Proofpoint Jumps 10% After Earnings, Acquisition Of Security Startup

Proofpoint Inc. gained about 10% in late trading Thursday after the security-software company detailed a huge earnings beat and acquisition of a young security startup. The Silicon Valley company agreed to purchase three-year-old startup FireLayers, which helps protect against malware passed along through cloud-based software, for $55 million. Proofpoint said it had a net loss of $18.4 million, or 44 cents a share, on sales of $99.8 million in the third quarter; after adjusting for stock-based compensation and other factors, the software firm claimed earnings of 19 cents a share. Analysts on average expected Proofpoint to report adjusted earnings of 5 cents a share on sales of $94.3 million, according to FactSet. Proofpoint's billings--an important metric for cloud-software companies that reflects deferred revenue--also handily beat analyst projections: Proofpoint reported billings of $124.8 million, while a FactSet survey said the average analyst estimate was $115.6 million. Proofpoint shares closed with a 0.1% gain at $69.78, then jumped to about $76.50 in late trading. The stock was damaged late last year after short-seller Carson Block named the company its best short bet, but shares jumped after the company beat earnings projections last quarter as well.