	288.0		(0.2)		—		—		288.0		(0.2)
Certificates of deposit and term deposits	93.1		(0.1)		—		—		93.1		(0.1)
Municipal bonds	5.3		—		—		—		5.3		—
Total available-for-sale securities	$	1,215.0	$	(2.5)	$	—	$	—	$	1,215.0	$	(2.5)

The contractual maturities of our investments were as follows (in millions):


	September 30, 2022		December 31, 2021
Due within one year	$	739.5	$	1,194.0
Due within one to three years	84.0		440.8
Total	$	823.5	$	1,634.8

Available-for-sale securities are reported at fair value, with unrealized gains and losses and the related tax impact included as a separate component of equity (deficit) and in comprehensive income. We do not intend to sell any of the securities in an unrealized loss position and it is not more likely than not that we would be required to sell these securities before recovery of their amortized cost basis, which may be at maturity.

Realized gains and losses on available-for-sale securities were insignificant in the periods presented.

Marketable Equity Securities

Our marketable equity securities were $26.9 million and $38.6 million as of September 30, 2022 and December 31, 2021. The changes in fair value of our marketable equity securities are recorded in other expense—net on the condensed consolidated statements of income. We recognized a $2.6 million gain and a $11.7 million loss during the three and nine months ended September 30, 2022, respectively. We recognized a $3.7 million and a $2.9 million loss during the three and nine months ended September 30, 2021, respectively.

Fair Value of Financial Instruments

Fair Value Accounting—We apply the following fair value hierarchy for disclosure of the inputs used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments.

Level 3—Unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation.

We measure the fair value of money market funds, certain U.S. government and agency securities and marketable equity securities using quoted prices in active markets for identical assets. The fair value of all other financial instruments was based on quoted prices for similar assets in active markets, or model-driven valuations using significant inputs derived from or corroborated by observable market data.

We classify investments within Level 1 if quoted prices are available in active markets for identical securities.

We classify items within Level 2 if the investments are valued using model-driven valuations using observable inputs such as quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Investments are held by custodians who obtain investment prices from a third-party pricing provider that incorporates standard inputs in various asset price models.

Assets Measured at Fair Value on a Recurring Basis

The following tables present the fair value of our financial assets measured at fair value on a recurring basis (in millions):


	September 30, 2022								December 31, 2021
	Aggregate Fair Value		Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs		Significant Other Unobservable Remaining Inputs		Aggregate Fair Value		Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs		Significant Other Unobservable Remaining Inputs
			(Level 1)		(Level 2)		(Level 3)				(Level 1)		(Level 2)		(Level 3)
Assets:
Corporate debt securities	$	336.3	$	—	$	336.3	$	—	$	542.5	$	—	$	542.5	$	—
U.S. government and agency securities	286.0		276.7		9.3		—		355.1		345.2		9.9		—
Commercial paper	140.9		—		140.9		—		580.3		—		580.3		—
Certificates of deposit and term deposits	55.4		—		55.4		—		259.0		—		259.0		—
Money market funds	380.5		380.5		—		—		57.5		57.5		—		—
Municipal bonds	5.0		—		5.0		—		5.4		—		5.4		—
Marketable equity securities	26.9		26.9		—		—		38.6		38.6		—		—
Total	$	1,231.0	$	684.1	$	546.9	$	—	$	1,838.4	$	441.3	$	1,397.1	$	—

Reported as:
Cash equivalents	$	380.6							$	165.0
Marketable equity securities	26.9								38.6
Short-term investments	739.5								1,194.0
Long-term investments	84.0								440.8
Total	$	1,231.0							$	1,838.4

There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the nine months ended September 30, 2022 and year ended December 31, 2021.

Subsequent Events	9 Months Ended
Subsequent Events	Sep. 30, 2022
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTS Acquisition of Non-Controlling Interests in Alaxala On October 3, 2022, we completed our acquisition of the remaining 25% equity interests in Alaxala for $13.5 million. Refer to Note 7. Business Combinations for information in connection with our acquisition of Alaxala.

Net Income Per Share , Anti Dilutive Securities (Details) - shares shares in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (in shares)	4.1	0.4	2.5	2.3
RSUs \| Share-based Payment Arrangement
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (in shares)	2.5	0.3	1.1	0.9
Stock options \| Share-based Payment Arrangement
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (in shares)	1.6	0.1	1.4	1.4

Revenue Recognition - Performance Obligation Satisfaction Period (Details) $ in Millions	Sep. 30, 2022 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 4,210
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 2,150
Performance obligation expected recognition period for three-fourths of remaining obligation	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 2,060
Performance obligation expected recognition period for three-fourths of remaining obligation

Income Taxes , Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Income Taxes , Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Income Tax Disclosure [Abstract]
Effective tax rate (percent)	10.00%	6.00%	4.00%	2.00%
U.S. federal and state taxes, withholding taxes and foreign taxes	$ 75.5	$ 40.1	$ 169.2	$ 115.8
Tax benefit from foreign-derived intangible income deduction	28.9	8.7	62.6	23.9
Excess tax benefits on stock compensation	19.3	25.0	68.7	60.3
Tax benefit from change in tax accounting position		$ 15.7		15.7
Release of reserves on uncertain tax positions and interest due			16.3	$ 5.5
Unrecognized tax benefits	65.5		65.5		$ 73.3
Unrecognized tax benefits that would favorably affect effective tax rate	56.9		56.9
Accrued interest and penalties related to uncertain tax benefits	10.2		10.2		$ 13.3
Possible decrease in unrecognized tax benefits (up to)	$ 20.3		20.3
Income tax expense adjustment			$ 16.4

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Comprehensive Income [Abstract]
Net income including non-controlling interests	$ 231.1	$ 163.2	$ 542.8	$ 407.9
Other comprehensive loss:
Change in foreign currency translation	(3.7)	(1.6)	(16.5)	(1.6)
Change in unrealized gains (losses) on investments	1.0	0.0	(10.7)	(1.0)
Less: tax provision (benefit) related to items of other comprehensive income or loss	0.3	(0.1)	(2.4)	(0.3)
Other comprehensive loss	(3.0)	(1.5)	(24.8)	(2.3)
Comprehensive income including non-controlling interests	228.1	161.7	518.0	405.6
Less: comprehensive loss attributable to non-controlling interests	(1.4)	(0.3)	(4.8)	(0.3)
Comprehensive income attributable to Fortinet, Inc.	$ 229.5	$ 162.0	$ 522.8	$ 405.9

Debt (Tables)

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Summary of Outstanding Debt

The total outstanding debt is summarized below (in millions, except percentages):


	Maturity	Coupon Rate	Effective Interest Rate	September 30, 2022		December 31, 2021
Debt
2026 Senior Notes	March 2026	1.0%	1.3%	$	500.0	$	500.0
2031 Senior Notes	March 2031	2.2%	2.3%	500.0		500.0
Total debt				1,000.0		1,000.0
Less: Unamortized discount and debt issuance costs				10.1		11.6
Total long-term debt				$	989.9	$	988.4

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 3
-Subparagraph (SX 210.12-04(a))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e24072-122690

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
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+ Details

Financial Instruments and Fair Value , Investments (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 836.7	$ 1,637.3
Unrealized Gains	0.0	0.0
Unrealized Losses	(13.2)	(2.5)
Fair Value	823.5	1,634.8
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less Than 12 Months, Fair Value	658.4	1,215.0
Less Than 12 Months, Unrealized Losses	(9.3)	(2.5)
12 Months or Greater, Fair Value	154.3	0.0
12 Months or Greater, Unrealized Losses	(3.9)	0.0
Total, Fair Value	812.7	1,215.0
Total, Unrealized Losses	(13.2)	(2.5)
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract]
Due within one year	739.5	1,194.0
Due within one to three years	84.0	440.8
Fair Value	823.5	1,634.8
Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	342.5	540.7
Unrealized Gains	0.0	0.0
Unrealized Losses	(6.2)	(1.2)
Fair Value	336.3	539.5
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less Than 12 Months, Fair Value	251.5	494.4
Less Than 12 Months, Unrealized Losses	(4.4)	(1.2)
12 Months or Greater, Fair Value	84.8	0.0
12 Months or Greater, Unrealized Losses	(1.8)	0.0
Total, Fair Value	336.3	494.4
Total, Unrealized Losses	(6.2)	(1.2)
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract]
Fair Value	336.3	539.5
U.S. government and agency securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	292.2	356.1
Unrealized Gains	0.0	0.0
Unrealized Losses	(6.2)	(1.0)
Fair Value	286.0	355.1
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less Than 12 Months, Fair Value	218.0	334.2
Less Than 12 Months, Unrealized Losses	(4.1)	(1.0)
12 Months or Greater, Fair Value	68.0	0.0
12 Months or Greater, Unrealized Losses	(2.1)	0.0
Total, Fair Value	286.0	334.2
Total, Unrealized Losses	(6.2)	(1.0)
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract]
Fair Value	286.0	355.1
Commercial paper
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	141.3	566.0
Unrealized Gains	0.0	0.0
Unrealized Losses	(0.4)	(0.2)
Fair Value	140.9	565.8
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less Than 12 Months, Fair Value	140.9	288.0
Less Than 12 Months, Unrealized Losses	(0.5)	(0.2)
12 Months or Greater, Fair Value	0.0	0.0
12 Months or Greater, Unrealized Losses	0.0	0.0
Total, Fair Value	140.9	288.0
Total, Unrealized Losses	(0.5)	(0.2)
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract]
Fair Value	140.9	565.8
Certificates of deposit and term deposits
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	55.5	169.1
Unrealized Gains	0.0	0.0
Unrealized Losses	(0.2)	(0.1)
Fair Value	55.3	169.0
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less Than 12 Months, Fair Value	43.0	93.1
Less Than 12 Months, Unrealized Losses	(0.2)	(0.1)
12 Months or Greater, Fair Value	1.5	0.0
12 Months or Greater, Unrealized Losses	0.0	0.0
Total, Fair Value	44.5	93.1
Total, Unrealized Losses	(0.2)	(0.1)
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract]
Fair Value	55.3	169.0
Municipal bonds
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	5.2	5.4
Unrealized Gains	0.0	0.0
Unrealized Losses	(0.2)	0.0
Fair Value	5.0	5.4
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less Than 12 Months, Fair Value	5.0	5.3
Less Than 12 Months, Unrealized Losses	(0.1)	0.0
12 Months or Greater, Fair Value	0.0	0.0
12 Months or Greater, Unrealized Losses	0.0	0.0
Total, Fair Value	5.0	5.3
Total, Unrealized Losses	(0.1)	0.0
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract]
Fair Value	$ 5.0	$ 5.4

