“and we expect investment in infrastructure will start to return within the next 1 to 2 years.”

In context

“Ken Xie (Founder, Chairman and CEO): I believe this is more in Keith's area. The remaining part of the year appears challenging due to the election and high interest rates. The cost of capital remains elevated, which may deter some companies from making long-term investments that drive product revenue and infrastructure development. Historically, every 4 to 5 years, networks and security systems require upgrades for enhanced performance and functionality. We feel that the ongoing supply chain issues have extended this cycle since 2001, and next year might complete a full cycle. Some companies may begin to consider upgrading the products they acquired 4 or 5 years ago, particularly in sectors like retail, where we have seen strong growth at the onset of supply chain difficulties, and we expect investment in infrastructure will start to return within the next 1 to 2 years. Additionally, we recognize a significant trend toward hybrid solutions. We have a robust SASE infrastructure, along with securing OT/IoT environments, which requires on-site appliances to support the work-from-home model. For SASE, we provide both cloud-based and on-premise private solutions, which also necessitate hardware for local customer support.”