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 The U.S.-Israeli company says its technology to secure data and web
applications taps into a shift away from perimeter defenses such as
firewalls to preventing attacks before they can reach inside
organizations.
"We think insider threats is one of the next big issues that
organizations will have to solve," Chief Executive Anthony
Bettencourt told Reuters.
Early next year Imperva plans to launch CounterBreach, a product
that applies machine learning and analytics to actual data access
patterns in order to more closely safeguard critical data and
applications. Other technologies on the market mainly monitor login
behavior to try and identify users that might be trying to enter the
network, it says.
Over 45 percent of enterprise data breaches result from malicious or
compromised inside users, according to the 2015 Verizon Breach
report. Most of these are due to careless workers clicking on a
phishing email, for example, and enabling outside hackers to access
the network.
Imperva, which competes against IBM, F5 Networks and Akamai
Technologies, was founded in 2002 by three Israelis including Shlomo
Kramer, who co-founded network security firm Check Point Software
Technologies. He owns 14 percent of California-based Imperva, which
has research bases in Israel and Texas.
The company struggled as it lost out on contracts to IBM and others
before bringing in Bettencourt to replace Kramer as CEO last year.
Bettencourt, who has now added the role of chairman, has been
credited with reviving the business by changing tactics, bringing in
new experienced management and board members and refining some
products.
After losing 203 database deals to IBM between 2010 and early 2015,
Imperva, whose customers include leading banks, insurers and telecom
providers, has since displaced IBM at more than 40 of those,
Bettencourt said.
The company's share price has doubled this year.
"We believe Imperva is the best-of-breed pure play leader in the
growing database activity monitoring market and the web application
firewall market, with a total addressable market opportunity of more
than $4 billion," said Joel Fishbein, an analyst at BTIG brokerage
in New York.
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"After some missteps in 2014, Imperva is experiencing accelerated
top-line growth, and we believe 20-30 percent growth is
sustainable."
Meaningful profitability is probably several years away, Fishbein
said, but he rates the stock a "buy", saying it is underpinned by
the possibility of consolidation in the security market.
Bettencourt expects revenue growth of at least 25 percent in 2016
and after buying three companies in 2014 says Imperva is looking for
more acquisitions, having raised $128 million in a secondary stock
offering in New York in March.
The company beat expectations with its third-quarter results last
week, as sales jumped 48 percent from a year earlier. It forecast
annual adjusted earnings per share of breakeven to 7 cents, versus a
74 cent loss last year, on revenue of $227.6-$229.6 million, up
37-39 percent.
D.A. Davidson analyst Jack Andrews noted though that the security
software market is highly competitive. "If Imperva is unable to
scale its business effectively in the face of these continually
evolving market conditions, operating results could be adversely
affected," he said in a note to clients.
(Editing by Eric Auchard and Susan Fenton)
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