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Palo Alto Networks (PANW - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.

Shares of this security software maker have returned -13.5% over the past month versus the Zacks S&P 500 composite's -0.4% change. The Zacks Security industry, to which Palo Alto belongs, has lost 3.4% over this period. Now the key question is: Where could the stock be headed in the near term?

Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.

Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

For the current quarter, Palo Alto is expected to post earnings of $0.97 per share, indicating a change of +4.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +6.1% over the last 30 days.

The consensus earnings estimate of $4.17 for the current fiscal year indicates a year-over-year change of +8.6%. This estimate has changed +2.4% over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $4.95 indicates a change of +18.7% from what Palo Alto is expected to report a year ago. Over the past month, the estimate has changed +0.3%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Palo Alto.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Revenue Growth ForecastWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.

For Palo Alto, the consensus sales estimate for the current quarter of $3.31 billion indicates a year-over-year change of +33.6%. For the current and next fiscal years, $14.17 billion and $16.21 billion estimates indicate +23.4% and +14.4% changes, respectively.

Last Reported Results and Surprise HistoryPalo Alto reported revenues of $3.41 billion in the last reported quarter, representing a year-over-year change of +34.4%. EPS of $1.02 for the same period compares with $0.95 a year ago.

Compared to the Zacks Consensus Estimate of $3.35 billion, the reported revenues represent a surprise of +1.78%. The EPS surprise was +4.08%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.

While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.

As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Palo Alto is graded F on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Palo Alto. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

Palo Alto Networks Downgrade Raises Red Flag After Massive Rally Summary

Palo Alto Networks Stock Faces Fresh Pressure as Top Analyst Cuts Rating After 160% Rally

Palo Alto Networks (PANW) faces a more cautious view from PhillipCapital after a sharp share-price advance, although analyst Paul Chew raised his price target to $346 from $320.

Chew shifted his rating to Hold from Buy, citing reduced near-term upside after the stock climbed about 160% from its February low to an August peak of $396. The analyst kept his fiscal 2027 estimates unchanged.

Underlying demand remains supported by expanding cybersecurity needs tied to artificial intelligence. Palo Alto Networks posted 34% year-over-year revenue growth in its latest fiscal year, while customers increasingly consolidated security products on its platforms.

More than 65% of advanced security annual recurring revenue now comes from platform customers, while net revenue retention remains above 120%. Chew expects AI infrastructure expansion and wider use of security products for autonomous AI systems to support growth.

The downgrade could limit near-term enthusiasm, but AI security demand and Wall Street's bullish consensus remain potential supports.

Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.

Click for the complete disclosure

Palo Alto Networks' SASE momentum and AI-driven demand support growth, but rising costs and a premium valuation warrant caution.

Palo Alto Networks (PANW) is positioning itself as a broad enterprise security platform as AI creates new cybersecurity risks across networks, cloud infrastructure, identities and endpoints. In this Tech Corner, George Tsilis breaks down the company's latest earnings and how its "platformization" strategy is driving deeper customer adoption.

Palo Alto (PANW) witnesses a hammer chart pattern, indicating support found by the stock after losing some value lately. This coupled with an upward trend in earnings estimate revisions could mean a trend reversal for the stock in the near term.

Shares of Palo Alto Networks (PANW +1.05%) surged 15% in August, according to data from S&P Global Market Intelligence. Cybersecurity stocks have seen booming investor demand due to the growing need for these services in the age of artificial intelligence (AI). Palo Alto Networks has seen its share price rise 320% in the last five years alone.

However, the stock has fallen over 10% this week, giving up most of its August gains, after reporting its Q4 earnings for fiscal year 2026. Here's why it rose in August and whether now is a good time to scoop up some shares.

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Surging demand Cybersecurity is becoming increasingly important for enterprises and other large organization seeking to secure data due to the threat posed by automated AI bots. Hackers using AI are becoming increasingly capable, meaning enterprises need to stay extra secure with their digital data.

This is where Palo Alto Networks steps in. It is one of the leading cybersecurity firms, providing solutions including automated firewalls, cloud security, threat detection, and threat intelligence. Last quarter, annual recurring revenue (ARR) for its next-generation solutions reached $9.1 billion, up 63% year-over-year, driven by contracts to protect from AI. Remaining performance obligations grew 34% to $21.2 billion.

Momentum into the quarter drove Palo Alto Networks' stock to a record high. Where it faltered this week was guidance for fiscal year 2027, which calls for total revenue growth of 23%-24%. Investors were likely hoping for more growth given the intense expectations surrounding the AI narrative.

Image source: Getty Images.

Should you buy Palo Alto Networks stock? Despite giving up these August gains, Palo Alto Networks stock has still been a huge winner in the last few years, and it trades at a premium valuation.

On a price-to-sales ratio (P/S), it trades at a valuation of 22. That is significantly higher than the S&P 500 Index average of 3.8, which is also at a record high. Expectations could not be higher for Palo Alto Networks.

It generates a healthy amount of free cash flow, but this is clouded by its heavy reliance on stock-based compensation, with shares outstanding up 48% over the last 10 years. In order to be a buyer of Palo Alto Networks stock today, you need to believe in two things. First, that revenue growth will stay above 20% for many years in the future. Second, that its GAAP (generally accepted accounting principles) operating margin will expand significantly from here.

If you don't believe these things, the stock is likely not a good bet at a P/S ratio of 22.

Palo Alto Networks delivered another strong quarter, with revenue up 34% and NGS ARR reaching $9.1B, supported by continued platformization and rising AI-security demand. The business remains high quality, with strong recurring revenue, solid free cash flow generation, and growing customer penetration across SASE, Cortex, identity, and observability. The main issue is valuation. PANW still trades at a substantial premium to its own history, while FY27 NGS ARR growth is expected to normalize to 22-23%.

Palo Alto Networks Inc (NYSE:PANW, XETRA:5AP) shares fell 10% Wednesday even after the cybersecurity company beat expectations across key fourth-quarter metrics and issued fiscal 2027 guidance above Street estimates.

The company reported next-generation security (NGS) annual recurring revenue of $9.1 billion, up 63% year-over-year, topping the Street's $8.86 billion estimate and including nearly $1 billion in net new ARR.

Revenue came in at $3.41 billion versus expectations of $3.35 billion, while remaining performance obligations reached $21.2 billion against a $20.95 billion estimate. Earnings per share of $1.02 beat the $0.98 consensus.

Operating margin was roughly in line at 29.6% versus an expected 29.3%, while gross margin came in light at 74.8% versus 76%.

Analysts at BofA said the muted market reaction reflected an unusually high bar for the quarter rather than any weakness in execution, noting that elevated investor expectations, driven by anticipation around Chronosphere, CyberArk cross-sell and improving cyber demand, left investors looking for an even stronger beat.

Palo Alto Networks saw record platformization adoption with 220 new multi-platform customers, alongside strong growth across SASE (up 40%), XSIAM (up 70% to over $700 million ARR), Prisma AIRS (about $120 million ARR) and Chronosphere (over $500 million ARR), while CyberArk integration synergies are running ahead of schedule.

Jefferies analysts called it "the cleanest print for PANW in a while," noting the quarter saw some benefit from Mythos, though management indicated it remains early days for that contribution. Jefferies estimated that excluding roughly $200 million of net new ARR from Chronosphere and $70 million from CyberArk, organic net new ARR growth accelerated to about 45% year-over-year from 17% in the prior quarter.

For fiscal 2027, Palo Alto Networks guided to revenue of $14.15 billion, ahead of the Street's $13.84 billion estimate, representing 23% year-over-year growth. RPO guidance of $25.2 billion to $25.4 billion implies 19% to 20% growth, compared with 34% growth in fiscal 2026. NGS ARR guidance of $11.075 billion to $11.175 billion implies roughly $2 billion in net new ARR at the midpoint. EPS guidance of $4.18 topped the Street's $4.11 estimate.

Jefferies said it sees room for further upside in the guidance, noting the revenue outlook embeds a deceleration in the core Network Security/AI segment despite recent strength in bookings.

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Palo Alto Networks Inc (NYSE:PANW, XETRA:5AP) shares fell 10% Wednesday even after the cybersecurity company beat expectations across key fourth-quarter metrics and issued fiscal 2027 guidance above Street estimates.

The company reported next-generation security (NGS) annual recurring revenue of $9.1 billion, up 63% year-over-year, topping the Street's $8.86 billion estimate and including nearly $1 billion in net new ARR.

Revenue came in at $3.41 billion versus expectations of $3.35 billion, while remaining performance obligations reached $21.2 billion against a $20.95 billion estimate. Earnings per share of $1.02 beat the $0.98 consensus.

Operating margin was roughly in line at 29.6% versus an expected 29.3%, while gross margin came in light at 74.8% versus 76%.