Business Combinations -Schedule of Acquired Finite-Lived Intangible Assets (Details) - USD ($) $ in Millions		9 Months Ended	12 Months Ended
	Aug. 31, 2021	Sep. 30, 2022	Dec. 31, 2021
Developed technology
Business Acquisition [Line Items]
Estimated Useful Life (in years)		4 years	4 years
Customer relationships
Business Acquisition [Line Items]
Estimated Useful Life (in years)		5 years 7 months 6 days	6 years
Trade name
Business Acquisition [Line Items]
Estimated Useful Life (in years)		10 years	10 years
Backlog
Business Acquisition [Line Items]
Estimated Useful Life (in years)		1 year	1 year
Alaxala
Business Acquisition [Line Items]
Total identified intangible assets:	$ 48.0
Alaxala \| Developed technology
Business Acquisition [Line Items]
Fair Value	$ 26.6
Estimated Useful Life (in years)	4 years
Alaxala \| Customer relationships
Business Acquisition [Line Items]
Fair Value	$ 10.0
Estimated Useful Life (in years)	10 years
Alaxala \| Trade name
Business Acquisition [Line Items]
Fair Value	$ 6.4
Estimated Useful Life (in years)	10 years
Alaxala \| Backlog
Business Acquisition [Line Items]
Fair Value	$ 5.0
Estimated Useful Life (in years)	1 year

Summary of Significant Accounting Policies	9 Months Ended
Summary of Significant Accounting Policies	Sep. 30, 2022
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Preparation—The unaudited condensed consolidated financial statements of Fortinet, Inc. and its subsidiaries (collectively, “we,” “us” or “our”) have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information, as well as the instructions to Form 10-Q pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements, and should be read in conjunction with our audited consolidated financial statements as of and for the year ended December 31, 2021, contained in our Annual Report on Form 10-K filed with the SEC on February 25, 2022. In the opinion of management, all adjustments, which include normal recurring adjustments, considered necessary for a fair presentation, have been included. The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the full year or for any future periods. The condensed consolidated balance sheet as of December 31, 2021 is derived from the audited consolidated financial statements for the year ended December 31, 2021. The condensed consolidated financial statements include the accounts of Fortinet, Inc. and its subsidiaries. We consolidate all legal entities in which we have an absolute controlling financial interest. All intercompany balances and transactions have been eliminated in consolidation. The preparation of the condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. On April 14, 2022, our Board of Directors approved a five-for-one forward stock split of our common stock (the "Forward Stock Split"), which was conditioned upon obtaining stockholder approval for the Forward Stock Split, and to increase the number of our authorized shares of common stock. On June 17, 2022, at our 2022 Annual Meeting of Stockholders, our stockholders approved the Forward Stock Split and the amendment and restatement of our amended and restated certificate of incorporation to increase the number of authorized shares of common stock from 300 million to 1.5 billion. The par value of our common stock was not adjusted as a result of the Forward Stock Split. Effective June 22, 2022, we filed our amended and restated certification of incorporation and completed the Forward Stock Split. All share and per share amounts and related stockholders’ equity (deficit) balances presented herein have been retroactively adjusted to reflect the Forward Stock Split. There have been no material changes to our significant accounting policies as of and for the three and nine months ended September 30, 2022. Recently Adopted and Recently Issued Accounting Standards There were no recently adopted accounting standards which would have a material effect on our condensed consolidated financial statements and accompanying disclosures, and no recently issued accounting standards that are expected to have a material impact on our condensed consolidated financial statements and accompanying disclosures.

Net Income Per Share , Calculation of Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share [Line Items]
Net income including non-controlling interests	$ 231.1	$ 163.2	$ 542.8	$ 407.9
Net income (loss) attributable to non-controlling interests	(0.5)	0.1	(0.7)	0.1
Net income (loss)	$ 231.6	$ 163.1	$ 543.5	$ 407.8
Basic shares:
Weighted-average common shares outstanding-basic (in shares)	786.2	817.7	795.0	816.5
Diluted shares:
Weighted-average common shares outstanding-basic (in shares)	786.2	817.7	795.0	816.5
Effect of potentially dilutive securities:
Weighted-average shares used to compute diluted net income per share (in shares)	798.6	838.6	809.8	835.4
Net income per share attributable to Fortinet, Inc.:
Basic (in dollars per share)	$ 0.29	$ 0.20	$ 0.68	$ 0.50
Diluted (in dollars per share)	$ 0.29	$ 0.19	$ 0.67	$ 0.49
RSUs
Effect of potentially dilutive securities:
RSUs and stock options (in shares)	4.9	11.8	6.6	11.0
Stock options
Effect of potentially dilutive securities:
RSUs and stock options (in shares)	7.5	9.1	8.2	7.9

Commitments and Contingencies

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

The following table summarizes our inventory purchase commitments as of September 30, 2022 (in millions):


	Total		2022		Thereafter
Inventory purchase commitments	$	1,456.4	$	1,070.8	$	385.6

Inventory Purchase Commitments—Our independent contract manufacturers and certain component suppliers procure components and build our products based on our forecasts, the availability of various components and their capacity. These forecasts are based on estimates of future demand for our products, which are in turn based on historical trends and an analysis from our sales and marketing organizations, adjusted for extended lead times, changes in supplier delivery commitments and other supply chain matters and market conditions. In order to manage manufacturing lead times, plan for adequate component supply and incentivize suppliers to deliver, we may issue purchase orders to some of our independent contract manufacturers, which are non-cancelable. As of September 30, 2022 and December 31, 2021, we had $1.46 billion and $1.14 billion, respectively, of open purchase orders with our independent contract manufacturers that consist of non-cancelable commitments. In certain instances, these agreements allow us the option to reschedule and adjust our requirements based on our business needs prior to firm orders being placed.

Other Contractual Commitments and Open Purchase Orders—In addition to commitments with contract manufacturers, we have open purchase orders and contractual obligations in the ordinary course of business for which we have not received goods or services. A significant portion of our reported purchase commitments consist of non-cancelable commitments. In certain instances, contractual commitments allow us the option to cancel, reschedule and adjust our requirements based on our business needs prior to firm orders being placed. As of September 30, 2022 and December 31, 2021, we had $111.7 million and $126.7 million, respectively, in other contractual commitments having a remaining term in excess of one year that are non-cancelable and an additional $73.5 million and $68.9 million, respectively, in contractual commitments for operating lease liabilities.

Litigation—We are involved in disputes, litigation, and other legal actions. For lawsuits where we are the defendant, we are in the process of defending these litigation matters, and while there can be no assurances and the outcome of certain of these matters is currently not determinable and not predictable, we currently are unaware of any existing claims or proceedings that we believe are likely to have a material adverse effect on our financial position. There are many uncertainties associated with any litigation and these actions or other third-party claims against us may cause us to incur costly litigation fees, costs and substantial settlement charges, and possibly subject us to damages and other penalties. In addition, the resolution of any intellectual property (“IP”) litigation may require us to make royalty payments, which could adversely affect our gross margins in future periods. If any of those events were to occur, our business, financial condition, results of operations, and cash flows could be adversely affected. Litigation is unpredictable and the actual liability in any such matters may be materially different from our current estimates, which could result in the need to adjust any accrued liability and record additional expenses. We accrue for contingencies when we believe that a loss is probable and that we can reasonably estimate the amount of any such loss. These accruals are generally based on a range of possible outcomes that require significant management judgement. If no amount within a range is a better estimate than any other, we accrue the minimum amount.

Litigation loss contingency accruals associated with outstanding cases were not material as of September 30, 2022 and December 31, 2021.

Indemnification and Other Matters—Under the indemnification provisions of our standard sales contracts, we agree to defend our customers against third-party claims asserting various allegations such as product defects and infringement of certain IP rights, which may include patents, copyrights, trademarks or trade secrets, and to pay judgments entered on such claims. In some contracts, our exposure under these indemnification provisions is limited by the terms of the contracts to certain defined limits, such as the total amount paid by our customer under the agreement. However, certain agreements include covenants, penalties and indemnification provisions including and beyond indemnification for third-party claims of IP infringement that could potentially expose us to losses in excess of the amount received under the agreement, and in some instances to potential liability that is not contractually limited. Although from time to time there are indemnification claims asserted against us and currently there are pending indemnification claims, to date there have been no material awards under such indemnification provisions.

Similar to other security companies and companies in other industries, we have in the past experienced, and we may in the future experience, cybersecurity threats, malicious activity directed against our information technology infrastructure or unauthorized attempts to gain access to our and our customers’ sensitive information and systems. We currently are unaware of

any existing claims or proceedings related to these types of matters, including any that we believe are likely to have a material adverse effect on our financial position.

Condensed Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
REVENUE:
Total revenue	$ 1,149.5	$ 867.2	$ 3,134.4	$ 2,378.6
COST OF REVENUE:
Total cost of revenue	283.0	211.2	787.6	554.7
GROSS PROFIT:
Total gross profit	866.5	656.0	2,346.8	1,823.9
OPERATING EXPENSES:
Research and development	134.3	107.8	383.5	311.6
Sales and marketing	427.1	347.1	1,230.2	978.0
General and administrative	40.7	35.8	124.7	102.2
Gain on intellectual property matter	(1.1)	(1.1)	(3.4)	(3.4)
Total operating expenses	601.0	489.6	1,735.0	1,388.4
OPERATING INCOME	265.5	166.4	611.8	435.5
INTEREST INCOME	4.6	1.2	8.3	3.5
INTEREST EXPENSE	(4.5)	(4.6)	(13.5)	(10.4)
OTHER EXPENSE—NET	(0.9)	(6.3)	(19.3)	(7.5)
INCOME BEFORE INCOME TAXES AND LOSS FROM EQUITY METHOD INVESTMENT	264.7	156.7	587.3	421.1
PROVISION FOR (BENEFIT FROM) INCOME TAXES	27.3	(9.3)	21.6	10.4
LOSS FROM EQUITY METHOD INVESTMENT	(6.3)	(2.8)	(22.9)	(2.8)
NET INCOME INCLUDING NON-CONTROLLING INTERESTS	231.1	163.2	542.8	407.9
LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTERESTS, NET OF TAX	(0.5)	0.1	(0.7)	0.1
NET INCOME ATTRIBUTABLE TO FORTINET, INC.	$ 231.6	$ 163.1	$ 543.5	$ 407.8
Net income per share attributable to Fortinet, Inc. (Note 9):
Basic (in dollars per share)	$ 0.29	$ 0.20	$ 0.68	$ 0.50
Diluted (in dollars per share)	$ 0.29	$ 0.19	$ 0.67	$ 0.49
Weighted-average shares used to compute net income per share attributable to Fortinet, Inc.:
Basic (in shares)	786.2	817.7	795.0	816.5
Diluted (in shares)	798.6	838.6	809.8	835.4
Product
REVENUE:
Total revenue	$ 468.7	$ 337.1	$ 1,240.4	$ 876.1
COST OF REVENUE:
Total cost of revenue	185.2	134.3	501.4	341.2
GROSS PROFIT:
Total gross profit	283.5	202.8	739.0	534.9
Service
REVENUE:
Total revenue	680.8	530.1	1,894.0	1,502.5
COST OF REVENUE:
Total cost of revenue	97.8	76.9	286.2	213.5
GROSS PROFIT:
Total gross profit	$ 583.0	$ 453.2	$ 1,607.8	$ 1,289.0

