The rise in online threats has triggered demand for companies like Palo Alto that offer cybersecurity products.
Palo Alto Networks on Monday forecast fiscal 2025 revenue and profit above Wall Street estimates, a sign of growing demand for its cybersecurity products as the digital threat landscape evolves.
Its shares rose about 2 percent in after-hours trading as the company announced an additional $500 million in share buybacks. The stock briefly fell during the post-earnings conference call after CEO Nikesh Arora said the recent global computer outage has caused several customers to reevaluate their options.
The rise in online threats has triggered demand for companies like Palo Alto that offer cybersecurity products.
However, analysts have said the July 19 outage, linked to CrowdStrike’s software update, has exposed the risks of vendor lock-in.
Starting this quarter, the company will make next-generation security annual recurring revenue the key financial metric for both quarterly and annual revenue projections, Chief Financial Officer Dipak Golechha said.
“It was a strong, better-than-expected quarter as PANW continues to expand its next-generation security business while balancing profitable growth,” said Shrenik Kothari, principal sector analyst at Baird.
The company, whose products include the Prisma cloud security suite and the AI-powered Cortex portfolio, expects its annual revenue to be between $9.1 billion and $9.15 billion, compared with the average analyst estimate of $9.11 billion, according to LSEG data.
Palo Alto expects its annual adjusted earnings per share to be in the range of $6.18 to $6.31, compared with estimates of $6.19.
Its fourth-quarter revenue rose about 12 percent to $2.19 billion, beating expectations of $2.16 billion.
The company, which counts NetApp, Iron Mountain and a U.S. federal agency among its customers, posted adjusted earnings per share of $1.51, beating the estimate of $1.41.
Earlier this month, rival Fortinet raised its annual revenue forecast.
(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First published: August 20, 2024 | 09:08 IS
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