Analysts at BofA said the muted market reaction reflected an unusually high bar for the quarter rather than any weakness in execution, noting that elevated investor expectations, driven by anticipation around Chronosphere, CyberArk cross-sell and improving cyber demand, left investors looking for an even stronger beat.

Palo Alto Networks saw record platformization adoption with 220 new multi-platform customers, alongside strong growth across SASE (up 40%), XSIAM (up 70% to over $700 million ARR), Prisma AIRS (about $120 million ARR) and Chronosphere (over $500 million ARR), while CyberArk integration synergies are running ahead of schedule.

Jefferies analysts called it "the cleanest print for PANW in a while," noting the quarter saw some benefit from Mythos, though management indicated it remains early days for that contribution. Jefferies estimated that excluding roughly $200 million of net new ARR from Chronosphere and $70 million from CyberArk, organic net new ARR growth accelerated to about 45% year-over-year from 17% in the prior quarter.

For fiscal 2027, Palo Alto Networks guided to revenue of $14.15 billion, ahead of the Street's $13.84 billion estimate, representing 23% year-over-year growth. RPO guidance of $25.2 billion to $25.4 billion implies 19% to 20% growth, compared with 34% growth in fiscal 2026. NGS ARR guidance of $11.075 billion to $11.175 billion implies roughly $2 billion in net new ARR at the midpoint. EPS guidance of $4.18 topped the Street's $4.11 estimate.

Jefferies said it sees room for further upside in the guidance, noting the revenue outlook embeds a deceleration in the core Network Security/AI segment despite recent strength in bookings.

DA Davidson went to $420, Piper Sandler to $410, RBC to $475 Summary

DA Davidson lifted its Palo Alto target to $420 from $345 on a Buy rating, calling fiscal 2027 guidance ahead of consensus on all figures.

DA Davidson raised its price target on Palo Alto Networks PANW to $420 from $345 and kept a Buy rating. Analyst Rudy Kessinger called fourth quarter results ahead of expectations and initial fiscal 2027 guidance well ahead of consensus on all figures. Palo Alto shares were down 7.75% intraday.

Davidson estimates implied organic next-generation ARR growth for fiscal 2027 at approximately flat year over year, which it identified as the main pushback from investors. That compares with initial fiscal 2026 guidance, which implied 10% to 18% organic growth. Palo Alto has not disclosed the exact inorganic contribution to its results. On the quarter itself, Davidson put organic next-generation ARR growth in the mid-30s percent range.

Other firms moved in the same direction on price. Piper Sandler went to $410 from $345, citing progress integrating acquired businesses, and RBC Capital raised to $475 from $434. StoneX reiterated Buy at $400, BMO stayed Outperform at $415, and JPMorgan kept Overweight. Palo Alto reaffirmed its fiscal 2028 target of a 40% free cash flow margin.

Disclosures I am/we currently own positions in the stocks mentioned, and have NO plans to sell some or all of the positions in the stocks mentioned over the next 72 hours.

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Key Takeaways PANW's Q4 revenues rose 34% to $3.41B as broad platform strength and record adoption fueled growth.PANW added about 220 net new platformizations, up 44%, while net new NGS ARR surged 98% to about $970M.Palo Alto Networks sees fiscal 2027 revenues of $14.10-$14.20B and NGS ARR of $11.075-$11.175B. Palo Alto Networks, Inc. (PANW - Free Report) delivered fourth-quarter fiscal 2026 non-GAAP earnings of $1.02 per share, which beat the Zacks Consensus Estimate by 4.1%. The figure improved 7.4% year over year.

Revenues climbed 34% year over year to $3.41 billion and topped the consensus estimate by 1.8%. Broad-based strength across Network & AI Security, Cortex and Idira, along with record platformization adoption, drove the fourth-quarter results. Next-Generation Security ARR jumped 63% to $9.10 billion.

PANW's Revenue Mix Shows Broad-Based GrowthProduct revenues increased 28.6% year over year to $738 million from $574 million in the year-ago quarter, accounting for 21.6% of total revenues. Subscription and support revenues rose 36.2% to $2.672 billion from $1.962 billion, which represented 78.4% of total revenues.

By platform, fourth-quarter revenues were $2.331 billion for Network & AI Security, $586 million for Cortex and $336 million for Idira. Other revenues, including Unit 42, professional services and financing income, totaled $157 million.

Palo Alto Networks' Platformization Hits Record LevelsRemaining performance obligations rose 34% year over year to $21.2 billion. Net new NGS ARR reached approximately $970 million, up 98% year over year, reflecting the strongest quarterly addition reported by the company.

Palo Alto Networks added roughly 220 net new platformizations in the quarter, up 44% year over year. Net retention among platformized customers exceeded 120%, while more than 65% of NGS ARR came from platformized customers.

PANW's AI Security Products Gain ScalePrisma AIRS reached roughly $120 million in ARR within one year of general availability and had over 800 customers, more than doubling sequentially. Software firewall ARR grew 29% year over year, while SASE competitive displacements totaled about $450 million in fiscal 2026.

Cortex momentum also remained strong. XSIAM ARR exceeded $700 million and grew about 70% year over year, while observability ARR surpassed $500 million and increased more than 2.5 times from the second quarter. CyberArk, now called Idira, generated more than 200 new-logo wins from PANW's installed base.

Palo Alto Networks' Margins Reflect SaaS Mix ShiftNon-GAAP gross profit was $2.552 billion, with gross margin at 74.8%, down from 75.8% a year earlier. Management attributed the pressure to a mix shift toward faster-growing SaaS offerings that have not yet reached gross-margin maturity.

Non-GAAP operating income was $1.011 billion, translating to a 29.6% margin compared with 30.3% a year ago.

Adjusted free cash flow increased to $1.289 billion from $954 million, with margin edging up to 37.8% from 37.6%. Cash and cash equivalents stood at $2.514 billion, with $557 million in short-term investments.

PANW Guides Strong Growth for Fiscal 2027For the first quarter of fiscal 2027, Palo Alto Networks expects revenues of $3.300-$3.310 billion, indicating 33-34% growth. NGS ARR is projected to be in the range of $9.54-$9.56 billion, RPO in the band of $20.8-$20.9 billion and non-GAAP earnings per share between 96 cents and 98 cents.

For fiscal 2027, revenues are forecast at $14.10-$14.20 billion, implying 23-24% growth. NGS ARR is expected to be in the range of $11.075-$11.175 billion, RPO in the band of $25.2-$25.4 billion and non-GAAP earnings per share between $4.16 and $4.19. The company targets a 29.5% non-GAAP operating margin and a 38.0% adjusted free cash flow margin.

Palo Alto Networks Maps Platform Growth AheadManagement expects fiscal 2027 Network & AI Security revenues to grow in the low double digits, Cortex revenues to rise about 30%, and Idira revenues to reach approximately $1.5 billion, implying pro forma growth in the high teens to 20%.

The company expects 60-61% of fiscal 2027 net new NGS ARR to arrive in the second half. Its outlook assumes the tail end of a large LLM customer's migration to Chronosphere continues through the first quarter, but contributes less net new ARR than it did in the fourth quarter.

PANW’s Zacks Rank and Other Stocks to ConsiderPalo Alto Networks has a Zacks Rank #2 (Buy) at present.

Some other top-ranked stocks worth considering in the broader Zacks Computer and Technology sector are Applied Materials (AMAT - Free Report) , Lam Research (LRCX - Free Report) and Amphenol (APH - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Applied Materials’ fiscal 2026 earnings is pegged at $12.76 per share, up by 3 cents over the past seven days, indicating a year-over-year increase of 35.5%. Applied Materials shares have surged 72.5% year to date (YTD).

The Zacks Consensus Estimate for Lam Research’s fiscal 2027 earnings has moved northward by a penny to $9.33 per share over the past seven days and calls for a year-over-year jump of 60.6%. Lam Research shares have soared 69.8% YTD.

The Zacks Consensus Estimate for Amphenol’s 2026 earnings has remained unchanged at $5.25 per share over the past 30 days, implying a year-over-year increase of 57.2%. Amphenol shares have rallied 20.8% YTD.

Palo Alto Networks shares are tumbling Wednesday even though the cybersecurity software maker's fiscal fourth-quarter results beat analysts' estimates.

Palo Alto Networks PANW fell 1.57% premarket after fourth quarter revenue rose 34% to $3.41 billion, ahead of the $3.35 billion consensus, with non-GAAP EPS of $1.02 against $0.98 expected. On a GAAP basis the company posted a net loss of $282 million, or $0.35 a share, compared with net income of $254 million a year earlier.