Segment Information (Tables)

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Revenue From External Customers by Geographic Region

Revenue by geographic region is based on the billing address of our customers. The following tables set forth revenue and property and equipment—net by geographic region (in millions):


	Three Months Ended				Nine Months Ended
Revenue	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Americas:
United States	$	344.1	$	258.4	$	942.8	$	722.6
Other Americas	123.5		91.7		321.0		255.4
Total Americas	467.6		350.1		1,263.8		978.0
Europe, Middle East and Africa (“EMEA”)	443.9		323.2		1,181.7		905.1
Asia Pacific (“APAC”)	238.0		193.9		688.9		495.5
Total revenue	$	1,149.5	$	867.2	$	3,134.4	$	2,378.6

Property and Equipment by Geographic Region


Property and Equipment—net	September 30, 2022		December 31, 2021
Americas:
United States	$	631.8	$	472.4
Canada	200.3		170.9
Latin America	1.2		1.6
Total Americas	833.3		644.9
EMEA	35.9		31.0
APAC	20.3		11.7
Total property and equipment—net	$	889.5	$	687.6

Schedule of Distributor Concentration

The following distributors accounted for 10% or more of our revenue:


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Distributor A	29	%	31	%	29	%	32	%
Distributor B	13	%	12	%	13	%	12	%
Distributor C	13	%	*		13	%	*

* Represents less than 10%

The following distributors accounted for 10% or more of net accounts receivable:


	September 30, 2022		December 31, 2021
Distributor A	32	%	33	%
Distributor B	12	%	13	%
Distributor C	13	%	13	%

Business Combinations

9 Months Ended

Sep. 30, 2022

Business Combination and Asset Acquisition [Abstract]

BUSINESS COMBINATIONS

2021 Acquisitions

Alaxala Networks Corporation

On August 31, 2021, we closed an acquisition of 75% of equity interests as controlling interests in Alaxala Networks Corporation (“Alaxala”), a privately held network hardware equipment company in Japan, for $64.2 million in cash. We acquired the equity interests in Alaxala to broaden our offering of secure switches integrated with our Core Platform and Enhanced Platform Technology functionality, and, over time, to innovate and rebrand certain of Alaxala’s switches to offer a broader suite of secure switches globally.

Under the acquisition method of accounting in accordance with ASC 805, the total purchase price was allocated to Alaxala’s identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values using management’s best estimates and assumptions to assign fair value as of the acquisition date. The following table provides the assets acquired and liabilities assumed as of the date of acquisition:


(in millions)	Estimated Fair Value
ASSETS
Cash	$	1.1
Accounts receivable—net	15.6
Inventory	33.4
Prepaid expenses and other current assets	2.9
Property and equipment	5.3
Goodwill	25.5
Other intangible assets	48.0
Other long-term assets	5.2
TOTAL ASSETS	$	137.0

LIABILITIES
Accounts payable	$	11.0
Current portion of long-term debt	20.2
Accrued and other current liabilities	17.1
Other long-term liabilities	6.7
TOTAL LIABILITIES	$	55.0
NON-CONTROLLING INTERESTS	$	17.8
Net purchase consideration	$	64.2

The excess of the purchase consideration and the fair value of non-controlling interests over the fair value of net tangible and identified intangible assets acquired was recorded as goodwill, which is not deductible for tax purposes. Goodwill is primarily attributable to the assembled workforce of Alaxala and the anticipated operational synergies.

The fair value of the non-controlling interests of $17.8 million was estimated based on the non-controlling interests’ respective share of the fair value of Alaxala.

Identified intangible assets acquired and their estimated useful lives as of August 31, 2021, were as follows (in millions, except years):


	Fair Value		Estimated Useful Life (in years)
Developed technology	$	26.6	4
Customer relationships	10.0		10
Trade name	6.4		10
Backlog	5.0		1
Total identified intangible assets:	$	48.0

Developed technology relates to Alaxala’s network equipment. We valued the developed technology using the relief-from-royalty method under the income approach. This method reflects the present value of the projected cost savings that are expected to be realized by the owner of the royalty granted in exchange for the use of the asset. The economic useful life was determined based on the technology cycle related to each developed technology, as well as the cash flows over the forecast period.

Customer relationships represent the fair value of future projected revenue that will be derived from sales to existing customers of Alaxala. Customer contracts and related relationships were valued using the multi-period excess earnings method. This method reflects the present value of the projected cash flows that are expected to be generated by the customer contracts and relationships less charges representing the contribution of other assets to those cash flows. The economic useful life was determined based on historical customer turnover rates.

Trade name relates to the “Alaxala” trade name. The fair value was determined by applying the relief-from-royalty method under the income approach. This method is based on the application of a royalty rate to forecasted revenue under the trade name. The economic useful life was determined based on the expected life of the trade name and the cash flows anticipated over the forecast period.

Customer backlog relates to the unfulfilled customer contract orders. Backlog was valued using the multi-period excess earnings method. This method reflects the present value of the projected cash flows that are expected to be generated by the execution of the unfulfilled customer contract orders less charges representing the contribution of other assets to those cash flows. The economic useful life was determined based on the anticipated contract orders’ execution timeframe.

In connection with our acquisition of Alaxala, we assumed certain current debt liabilities of $20.2 million as of August 31, 2021. We concluded that the fair value of this debt approximated its book value as of the acquisition date. We repaid this debt in full in September and October 2021. During the post-acquisition period from September 1, 2021 through the repayment dates, interest expense related to Alaxala debt was not material.

The following unaudited pro forma financial information presents the combined results of operations of Fortinet, Inc. and Alaxala, as if Alaxala had been acquired as of the beginning of business on January 1, 2020. The unaudited pro forma financial information is presented for informational purposes only and is not necessarily indicative of our consolidated results of operations of the combined business that would have been achieved if the acquisition had taken place at the beginning of business on January 1, 2020, or of the results of our future operations of the combined business. The following unaudited pro forma financial information for all periods presented includes purchase accounting adjustments for amortization of acquired intangible assets, depreciation of acquired property and equipment, the purchase accounting effect on inventory acquired and related tax effects (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2021		September 30, 2020		September 30, 2021		September 30, 2020
Pro forma revenue	$	887.6	$	684.3	$	2,460.5	$	1,939.6
Pro forma net income attributable to Fortinet, Inc.	$	165.1	$	122.8	$	407.3	$	334.8

Debt

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

DEBT

2026 and 2031 Senior Notes

On March 5, 2021, we issued $1.0 billion aggregate principal amount of senior notes (collectively, the “Senior Notes”), consisting of $500.0 million aggregate principal amount of 1.0% notes due March 15, 2026 (the “2026 Senior Notes”) and $500.0 million aggregate principal amount of 2.2% notes due March 15, 2031 (the “2031 Senior Notes”), in an underwritten registered public offering. The Senior Notes are senior unsecured obligations and rank equally with each other in right of payment and with our other outstanding obligations. We may redeem the Senior Notes at any time in whole or in part for cash, at specified redemption prices that include accrued and unpaid interest, if any, and a make-whole premium. However, no make-whole premium will be paid for redemptions of the 2026 Senior Notes on or after February 15, 2026, or the 2031 Senior Notes on or after December 15, 2030. Interest on the Senior Notes is payable on March 15 and September 15 of each year, beginning on September 15, 2021. As of September 30, 2022 and December 31, 2021, the Senior Notes were recorded as long-term debt, net of discount and issuance costs, which are amortized to interest expense over the respective contractual terms of these notes using the effective interest method.

The total outstanding debt is summarized below (in millions, except percentages):


	Maturity	Coupon Rate	Effective Interest Rate	September 30, 2022		December 31, 2021
Debt
2026 Senior Notes	March 2026	1.0%	1.3%	$	500.0	$	500.0
2031 Senior Notes	March 2031	2.2%	2.3%	500.0		500.0
Total debt				1,000.0		1,000.0
Less: Unamortized discount and debt issuance costs				10.1		11.6
Total long-term debt				$	989.9	$	988.4

As of September 30, 2022 and December 31, 2021, we accrued interest payable of $0.7 million and $4.7 million, respectively, and there are no financial covenants with which we must comply. During the three months ended September 30, 2022 and 2021, we recorded $4.4 million of total interest expense in relation to these Senior Notes in each quarter. During the nine months ended September 30, 2022 and 2021, total interest expense in relation to these Senior Notes was $13.4 million and $10.2 million, respectively. No interest costs were capitalized for the three months or nine months ended September 30, 2022 and 2021, as the costs that qualified for capitalization were not material.

The total estimated fair value of the outstanding Senior Notes was approximately $808.9 million, including accrued and unpaid interest, as of September 30, 2022. The fair value was determined based on observable market prices of identical instruments in less active markets. The estimated fair values are based on Level 2 inputs.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

Goodwill and Other Intangible Assets - Net (Tables)

9 Months Ended

Sep. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in Carrying Amount of Goodwill

The following table presents the changes in the carrying amount of goodwill (in millions):


	Amount
Balance—December 31, 2021	$	125.1
Foreign currency translation adjustments	(4.9)
Balance—September 30, 2022	$	120.2

Schedule of Finite-Lived Intangible Assets by Major Class

The following tables present other intangible assets—net (in millions, except years):


	September 30, 2022
	Weighted-Average Useful Life (in Years)	Gross		Accumulated Amortization		Net
Other intangible assets—net:
Finite-lived intangible assets:
Developed technologies	4.0	$	77.0	$	49.0	$	28.0
Customer relationships	5.6	20.2		13.7		6.5
Trade name	10.0	4.8		0.5		4.3
Backlog	1.0	3.8		3.8		—
Total other intangible assets—net		$	105.8	$	67.0	$	38.8


	December 31, 2021
	Weighted-Average Useful Life (in Years)	Gross		Accumulated Amortization		Net
Other intangible assets—net:
Finite-lived intangible assets:
Developed technologies	4.0	$	82.2	$	38.0	$	44.2
Customer relationships	6.0	22.2		11.9		10.3
Trade name	10.0	6.1		0.2		5.9
Backlog	1.0	4.8		1.6		3.2
Total other intangible assets—net		$	115.3	$	51.7	$	63.6

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

The following table summarizes estimated future amortization expense of finite-lived intangible assets—net (in millions):


	Amount
Years:
2022 (the remainder of 2022)	$	4.0
2023	14.4
2024	9.8
2025	4.9
2026	1.1
Thereafter	4.6
Total	$	38.8

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

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+ Details

Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table presents our revenue disaggregated by major product and service lines (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Product	$	468.7	$	337.1	$	1,240.4	$	876.1
Service:
Security subscription	369.8		287.4		1,023.1		815.6
Technical support and other	311.0		242.7		870.9		686.9
Total service revenue	680.8		530.1		1,894.0		1,502.5
Total revenue	$	1,149.5	$	867.2	$	3,134.4	$	2,378.6

