Fortinet, Inc.FTNT

Fortinet, Inc. Debt Disclosure

10-KFiled Feb 25, 20262 min read
DEBT
2026 and 2031 Senior Notes

On March 5, 2021, we issued $1.0 billion aggregate principal amount of senior notes (collectively, the “Senior Notes”), consisting of $500.0 million aggregate principal amount of 1.0% notes due March 15, 2026 (the “2026 Senior Notes”) and $500.0 million aggregate principal amount of 2.2% notes due March 15, 2031 (the “2031 Senior Notes”), in an underwritten registered public offering. The Senior Notes are senior unsecured obligations and rank equally with each other in right of payment and with our other outstanding obligations. We may redeem the Senior Notes at any time in whole or in part for cash, at specified redemption prices that include accrued and unpaid interest, if any, and a make-whole premium. However, no make-whole premium will be paid for redemptions of the 2026 Senior Notes on or after February 15, 2026, or the 2031 Senior Notes on or after December 15, 2030. Interest on the Senior Notes is payable on March 15 and September 15 of each year, beginning on September 15, 2021. The 2026 Senior Notes were recorded as current portion of long-term debt and the 2031 Senior Notes were recorded as long-term debt as of December 31, 2025 and both of the Senior Notes were recorded as long-term debt as of December 31, 2024, net of discount and issuance costs, which are amortized to interest expense over the respective contractual terms of these notes using the effective interest method.

The total outstanding debt is summarized below (in millions, except percentages):
 MaturityCoupon RateEffective Interest RateDecember 31,
2025		December 31,
2024
Debt
2026 Senior NotesMarch 20261.0 %1.3 %$500.0 $500.0 
2031 Senior NotesMarch 20312.2 %2.3 %500.0 500.0 
Total debt1,000.0 1,000.0 
Less: Unamortized discount and debt issuance costs3.7 5.7 
Less: Current portion of long-term debt$499.7 $— 
Total long-term debt$496.6 $994.3 

As of December 31, 2025 and 2024, we accrued interest payable of $4.7 million, and there are no financial covenants with which we must comply. In 2025, 2024 and 2023 we recorded $18.0 million, $18.0 million and $17.9 million of total interest expense in relation to these Senior Notes and repaid $16.0 million of interest in cash, respectively. No interest costs were capitalized in 2025, 2024 and 2023, as the costs that qualified for capitalization were not material.

The total estimated fair value of the outstanding Senior Notes was approximately $950.1 million, including accrued and unpaid interest, as of December 31, 2025. The fair value was determined based on observable market prices of identical instruments in less active markets. The estimated fair values are based on Level 2 inputs.
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Historical Timeline

Fiscal YearFiled
2025Feb 25, 2026Showing above
2024Feb 21, 2025
2023Feb 26, 2024
2022Feb 24, 2023
2021Feb 25, 2022

About Debt Disclosures

Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.

Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.

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