Next-Generation Security ARR grew 63% to $9.10 billion, with CEO Nikesh Arora citing "nearly $1 billion of Net New NGS ARR in a single quarter." Remaining performance obligations rose 34% to $21.2 billion and non-GAAP operating income reached $1.01 billion from $768 million. The GAAP swing came from $281 million of acquired intangible amortization and a $524 million fair value change on convertible notes acquired from CyberArk. Goodwill now stands at $22.0 billion against $4.6 billion a year ago.

For fiscal 2027 the company guided NGS ARR to $11.075 billion to $11.175 billion, growth of 22% to 23%, and revenue to $14.10 billion to $14.20 billion. Non-GAAP EPS is guided to $4.16 to $4.19, against $3.84 in fiscal 2026. Adjusted free cash flow margin is expected at 38.0%, down from 38.4%. Palo Alto separately disclosed it has acquired Console, an AI-native agentic workflow platform.

Key Takeaways Palo Alto Networks added about 220 net new platformizations in Q4, a record, with NRR above 120%. AI-driven demand lifted agentic SASE traffic 9x in nine months, while Prisma AIRS topped $100M in ARR.PANW guides fiscal 2027 revenues of $14.1B-$14.2B, up 23%-24%, despite SaaS and hardware cost pressure. Palo Alto Networks, Inc. (PANW - Free Report) used its fiscal fourth-quarter 2026 call to frame AI as a durable cybersecurity demand driver, tying machine-speed threats to demand for unified, real-time defense.

Management also focused on platformization, contributions from CyberArk and Chronosphere, and a fiscal 2027 outlook that assumes continued growth alongside SaaS mix and hardware cost pressure.

PANW Ties AI Risks to Platform DemandChairman and CEO Nikesh Arora said three AI shifts are reshaping security: autonomous agents, more capable cyber models and a widening ecosystem of open-weight and open-source models.

Arora said those shifts expand traffic, machine identities, sensitive data and infrastructure requiring protection. He positioned unified data and policy as essential for detection and remediation at machine speed.

The CEO noted agentic traffic on Palo Alto's SASE platform rose 9x over nine months. Prisma AIRS also surpassed $100 million in ARR within four quarters of general availability.

Palo Alto Expands Its Platformization FootprintArora said PANW added about 220 net new platformizations in the fourth quarter, a record and more than twice the level when the metric began two years ago. Net revenue retention for platformized customers exceeded 120%.

Large deals included a $126 million global telecom agreement, a $72 million IT services transaction spanning Network Security, Cortex and Idira, and a $53 million agreement with a global payments platform.

Management maintained long-term targets of more than 4,000 platformizations and $20 billion in Next-Generation Security ARR by fiscal 2030. Fourth-quarter NGS ARR reached $9.1 billion, up 63%, with nearly $1 billion of net new ARR.

PANW Guides for Fiscal 2027 GrowthCFO Dipak Golechha guided fiscal 2027 NGS ARR of $11.075 billion-$11.175 billion, up 22%-23%, and revenues in the range of $14.1 billion-$14.2 billion, up 23%-24%.

For fiscal first-quarter 2027, Golechha projected revenues of $3.30 billion-$3.31 billion, up 33%-34%, and non-GAAP EPS of $0.96-$0.98. NGS ARR is expected at $9.54 billion-$9.56 billion, up 63%.

Golechha said fiscal 2026 net new NGS ARR included a nine-figure benefit from a large LLM customer's Chronosphere migration. The tail end should continue into the first quarter, while 60%-61% of fiscal 2027 net new NGS ARR is expected in the second half.

Palo Alto Balances Growth With Cost PressureFourth-quarter revenues rose 34% year over year to $3.41 billion, beating the Zacks Consensus Estimate of $3.35 billion. Non-GAAP EPS of $1.02 topped the consensus mark of $0.98.

Golechha said fourth-quarter gross margin fell 100 basis points to 74.8% as faster-growing SaaS offerings carried higher cloud hosting costs. He also flagged rising memory and storage costs in hardware, about 10% of revenues.

Fourth-quarter non-GAAP operating margin was 29.6%. Golechha expects higher fiscal 2027 cost of goods sold to be more than offset by operating leverage and M&A synergies, supporting a 29.5% operating margin and 38% adjusted free cash flow margin outlook.

PANW Q&A Tests CyberArk and SASE MomentumA JPMorgan analyst asked about CyberArk revenue synergies and installed-base penetration. Arora said the integration accelerated the business while lifting margins by more than 1,000 basis points, and highlighted Modern PAM as an expansion avenue.

A BTIG analyst pressed management on SASE displacement activity. Golechha clarified that displacement value rose from $200 million through the third quarter to $450 million for fiscal 2026. Arora credited the integrated firewall, SASE and SD-WAN architecture.

A Barclays analyst asked whether AI threats were changing buying behavior. Arora said discussions are moving toward modernizing security estates and consolidating on larger platforms, with customers focused on faster vulnerability detection and remediation.

Palo Alto Keeps Execution at the CenterManagement remains focused on converting AI-driven security urgency into broader platform adoption while integrating acquisitions entering into fiscal 2027. Arora characterized M&A as a consequence of product-development needs rather than a stand-alone strategy.

Golechha emphasized operating leverage, acquisition synergies and cash-flow visibility as the framework for continued investment and progress toward the fiscal 2030 NGS ARR objective.

What Zacks Signals Say About PANWPANW carries a Zacks Rank #2 (Buy), a favorable near-term signal under the Zacks framework. Its Value Score is F, Growth Score is D, Momentum Score is F and VGM Score is F, leaving the Style Score profile weak.

Zacks' framework favors A or B Style Scores alongside Zacks Rank #1 (Strong Buy) or #2 stocks. PANW's current combination is therefore mixed rather than uniformly favorable, and the Zacks Rank can change as earnings estimates are revised after the just-reported results. You can see the complete list of today’s Zacks #1 Rank stocks here.

2.9.2026 15:00, PANW

Americká společnost Palo Alto Networks, působící v oblasti kybernetické bezpečnosti, zveřejnila výsledky hospodaření za 4Q fiskálního roku 2026, který skončil 31. července 2026. Výsledky byly podle analytiků nad očekáváním a poskytnutý výhled byl podle nich také nad odhady. Společnost těží z poptávky po jejich řešeních, kterou vytváří hrozba AI.

Výsledky společnosti Palo Alto Networks (PANW) za 4Q FY 2026   4Q FY 2026 Konsensus 4Q 2026 4Q FY 2025 Výnosy (mld. USD) 3,41 3,35 2,54 Čistý zisk (mil. USD) -282 -- 254 Očištěný zisk na akcii (EPS, USD/akcie) 1,02 0,98 0,95 Výsledky za 4Q Výnosy společnosti ve třetím kvartálu meziročně vzrostly o 34 % na 3,41 mld. USD při očekávání 3,35 mld. USD.

Výnosy z produktů dosáhly 738 mil. USD, což představuje meziroční růst o 29 %. Konsensus analytiků činil 678,8 mil. USD. Výnosy z předplatného a podpory meziročně vzrostly o 36 % na 2,67 mld. USD. Analytici očekávali 2,68 mld. USD.

Očištěný zisk na akcii dosáhl 1,02 USD. Ve stejném období předchozího roku činil 0,95 USD a trh očekával 0,98 USD.

Zbývající nasmlouvané závazky (RPO) dosáhly 21,2 mld. USD, což představuje meziroční růst o 34 %. Konsensus byl nastaven na 20,95 mld. USD.

Roční opakující se výnosy (ARR) z nové generace bezpečnostních řešení dosáhly 9,1 mld. USD při očekávání 8,86 mld. USD. Meziročně vzrostly o 63 %.

Provozní hotovostní toky dosáhly 1,4 mld. USD. Očištěné volné hotovostní toky (FCF) dosáhly 1,3 mld. USD. Minulý rok ve stejném období činily 954 mil. USD.

Výdaje na výzkum a vývoj meziročně vzrostly o 55 % na 779 mil. USD. Analytici očekávali 720,4 mil. USD.

Výhled na 1Q Pro první kvartál fiskálního roku 2027 společnost očekává:

Výnosy v rozmezí 3,30 až 3,31 mld. USD, tedy nad očekáváním 3,21 mld. USD. Očištěný zisk na akcii ve výši 0,96 až 0,98 USD. Konsensus trhu byl položen níže na 0,94 USD. Roční opakující se výnosy (ARR) z nové generace bezpečnostních řešení na úrovni 9,54 až 9,56 mld. USD, tedy nad očekáváním 9,2 mld. USD. Zbývající nasmlouvané závazky (RPO) ve výši 20,80 až 20,90 mld. USD, což je nad konsensem 20,31 mld. USD. Výhled na fiskální rok 2027 V celém roce společnost očekává:

Výnosy v rozmezí 14,10 až 14,20 mld. USD. Wall Street predikovala 13,84 mld. USD. Očištěný zisk na akcii ve výši 4,16 až 4,19 USD, tedy nad konsensem 4,11 USD. Očištěnou provozní marži ve výši 29,5 %. Očištěnou marži volných hotovostní toků ve výši 38 %. Roční opakující se výnosy (ARR) z nové generace bezpečnostních řešení 11,075 až 11,175 mld. USD. Očekávalo se 10,91 mld. USD. Zbývající nasmlouvané závazky (RPO) v rozmezí 25,20 až 25,40 mld. USD, tedy nad konsensem trhu 24,74 mld. USD. Akvizice společnosti Console Palo Alto Networks akvírovala společnost Console, AI-nativní platformu umožňující agentní workflow napříč podnikovým provozem. Console rozšíří roli platformy Cortex v rámci širší agentní transformace podniku.