Goodwill and Other Intangible Assets - Net - Other Intangible Assets, Net (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets, Net [Abstract]
Gross	$ 105.8	$ 115.3
Accumulated Amortization	67.0	51.7
Total	$ 38.8	$ 63.6
Developed technology
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Life (in years)	4 years	4 years
Finite-Lived Intangible Assets, Net [Abstract]
Gross	$ 77.0	$ 82.2
Accumulated Amortization	49.0	38.0
Total	$ 28.0	$ 44.2
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Life (in years)	5 years 7 months 6 days	6 years
Finite-Lived Intangible Assets, Net [Abstract]
Gross	$ 20.2	$ 22.2
Accumulated Amortization	13.7	11.9
Total	$ 6.5	$ 10.3
Trade name
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Life (in years)	10 years	10 years
Finite-Lived Intangible Assets, Net [Abstract]
Gross	$ 4.8	$ 6.1
Accumulated Amortization	0.5	0.2
Total	$ 4.3	$ 5.9
Backlog
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Life (in years)	1 year	1 year
Finite-Lived Intangible Assets, Net [Abstract]
Gross	$ 3.8	$ 4.8
Accumulated Amortization	3.8	1.6
Total	$ 0.0	$ 3.2

Inventory (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Inventory, Net [Abstract]
Raw materials	$ 42.4	$ 40.2
Work in process	8.9	9.8
Finished goods	164.5	125.8
Inventory	$ 215.8	$ 175.8

Revenue Recognition - Disaggregated Revenues (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Total revenue	$ 1,149.5	$ 867.2	$ 3,134.4	$ 2,378.6
Product
Disaggregation of Revenue [Line Items]
Total revenue	468.7	337.1	1,240.4	876.1
Service
Disaggregation of Revenue [Line Items]
Total revenue	680.8	530.1	1,894.0	1,502.5
Security subscription
Disaggregation of Revenue [Line Items]
Total revenue	369.8	287.4	1,023.1	815.6
Technical support and other
Disaggregation of Revenue [Line Items]
Total revenue	$ 311.0	$ 242.7	$ 870.9	$ 686.9

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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+ Details

Goodwill and Other Intangible Assets - Net - Narrative (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill impairment			$ 0	$ 0
Amortization expense	$ 5,200,000	$ 4,800,000	$ 17,600,000	$ 11,700,000

Financial Instruments and Fair Value (Tables)

9 Months Ended

Sep. 30, 2022

Financial Instruments and Fair Value [Abstract]

Summary of Investments

The following tables summarize our available-for-sale securities (in millions):


	September 30, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Corporate debt securities	$	342.5	$	—	$	(6.2)	$	336.3
U.S. government and agency securities	292.2		—		(6.2)		286.0
Commercial paper	141.3		—		(0.4)		140.9
Certificates of deposit and term deposits	55.5		—		(0.2)		55.3
Municipal bonds	5.2		—		(0.2)		5.0
Total available-for-sale securities	$	836.7	$	—	$	(13.2)	$	823.5


	December 31, 2021
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Corporate debt securities	$	540.7	$	—	$	(1.2)	$	539.5
U.S. government and agency securities	356.1		—		(1.0)		355.1
Commercial paper	566.0		—		(0.2)		565.8
Certificates of deposit and term deposits	169.1		—		(0.1)		169.0
Municipal bonds	5.4		—		—		5.4
Total available-for-sale securities	$	1,637.3	$	—	$	(2.5)	$	1,634.8

Schedule of Unrealized Loss on Investments

The following tables show the gross unrealized losses and the related fair values of our available-for-sale securities that have been in a continuous unrealized loss position (in millions):


	September 30, 2022
	Less Than 12 Months				12 Months or Greater				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Corporate debt securities	$	251.5	$	(4.4)	$	84.8	$	(1.8)	$	336.3	$	(6.2)
U.S. government and agency securities	218.0		(4.1)		68.0		(2.1)		286.0		(6.2)
Commercial paper	140.9		(0.5)		—		—		140.9		(0.5)
Certificates of deposit and term deposits	43.0		(0.2)		1.5		—		44.5		(0.2)
Municipal bonds	5.0		(0.1)		—		—		5.0		(0.1)
Total available-for-sale securities	$	658.4	$	(9.3)	$	154.3	$	(3.9)	$	812.7	$	(13.2)


	December 31, 2021
	Less Than 12 Months				12 Months or Greater				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Corporate debt securities	$	494.4	$	(1.2)	$	—	$	—	$	494.4	$	(1.2)
U.S. government and agency securities	334.2		(1.0)		—		—		334.2		(1.0)
Commercial paper	288.0		(0.2)		—		—		288.0		(0.2)
Certificates of deposit and term deposits	93.1		(0.1)		—		—		93.1		(0.1)
Municipal bonds	5.3		—		—		—		5.3		—
Total available-for-sale securities	$	1,215.0	$	(2.5)	$	—	$	—	$	1,215.0	$	(2.5)

Investments Classified by Contractual Maturity Date

The contractual maturities of our investments were as follows (in millions):


	September 30, 2022		December 31, 2021
Due within one year	$	739.5	$	1,194.0
Due within one to three years	84.0		440.8
Total	$	823.5	$	1,634.8

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following tables present the fair value of our financial assets measured at fair value on a recurring basis (in millions):


	September 30, 2022								December 31, 2021
	Aggregate Fair Value		Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs		Significant Other Unobservable Remaining Inputs		Aggregate Fair Value		Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs		Significant Other Unobservable Remaining Inputs
			(Level 1)		(Level 2)		(Level 3)				(Level 1)		(Level 2)		(Level 3)
Assets:
Corporate debt securities	$	336.3	$	—	$	336.3	$	—	$	542.5	$	—	$	542.5	$	—
U.S. government and agency securities	286.0		276.7		9.3		—		355.1		345.2		9.9		—
Commercial paper	140.9		—		140.9		—		580.3		—		580.3		—
Certificates of deposit and term deposits	55.4		—		55.4		—		259.0		—		259.0		—
Money market funds	380.5		380.5		—		—		57.5		57.5		—		—
Municipal bonds	5.0		—		5.0		—		5.4		—		5.4		—
Marketable equity securities	26.9		26.9		—		—		38.6		38.6		—		—
Total	$	1,231.0	$	684.1	$	546.9	$	—	$	1,838.4	$	441.3	$	1,397.1	$	—

Reported as:
Cash equivalents	$	380.6							$	165.0
Marketable equity securities	26.9								38.6
Short-term investments	739.5								1,194.0
Long-term investments	84.0								440.8
Total	$	1,231.0							$	1,838.4

Business Combinations - Pro Forma Information (Details) - Alaxala - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Business Acquisition [Line Items]
Pro forma revenue	$ 887.6	$ 684.3	$ 2,460.5	$ 1,939.6
Pro forma net income attributable to Fortinet, Inc.	$ 165.1	$ 122.8	$ 407.3	$ 334.8

Business Combinations and Asset Acquisitions (Tables)

9 Months Ended

Sep. 30, 2022

Business Combination and Asset Acquisition [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table provides the assets acquired and liabilities assumed as of the date of acquisition:


(in millions)	Estimated Fair Value
ASSETS
Cash	$	1.1
Accounts receivable—net	15.6
Inventory	33.4
Prepaid expenses and other current assets	2.9
Property and equipment	5.3
Goodwill	25.5
Other intangible assets	48.0
Other long-term assets	5.2
TOTAL ASSETS	$	137.0

LIABILITIES
Accounts payable	$	11.0
Current portion of long-term debt	20.2
Accrued and other current liabilities	17.1
Other long-term liabilities	6.7
TOTAL LIABILITIES	$	55.0
NON-CONTROLLING INTERESTS	$	17.8
Net purchase consideration	$	64.2

Schedule of Acquired Finite-Lived Intangible Assets

Identified intangible assets acquired and their estimated useful lives as of August 31, 2021, were as follows (in millions, except years):


	Fair Value		Estimated Useful Life (in years)
Developed technology	$	26.6	4
Customer relationships	10.0		10
Trade name	6.4		10
Backlog	5.0		1
Total identified intangible assets:	$	48.0

Pro Forma Information

The following unaudited pro forma financial information for all periods presented includes purchase accounting adjustments for amortization of acquired intangible assets, depreciation of acquired property and equipment, the purchase accounting effect on inventory acquired and related tax effects (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2021		September 30, 2020		September 30, 2021		September 30, 2020
Pro forma revenue	$	887.6	$	684.3	$	2,460.5	$	1,939.6
Pro forma net income attributable to Fortinet, Inc.	$	165.1	$	122.8	$	407.3	$	334.8

Equity Plans and Share Repurchase Program (Deficit) , Share Repurchase Program (Details) - Repurchase Program - USD ($) $ / shares in Units, shares in Millions	1 Months Ended	3 Months Ended	9 Months Ended
	Jul. 31, 2022	Sep. 30, 2022	Sep. 30, 2022
Share Repurchase Program [Line Items]
Increase in authorized stock repurchase amount	$ 1,000,000,000
Stock repurchase program, authorized amount	$ 5,250,000,000
Stock repurchased (in shares)		10.2	36.0
Stock repurchased, average price (in dollars per share)		$ 49.15	$ 55.37
Stock repurchased		$ 500,000,000	$ 1,990,000,000
Stock repurchase program, unused balance		$ 529,600,000	$ 529,600,000

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Inventory Purchase Commitments, Fiscal Year Maturity Schedule

The following table summarizes our inventory purchase commitments as of September 30, 2022 (in millions):


	Total		2022		Thereafter
Inventory purchase commitments	$	1,456.4	$	1,070.8	$	385.6

Inventory (Tables)

9 Months Ended

Sep. 30, 2022

Inventory Disclosure [Abstract]

Inventory

Inventory consisted of the following (in millions):


	September 30, 2022		December 31, 2021
Raw materials	$	42.4	$	40.2
Work in process	8.9		9.8
Finished goods	164.5		125.8
Inventory	$	215.8	$	175.8

Segment Information

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATIONOperating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our chief executive officer. Our chief executive officer reviews financial information presented on a consolidated basis, accompanied by information about revenue by geographic region for purposes of allocating resources and evaluating financial performance. We have one business activity, and there are no segment managers who are held accountable for operations, operating results and plans for levels or components below the consolidated unit level. Accordingly, we have determined that we have one operating segment, and therefore, one reportable segment.

