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Trend Micro
(OTC:TMICY)
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Rating:68Neutral
Price Target:
$39.00
▲(11.81% Upside)
Action:Reiterated
Date:08/20/26
The score is anchored by strong financial quality—especially the debt-free balance sheet and solid margins—tempered by earnings/FCF variability. Near-term risk is elevated due to weak technical trend signals and the earnings call’s margin pressure and lowered profit guidance, partially offset by reasonable valuation and dividend support.
Positive Factors
Recurring Subscription Model
Recurring subscriptions, renewals, and usage expansion can improve revenue visibility and customer retention. Exposure to cloud, hybrid IT, and ongoing threat protection also supports durable demand as organizations continue to invest in cybersecurity.
Negative Factors
Earnings Volatility
The uneven net-margin record suggests that strong gross margins do not consistently translate into stable bottom-line results. Persistent earnings volatility can reduce forecasting reliability and may constrain the pace of reinvestment or shareholder distributions.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring Subscription Model
Recurring subscriptions, renewals, and usage expansion can improve revenue visibility and customer retention. Exposure to cloud, hybrid IT, and ongoing threat protection also supports durable demand as organizations continue to invest in cybersecurity.
Read all positive factors
Trend Micro (TMICY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.91B
Dividend Yield3.08%
Average Volume (3M)2.17K
Price to Earnings (P/E)22.4
Beta (1Y)0.68
Revenue Growth3.52%
EPS Growth12.65%
CountryUS
Employees6,717
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)273.73
Shares Outstanding140,901,610
10 Day Avg. Volume3,110
30 Day Avg. Volume2,171
Financial Highlights & Ratios
PEG Ratio3.95
Price to Book (P/B)6.51
Price to Sales (P/S)2.94
P/FCF Ratio12.78
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)1.65
Revenue Forecast (FY)$1.89B
Trend Micro Business Overview & Revenue Model
Company Description
Headquartered in Tokyo, Japan, and established in 1965, Trend Micro Incorporated specializes in creating and distributing cybersecurity software. The company primarily focuses on the Japanese market, providing security solutions for computers and ...
How the Company Makes Money
Trend Micro makes money primarily by selling cybersecurity products and services through recurring subscription and licensing arrangements, complemented by maintenance/support and related services. Its core revenue model is built around (1) enterp...
Trend Micro Earnings Call Summary
Earnings Call Date:Aug 13, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Neutral
The call conveys clear product and ARR momentum—especially strong performance from the Vision One platform (49% ARR growth, $615M ARR, 122% NRR), services expansion, AI-driven productivity gains, and strategic sovereign-cloud investments—indicating solid top-line growth drivers and long-term opportunity. However, near-term profitability has been materially impacted by deliberate, sizable AI and infrastructure investments (large one-time/transition costs and increased cloud consumption), causing operating income to fall sharply and prompts downward revisions to profit-line guidance. Management positions most costs as strategic and temporary with expected improvements in H2 and beyond, but timing and magnitude of recovery remain uncertain.Positive Updates
Record Quarterly Net Sales and ARR Momentum
Q2 highest-ever quarterly net sales with net sales up 13% year-over-year (constant-currency net sales +3%). Company emphasizes ARR as a leading indicator: total ARR up 5% year-over-year, enterprise ARR improved from 4% to 6% sequentially and management expects further improvement in H2.
Negative Updates
Sharp Operating Income Decline
Operating income fell dramatically (operating income indicated as down ~54%), driven by cost growth outpacing revenue: total costs grew ~29% vs net sales growth of 13%, prompting downward revisions to operating income, ordinary income and net income for the full year.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Net Sales and ARR Momentum
Q2 highest-ever quarterly net sales with net sales up 13% year-over-year (constant-currency net sales +3%). Company emphasizes ARR as a leading indicator: total ARR up 5% year-over-year, enterprise ARR improved from 4% to 6% sequentially and management expects further improvement in H2.