Komentář vedení „Ve čtvrtém kvartále jsme dosáhli silných výsledků a zakončili jimi celý rok – jen za jeden kvartál jsme přidali téměř 1 mld. USD čistého nového ARR z nové generace bezpečnostních řešení," uvedl generální ředitel Nikesh Arora. „Nejnovější pokrok v oblasti AI posouvá kybernetickou bezpečnost na první místo v prioritách ředitelů informačních technologií (CIO) a bude pro nás dlouhodobě příznivým faktorem na cestě k cíli 20 mld. USD ARR z nové generace bezpečnostních řešení ve fiskálním roce 2030."

„Rekordní rok jsme zakončili silně a překonali jsme náš výhled ve všech ohledech, k čemuž nám pomohla síla napříč platformami Network & AI Security, Cortex a Idira," řekl finanční ředitel Dipak Golechha. „Náš rámec ziskového růstu se nadále efektivně škáluje, což posiluje naši důvěru v dosažení 40% marže očištěného volného hotovostního toku ve fiskálním roce 2028."

Komentáře analytiků Analytici z RBC Capital Markets uvedli, že navzdory vysoko nastavené laťce vzhledem k vývoji akcie za poslední týden a od začátku roku vykázalo Palo Alto silné výsledky za 4Q 2026, kdy všechny metriky kromě odložených výnosů a fakturací překonaly očekávání. Společnost uvedla, že AI posouvá kybernetickou bezpečnost na první místo v prioritách ředitelů informačních technologií (CIO), což by podle nich mělo být dlouhodobě příznivým faktorem.

Analytici z Vital Knowledge poznamenali, že si není na co stěžovat. Společnost Palo Alto Networks podle nich vykázala zdravé překonání očekávání a výhled na fiskální rok 2027 nad odhady, strategie platformizace firmy tak nadále přináší ovoce. Sentiment byl přitom před zveřejněním výsledků už tak pozitivní.

Vývoj akcie Akcie Palo Alto Networks (PANW) v předburzovní fázi obchodování odepisují 2,26 % na 353,92 USD.

Akcie Palo Alto Networks (PANW) včera oslabily o 5,2 % na 362,09 USD Ukazatel   Ukazatel   Kapitalizace (mld. USD) 295,1 P/E 259,6 Vývoj za letošní rok (%) +96,6 Očekávané P/E 87,3 52týdenní minimum (USD) 139,6 Prům. cílová cena (USD) 389,3 52týdenní maximum (USD) 398,9 Dividendový výnos (%) -- Zdroj: Palo Alto Networks, Bloomberg

Michal Bárta, Fio banka, a.s.

Palo Alto Networks Inc (NASDAQ:PANW) on Tuesday reported better-than-expected fourth-quarter financial results and issued strong FY27 guidance.

Palo Alto posted fourth-quarter revenue of $3.41 billion, beating analyst estimates of $3.35 billion. The cybersecurity company reported adjusted earnings of $1.02 per share for the quarter, beating estimates of 98 cents per share, according to Benzinga Pro.

"We delivered a strong Q4 to close out the year, adding nearly $1 billion of Net New NGS ARR in a single quarter," said Nikesh Arora, chairman and CEO of Palo Alto Networks.

Palo Alto expects first-quarter revenue to be in the range of $3.30 billion to $3.31 billion versus estimates of $3.22 billion. The company anticipates first-quarter adjusted earnings between 96 cents and 98 cents per share versus estimates of 93 cents per share.

Palo Alto also introduced fiscal 2027 guidance. The company expects full-year revenue of $14.10 billion to $14.20 billion versus estimates of $13.79 billion, and adjusted earnings of $4.16 to $4.19 per share versus estimates of $4.11 per share.

Trending

Palo Alto also announced the acquisition of Console, an AI-native platform that enables agentic capabilities.

Palo Alto shares fell 1.2% to $357.90 in pre-market trading.

These analysts made changes to their price targets on Palo Alto following earnings announcement.

BTIG analyst Gray Powell maintained the stock with a Buy and raised the price target from $380 to $404. Rosenblatt analyst Catharine Trebnick maintained the stock with a Buy and raised the price target from $355 to $415. Morgan Stanley analyst Meta Marshall maintained the stock with an Overweight rating and boosted the price target from $387 to $394. Considering buying PANW stock? Here’s what analysts think:

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Palo Alto Networks, Inc. (PANW) Q4 2026 Earnings Call September 1, 2026 4:30 PM EDT

Company Participants

Hamza Fodderwala - Senior VP of Investor Relations & Strategic Finance
Nikesh Arora - Chairman & CEO
Dipak Golechha - Executive VP & CFO

Conference Call Participants

Robbie Owens - Piper Sandler & Co., Research Division
Brian Essex - JPMorgan Chase & Co, Research Division
Saket Kalia - Barclays Bank PLC, Research Division
Fatima Boolani - Citigroup Inc., Research Division
Matthew Hedberg - RBC Capital Markets, Research Division
Michael Turrin - Wells Fargo Securities, LLC, Research Division
Gray Powell - BTIG, LLC, Research Division
Meta Marshall - Morgan Stanley, Research Division
Brad Zelnick - Deutsche Bank AG, Research Division

Presentation

Hamza Fodderwala
Senior VP of Investor Relations & Strategic Finance

Good day, everyone, and welcome to Palo Alto Networks' Fiscal Fourth Quarter 2026 Earnings Conference Call. I am Hamza Fodderwala, Senior Vice President of Investor Relations and Strategic Finance. Please note that this call is being recorded today, Tuesday, September 1, 2026, at 1:30 p.m. Pacific Time.

With me on today's call to discuss our fiscal fourth quarter results are Nikesh Arora, our Chairman and Chief Executive Officer; and Dipak Golechha, our Chief Financial Officer. You can find the press release and other information to supplement today's discussion on our website at investors.paloaltonetworks.com. While there, please click on the link for quarterly results to find the Q4 '26 supplemental financial information and Q4 '26 earnings presentation.

During the course of today's call, we will be making forward-looking statements and projections regarding the company's business operations and financial performance as well as the company's recent acquisitions. These statements made today are subject to a number of risks and uncertainties that could cause our actual results to differ from these forward-looking statements. Please review our press release and recent SEC filings for a description of these risks

For the quarter ended July 2026, Palo Alto Networks (PANW - Free Report) reported revenue of $3.41 billion, up 34.5% over the same period last year. EPS came in at $1.02, compared to $0.95 in the year-ago quarter.

The reported revenue compares to the Zacks Consensus Estimate of $3.35 billion, representing a surprise of +1.78%. The company delivered an EPS surprise of +4.08%, with the consensus EPS estimate being $0.98.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Palo Alto performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

RPO (Remaining Performance Obligation): $21.20 billion versus the seven-analyst average estimate of $20.96 billion.Revenue- Product: $738 million versus $668.37 million estimated by 12 analysts on average. Compared to the year-ago quarter, this number represents a +28.6% change.Revenue- Subscription and support: $2.67 billion versus $2.68 billion estimated by 12 analysts on average. Compared to the year-ago quarter, this number represents a +36.2% change.Revenue- Subscription and support- Support: $833 million compared to the $770.34 million average estimate based on three analysts. The reported number represents a change of +28.7% year over year.Revenue- Subscription and support- Subscription: $1.84 billion versus $1.91 billion estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +39.9% change.Subscription and support gross profit Non-?GAAP: $1.97 billion compared to the $2.03 billion average estimate based on eight analysts.Product gross profit Non-GAAP: $582 million versus $518.29 million estimated by eight analysts on average.Product gross profit GAAP: $541 million compared to the $496.28 million average estimate based on two analysts.Subscription and support gross profit GAAP: $1.76 billion versus the two-analyst average estimate of $1.99 billion.View all Key Company Metrics for Palo Alto here>>>

Shares of Palo Alto have returned +10.1% over the past month versus the Zacks S&P 500 composite's +2.7% change. The stock currently has a Zacks Rank #2 (Buy), indicating that it could outperform the broader market in the near term.