Revenue by geographic region is based on the billing address of our customers. The following tables set forth revenue and property and equipment—net by geographic region (in millions):


	Three Months Ended				Nine Months Ended
Revenue	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Americas:
United States	$	344.1	$	258.4	$	942.8	$	722.6
Other Americas	123.5		91.7		321.0		255.4
Total Americas	467.6		350.1		1,263.8		978.0
Europe, Middle East and Africa (“EMEA”)	443.9		323.2		1,181.7		905.1
Asia Pacific (“APAC”)	238.0		193.9		688.9		495.5
Total revenue	$	1,149.5	$	867.2	$	3,134.4	$	2,378.6


Property and Equipment—net	September 30, 2022		December 31, 2021
Americas:
United States	$	631.8	$	472.4
Canada	200.3		170.9
Latin America	1.2		1.6
Total Americas	833.3		644.9
EMEA	35.9		31.0
APAC	20.3		11.7
Total property and equipment—net	$	889.5	$	687.6

The following distributors accounted for 10% or more of our revenue:


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Distributor A	29	%	31	%	29	%	32	%
Distributor B	13	%	12	%	13	%	12	%
Distributor C	13	%	*		13	%	*

* Represents less than 10%

The following distributors accounted for 10% or more of net accounts receivable:


	September 30, 2022		December 31, 2021
Distributor A	32	%	33	%
Distributor B	12	%	13	%
Distributor C	13	%	13	%

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 280
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Subparagraph (a)
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599

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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Summary of Significant Accounting Policies (Policies)	9 Months Ended
Summary of Significant Accounting Policies (Policies)	Sep. 30, 2022
Accounting Policies [Abstract]
Basis of Presentation and Preparation	Basis of Presentation and Preparation—The unaudited condensed consolidated financial statements of Fortinet, Inc. and its subsidiaries (collectively, “we,” “us” or “our”) have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information, as well as the instructions to Form 10-Q pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements, and should be read in conjunction with our audited consolidated financial statements as of and for the year ended December 31, 2021, contained in our Annual Report on Form 10-K filed with the SEC on February 25, 2022. In the opinion of management, all adjustments, which include normal recurring adjustments, considered necessary for a fair presentation, have been included. The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the full year or for any future periods. The condensed consolidated balance sheet as of December 31, 2021 is derived from the audited consolidated financial statements for the year ended December 31, 2021. The condensed consolidated financial statements include the accounts of Fortinet, Inc. and its subsidiaries. We consolidate all legal entities in which we have an absolute controlling financial interest. All intercompany balances and transactions have been eliminated in consolidation. The preparation of the condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. On April 14, 2022, our Board of Directors approved a five-for-one forward stock split of our common stock (the "Forward Stock Split"), which was conditioned upon obtaining stockholder approval for the Forward Stock Split, and to increase the number of our authorized shares of common stock. On June 17, 2022, at our 2022 Annual Meeting of Stockholders, our stockholders approved the Forward Stock Split and the amendment and restatement of our amended and restated certificate of incorporation to increase the number of authorized shares of common stock from 300 million to 1.5 billion. The par value of our common stock was not adjusted as a result of the Forward Stock Split. Effective June 22, 2022, we filed our amended and restated certification of incorporation and completed the Forward Stock Split. All share and per share amounts and related stockholders’ equity (deficit) balances presented herein have been retroactively adjusted to reflect the Forward Stock Split. There have been no material changes to our significant accounting policies as of and for the three and nine months ended September 30, 2022.
Recently Adopted and Recently Issued Accounting Standards	Recently Adopted and Recently Issued Accounting Standards There were no recently adopted accounting standards which would have a material effect on our condensed consolidated financial statements and accompanying disclosures, and no recently issued accounting standards that are expected to have a material impact on our condensed consolidated financial statements and accompanying disclosures.

Condensed Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) shares in Millions, $ in Millions	Total	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Non-Controlling Interests
Balance, shares at Dec. 31, 2020		812.7
Balance, beginning of period at Dec. 31, 2020	$ 856.0	$ 0.8	$ 1,206.6	$ 0.7	$ (352.1)	$ 0.0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in connection with equity incentive plans - net of tax withholding (in shares)		8.2
Issuance of common stock in connection with equity incentive plans - net of tax withholding	(98.2)		(98.2)
Repurchase and retirement of common stock (in shares)		(4.1)
Repurchase and retirement of common stock	(200.4)		(6.1)		(194.3)
Stock-based compensation expense	154.8		154.8
Recognition of non-controlling interests upon business combination	17.8					17.8
Net unrealized gain on investments - net of tax	(0.7)			(0.7)
Foreign currency translation adjustment	(1.6)			(1.2)		(0.4)
Net income including non-controlling interests	407.9				407.8	0.1
Balance, shares at Sep. 30, 2021		816.8
Balance, end of period at Sep. 30, 2021	1,135.6	$ 0.8	1,257.1	(1.2)	(138.6)	17.5
Balance, shares at Jun. 30, 2021		816.5
Balance, beginning of period at Jun. 30, 2021	1,050.2	$ 0.8	1,245.2	(0.1)	(195.7)	0.0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in connection with equity incentive plans - net of tax withholding (in shares)		2.1
Issuance of common stock in connection with equity incentive plans - net of tax withholding	(38.0)		(38.0)
Repurchase and retirement of common stock (in shares)		(1.8)
Repurchase and retirement of common stock	(108.8)		(2.8)		(106.0)
Stock-based compensation expense	52.7		52.7
Recognition of non-controlling interests upon business combination	17.8					17.8
Net unrealized gain on investments - net of tax	0.1			0.1
Foreign currency translation adjustment	(1.6)			(1.2)		(0.4)
Net income including non-controlling interests	163.2				163.1	0.1
Balance, shares at Sep. 30, 2021		816.8
Balance, end of period at Sep. 30, 2021	1,135.6	$ 0.8	1,257.1	(1.2)	(138.6)	17.5
Balance, shares at Dec. 31, 2021		810.0
Balance, beginning of period at Dec. 31, 2021	798.4	$ 0.8	1,253.6	(4.8)	(467.9)	16.7
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in connection with equity incentive plans - net of tax withholding (in shares)		6.1
Issuance of common stock in connection with equity incentive plans - net of tax withholding	(110.6)		(110.6)
Repurchase and retirement of common stock (in shares)		(36.0)
Repurchase and retirement of common stock	(1,991.2)		(55.4)		(1,935.8)
Stock-based compensation expense	162.6		162.6
Net unrealized gain on investments - net of tax	(8.3)			(8.3)
Foreign currency translation adjustment	(16.5)			(12.4)		(4.1)
Net income including non-controlling interests	542.8				543.5	(0.7)
Balance, shares at Sep. 30, 2022		780.1
Balance, end of period at Sep. 30, 2022	(622.8)	$ 0.8	1,250.2	(25.5)	(1,860.2)	11.9
Balance, shares at Jun. 30, 2022		788.4
Balance, beginning of period at Jun. 30, 2022	(379.6)	$ 0.8	1,237.3	(23.4)	(1,607.6)	13.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in connection with equity incentive plans - net of tax withholding (in shares)		1.9
Issuance of common stock in connection with equity incentive plans - net of tax withholding	(26.0)		(26.0)
Repurchase and retirement of common stock (in shares)		(10.2)
Repurchase and retirement of common stock	(500.0)		(15.8)		(484.2)
Stock-based compensation expense	54.7		54.7
Net unrealized gain on investments - net of tax	0.7			0.7
Foreign currency translation adjustment	(3.7)			(2.8)		(0.9)
Net income including non-controlling interests	231.1				231.6	(0.5)
Balance, shares at Sep. 30, 2022		780.1
Balance, end of period at Sep. 30, 2022	$ (622.8)	$ 0.8	$ 1,250.2	$ (25.5)	$ (1,860.2)	$ 11.9

Condensed Consolidated Balance Sheets Parenthetical - $ / shares	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Common Stock, par value (dollars per share)	$ 0.001	$ 0.001
Common Stock, shares authorized	1,500,000,000	1,500,000,000
Common Stock, shares issued	780,100,000	810,000,000.0
Common Stock, shares outstanding	780,100,000	810,000,000.0

Equity Plans and Share Repurchase Program

9 Months Ended

Sep. 30, 2022

Share-Based Payment Arrangement [Abstract]

EQUITY (DEFICIT)

EQUITY PLANS AND SHARE REPURCHASE PROGRAM

Stock-Based Compensation Plans

We maintain the Amended and Restated Fortinet, Inc. 2009 Equity Incentive Plan (the “Amended Plan”) pursuant to which we have granted RSUs and stock options. As of September 30, 2022, there were a total of 57.3 million shares of common stock available for grant under the Amended Plan.

Restricted Stock Units

The following table summarizes the activity and related information for RSUs for the periods presented below (in millions, except per share amounts):


	Restricted Stock Units Outstanding
	Number of Shares	Weighted-Average Grant Date Fair Value per Share
Balance—December 31, 2021	15.7	$	27.06
Granted	3.4	58.77
Forfeited	(0.9)	33.94
Vested	(6.6)	23.02
Balance—September 30, 2022	11.6	38.18

Stock compensation expense is recognized on a straight-line basis over the vesting period of each RSU. As of September 30, 2022, total compensation expense related to unvested RSUs granted to employees and non-employees under the Amended Plan, but not yet recognized, was $393.3 million, with a weighted-average remaining vesting period of 2.7 years.

RSUs settle into shares of common stock upon vesting. Upon the vesting of the RSUs, we net-settle the RSUs and withhold a portion of the shares to satisfy employee withholding tax requirements. The payment of the withheld taxes to the tax authorities is reflected as a financing activity within the condensed consolidated statements of cash flows.

The following summarizes the number and value of the shares withheld for employee taxes (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Shares withheld for taxes	0.5		0.8		2.2		3.0
Amount withheld for taxes	$	32.0	$	42.9	$	132.1	$	119.0

Employee Stock Options

The following table summarizes the weighted-average assumptions relating to our employee stock options:


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Expected term in years	4.4		4.4		4.4		4.4
Volatility	42.5	%	36.9	%	41.2	%	39.2	%
Risk-free interest rate	3.1	%	0.7	%	2.0	%	0.5	%
Dividend rate	—	%	—	%	—	%	—	%

The following table summarizes the stock option activity and related information for the periods presented below (in millions, except exercise prices and contractual life):


	Options Outstanding
	Number of Shares	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Balance—December 31, 2021	13.7	$	18.57	4.0	$	729.9
Granted	1.5	60.84
Forfeited	(0.2)	35.79
Exercised	(1.6)	13.38
Balance—September 30, 2022	13.4	$	23.72
Options vested and expected to vest—September 30, 2022	13.4	$	23.72	3.7	$	361.5
Options exercisable—September 30, 2022	8.9	$	15.25	2.8	$	303.1

The aggregate intrinsic value represents the difference between the exercise price of stock options and the quoted market price of our common stock on September 30, 2022 for all in-the-money stock options. Stock compensation expense is recognized on a straight-line basis over the vesting period of each stock option. As of September 30, 2022, total compensation expense related to unvested stock options granted to employees but not yet recognized was $56.9 million, with a weighted-average remaining vesting period of 2.7 years.

