Raytheon [RTN] on Wednesday said that the board of its commercial cyber security joint venture Forcepoint has appointed a new chief executive, Matthew Moynahan, to help achieve the company’s growth goals by adding larger enterprises to its customer mix.
Thomas Kennedy, Raytheon’s chairman and CEO and the chairman of Forcepoint, said on his company’s earnings call on Thursday that the cyber security firm needs new leadership to take it to the next level.
Forcepoint is made up of the former Websense, which Raytheon acquired last May, Raytheon’s legacy Cyber Products business, Stonesoft, a smaller acquisition in January, and includes the private equity firm Vista Equity Partners as a minority owner. Kennedy said that Websense had a “strong” foundation with small and medium-size enterprises and had some large customers “but we see significant opportunity in expanding into the larger enterprise area.”
“And so we needed to bring in a leader with that kind of experience to go drive the expansion and market segmentation into those two groups,” Kennedy said.
Kennedy said that through his previous job experience Moynahan has experience with larger enterprises.
Moynahan will take over at Forcepoint on May 9 and joins the company after leading the security firm Arbor Networks, Inc., which is the security division of the service assurance and cyber security company NETSCOUT [NTCT]. Moynahan joined Arbor Networks as president in 2012 and before that he held senior roles at Reciprocal, Symantec [SYMC], and application security provider Veracode, where he was president and CEO.
Arbor Networks has over 500 employees and its products are used by 90 percent of the world’s tier one service providers, nine out of 10 of the largest managed security service providers, and eight out of 10 of the largest cloud service providers, and has more than 1,200 customers across 107 countries, according to its web site.
Forcepoint said that Moynahan will lead its “strategy to accelerate delivery of a unified, cloud-centric security platform to an expanding global customer base.”
In a statement Wednesday announcing Moynahan’s appointment, Kennedy said, “Forcepoint was created to empower organizations to drive their business forward by safely embracing transformative cyber security technologies. As we conclude our integration activity from last year’s Raytheon/Websense merger, Matt’s leadership will enable Forcepoint to deliver on that promise as the company enters its next phase of innovation and growth.”
In its first quarter financial report on Thursday, Raytheon said that Forcepoint is on track to deliver $600 million in sales this year with operating margins between 11.5 percent and 12.5 percent. Forcepoint tallied $136 million in sales and $24 million in operating income in the first quarter.
Kennedy said on the call that there is demand for all of Forcepoint’s key products, including its TRITON advance threat protection and data theft prevention software suite, Raytheon’s defense-grade SureView analytics, and the Stonesoft Next-Generation Firewall.
Anthony “Toby” O’Brien, Raytheon’s chief financial officer, said on Thursday’s analyst call that excluding the Stonesoft acquisition, Forcepoint posted a 9 percent increase in sales on a normalized basis. He said revenue from the company’s legacy web filtering products were down about one-third but that growth in TRITON and the federal business of Raytheon Cyber Products more than offset that decline.
Moynahan succeeds Forcepoint’s interim-CEO, Jim Hagan, who will stay on as chief operating officer, and former CEO John McCormack, who will remain with the company as a strategic adviser to the board of directors through 2016.