Palo Alto Networks Chairman and CEO Nikesh Arora joins 'Mad Money' host Jim Cramer to talk quarterly results, the state of the cybersecurity space, the weaponization of AI, and more.

Live 4 updates · Last at 4:44pm ET Updates appear automatically.

By Thomas Richmond · Updated Sep 1, 4:44pm ET · Published Sep 1, 2:35pm ET

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Live UpdatesNewest first

That wraps up our initial coverage of Palo Alto’s Q4 results. Thank you for stopping by!

Palo Alto Networks just reported earnings with shares initially up 6% following the report. Here are the key numbers:

Revenue: $3.41 billion vs. $3.35 billion expected Adjusted EPS: $1.02 vs. $0.98 expected NGS ARR: $9.10 billion, up 63% year over year Free Cash Flow: $1.3 billion Guidance:

Q1 Revenue: $3.30 billion to $3.31 billion vs. $3.22 billion expected Q1 EPS: $0.96 to $0.98 FY27 Revenue: $14.10 billion to $14.20 billion vs. $13.83 billion expected FY27 EPS: $4.16 to $4.19 Quick Read:

Beat-and-raise across the board: Palo Alto topped Q4 revenue and EPS estimates while both Q1 and full-year revenue guidance came in ahead of Wall Street expectations. NGS growth is the standout: NGS ARR surged 63% to $9.10 billion, with nearly $1 billion of net new ARR added during Q4, reinforcing the company’s AI and platformization growth story.

Consensus for Q4 sits at on in revenue, essentially matching management’s own range. The real event is the first FY27 outlook.

Wall Street currently models in FY27 revenue, with EPS estimates trimmed to from ninety days ago on .

CEO Nikesh Arora has beaten and raised for five straight quarters, so a conservative guide is baked in.

Bullish scenario: FY27 revenue above $14B, NGS ARR growth above 40%, and FCF margin tracking toward the target early.

Bearish scenario: revenue below $13.5B, Q1 EPS under consensus, or FCF margin stalling at . With shares already off intraday, the guide dictates the next leg.

Palo Alto Networks reports Q4 FY26 earnings after the bell, with Wall Street focused on $3.35 billion in revenue and adjusted EPS guidance of $0.96-$0.98.

The bigger number may be Next-Generation Security ARR. Management guided for $8.90 billion to $8.95 billion, representing 59-60% growth, with investors watching closely for CyberArk’s contribution.

Expectations are high. Palo Alto shares have roughly doubled year to date as investors bet on platformization, AI security demand, and a longer-term path toward 40% free cash flow margins. Yet each of the company’s last three earnings beats was followed by a negative day-of stock reaction.

A clean beat and strong FY27 outlook could validate the rally. Any softness in NGS ARR or cautious forward guidance could quickly put the stock’s premium valuation under pressure.

This article is updated throughout the trading day. Check back for more.

Full CoverageThe story so far

Palo Alto Networks (NASDAQ:PANW | PANW Price Prediction) reports fiscal Q4 2026 results today at 4:05 PM ET. Shares have climbed 89.18% year to date, but the stock is down 5.67% intraday.

Momentum Meets a Premium Setup Q3 delivered revenue of $3.002 billion, up 31.15% year over year, and non-GAAP EPS of $0.85, beating by 6.65% and extending the streak to five quarters.

NGS ARR reached $8.13 billion, up 60%, while trailing 12-month adjusted free cash flow margin ran at 38.5%, a 430 basis point improvement. CEO Nikesh Arora called Q3 “a record quarter,” citing accelerating organic bookings as customers race to secure AI deployments. Shares now trade at $359.66 against a forward P/E of 93, so high expectations are already priced in.

Consensus Estimates Metric Q4 FY26 Estimate YoY Change FY26 Estimate FY27 Estimate Revenue $3.35B +32% $11.42B $13.84B EPS (Non-GAAP) $0.9777 +10% $3.7754 $1.9418 Revisions skew sharply positive, with 40 upward Q4 EPS revisions in the trailing 30 days against one downward. FY27 EPS, however, has been reset from $2.33 ninety days ago to $1.94 as acquisition dilution flows through models.

What I’m Watching Tonight: NGS ARR, AI Security Traction, and FY27 Framing Tonight, I’ll be watching whether NGS ARR lands inside guidance, and how much came from organic growth versus acquisitions. Q3 organic NGS ARR grew 28% against the 60% reported figure, so the split shapes the growth narrative.

I’ll be tracking Prisma AIRS after customer count expanded to more than 300 in Q3 from 100 at the end of Q2, with $100 million ARR in sight. XIM ended Q3 at $600 million ARR across 740 customers, validating the AI security thesis.

Analysts will also focus on CyberArk profitability convergence, which management said is running 3-6 months ahead of the original 12-18 month timeline. The path to 40% adjusted FCF margin by FY28 hinges on that work.

Management also flagged FY27 segment disclosures across Network Security, Cortex, and Identity. Initial FY27 framing will reset the debate. Rising memory and storage costs, plus $517 million in Q3 share-based compensation, are also items to watch.

Earnings History Table Quarter EPS Surprise Day-of Move 1-Week Move 30-Day Move Q3 FY26 +6.65% -5.64% -6.14% +20.19% Q2 FY26 +9.70% -6.82% -4.93% +6.96% Q1 FY26 +4.35% -7.42% +2.73% +1.65% Q4 FY25 +6.74% +3.06% +1.47% +14.67% On average, shares moved -1.14% one week after earnings over the past year.

Contact [email protected] for any questions or corrections.

Thomas Richmond

Thomas Richmond is a financial writer and content strategist with 5+ years of experience covering stocks and financial markets. He has published over 250 articles focused on individual stock analysis, helping investors better understand business fundamentals, stock valuations, and long-term opportunities.

Thomas previously served as a Content Lead at TIKR, a stock research platform, where he helped scale the company’s blog to hundreds of articles per month and contributed to a weekly newsletter reaching more than 100,000 investors.

He specializes in breaking down complex companies into clear, actionable insights for everyday investors, with a focus on fundamentals-driven research.

His work has also been featured on platforms including Seeking Alpha and Sure Dividend.

Outside of work, Thomas enjoys weight lifting and soccer.

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, /PRNewswire/ -- Palo Alto Networks® (NASDAQ: PANW), the global AI cybersecurity leader, announced today financial results for its fiscal fourth quarter and fiscal year, ended July 31, 2026.

"We delivered a strong Q4 to close out the year, adding nearly $1 billion of Net New NGS ARR in a single quarter," said Nikesh Arora, chairman and chief executive officer of Palo Alto Networks. "The latest advancements in AI are elevating cybersecurity to the top of the CIO priority list, and will serve as durable tailwinds as we progress towards our $20 billion FY30 NGS ARR target."

"We delivered a strong finish to a record year and exceeded our guidance across the board, fueled by strength across our Network & AI Security, Cortex, and Idira platforms," said Dipak Golechha, chief financial officer of Palo Alto Networks. "Our profitable growth framework continues to scale effectively, reinforcing our confidence in achieving 40% adjusted free cash flow margin in FY28."

Fourth Quarter Fiscal 2026 Financial Highlights

Total revenue for the fiscal fourth quarter 2026 grew 34% year over year to $3.41 billion. Next-Generation Security ARR for the fiscal fourth quarter 2026 grew 63% year over year to $9.10 billion. Remaining performance obligations grew 34% year over year to $21.2 billion. GAAP operating income for the fiscal fourth quarter 2026 was $172 million, compared with GAAP operating income of $497 million for the fiscal fourth quarter 2025. Non-GAAP operating income for the fiscal fourth quarter 2026 was $1.0 billion, compared with non-GAAP operating income of $768 million for the fiscal fourth quarter 2025. A reconciliation between GAAP and non-GAAP information is contained in the tables below. GAAP net loss for the fiscal fourth quarter 2026 was $282 million, or ($0.35) per diluted share, compared with GAAP net income of $254 million, or $0.36 per diluted share, for the fiscal fourth quarter 2025. Non-GAAP net income for the fiscal fourth quarter 2026 was $853 million, or $1.02 per diluted share, compared with non-GAAP net income of $673 million, or $0.95 per diluted share, for the fiscal fourth quarter 2025. A reconciliation between GAAP and non-GAAP information is contained in the tables below. Net cash provided by operating activities for the fiscal fourth quarter 2026 was $1.4 billion, compared with net cash provided by operating activities of $1.0 billion for the fiscal fourth quarter 2025. Adjusted free cash flow for fiscal fourth quarter 2026 was $1.3 billion, compared with adjusted free cash flow of $954 million for the fiscal fourth quarter 2025. Fiscal year 2026 adjusted free cash flow margin was 38.4%. A reconciliation between GAAP and non-GAAP information is contained in the tables below. Acquisition of Console
Palo Alto Networks has acquired Console, an AI-native platform that enables agentic workflows across enterprise operations. Console will expand the role of our Cortex platform across the broader enterprise agentic transformation.