Additional information related to our stock options is summarized below (in millions, except per share amounts):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Weighted-average fair value per share granted	$	20.22	$	19.07	$	22.09	$	11.74
Intrinsic value of options exercised	$	29.7	$	20.9	$	73.3	$	60.2
Fair value of options vested	$	4.8	$	3.3	$	19.8	$	13.9

Stock-Based Compensation Expense

Stock-based compensation expense, including stock-based compensation expense related to awards classified as liabilities, is included in costs and expenses as follows (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Cost of product revenue	$	0.5	$	0.4	$	1.3	$	1.3
Cost of service revenue	4.8		4.1		14.0		11.4
Research and development	16.7		14.5		47.9		42.0
Sales and marketing	25.9		27.6		79.0		82.1
General and administrative	7.4		6.9		22.3		20.2
Total stock-based compensation expense	$	55.3	$	53.5	$	164.5	$	157.0

The following table summarizes stock-based compensation expense, including stock-based compensation expense related to awards classified as liabilities, by award type (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
RSUs	$	48.9	$	48.5	$	146.2	$	142.8
Stock options	6.4		5.0		18.3		14.2
Total stock-based compensation expense	$	55.3	$	53.5	$	164.5	$	157.0

Total income tax benefit associated with stock-based compensation that is recognized in the condensed consolidated statements of income is as follows (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Income tax benefit associated with stock-based compensation	$	12.2	$	11.7	$	36.2	$	34.5

Share Repurchase Program

In July 2022, under the Share Repurchase Program originally approved by our board of directors in January 2016 (the “Repurchase Program”), our board of directors approved a $1.0 billion increase, bringing the aggregate amount authorized to be repurchased to $5.25 billion of our outstanding common stock through February 28, 2023. Share repurchases may be made by us from time to time in privately negotiated transactions or in open-market transactions. The Repurchase Program does not require us to purchase a minimum number of shares, and may be suspended, modified or discontinued at any time without prior notice.

During the three and nine months ended September 30, 2022, we repurchased 10.2 million and 36.0 million shares of common stock, respectively, under the Repurchase Program in open-market transactions at a weighted-average price of $49.15 per share and $55.37 per share, respectively, for an aggregate purchase price of $500.0 million and $1.99 billion, respectively. As of September 30, 2022, $529.6 million remained available for future share repurchases under the Repurchase Program.

Goodwill and Other Intangible Assets - Net

9 Months Ended

Sep. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS - Net

GOODWILL AND OTHER INTANGIBLE ASSETS—Net

Goodwill

The following table presents the changes in the carrying amount of goodwill (in millions):


	Amount
Balance—December 31, 2021	$	125.1
Foreign currency translation adjustments	(4.9)
Balance—September 30, 2022	$	120.2

There were no impairments to goodwill during the nine months ended September 30, 2022 or during prior periods.

Other Intangible Assets—Net

The following tables present other intangible assets—net (in millions, except years):


	September 30, 2022
	Weighted-Average Useful Life (in Years)	Gross		Accumulated Amortization		Net
Other intangible assets—net:
Finite-lived intangible assets:
Developed technologies	4.0	$	77.0	$	49.0	$	28.0
Customer relationships	5.6	20.2		13.7		6.5
Trade name	10.0	4.8		0.5		4.3
Backlog	1.0	3.8		3.8		—
Total other intangible assets—net		$	105.8	$	67.0	$	38.8


	December 31, 2021
	Weighted-Average Useful Life (in Years)	Gross		Accumulated Amortization		Net
Other intangible assets—net:
Finite-lived intangible assets:
Developed technologies	4.0	$	82.2	$	38.0	$	44.2
Customer relationships	6.0	22.2		11.9		10.3
Trade name	10.0	6.1		0.2		5.9
Backlog	1.0	4.8		1.6		3.2
Total other intangible assets—net		$	115.3	$	51.7	$	63.6

Amortization expense was $5.2 million and $4.8 million during the three months ended September 30, 2022 and 2021, respectively. Amortization expense was $17.6 million and $11.7 million during the nine months ended September 30, 2022 and 2021, respectively.

The following table summarizes estimated future amortization expense of finite-lived intangible assets—net (in millions):


	Amount
Years:
2022 (the remainder of 2022)	$	4.0
2023	14.4
2024	9.8
2025	4.9
2026	1.1
Thereafter	4.6
Total	$	38.8

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
CURRENT ASSETS:
Cash and cash equivalents	$ 964.0	$ 1,319.1
Short-term investments	739.5	1,194.0
Marketable equity securities	26.9	38.6
Accounts receivable—net	963.2	807.7
Inventory	215.8	175.8
Prepaid expenses and other current assets	72.8	65.4
Total current assets	2,982.2	3,600.6
LONG-TERM INVESTMENTS	84.0	440.8
PROPERTY AND EQUIPMENT—NET	889.5	687.6
DEFERRED CONTRACT COSTS	480.5	423.3
DEFERRED TAX ASSETS	515.5	342.3
GOODWILL	120.2	125.1
OTHER INTANGIBLE ASSETS—NET	38.8	63.6
OTHER ASSETS	225.2	235.8
TOTAL ASSETS	5,335.9	5,919.1
CURRENT LIABILITIES:
Accounts payable	215.1	148.4
Accrued liabilities	244.8	197.3
Accrued payroll and compensation	190.7	195.0
Deferred revenue	2,129.0	1,777.4
Total current liabilities	2,779.6	2,318.1
DEFERRED REVENUE	2,064.5	1,675.5
INCOME TAX LIABILITIES	67.8	79.5
LONG-TERM DEBT	989.9	988.4
OTHER LIABILITIES	56.9	59.2
Total liabilities	5,958.7	5,120.7
COMMITMENTS AND CONTINGENCIES (Note 11)
EQUITY (DEFICIT):
Common stock, $0.001 par value—1,500.0 shares authorized; 780.1 and 810.0 shares issued and outstanding on September 30, 2022 and December 31, 2021, respectively	0.8	0.8
Additional paid-in capital	1,250.2	1,253.6
Accumulated other comprehensive loss	(25.5)	(4.8)
Accumulated deficit	(1,860.2)	(467.9)
Total Fortinet, Inc. stockholders’ equity (deficit)	(634.7)	781.7
Non-controlling interests	11.9	16.7
Total equity (deficit)	(622.8)	798.4
TOTAL LIABILITIES AND EQUITY (DEFICIT)	$ 5,335.9	$ 5,919.1

Goodwill and Other Intangible Assets - Net - Changes in Carrying Amount of Goodwill (Details) $ in Millions	9 Months Ended
	Sep. 30, 2022 USD ($)
Goodwill [Roll Forward]
Balance - beginning of period	$ 125.1
Foreign currency translation adjustments	(4.9)
Balance - end of period	$ 120.2

- Definition

Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.

+ References + Details

Debt - Narrative (Details) - Senior Notes - USD ($)	3 Months Ended		9 Months Ended
Debt - Narrative (Details) - Senior Notes - USD ($)	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Mar. 05, 2021
Debt Instrument [Line Items]
Aggregate principal amount						$ 1,000,000,000
Accrued interest payable	$ 700,000		$ 700,000		$ 4,700,000
Interest expense	4,400,000	$ 4,400,000	13,400,000	$ 10,200,000
Interest costs capitalized	0	$ 0	0	$ 0
Level 2
Debt Instrument [Line Items]
Estimated fair value of outstanding debt	$ 808,900,000		$ 808,900,000
2026 Senior Notes
Debt Instrument [Line Items]
Aggregate principal amount						$ 500,000,000
Stated interest rate	1.00%		1.00%			1.00%
2031 Senior Notes
Debt Instrument [Line Items]
Aggregate principal amount						$ 500,000,000
Stated interest rate	2.20%		2.20%			2.20%

Business Combinations - Additional Information (Details) - Alaxala $ in Millions	Aug. 31, 2021 USD ($)
Business Acquisition [Line Items]
Equity interests acquired	75.00%
Cash consideration	$ 64.2
Non-controlling interests	17.8
Current debt liabilities assumed	$ 20.2

Property and Equipment—Net

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT—Net

Property and equipment—net consisted of the following (in millions):


	September 30, 2022		December 31, 2021
Land	$	305.7	$	204.5
Buildings and improvements	488.9		416.2
Computer equipment and software	219.3		176.1
Leasehold improvements	49.7		40.1
Evaluation units	16.5		15.6
Furniture and fixtures	31.2		26.9
Construction-in-progress	38.0		19.9
Total property and equipment	1,149.3		899.3
Less: accumulated depreciation	(259.8)		(211.7)
Property and equipment—net	$	889.5	$	687.6

In July 2022, we purchased real property in Union City, California, for $65.4 million. The purchase was accounted for under the asset acquisition method. The cost of the assets acquired was allocated to land and buildings based on their relative fair values. The amounts allocated to land and buildings were $52.4 million and $13.0 million, respectively.

Depreciation expense was $21.2 million and $18.1 million during the three months ended September 30, 2022 and 2021, respectively. Depreciation expense was $59.4 million and $47.4 million during the nine months ended September 30, 2022 and 2021, respectively.

Revenue Recognition

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITIONWe sell cybersecurity solutions to channel partners who in turn sell such solutions to a variety of organizations, such as large-, medium- and small-sized enterprises, communication service providers and government organizations. Our revenue consists of product and service revenue. Product revenue is generated by our Core Platform (previously referred to as FortiGate network security and other products) and our Enhanced Platform Technologies (previously referred to as Platform Extension). Service revenue relates to sales of our security subscription services, which mainly consists of our FortiGuard security subscriptions, as well as our FortiCare technical support services and other services.

Disaggregation of Revenue

The following table presents our revenue disaggregated by major product and service lines (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Product	$	468.7	$	337.1	$	1,240.4	$	876.1
Service:
Security subscription	369.8		287.4		1,023.1		815.6
Technical support and other	311.0		242.7		870.9		686.9
Total service revenue	680.8		530.1		1,894.0		1,502.5
Total revenue	$	1,149.5	$	867.2	$	3,134.4	$	2,378.6

Deferred Revenue

During the three and nine months ended September 30, 2022, we recognized $401.9 million and $1.37 billion in service revenue that was included in the deferred revenue balance as of December 31, 2021, respectively. During the three and nine months ended September 30, 2021, we recognized $309.2 million and $1.10 billion in service revenue that was included in the deferred revenue balance as of December 31, 2020, respectively.

Transaction Price Allocated to the Remaining Performance Obligations

As of September 30, 2022, the aggregate amount of the transaction price allocated to remaining performance obligations was $4.21 billion, which was substantially comprised of deferred security subscription, technical support services revenue and unbilled contract revenue from non-cancellable contracts that will be recognized in future periods. We expect to recognize approximately $2.15 billion as revenue over the next 12 months and the remainder thereafter.

Accounts receivable

Trade accounts receivable are recorded at the invoiced amount. Our accounts receivable balance is reduced by an allowance for expected credit losses. We measure expected credit losses of accounts receivable on a collective (pooled) basis, aggregating accounts receivable that are either current or no more than 60 days past due, and aggregating accounts receivable that are more than 60 days past due. We apply a credit-loss percentage to each of the pools that is based on our historical credit losses. We review whether each of our significant accounts receivable that is more than 60 days past due continues to exhibit similar risk characteristics with the other accounts receivable in the pool. If we determine that it does not, we evaluate it for expected credit losses on an individual basis. Expected credit losses are recorded as general and administrative expenses on our consolidated statements of income.