Read all positive updates
Company Guidance
Management kept full‑year net sales guidance unchanged but lowered operating, ordinary and net income after Q2, saying the downgrade reflects continued investment in AI and cloud (costs will continue into H2) even as they expect unit economics and ARR momentum to improve in H2; they reiterated no formal ARR guidance but are targeting double‑digit ARR over time. Key metrics cited on the call: Q2 net sales +13% (constant‑currency +3%), costs +29% and operating income down ~54%; company ARR up ~5% year‑over‑year (ARR progression 4% → 6% in enterprise CC), Vision One ARR $615M (+49% y/y) with NRR 122% and GRR improved to 87%, average 4.2 solutions per customer and ~45% of Trend ARR from Vision One; services $81M (+27%) with ~2,200 customers; headcount broadly flat; H1 internal AI transformation ~$12.6M (6,000% rise y/y), infrastructure expansion ~$6.5M, transition costs ~$7.2M, about 80% of the JPY12bn cost increase cloud‑related; SaaS cost per $1 ARR $0.14 in H1 2026 (vs $0.13 in 2025 and $0.19 in 2024); FX planning at JPY157.Trend Micro Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
91
Very Positive
Cash Flow
74
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 295.53B | 289.36B | 272.64B | 248.69B | 223.79B | 190.36B |
| Gross Profit | 228.71B | 222.56B | 207.66B | 185.03B | 169.50B | 148.34B |
| EBITDA | 81.66B | 88.95B | 77.03B | 60.92B | 56.53B | 64.54B |
| Net Income | 35.99B | 36.20B | 34.36B | 10.73B | 29.84B | 38.37B |
Balance Sheet | ||||||
| Total Assets | 405.19B | 422.53B | 400.32B | 492.63B | 470.80B | 420.46B |
| Cash, Cash Equivalents and Short-Term Investments | 231.36B | 231.19B | 210.90B | 299.03B | 242.85B | 256.80B |
| Total Debt | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 286.04B | 291.31B | 280.87B | 278.21B | 242.12B | 199.03B |
| Stockholders Equity | 118.99B | 130.72B | 119.44B | 214.39B | 228.66B | 220.64B |
Cash Flow | ||||||
| Free Cash Flow | 65.26B | 66.56B | 21.84B | 30.87B | 35.92B | 36.48B |
| Operating Cash Flow | 66.56B | 67.77B | 46.78B | 57.23B | 56.90B | 55.27B |
| Investing Cash Flow | -14.60B | 3.00B | 5.04B | 31.00B | -67.72B | 2.58B |
| Financing Cash Flow | -38.46B | -31.00B | -130.90B | -43.43B | -30.44B | -16.45B |
Trend Micro Technical Analysis
Neutral
34.88
Price Trends
38.38
Negative
37.44
Positive
38.70
Negative
Market Momentum
-0.93
Positive
49.07
Neutral
95.50
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TMICY, the sentiment is Neutral. The current price of 34.88 is below the 20-day moving average (MA) of 38.39, below the 50-day MA of 38.38, and below the 200-day MA of 38.70, indicating a bearish trend. The MACD of -0.93 indicates Positive momentum. The RSI at 49.07 is Neutral, neither overbought nor oversold. The STOCH value of 95.50 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TMICY.
Trend Micro Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $125.41B | 56.59 | 187.95% | ― | 18.77% | 12.93% | |
77 Outperform | $26.55B | 24.31 | 30.40% | ― | 20.36% | 11.15% | |
76 Outperform | $236.53B | 6,109.94 | 1.29% | ― | 24.30% | ― | |
71 Outperform | $30.46B | -371.60 | -3.71% | ― | 24.61% | -91.58% | |
68 Neutral | $4.91B | 22.39 | 28.87% | 2.30% | 3.52% | 12.65% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
TMICY
Trend Micro
37.76
-15.65
-29.30%
CPAY
Corpay Inc
404.81
87.02
27.38%
FTNT
Fortinet
161.85
84.93
110.40%
ZS
Zscaler
178.37
-96.20
-35.04%
CRWD
CrowdStrike Holdings
215.07
111.70
108.05%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.