Financial Outlook
Palo Alto Networks provides guidance based on current market conditions and expectations.

For the fiscal first quarter 2027, we expect:

Next-Generation Security ARR of $9.54 billion to $9.56 billion, representing year-over-year growth of 63%. Remaining performance obligations of $20.8 billion to $20.9 billion, representing year-over-year growth of 34% to 35%. Total revenue in the range of $3.300 billion to $3.310 billion, representing year-over-year growth of 33% to 34%. Diluted non-GAAP net income per share in the range of $0.96 to $0.98, using 837 million to 844 million shares outstanding. For the fiscal year 2027, we expect:

Next-Generation Security ARR of $11.075 billion to $11.175 billion, representing year-over-year growth of 22% to 23%. Remaining performance obligations of $25.2 billion to $25.4 billion, representing year-over-year growth of 19% to 20%. Total revenue in the range of $14.10 billion to $14.20 billion, representing year-over-year growth of 23% to 24%. Non-GAAP operating margin of 29.5%. Diluted non-GAAP net income per share in the range of $4.16 to $4.19, using 844 million to 847 million shares outstanding. Adjusted free cash flow margin to be 38.0%. Guidance for non-GAAP financial measures excludes share-based compensation-related charges, including share-based payroll tax expense, acquisition-related costs, including change in fair value of contingent consideration liability, amortization expense of acquired intangible assets, litigation-related charges, non-cash charges related to convertible notes, change in fair value of convertible senior notes and capped calls, and income tax and other tax adjustments related to our long-term non-GAAP effective tax rate, along with certain non-recurring expenses and certain non-recurring cash flows. We have not reconciled non-GAAP operating margin guidance to GAAP operating margin, diluted non-GAAP net income per share guidance to GAAP net income (loss) per diluted share, or adjusted free cash flow margin guidance to GAAP net cash provided by operating activities because we do not provide guidance on GAAP operating margin, GAAP net income (loss) or net cash provided by operating activities and would not be able to present the various reconciling cash and non-cash items between GAAP and non-GAAP financial measures because certain items that impact these measures are uncertain or out of our control, or cannot be reasonably predicted, including share-based compensation expense, without unreasonable effort. The actual amounts of such reconciling items will have a significant impact on the company's GAAP net income (loss) per diluted share, GAAP operating margin and GAAP net cash provided by operating activities.

Earnings Call Information
Palo Alto Networks will host a video webcast for analysts and investors to discuss the company's fiscal fourth quarter and fiscal year 2026 results as well as the outlook for its fiscal first quarter and fiscal year 2027 today at 4:30 p.m. Eastern time/1:30 p.m. Pacific time. Open to the public, investors may access the webcast, supplemental financial information and earnings slides from the "Investors" section of the company's website at investors.paloaltonetworks.com. A replay will be available three hours after the conclusion of the webcast and archived for one year.

Forward-Looking Statements
This press release contains forward-looking statements that involve risks, uncertainties and assumptions including statements regarding our financial and operating results and financial outlook for the fiscal first quarter 2027 and fiscal year 2027. There are a significant number of factors that could cause actual results to differ materially from forward-looking statements made or implied in this press release, including: unfavorable economic and market conditions and the uncertain geopolitical environment; our ability to effectively manage future growth and improve our systems, processes, and controls; our ability to maintain our revenue growth rate or profitability; variability and seasonality in our operating results; our ability to sell new and additional products, subscriptions, and support offerings to existing and new customers; the delayed recognition of revenue from subscription and support offerings; revenue volatility from consumption- or usage-based offerings and customer usage optimization behavior; potential decreases in the sales prices of our products, subscriptions, and support offerings; our reliance on channel partners; credit and liquidity risk exposure; challenges associated with sales to government entities; intense competition in our markets; risks associated with the evolving definition of the identity security market; customer trends toward vendor consolidation in cybersecurity; competition from cloud infrastructure providers offering native security capabilities; risks related to past and future acquisitions; our ability to predict, prepare for, and respond to rapidly evolving technological and market developments; the need to maintain a broad ecosystem of third-party technology integrations; risks related to the development, deployment, or use of AI, including AI agents as a new class of identity; the impact of network or data security incidents; defects, errors, or vulnerabilities in our products and subscriptions; reliance on customers to configure and use our products securely; the quality of our technical support services; our ability to meet service-level commitments; our reliance on data center facilities operated by third-party cloud service providers; intellectual property claims and our ability to protect proprietary rights; risks associated with open source software; our reliance on third-party technology licenses; dependence on manufacturing partners and limited sources of supply; our ability to attract, retain, and motivate key personnel; risks associated with international sales and operations, including export and import controls; fluctuations in foreign currency exchange rates; risks associated with operations and employees located in Israel; costs and risks related to compliance with privacy and data protection laws; potential tax liabilities; risks related to estimates, judgments, and critical accounting policies; our ability to maintain proper and effective internal control over financial reporting; risks related to corporate responsibility matters; dilution from issuance of additional common stock; risks related to our convertible senior notes, including our ability to settle conversions, repurchase, or repay such notes and the potential effect of capped call transactions.

Additional risks and uncertainties on these and other factors that could affect our financial results and cause actual results to differ materially from those described in the forward-looking statements we make in this press release are included under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our annual reports on Form 10-K and quarterly reports on Form 10-Q, which are available on our website at investors.paloaltonetworks.com and on the SEC's website at www.sec.gov. Additional information and risks and uncertainties will also be set forth in other documents that we file with or furnish to the SEC from time to time. All forward-looking statements in this press release are based on our current beliefs and information available to management as of the date hereof and are inherently uncertain, and we do not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

Non-GAAP Financial Measures and Other Key Metrics
Palo Alto Networks has provided in this press release financial information that has not been prepared in accordance with generally accepted accounting principles in the United States (GAAP). The company uses these non-GAAP financial measures and other key metrics internally in analyzing its financial results and believes that the use of these non-GAAP financial measures and key metrics are helpful to investors as an additional tool to evaluate ongoing operating results and trends, and in comparing the company's financial results with other companies in its industry, many of which present similar non-GAAP financial measures or key metrics.

The presentation of these non-GAAP financial measures and key metrics are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with the company's consolidated financial statements prepared in accordance with GAAP. A reconciliation of the company's historical non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included in this press release, and investors are encouraged to review these reconciliations.

Non-GAAP operating income. Palo Alto Networks defines non-GAAP operating income as operating income plus share-based compensation-related charges, including share-based payroll tax expense, acquisition-related costs, including change in fair value of contingent consideration liability, amortization expense of acquired intangible assets, and litigation-related charges. The company believes that non-GAAP operating income provides management and investors with greater visibility into the underlying performance of the company's core business operating results.

Non-GAAP net income and net income per share, diluted. Palo Alto Networks defines non-GAAP net income as net income (loss) plus share-based compensation-related charges, including share-based payroll tax expense, acquisition-related costs, including change in fair value of contingent consideration liability, amortization expense of acquired intangible assets, litigation-related charges, non-cash charges related to convertible notes, and change in fair value of convertible senior notes and capped calls. The company also excludes from non-GAAP income tax and other tax adjustments related to our long-term non-GAAP effective tax rate in order to provide a complete picture of the company's recurring core business operating results. The company defines non-GAAP net income per share, diluted, as non-GAAP net income divided by the weighted-average diluted shares outstanding, which includes the potentially dilutive effect of the company's employee equity incentive plan awards and the company's convertible senior notes and related warrants, after giving effect to the anti-dilutive impact of the company's note hedge agreements and capped call transactions, which reduced the potential economic dilution that otherwise would have occurred in connection with the conversion and settlement of the company's convertible senior notes. Under GAAP, the anti-dilutive impact of the note hedge or capped calls is not reflected in diluted shares outstanding. The company considers these non-GAAP financial measures to be useful metrics for management and investors for the same reasons that it uses non-GAAP operating income.

Adjusted free cash flow margin, adjusted free cash flow, and free cash flow. Palo Alto Networks defines adjusted free cash flow margin, a non-GAAP measure, as adjusted free cash flow divided by total revenue. The company defines adjusted free cash flow, a non-GAAP measure, as free cash flow, plus certain capital expenditures for our headquarters and certain corporate assets, plus payments of acquisition-related costs, plus litigation-related payments. The company defines free cash flow, a non-GAAP measure, as net cash provided by operating activities less purchases of property, equipment, and other assets. We consider free cash flow, adjusted free cash flow, and adjusted free cash flow margin to be operating metrics as well as liquidity measures that provide useful information to management and investors about the amount of cash generated by the business after necessary capital expenditures and before the impact of certain qualifying non-recurring cash payments from operating activities, as applicable. A limitation of the utility of free cash flow or adjusted free cash flow as a measure of our liquidity is that it does not represent the total increase or decrease in our cash balance for the period. In addition, it is important to note that other companies, including companies in our industry, may not use free cash flow or adjusted free cash flow, may calculate free cash flow or adjusted free cash flow in a different manner than we do, or may use other financial measures to evaluate their liquidity, all of which could reduce the usefulness of free cash flow or adjusted free cash flow as a comparative measure.