The allowance for credit losses was $3.7 million and $2.4 million as of September 30, 2022 and December 31, 2021, respectively. Provisions, write-offs and recoveries were not material during the nine months ended September 30, 2022 and 2021.

Deferred Contract Costs

Amortization of deferred contract costs during the three months ended September 30, 2022 and 2021 were $56.7 million and $45.1 million, respectively. Amortization of deferred contract costs during the nine months ended September 30, 2022 and 2021 were $163.8 million and $126.9 million, respectively.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI https://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

+ Details

Defined Contribution Plans	9 Months Ended
Defined Contribution Plans	Sep. 30, 2022
Retirement Benefits [Abstract]
DEFINED CONTRIBUTION PLANS	DEFINED CONTRIBUTION PLANSOur tax-deferred savings plan under our 401(k) Plan permits participating U.S. employees to contribute a portion of their pre-tax or after-tax earnings. In Canada, we have a Group Registered Retirement Savings Plan Program (the “RRSP”), which permits participants to make pre-tax contributions. Our board of directors approved 50% matching contributions on employee contributions up to 4% of each employee’s eligible earnings. Our matching contributions to our 401(k) Plan and the RRSP for the three months ended September 30, 2022 and 2021 were $3.2 million and $2.5 million, respectively. Our matching contributions to our 401(k) Plan and the RRSP for the nine months ended September 30, 2022 and 2021 were $9.8 million and $7.9 million, respectively.

Property and Equipment—Net (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		9 Months Ended
	Jul. 31, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		$ 1,149.3		$ 1,149.3		$ 899.3
Less: accumulated depreciation		(259.8)		(259.8)		(211.7)
Property and equipment—net		889.5		889.5		687.6
Purchase of property and equipment				250.3	$ 144.6
Depreciation expense		21.2	$ 18.1	59.4	$ 47.4
Union City Property
Property, Plant and Equipment, Net, by Type [Abstract]
Purchase of property and equipment	$ 65.4
Land
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		305.7		305.7		204.5
Land \| Union City Property
Property, Plant and Equipment, Net, by Type [Abstract]
Property and equipment, additions	52.4
Buildings and improvements
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		488.9		488.9		416.2
Computer equipment and software
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		219.3		219.3		176.1
Leasehold improvements
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		49.7		49.7		40.1
Evaluation units
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		16.5		16.5		15.6
Furniture and fixtures
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		31.2		31.2		26.9
Construction-in-progress
Property, Plant and Equipment, Net, by Type [Abstract]
Total property and equipment		$ 38.0		$ 38.0		$ 19.9
Buildings \| Union City Property
Property, Plant and Equipment, Net, by Type [Abstract]
Property and equipment, additions	$ 13.0

Business Combinations - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021	Aug. 31, 2021
ASSETS
Goodwill	$ 120.2	$ 125.1
Alaxala
ASSETS
Cash			$ 1.1
Accounts receivable—net			15.6
Inventory			33.4
Prepaid expenses and other current assets			2.9
Property and equipment			5.3
Goodwill			25.5
Other intangible assets			48.0
Other long-term assets			5.2
TOTAL ASSETS			137.0
LIABILITIES
Accounts payable			11.0
Current portion of long-term debt			20.2
Accrued and other current liabilities			17.1
Other long-term liabilities			6.7
TOTAL LIABILITIES			55.0
NON-CONTROLLING INTERESTS			17.8
Net purchase consideration			$ 64.2

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income including non-controlling interests	$ 542.8	$ 407.9
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation	162.6	154.8
Amortization of deferred contract costs	163.8	126.9
Depreciation and amortization	77.0	59.1
Amortization of investment premiums	3.6	4.8
Loss from equity method investment	22.9	2.8
Other	21.2	4.4
Changes in operating assets and liabilities, net of impact of business combinations:
Accounts receivable—net	(162.7)	130.6
Inventory	(59.7)	(19.5)
Prepaid expenses and other current assets	(7.6)	(12.5)
Deferred contract costs	(221.0)	(201.0)
Deferred tax assets	(172.0)	(91.9)
Other assets	(13.9)	(15.7)
Accounts payable	78.6	(11.8)
Accrued liabilities	27.8	77.0
Accrued payroll and compensation	(3.2)	23.1
Other liabilities	(0.5)	(3.2)
Deferred revenue	742.8	497.1
Net cash provided by operating activities	1,202.5	1,132.9
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of investments	(389.1)	(1,749.9)
Sales of investments	3.0	82.2
Maturities of investments	1,182.9	1,029.0
Purchases of property and equipment	(250.3)	(144.6)
Purchase of investment in privately held company	0.0	(160.0)
Payments made in connection with business combinations, net of cash acquired	0.0	(73.4)
Purchases of marketable equity securities	0.0	(42.5)
Net cash provided by (used in) investing activities	546.5	(1,059.2)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term borrowings, net of discount and underwriting fees	0.0	989.4
Payments for debt issuance costs	0.0	(2.4)
Payments of debt assumed in connection with business combination	0.0	(2.2)
Repurchase and retirement of common stock	(1,991.2)	(170.0)
Proceeds from issuance of common stock	21.7	20.7
Taxes paid related to net share settlement of equity awards	(132.1)	(118.9)
Other	(1.3)	(0.2)
Net cash provided by (used in) financing activities	(2,102.9)	716.4
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(1.2)	0.2
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(355.1)	790.3
CASH AND CASH EQUIVALENTS—Beginning of period	1,319.1	1,061.8
CASH AND CASH EQUIVALENTS—End of period	964.0	1,852.1
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for income taxes—net	197.6	69.9
Operating lease liabilities arising from obtaining right-of-use assets	36.2	31.0
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Transfers of evaluation units from inventory to property and equipment	13.1	14.6
Liability for purchase of property and equipment	25.3	23.8
Liability for repurchase of common stock	$ 0.0	$ 30.4

Net Income Per Share (Tables)

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Numerator:
Net income including non-controlling interests	$	231.1	$	163.2	$	542.8	$	407.9
Net income (loss) attributable to non-controlling interests	(0.5)		0.1		(0.7)		0.1
Net income attributable to Fortinet, Inc.	$	231.6	$	163.1	$	543.5	$	407.8

Denominator:
Basic shares:
Weighted-average common stock outstanding-basic	786.2		817.7		795.0		816.5
Diluted shares:
Weighted-average common stock outstanding-basic	786.2		817.7		795.0		816.5
Effect of potentially dilutive securities:
RSUs	4.9		11.8		6.6		11.0
Stock options	7.5		9.1		8.2		7.9
Weighted-average shares used to compute diluted net income per share attributable to Fortinet, Inc.	798.6		838.6		809.8		835.4
Net income per share attributable to Fortinet, Inc.:
Basic	$	0.29	$	0.20	$	0.68	$	0.50
Diluted	$	0.29	$	0.19	$	0.67	$	0.49

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share


	Three Months Ended		Nine Months Ended
	September 30, 2022	September 30, 2021	September 30, 2022	September 30, 2021
RSUs	2.5	0.3	1.1	0.9
Stock options	1.6	0.1	1.4	1.4
Total	4.1	0.4	2.5	2.3

Equity Plans and Share Repurchase Program (Deficit) - Employee Stock Options (Details) - Stock options - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Expected term in years	4 years 4 months 24 days	4 years 4 months 24 days	4 years 4 months 24 days	4 years 4 months 24 days
Volatility	42.50%	36.90%	41.20%	39.20%
Risk-free interest rate	3.10%	0.70%	2.00%	0.50%
Dividend rate	0.00%	0.00%	0.00%	0.00%
Number of Shares
Balance - Beginning (in shares)			13.7
Granted (in shares)			1.5
Forfeited (in shares)			(0.2)
Exercised (in shares)			(1.6)
Balance - Ending (in shares)	13.4		13.4		13.7
Weighted- Average Exercise Price
Balance - Beginning (in dollars per share)			$ 18.57
Granted (in dollars per share)			60.84
Forfeited (in dollars per share)			35.79
Exercised (in dollars per share)			13.38
Balance - Ending (in dollars per share)	$ 23.72		$ 23.72		$ 18.57
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Options outstanding, Weighted average remaining contractual life (in years)					4 years
Options outstanding, Aggregate intrinsic value					$ 729.9
Options vested and expected to vest, Outstanding (in shares)	13.4		13.4
Options vested and expected to vest, Weighted average exercise price (in dollars per share)	$ 23.72		$ 23.72
Options vested and expected to vest, Weighted average remaining contractual life (in years)			3 years 8 months 12 days
Options vested and expected to vest, Aggregate intrinsic value	$ 361.5		$ 361.5
Options exercisable, Outstanding (in shares)	8.9		8.9
Options exercisable, Weighted average exercise price (in dollars per share)	$ 15.25		$ 15.25
Options exercisable, Weighted average remaining contractual life (in years)			2 years 9 months 18 days
Options exercisable, Aggregate intrinsic value	$ 303.1		$ 303.1
Compensation cost not yet recognized	$ 56.9		$ 56.9
Compensation cost not yet recognized period of recognition			2 years 8 months 12 days
Weighted-average fair value per share granted	$ 20.22	$ 19.07	$ 22.09	$ 11.74
Intrinsic value of options exercised	$ 29.7	$ 20.9	$ 73.3	$ 60.2
Fair value of options vested	$ 4.8	$ 3.3	$ 19.8	$ 13.9

Commitments and Contingencies - Summary of Inventory Purchase Commitments (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Inventory purchase commitments
Total	$ 1,456.4	$ 1,140.0
2022	1,070.8
Thereafter	$ 385.6

