Secureworks is making progress as it expands beyond traditional MSSP services to offer managed detection and response (MDR) and other SaaS-based cybersecurity capabilities to partners and customers, CEO Michael R. Cote asserts. Still, Secureworks' overall business transformation remains a work in progress, the MSSP's latest financial results reveal.
For its third quarter of fiscal 2020, Secureworks today disclosed:
- Revenue of $141.3 million, up 6.2 percent from the corresponding quarter last year.
- GAP net los of $7.9 million, larger than the $3.7 GAP net loss from the corresponding quarter last year.
The figures generally beat Wall Street's expectations, according to SeekingAlpha, and Secureworks' stock rose about 15.6 percent shortly after announcing the earnings news. That could be good news for parent Dell Technologies, which is working closely with the MSSP but has also occasionally tested the market for a potential Secureworks company sale.
Secureworks Evolution: Progress, Challenges
No doubt, Secureworks remains a firmly entrenched Top 200 MSSP for 2019, according to MSSP Alert research. But the company's business model remains in transition as customers seek more highly automated MSSP, MDR, endpoint and cloud security services.
Recent developments at Secureworks include:
- Launching Red Cloak Threat Detection and Response (TDR) in November 2019 as part of an expanded Dell Safeguard and Response portfolio of offerings. TDR is being sold in combination with VMware Carbon Black's endpoint security products.
- Also, Secureworks MDR is also now available to Dell customers through the Dell Safeguard and Response portfolio of offerings.
- A Microsoft partnership to extend TDR capabilities to Microsoft ATP and Office 365 customers.
- Hiring NCR veteran Maureen Perrelli as chief channel officer.
Secureworks Evolution: CEO Michael R. Cote's Perspective
Describing Secureworks' recent business progress, CEO Michael R. Cote in a statement today said:
“In the world of accelerating digital transformation and complex technology ecosystems, effective security programs require a more agile and scalable model. Our model goes beyond prevention alone, to leverage the powerful combination of machine and human intelligence and the community. As a global leader in the security industry, we are proud to partner with other leading security and technology companies to deliver solutions to the market that work in concert to increase the speed of detection and effectiveness of response to reduce risk.
Revenue, gross margin, adjusted EBITDA and cash flow were strong again in the third quarter and exceeded our expectations. We continue to invest in our security analytics platform and SaaS-based offerings and, as we finish the year, we remain focused on building upon our progress, driving our business transformation and bringing our vision of the future of security to life."
Clearly, Secureworks plans to double down on its relationships with parent Dell and sister company VMware -- which acquired Carbon Black earlier this year. We'll be watching to see how new Chief Channel Officer Maureen Perrelli evolves the partner efforts beyond those core companies.