Next-Generation Security ARR. Palo Alto Networks defines Next-Generation Security ARR as the annualized allocated revenue of all active contracts as of the final day of the reporting period related to all product, subscription and support offerings, excluding revenue from hardware products, and legacy attached subscriptions, support offerings and professional services. The company considers Next-Generation Security ARR to be a useful operating metric for management and investors to assess the performance of the company because Next-Generation Security is where the company has focused its innovation and the company expects its overall revenue to be disproportionately driven by this Next-Generation Security portfolio. Because Next-Generation Security ARR does not have the effect of providing a numerical measure that is different from any comparable GAAP measure, the company does not consider it a non-GAAP measure.

Investors are cautioned that there are a number of limitations associated with the use of non-GAAP financial measures and key metrics as analytical tools. Many of the adjustments to the company's GAAP financial measures reflect the exclusion of items that are recurring and will be reflected in the company's financial results for the foreseeable future, such as share-based compensation, which is an important part of Palo Alto Networks employees' compensation and impacts their performance. Furthermore, these non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP, and the components that Palo Alto Networks excludes in its calculation of non-GAAP financial measures may differ from the components that its peer companies exclude when they report their non-GAAP results of operations. As a result, these non-GAAP financial measures may not be directly comparable to similar non-GAAP financial measures used by other companies. Palo Alto Networks compensates for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures. In the future, the company may also exclude non-recurring expenses and other expenses that do not reflect the company's core business operating results.

About Palo Alto Networks
Palo Alto Networks® (NASDAQ: PANW), the global AI cybersecurity leader, protects our digital way of life with a comprehensive portfolio of cybersecurity solutions and platforms across Network, Cloud, Security Operations, AI and Identity. Trusted by 70,000+ customers and powered by Unit 42® threat intelligence, our AI-driven platforms eliminate complexity, empowering enterprises to modernize with confidence and securing the speed of innovation. Explore the future of security at www.paloaltonetworks.com.

Palo Alto Networks and the Palo Alto Networks logo are trademarks of Palo Alto Networks, Inc. in the United States or in certain jurisdictions throughout the world. All other trademarks, trade names, or service marks used or mentioned herein belong to their respective owners. Any unreleased services or features (and any services or features not generally available to customers) referenced in this or other press releases or public statements are not currently available (or are not yet generally available to customers) and may not be delivered when expected or at all. Customers who purchase Palo Alto Networks applications should make their purchase decisions based on services and features currently generally available.

Palo Alto Networks, Inc.

Preliminary Condensed Consolidated Statements of Operations

(In millions, except per share data)

(Unaudited)

Three Months Ended

Year Ended

July 31,

July 31,

2026

2025

2026

2025

Revenue:

Product

$          738

$          574

$        2,280

$        1,802

Subscription and support

2,672

1,962

9,200

7,419

Total revenue

3,410

2,536

11,480

9,221

Cost of revenue:

Product

197

136

568

413

Subscription and support

909

543

2,835

2,038

Total cost of revenue

1,106

679

3,403

2,451

Total gross profit

2,304

1,857

8,077

6,770

Operating expenses:

Research and development

779

504

2,552

1,984

Sales and marketing

1,127

829

3,931

3,100

General and administrative

226

27

899

443

Total operating expenses

2,132

1,360

7,382

5,527

Operating income

172

497

695

1,243

Other income (expense), net

(441)

95

(159)

353

Income (loss) before income taxes

(269)

592

536

1,596

Provision for income taxes

13

338

229

462

Net income (loss)

$         (282)

$          254

$          307

$        1,134

Net income (loss) per share, basic

$         (0.35)

$          0.38

$          0.41

$          1.71

Net income (loss) per share, diluted

$         (0.35)

$          0.36

$          0.40

$          1.60

Weighted-average shares used to compute net income
(loss) per share, basic

817

669

749

663

Weighted-average shares used to compute net income
(loss) per share, diluted

817

709

764

709

Palo Alto Networks, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(In millions, except per share amounts)

(Unaudited)

Three Months Ended

Year Ended

July 31,

July 31,

2026

2025

2026

2025

GAAP operating income

$        172

$        497

$        695

$      1,243

Share-based compensation-related charges

487

372

1,712

1,386

Acquisition-related costs(1)

68

(142)

295

(110)

Amortization expense of acquired intangible assets

281

37

638

164

Litigation-related charges(2)

3

4

16

(31)

Non-GAAP operating income

$      1,011

$        768

$      3,356

$      2,652

GAAP net income (loss)

$       (282)

$        254

$        307

$      1,134

Share-based compensation-related charges

487

372

1,712

1,386

Acquisition-related costs(1)

68

(142)

295

(110)

Amortization expense of acquired intangible assets

281

37

638

164

Litigation-related charges(2)

3

4

16

(31)

Change in fair value of convertible senior notes and capped calls(3)

524

—

562

1

Income tax and other tax adjustments(4)

(228)

148

(599)

(199)

Non-GAAP net income

$        853

$        673

$      2,931

$      2,345

GAAP net income (loss) per share, diluted

$      (0.35)

$       0.36

$       0.40

$       1.60

Share-based compensation-related charges

0.59

0.53

2.23

1.98

Acquisition-related costs(1)

0.08

(0.20)

0.39

(0.15)

Amortization expense of acquired intangible assets

0.34

0.05

0.84

0.23

Litigation-related charges(2)

0.00

0.00

0.02

(0.04)

Change in fair value of convertible senior notes and
capped calls(3)

0.64

0.00

0.74

0.00

Income tax and other tax adjustments(4)

(0.28)

0.21

(0.78)

(0.28)

Non-GAAP net income per share, diluted

$       1.02

$       0.95

$       3.84

$       3.34

GAAP weighted-average shares used to compute net
income (loss) per share, diluted

817

709

764

709

Weighted-average dilutive effect of potentially dilutive
securities(5)

16

—

—

—

Weighted-average anti-dilutive impact of note hedge
agreements and capped call transactions

(1)

(2)

—

(7)

Non-GAAP weighted-average shares used to compute net
income per share, diluted

832

707

764

702

(1)

Consists of acquisition transaction costs, share-based compensation related to the cash settlement of certain equity awards, change in fair value of contingent consideration liability, and costs to terminate certain employment, operating lease, and other contracts of the acquired companies. During the three months and fiscal year ended July 31, 2026, it also includes integration costs related to our acquisition of CyberArk Software Ltd.

(2)

Consists of the amortization of intellectual property licenses and covenant not to sue, and legal contingency charges (credit). During the fiscal year ended July 31, 2026, it also includes a litigation settlement charge.

(3)

Consists of changes in fair value of convertible senior notes acquired from CyberArk Software Ltd. that are included in earnings and changes in fair value of the related capped calls. During the fiscal year ended July 31, 2025, it also includes non-cash interest expense for amortization of debt issuance costs related to our convertible senior notes.

(4)

Consists of income tax adjustments related to our long-term non-GAAP effective tax rate. During the three months and fiscal year ended July 31, 2025, it included a one-time deferred tax provision adjustment relating to the enactment of One Big Beautiful Bill.

(5)

Consists of potentially dilutive effect of employee equity incentive plan awards in periods with GAAP net loss position as they are excluded from GAAP weighted-average shares.

Palo Alto Networks, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures (Continued)

(In millions)

(Unaudited)

Three Months Ended

Year Ended

July 31,

July 31,

2026

2025

2026

2025

Net cash provided by operating activities

$      1,357

$      1,021

$    4,553

$    3,716

Less: purchases of property, equipment, and other assets     

103

87

440

247

Free cash flow (non-GAAP)

$      1,254

$        934

$    4,113

$    3,469

Add: capital expenditures for headquarters(1)

—

—

91

—

Add: capital expenditures for certain corporate assets(2)

7

20

42

38

Add: payments of acquisition-related costs(3)

28

—

164

—

Add: litigation-related payment(4)

—

—

4

—

Adjusted free cash flow (non-GAAP)

$      1,289

$        954

$    4,414

$    3,507

Adjusted free cash flow margin (non-GAAP)

37.8 %

37.6 %

38.4 %

38.0 %

(1)

Consists of a land purchase of $91 million.

(2)

Consists of a one-time purchase of a corporate asset which was paid through July 2026.

(3)

Consists of payments of acquisition-related costs in connection with our acquisitions of CyberArk Software Ltd. and Koi Security Ltd.

