Palo Alto Networks shares appear as earnings and higher revenue estimates


Palo Alto Networks (PANW) announced earnings and revenue for the fiscal third quarter that beat estimates. PANW stock jumped as its outlook for the July quarter beat expectations despite supply chain constraints.




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“Large deal momentum and effective cross-platform strategies have driven widespread strength across product categories and geographies,” Cowen analyst Shaul Eyal said in a report. “Superior supply chain management helps drive market share gains.”

The cybersecurity company released its April quarter results after the market closed Thursday. PANW stock jumped 11.1% to 484.84 in early trading in the stock market today.

Palo Alto said earnings rose 30% to $1.79 per share on an adjusted basis. Including acquisitions, revenue rose 29% to $1.4 billion, the company said. Analysts had expected earnings of $1.68 per share on sales of $1.36 billion.

“Supply chain constraints have led to demand exceeding supply as the company continues to enjoy strong reception for its fourth-generation firewall products and higher subscription rates,” William Blair analyst Jonatan Ho said in a statement.

Additionally, billings were $1.8 billion, up 40% year-over-year from estimates of $1.6 billion.

“Palo Alto reported results that beat expectations and was highlighted by billing growth of 40% versus consensus of 25%,” RBC Capital analyst Matthew Hedberg said in a note to clients. revenue increased 65% to $1.6 billion.

PANW action: forecasts exceed estimates

For the current quarter ending in July, Palo Alto said it expects earnings per share of between $2.26 and $2.29 on revenue of $1.54 billion.

Analysts had forecast earnings of $2.22 a share on revenue of $1.53 billion. Additionally, Palo Alto is forecasting billings of $2.33 billion versus analyst estimates of $2.23 billion.

Meanwhile, the company has spent more than $3.4 billion on 10 acquisitions over the past three years. With its roots in the “firewall” network security market, Palo Alto aims to build a broad cloud-based security platform.

“PANW easily has the largest range of cloud assets among traditional network security vendors,” Gregg Moskowitz, analyst at Mizuho Securities, said in a statement.

Heading into the Palo Alto earnings report, the cybersecurity stock had a relative strength rating of 86 out of the best possible 99, according to IBD Stock Check-up. PANW stock is down 21% in 2022.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.

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