Fortinet Expands AI Security With Virtue AI: Can Growth Accelerate?

Fortinet FTNT is strengthening its AI security portfolio with the acquisition of Virtue AI, expanding its capabilities beyond traditional network protection toward securing autonomous AI systems. The deal adds AI runtime protection, automated validation and agent security to Fortinet’s existing AI security offerings, potentially positioning the company to capture a broader share of enterprise spending as AI deployments move into production.

Virtue AI complements Fortinet’s FortiAIGate, which protects large language models from risks including prompt injection, data leakage and model poisoning. Its technology extends protection across AI models, applications and agentic systems throughout development and runtime. Capabilities include automated red-teaming across more than 50 sandboxed environments and 14 high-stakes domains, continuous validation across model updates and policy changes and real-time guardrails covering text, images, video, audio and AI-generated code. This broader coverage could strengthen Fortinet’s ability to address the expanding security requirements associated with enterprise AI adoption.

The acquisition also builds on improving demand for Fortinet’s AI-related security offerings. In the second quarter of 2026, billings from AI-driven security operations increased 25%, supported by more than 20 AI-enabled solutions. Total revenues rose 26% year over year to $2.05 billion, while product revenues increased 52% to $773 million, indicating strong demand for security infrastructure as customers invest in AI workloads.

By combining Virtue AI's validation and runtime protection into its broader Security Fabric, Fortinet is gaining an additional avenue to cross-sell into its installed base as enterprises consolidate AI security spending with fewer platform vendors, a dynamic that could support continued momentum in the company's AI-linked growth pipeline.

How FTNT Is Placed Against Peers

Fortinet is competing in an AI security landscape where Palo Alto Networks PANW and CrowdStrike CRWD are also expanding aggressively. Palo Alto Networks is closing its roughly $25 billion CyberArk acquisition to secure agentic identity, complementing its Prisma AIRS platform. CrowdStrike is extending its Falcon platform across the AI stack, leveraging its endpoint footprint to detect unauthorized AI agents. Against these two, Fortinet's Virtue AI deal is comparatively smaller in scale but is tightly integrated with its existing FortiAIGate offering, reflecting a platform-native approach rather than the large standalone acquisitions pursued by Palo Alto Networks and CrowdStrike.

FTNT’s Share Price Performance, Valuation & Estimates

Fortinet shares have gained 96.3% in the year-to-date period, outperforming the Zacks Security industry and the broader Computer and Technology sector’s growth of 83.6% and 19%, respectively.

FTNT’s Price Performance

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From a valuation standpoint, FTNT appears overvalued, trading at a forward 12-month price-to-earnings ratio of 42.65, higher than the sector's average of 21.62. The company carries a Value Score of F.

FTNT’s Valuation

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The Zacks Consensus Estimate for Fortinet’s earnings is pegged at $3.40 per share for 2026, which implies year-over-year growth of 23.19%.

Fortinet, Inc. Price and Consensus

Fortinet, Inc. price-consensus-chart | Fortinet, Inc. Quote

Fortinet currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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