(4)

Consists of a non-recurring litigation settlement payment during the three months ended January 31, 2026.

Palo Alto Networks, Inc.

Preliminary Condensed Consolidated Balance Sheets

(In millions)

July 31, 2026

July 31, 2025

(unaudited)

Assets

Current assets:

Cash and cash equivalents

$        2,514

$        2,269

Short-term investments

557

635

Accounts receivable, net

3,629

2,965

Short-term financing receivables, net

592

715

Short-term deferred contract costs

544

419

Prepaid expenses and other current assets

807

520

Total current assets

8,643

7,523

Property and equipment, net

523

387

Operating lease right-of-use assets

700

347

Long-term investments

4,835

5,555

Long-term financing receivables, net

944

1,002

Long-term deferred contract costs

667

586

Goodwill

22,010

4,567

Intangible assets, net

7,017

763

Deferred tax assets

2,443

2,424

Other assets

678

422

Total assets

$       48,460

$       23,576

Liabilities and stockholders' equity

Current liabilities:

Accounts payable

$          290

$          232

Accrued compensation

1,048

608

Accrued and other liabilities

838

846

Deferred revenue

7,747

6,302

Total current liabilities

9,923

7,988

Long-term convertible senior notes

1,774

—

Long-term deferred revenue

7,009

6,450

Deferred tax liabilities

251

89

Long-term operating lease liabilities

726

338

Other long-term liabilities

1,285

887

Total liabilities

20,968

15,752

Stockholders' equity:

Preferred stock

—

—

Common stock and additional paid-in capital

24,772

5,292

Accumulated other comprehensive income (loss)

(71)

48

Retained earnings

2,791

2,484

Total stockholders' equity

27,492

7,824

Total liabilities and stockholders' equity

$       48,460

$       23,576

SOURCE Palo Alto Networks, Inc.

Palo Alto Networks Inc (NASDAQ:PANW) reported financial results for the fourth quarter of fiscal 2026 after the market close on Tuesday. Here’s a look at the key details from the print.

Palo Alto Networks stock is moving higher. Why are PANW shares up? Palo Alto Q4 Earnings HighlightsPalo Alto posted fourth-quarter revenue of $3.41 billion, beating analyst estimates of $3.35 billion. The cybersecurity company reported adjusted earnings of $1.02 per share for the quarter, beating estimates of 98 cents per share, according to Benzinga Pro.

Total revenue was up 34% year-over-year, and remaining performance obligations grew 34% year-over-year to $21.2 billion. The company said next-generation security annual recurring revenue increased 63% year-over-year to $9.1 billion.

Palo Alto generated $1.3 billion in adjusted free cash flow during the quarter and exited the period with approximately $2.51 billion in cash and cash equivalents.

“We delivered a strong Q4 to close out the year, adding nearly $1 billion of Net New NGS ARR in a single quarter,” said Nikesh Arora, chairman and CEO of Palo Alto Networks.

“The latest advancements in AI are elevating cybersecurity to the top of the CIO priority list, and will serve as durable tailwinds as we progress towards our $20 billion FY30 NGS ARR target.”

Palo Alto expects first-quarter revenue to be in the range of $3.30 billion to $3.31 billion versus estimates of $3.22 billion. The company anticipates first-quarter adjusted earnings between 96 cents and 98 cents per share versus estimates of 93 cents per share.

Palo Alto also introduced fiscal 2027 guidance. The company expects full-year revenue of $14.10 billion to $14.20 billion versus estimates of $13.79 billion, and adjusted earnings of $4.16 to $4.19 per share versus estimates of $4.11 per share.

In connection with earnings, Palo Alto announced the acquisition of Console, an AI-native platform that enables agentic capabilities. The company said Console will help deepen its agentic capabilities in Cortex as AI reshapes the threat landscape.

Palo Alto management will discuss the quarter on an earnings call with investors and analysts at 4:30 p.m. ET. A link to the call has been provided below.

PANW Shares Move Higher After EarningsPANW Price Action: Palo Alto shares were up 3.04% in after-hours, trading at $368.58 at the time of publication on Tuesday, according to Benzinga Pro.

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Palo Alto Networks Inc (NYSE:PANW, XETRA:5AP) reported fiscal fourth-quarter revenue and profit that topped analyst estimates, as the cybersecurity company closed out its fiscal year with a nearly $1 billion jump in net new next-generation security annual recurring revenue. Revenue came in at $3.41 billion, versus estimates of $3.35 billion, up 34% year over year.

Palo Alto Networks (PANW.O) beat fourth-quarter earnings estimates on Tuesday and announced the ​acquisition of AI-native platform Console, saying ‌advances in artificial intelligence are making cybersecurity a higher priority for corporate technology leaders.

Here are ​more details:

Palo Alto Networks said ​it acquired Console, an AI-native platform designed ⁠to help organizations use AI-driven analysis ​and action across enterprise operations.

CEO Nikesh Arora ​said the acquisition will allow customers to "build agentic workflows in natural language" that can automatically flag ​and remediate issues.

The growing use of ​AI is increasing cybersecurity needs, as companies deploy ‌AI ⁠at scale and face new security risks.

The company posted fourth-quarter revenue of $3.41 billion, beating analysts' average estimate of $3.35 billion, according to ​data compiled ​by LSEG.

Adjusted ⁠profit per share came in at $1.02, ahead of estimates of ​98 cents.

The company forecast fiscal ​2027 ⁠revenue of between $14.10 billion and $14.20 billion, above analysts' estimate of $13.79 billion.

Palo Alto Networks forecast ⁠fiscal ​2027 adjusted profit per ​share of between $4.16 and $4.19, above estimates of $4.11.

Palo Alto Networks Inc. (NASDAQ:PANW) shares are dipping Tuesday as software stocks broadly pull back amid rising bond yields and oil prices, with the company also set to report fourth-quarter results after today’s market close.

Palo Alto Networks shares are retreating from recent levels. Why are PANW shares down? Rising Yields and Oil Prices Weigh On Software StocksBond markets sent the 10-year Treasury yield to 4.80% Tuesday, its highest level since January 2025, while the 30-year climbed to 5.25%, despite the Treasury Department’s move back in August to double its long-dated bond buybacks in an effort to keep a lid on borrowing costs. That step hasn’t been enough to counter inflation running hotter than the Fed’s target alongside a widening federal deficit, with total U.S. debt now above $40 trillion.

Oil added to the pressure too, with Brent up more than 4% and WTI gaining nearly 3% after Iran’s president said Tehran would respond if the U.S. upholds a temporary agreement signed in June, following the first direct military exchange between the two countries since late July. Rising yields tend to hit software and other growth stocks especially hard, since more expensive borrowing makes investors place less value today on profits companies expect to earn further into the future.

Palo Alto Set to Report Fourth-Quarter Results After the CloseWall Street is looking for Palo Alto to post $3.35 billion in fourth-quarter sales, a jump from the $2.54 billion it brought in during the same period last year, alongside earnings of 98 cents per share versus 95 cents a year earlier. The cybersecurity company has cleared revenue expectations for 11 consecutive quarters running and profit targets in eight of its last ten, and simply matching those numbers tonight would push the company past its own third-quarter revenue mark of $3 billion into new record territory.

If Palo Alto clears those marks tonight, it would reinforce the idea that enterprise demand for cybersecurity, and specifically for AI-related security tools, remains resilient even as broader markets grapple with higher rates and macro uncertainty. A strong beat could also help push the stock back toward its all-time high, something the company is explicitly aiming for with this report.

Palo Alto Posted Accelerating Growth Last QuarterThat upcoming report follows a strong third-quarter showing. For the period ended April 30, Palo Alto’s top line climbed 31% from a year earlier to $3 billion, with $388 million of that boost coming from its recent purchases of CyberArk and Chronosphere.

Chairman and CEO Nikesh Arora described the quarter as “a standout quarter for Palo Alto Networks,” crediting faster organic booking growth to enterprises increasingly leaning on Palo Alto to protect their AI rollouts at scale. He argued that breakthroughs happening at the cutting edge of AI have made cybersecurity a more urgent priority industrywide and are fundamentally altering how the sector will look in years ahead.

Adjusted net income for the quarter came in at $684 million, or 85 cents per diluted share. Adjusted free cash flow reached $910 million for the quarter, and trailing 12-month adjusted free cash flow margin improved to 38.5%. For the fourth quarter, Palo Alto had guided to revenue roughly between $3.35 billion and $3.36 billion, Next-Generation Security ARR of $8.90 billion to $8.95 billion, and adjusted earnings between 96 cents and 98 cents per diluted share.

PANW Shares Are FallingPANW Price Action: Palo Alto shares were down 6.09% at $358.84 at the time of publication on Tuesday, according to Benzinga Pro.

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© 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.