FireEye's CEO partly blamed a slowdown in Chinese hacking for its poor results, and the stock is getting crushed

Cyber security firm FireEye shares are down almost 25% Thursday morning, after reporting lower-than-expected third quarter revenue and guidance numbers.

Although the company didn’t lose as much as expected, its third quarter revenue was below street estimates, while its guidance for the coming year was lowered as well.

FireEye CEO Dave DeWalt partly blamed the disappointing results on a lack of Chinese hackers.

“I believe this change in customer buying patterns is at least particularly due in changes in the threat landscape in the wake of the global cyber security agreements we’ve seen with China that is making headlines since September,” he said during the earnings call.

DeWalt was probably referring to the agreement President Barack Obama and Chinese President Xi Jinping announced in September, when they announced, “neither country’s government would conduct or knowingly support cyber-enabled theft of intellectual property.”

But it doesn’t seem like investors are buying into it, as its stock dropped more than 15% since after hours trading yesterday. As of noon (EST) Thursday, FireEye shares are down more than 22%.

Analysts at FBR downgraded the stock from “outperform” to “market perform,” writing:

With DeWalt blaming FireEye’s weakness on non-company-specific issues, macro, weaker spending trends, Europe, and “head scratching” better China-U.S. relations, which is causing less threats, investors are taking his words and running for the exits in a panic. We continue to strongly believe that FireEye’s issues are much more company-specific as DeWalt & Co. are dealing with a plethora of execution/product headaches in the field, which are major overhangs on the FireEye story heading into 2016.

FireEye beat on earnings with a loss of $US0.37 per share, versus expectations of a $US0.45 per share, but third quarter revenue of $US165.6 million was below analyst estimates of $US167.1 million in revenue. But investors seemed most spooked by lowered revenue projections for the coming year — the new projections are $US620 to $US628 million, down from the previously predicted range of $US630 to $US645 million.

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