Palo Alto (PANW) Q1 Earnings: Taking a Look at Key Metrics Versus Estimates

Core Insights - Palo Alto Networks (PANW) reported a revenue of $2.47 billion for the quarter ended October 2025, reflecting a year-over-year increase of 15.7% and a surprise of +0.52% over the Zacks Consensus Estimate of $2.46 billion [1] - The earnings per share (EPS) for the quarter was $0.93, up from $0.78 in the same quarter last year, resulting in an EPS surprise of +4.49% compared to the consensus estimate of $0.89 [1] Financial Performance Metrics - Remaining Performance Obligation (RPO) stood at $15.50 billion, slightly above the average estimate of $15.47 billion from six analysts [4] - Product revenue was reported at $434 million, exceeding the average estimate of $423.19 million from 13 analysts, marking a year-over-year increase of +22.7% [4] - Subscription and support revenue reached $2.04 billion, matching the average estimate from 13 analysts, with a year-over-year growth of +14.3% [4] - Subscription support revenue was $676 million, surpassing the average estimate of $651.71 million from two analysts, reflecting a +14% year-over-year change [4] - Subscription revenue was $1.36 billion, slightly below the average estimate of $1.39 billion from two analysts, but still showing a +14.5% increase compared to the previous year [4] - Non-GAAP product gross profit was $348 million, exceeding the average estimate of $333.92 million from nine analysts [4] - Non-GAAP subscription and support gross profit was $1.55 billion, slightly below the average estimate of $1.56 billion from nine analysts [4] - GAAP subscription and support gross profit was $1.49 billion, compared to the average estimate of $1.51 billion from two analysts [4] - GAAP product gross profit was $345 million, above the average estimate of $333.26 million from two analysts [4] Stock Performance - Over the past month, shares of Palo Alto Networks have returned -6.3%, in contrast to the Zacks S&P 500 composite's -0.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]