FireEye Acquires Threat-Intelligence Analyst iSight

Cybersecurity technology developer FireEye turned the page on a difficult year Wednesday by revealing the acquisition of a prominent threat-intelligence monitoring firm in conjunction with its preliminary financials for the entirety of 2015.

The acquisition of global cyberthreat researcher iSight Partners, based in Dallas, brings under FireEye's roof a threat-intelligence platform that monitors cybercriminals in all corners of the world with the aim of warning customers before debilitating attacks are even launched.

Dave DeWalt, FireEye's CEO, said on an investor call discussing the acquisition that iSight gives FireEye an "attacker view" of cybercrime. That complements the "victim view" delivered by subsidiary Mandiant, and its own "machine view" of cybercrime -- a combination that adds up to "nation-state-grade intelligence infrastructure" for stopping cyberattacks, he said.

[Related: FireEye's Future: 6 Reasons Analysts Are Skeptical About The Security Vendor's Outlook]

Sponsored post

FireEye, based in Milpitas, Calif., paid $200 million in cash, with an additional $75 million in performance-based earn-out value for iSight shareholders -- $41 million in cash and 1.8 million shares of FireEye stock.

The acquisition, which closed Jan. 14, was made public after the stock market closed Wednesday, along with preliminary financials that revealed 36 to 38 cents loss per share on quarterly revenue of about $185 million -- results that were within the company's guidance.

DeWalt said the company is closing the year with billings up 35 percent over 2014, and more than triple what they were in 2013, the year of the company's IPO. FireEye closed a record number of transactions, new deals and new customers in 2015, DeWalt said, and iSight's technology and expertise will expand the company's addressable market.

FireEye continues transforming "from a single-product vendor to a complete, intelligence-led threat management platform" with nine components, the CEO said.

DeWalt told investors iSight brings "a different and complementary perspective on threat environment."

By merging "two of the world's leading threat intelligence organizations," FireEye achieves a combination of machine intelligence and human intelligence that's needed to address the escalating threat climate, he said.

FireEye's existing portfolio offers advanced machine learning capabilities that absorb information from tens of millions of virtual machines running in the data centers of more than 4,000 customers, according to the company.

Two years ago, FireEye bought Mandiant, an Alexandria, Va.-based endpoint security and incident response services company that added a human intelligence component obtained from interacting in the field with targeted customers.

Now, iSight's global network of more than 250 threat researchers that track bad actors in 29 languages adds insight into the behavior of the attackers, DeWalt said.

The company studies the tools and techniques of cybercrime, cyberespionage and hacktivism, helping block attacks before they occur through an early-warning system.

That final capability, which is already being integrated into FireEye's platform, will enrich the portfolio FireEye offers to government and commercial entities, he said.

Jane Wright, senior analyst for security at Technology Business Research, told CRN the iSight acquisition was a smart move.

FireEye competitors like Symantec and Intel point to high volumes of threat information that they accumulate from their huge customer bases.

"Being a younger company with a more limited scope, FireEye didn’t have firsthand access to as much threat information," she said. "But it will gain this when it acquires iSight Partners."

That will benefit the company's channel by leveling the playing field for FireEye vs. its competition.

"This acquisition will help channel partners feel more confident that FireEye has its finger on the pulse of many of the threats and attacks that are happening overall, not just the ones happening inside FireEye's own customer base," Wright told CRN.

FireEye CFO Mike Berry, in presenting the financial picture, told investors that one of the "key takeaways" should be how the company's journey from a product to a platform impacts the billing mix.

Sales of the company's security appliances are slumping as customers opt for an as-a-service delivery model, he said.

"We're clearly seeing a shift in customer buying behavior to cloud solutions," Berry told investors.