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2022
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES Our effective tax rate was 10% for the three months ended September 30, 2022, compared to an effective tax rate of negative 6% for the same period last year. Our effective tax rate was 4% for the nine months ended September 30, 2022, compared to an effective tax rate of 2% for the same period last year. The effective tax rates for the periods presented are primarily comprised of U.S. federal and state taxes, withholding taxes, foreign taxes, the tax benefit from foreign-derived intangible income deduction (the “FDII deduction”) and excess tax benefits from stock-based compensation expense. The tax rates for the three months ended September 30, 2022 and 2021 were composed of U.S. federal and state taxes, withholding taxes and foreign taxes that amounted to $75.5 million and $40.1 million, respectively. The tax rate for the three months ended September 30, 2022 was impacted by a tax benefit of $28.9 million from the FDII deduction and excess tax benefits from stock-based compensation expense of $19.3 million. The tax rate for the three months ended September 30, 2021 was impacted by a tax benefit of $8.7 million from the FDII deduction and excess tax benefits from stock-based compensation expense of $25.0 million. In addition, the tax rate for the three months ended September 30, 2021 was further impacted by a tax benefit of $15.7 million for a change in tax accounting positions in finalization of the prior year’s tax return. The tax rates for the nine months ended September 30, 2022 and 2021 were composed of U.S. federal and state taxes, withholding taxes and foreign taxes that amounted to $169.2 million and $115.8 million, respectively. The tax rate for the nine months ended September 30, 2022 was impacted by a tax benefit of $62.6 million from the FDII deduction, excess tax benefits from stock-based compensation expense of $68.7 million and release of reserves of $16.3 million on uncertain tax positions and the accrued interest thereon due to the expiration of the statute of limitations. The tax rate for the nine months ended September 30, 2021 was impacted by a tax benefit of $23.9 million from the FDII deduction, excess tax benefits from stock-based compensation expense of $60.3 million and release of reserves of $5.5 million on uncertain tax positions and the accrued interest thereon due to the expiration of the statute of limitations. In addition, the tax rate for the nine months ended September 30, 2021 was further impacted by a tax benefit of $15.7 million for a change in tax accounting positions in finalization of the prior year’s tax return. As of September 30, 2022 and December 31, 2021, unrecognized tax benefits were $65.5 million and $73.3 million, respectively. If recognized, $56.9 million of the unrecognized tax benefits as of September 30, 2022 would favorably affect our effective tax rate. It is our policy to include accrued interest and penalties related to unrecognized tax benefits in income tax expense. As of September 30, 2022 and December 31, 2021, accrued interest and penalties were $10.2 million and $13.3 million, respectively. It is reasonably possible that our gross unrecognized tax benefits will decrease by up to $20.3 million in the next 12 months, due to the lapse of statutes of limitation in various jurisdictions. This decrease, if recognized, would favorably impact our effective tax rate, and would be recognized as additional tax benefits. We file income tax returns in the U.S. federal jurisdiction and in various U.S. state and foreign jurisdictions. Generally, we are no longer subject to examination by U.S federal income tax authorities for tax years prior to 2015. We are no longer subject to U.S. state and foreign income tax examinations by tax authorities for tax years prior to 2010. We currently have ongoing tax audits in the United Kingdom, Canada, Germany and several other foreign jurisdictions. The focus of these audits is the inter-company profit allocation. On September 29, 2020, the United States Department of the Treasury (the “U.S. Treasury”) and the Internal Revenue Service (the “IRS”) released final regulations related to foreign tax credits that were the subject of proposed regulations issued in December 2019 and proposed certain provisions in proposed regulations issued in December 2019. The final and proposed regulations provide administrative guidance for the foreign tax credit regime, which was updated in the 2017 Tax Cuts and Jobs Act (the “2017 Tax Act”). Generally, the provisions that were included in the 2019 proposed regulations apply to taxable years ended on or after December 16, 2019, except as otherwise specified. On December 28, 2021, the U.S. Treasury and the IRS released final regulations addressing various aspects of the foreign tax credit regime, which did not have a material impact on our consolidated financial statements as of December 31, 2021. On January 4, 2022, the U.S. Treasury and the IRS published another tranche of final regulations regarding the foreign tax credit. These final regulations impose new requirements that a foreign tax must meet in order to be creditable against U.S. income taxes, and generally apply to tax years beginning on or after December 28, 2021. On July 26, 2022, the U.S. Treasury released corrections to the final regulations. These final regulations adversely impact our ability to claim foreign tax credits in the United States for certain taxes imposed by certain foreign jurisdictions. These final regulations increased our tax expense in the nine months ended September 30, 2022 by approximately $16.4 million. On August 16, 2022, the United States enacted the Inflation Reduction Act of 2022 that provides for, among other changes, changes to the U.S. corporate income tax system, including a 15% minimum tax based on financial statement income for companies with three-year average annual adjusted financial statement income exceeding $1 billion, and a 1% excise tax on net repurchases of stock after December 31, 2022. The 15% minimum tax based on financial statement income will not apply to us immediately, but may in the future as we continue to grow. The 1% excise tax on net repurchases of stock will apply to our net repurchases after December 31, 2022, if any.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI https://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Debt - Summary of Outstanding Debt (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021	Mar. 05, 2021
Debt Instrument [Line Items]
Total debt	$ 1,000.0	$ 1,000.0
Less: Unamortized discount and debt issuance costs	10.1	11.6
LONG-TERM DEBT	$ 989.9	988.4
Senior Notes \| 2026 Senior Notes
Debt Instrument [Line Items]
Coupon Rate	1.00%		1.00%
Effective Interest Rate	1.30%
Total debt	$ 500.0	500.0
Senior Notes \| 2031 Senior Notes
Debt Instrument [Line Items]
Coupon Rate	2.20%		2.20%
Effective Interest Rate	2.30%
Total debt	$ 500.0	$ 500.0

Revenue Recognition - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Disaggregation of Revenue [Line Items]
Threshold period past due	60 days		60 days
Allowance for credit losses	$ 3.7		$ 3.7		$ 2.4
Amortization of deferred contract costs	56.7	$ 45.1	163.8	$ 126.9
Service
Disaggregation of Revenue [Line Items]
Deferred revenue recognized in period	$ 401.9	$ 309.2	$ 1,370.0	$ 1,100.0

Equity Plans and Share Repurchase Program (Deficit) , Allocation of Stock-Based Compensation Expense (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 55.3	$ 53.5	$ 164.5	$ 157.0
Income tax benefit associated with stock-based compensation	12.2	11.7	36.2	34.5
RSUs
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	48.9	48.5	146.2	142.8
Stock options
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	6.4	5.0	18.3	14.2
Cost of product revenue
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	0.5	0.4	1.3	1.3
Cost of service revenue
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	4.8	4.1	14.0	11.4
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	16.7	14.5	47.9	42.0
Sales and marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	25.9	27.6	79.0	82.1
General and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 7.4	$ 6.9	$ 22.3	$ 20.2

Subsequent Events (Details) - Alaxala - USD ($) $ in Millions	Oct. 03, 2022	Aug. 31, 2021
Subsequent Event [Line Items]
Equity interests acquired		75.00%
Cash consideration		$ 64.2
Subsequent Event
Subsequent Event [Line Items]
Equity interests acquired	25.00%
Cash consideration	$ 13.5

Summary of Significant Accounting Policies (Details)	Apr. 14, 2022	Sep. 30, 2022 shares	Jun. 17, 2022 shares	Jun. 16, 2022 shares	Dec. 31, 2021 shares
Accounting Policies [Abstract]
Stock split ratio, Common stock	5
Common Stock, shares authorized		1,500,000,000	1,500,000,000	300,000,000	1,500,000,000

Goodwill and Other Intangible Assets - Net - Estimated Future Amortization Expense (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Fiscal Years:
2022 (the remainder of 2022)	$ 4.0
2023	14.4
2024	9.8
2025	4.9
2026	1.1
Thereafter	4.6
Total	$ 38.8	$ 63.6

Equity Plans and Share Repurchase Program (Tables)

9 Months Ended

Sep. 30, 2022

Share-Based Payment Arrangement [Abstract]

Schedule of Share-based Compensation, Restricted Stock Units Award Activity

The following table summarizes the activity and related information for RSUs for the periods presented below (in millions, except per share amounts):


	Restricted Stock Units Outstanding
	Number of Shares	Weighted-Average Grant Date Fair Value per Share
Balance—December 31, 2021	15.7	$	27.06
Granted	3.4	58.77
Forfeited	(0.9)	33.94
Vested	(6.6)	23.02
Balance—September 30, 2022	11.6	38.18

Schedule of Share-based Compensation, Shares Withheld for Taxes

The following summarizes the number and value of the shares withheld for employee taxes (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Shares withheld for taxes	0.5		0.8		2.2		3.0
Amount withheld for taxes	$	32.0	$	42.9	$	132.1	$	119.0

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The following table summarizes the weighted-average assumptions relating to our employee stock options:


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Expected term in years	4.4		4.4		4.4		4.4
Volatility	42.5	%	36.9	%	41.2	%	39.2	%
Risk-free interest rate	3.1	%	0.7	%	2.0	%	0.5	%
Dividend rate	—	%	—	%	—	%	—	%

Schedule of Share-based Compensation, Stock Options, Activity

The following table summarizes the stock option activity and related information for the periods presented below (in millions, except exercise prices and contractual life):


	Options Outstanding
	Number of Shares	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Balance—December 31, 2021	13.7	$	18.57	4.0	$	729.9
Granted	1.5	60.84
Forfeited	(0.2)	35.79
Exercised	(1.6)	13.38
Balance—September 30, 2022	13.4	$	23.72
Options vested and expected to vest—September 30, 2022	13.4	$	23.72	3.7	$	361.5
Options exercisable—September 30, 2022	8.9	$	15.25	2.8	$	303.1

Schedule of Share-based Compensation, Stock Options, Activity, Additional Information

Additional information related to our stock options is summarized below (in millions, except per share amounts):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Weighted-average fair value per share granted	$	20.22	$	19.07	$	22.09	$	11.74
Intrinsic value of options exercised	$	29.7	$	20.9	$	73.3	$	60.2
Fair value of options vested	$	4.8	$	3.3	$	19.8	$	13.9

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs

Stock-based compensation expense, including stock-based compensation expense related to awards classified as liabilities, is included in costs and expenses as follows (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Cost of product revenue	$	0.5	$	0.4	$	1.3	$	1.3
Cost of service revenue	4.8		4.1		14.0		11.4
Research and development	16.7		14.5		47.9		42.0
Sales and marketing	25.9		27.6		79.0		82.1
General and administrative	7.4		6.9		22.3		20.2
Total stock-based compensation expense	$	55.3	$	53.5	$	164.5	$	157.0

Schedule of Employee Service Share based Compensation Allocation of Recognized Period Costs by Award Type

The following table summarizes stock-based compensation expense, including stock-based compensation expense related to awards classified as liabilities, by award type (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
RSUs	$	48.9	$	48.5	$	146.2	$	142.8
Stock options	6.4		5.0		18.3		14.2
Total stock-based compensation expense	$	55.3	$	53.5	$	164.5	$	157.0

Income Tax Benefit from Stock Option Plans

Total income tax benefit associated with stock-based compensation that is recognized in the condensed consolidated statements of income is as follows (in millions):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
Income tax benefit associated with stock-based compensation	$	12.2	$	11.7	$	36.2	$	34.5

Investments in Privately Held Companies (Details) - USD ($) $ in Millions			3 Months Ended		9 Months Ended
	Sep. 24, 2021	Mar. 19, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Schedule of Equity Method Investments [Line Items]
Cash investment in privately held company					$ 0.0	$ 160.0
Loss from equity method investments			$ 6.3	$ 2.8	$ 22.9	$ 2.8
Linksys
Schedule of Equity Method Investments [Line Items]
Cash investment in privately held company	$ 85.0	$ 75.0
Ownership interest percentage		32.60%	50.80%		50.80%		50.80%