Core Viewpoint - Palo Alto Networks has experienced a significant decline in stock price, down over 25% in the past year, and further dropped following its recent fiscal Q2 earnings announcement, raising questions about potential investment opportunities [1]. Financial Performance - For fiscal Q2 2026, Palo Alto reported a revenue increase of 15% year over year, reaching $2.59 billion, which was at the high end of its forecast [5]. - Service revenue grew by 13% to $2.08 billion, with subscription revenue up 14% and support revenue increasing by 12% [5]. - Product revenue rose by 22% to $514 million, driven by growth in software firewalls [5]. - Adjusted earnings per share (EPS) surged by 27% year over year to $1.03, exceeding guidance of $0.93 to $0.95 [6]. Strategic Acquisitions - Palo Alto is actively pursuing a platformization strategy, acquiring companies to enhance its cybersecurity solutions [3]. - Recent acquisitions include Chronosphere for real-time data monitoring and CyberArk for privileged access, with a new acquisition of Koi for AI enterprise endpoint security solutions announced alongside the earnings report [3][4]. - While these acquisitions strengthen the company's market position, they are expected to negatively impact EPS in the short term due to the stock component of the CyberArk deal [4]. Future Guidance - The company updated its full-year guidance, projecting revenue growth of 22% to 23% for fiscal 2026, with a revised revenue forecast of $11.28 billion to $11.31 billion [8]. - The next-generation security annual recurring revenue (ARR) is expected to reach $8.52 billion, reflecting a growth rate of 53% to 54% [9]. - Adjusted EPS guidance was lowered to $3.65 to $3.70, indicating a growth rate of 9% to 11% [9]. Valuation and Investment Outlook - The recent drop in stock price has led to a more attractive valuation, with a forward price-to-sales ratio of 9 times fiscal 2027 estimates and a forward price-to-earnings ratio of 33 times 2027 estimates [10]. - Despite initial EPS pressure from acquisitions, these strategic moves are viewed as beneficial for long-term growth, suggesting that current stock levels may present a buying opportunity [10][11].

This story was originally published on Cybersecurity Dive. To receive daily news and insights, subscribe to our free daily Cybersecurity Dive newsletter. As investors worry that existing software and services could be rendered obsolete, Palo Alto Networks CEO Nikesh Arora said the rapid acceleration of AI should not be considered a threat to cybersecurity.  Arora addressed the concerns on Tuesday during the company’s fiscal second-quarter conference call, where the surge in AI dominated much of the discus ...

Core Viewpoint - Despite exceeding Wall Street expectations in Q2, Palo Alto Networks' stock fell over 9% due to Q3 guidance falling short of market expectations [1] Group 1: Company Performance - Palo Alto Networks reported Q2 performance that surpassed Wall Street expectations [1] - The stock price dropped to $148.5 following the Q3 guidance announcement [1] Group 2: Market Context - The software sector is under pressure as generative AI tools rapidly penetrate enterprise processes and web development [1] - Software-related ETFs have declined over 20% since the beginning of the year, reflecting broader market concerns [1] Group 3: AI Strategy - CEO Nikesh Arora stated that AI will not replace the cybersecurity industry in the short term, expressing confusion over the perception of AI as a cybersecurity threat [1] - Customers are recognizing the need for a more unified and consistent security architecture to leverage AI for faster and more efficient security responses [1] - The company is enhancing its AI capabilities by launching a new generation of "smart agent" tools and acquiring CyberArk, along with integrating the AI observability platform Chronosphere [1] - These investments are seen as a response to structural changes in the market, indicating the company's progression into the next phase of AI application [1]

Palo Alto Networks (NasdaqGS:PANW) Q2 2026 Earnings call February 17, 2026 04:30 PM ET Company ParticipantsAdam Borg - Managing DirectorAdam Tindle - Managing DirectorBrad Zelnick - Managing DirectorDipak Golechha - CFOGabriela Borges - Managing Director and Head of US Software Equity ResearchGregg Moskowitz - Managing DirectorHamza Fodderwala - SVP of Investor Relations and Strategic FinanceJohn DiFucci - Senior Managing DirectorJosh Tilton - Managing DirectorLee Klarich - Chief Product and Technology Offi ...

Palo Alto Networks (NasdaqGS:PANW) Q2 2026 Earnings call February 17, 2026 04:30 PM ET Company ParticipantsAdam Borg - Managing DirectorAdam Tindle - Managing DirectorBrad Zelnick - Managing DirectorDipak Golechha - CFOGabriela Borges - Managing Director and Head of US Software Equity ResearchGregg Moskowitz - Managing DirectorHamza Fodderwala - SVP of Investor Relations and Strategic FinanceJohn DiFucci - Senior Managing DirectorJosh Tilton - Managing DirectorLee Klarich - Chief Product and Technology Offi ...

Palo Alto Networks (NasdaqGS:PANW) Q2 2026 Earnings call February 17, 2026 04:30 PM ET Speaker5Good day, everyone, and welcome to Palo Alto Networks' fiscal second 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, February 17, 2026, at 1:30 P.M. Pacific Time. With me on today's call to discuss our fiscal second quarter results are Nikesh Arora, our Chairman and Chief Ex ...

Q2 Fiscal Year 2026 Earnings Call February 17, 2026 © 2026 Palo Alto Networks, Inc. All rights reserved. Proprietary and confidential information. © 2026 Palo Alto Networks, Inc. All rights reserved. Safe Harbor This presentation contains "forward-looking" statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements other than statements of historical or current facts, including, without limitation, statements regarding the cybersecurity threat lands ...

Core Viewpoint - Analysts expect Palo Alto Networks to report Q2 revenue of $2.58 billion, an increase from $2.26 billion, and earnings per share of 76 cents, down from 81 cents in the same quarter last year [1][2] Financial Performance - The company has beaten analyst estimates for revenue for nine consecutive quarters [1] - Analysts anticipate earnings per share to decline, marking a potential shift in performance metrics [1] - Company guidance indicates expected revenue between $2.57 billion and $2.59 billion and earnings per share between 93 to 95 cents [2] Analyst Ratings - Analysts have been lowering their price targets ahead of the quarterly results, with several firms maintaining their ratings but adjusting targets downward [3][8] - Mizuho lowered its price target from $220 to $205 while maintaining an Outperform rating [8] - Other firms like BTIG, DA Davidson, JPMorgan, and Barclays also adjusted their price targets downward while maintaining their ratings [8] Strategic Moves - Palo Alto Networks announced plans to acquire Koi, an agentic endpoint security company, to address new challenges in cybersecurity [4][5] - The acquisition is part of a broader strategy to enhance the company's offerings in the AI era, as traditional security measures may not suffice against modern threats [4][7] - The company has recently completed other acquisitions, including Chronosphere and CyberArk, which may not fully impact the upcoming quarterly results [5][6] Market Sentiment - Shares of Palo Alto Networks have decreased by 22.6% over the last year, with current stock price at $161.24, down 3.4% on the day [10] - Investors are looking for strong guidance and performance in the upcoming earnings report to restore optimism [9]

Palo Alto Networks, Inc. (NASDAQ:PANW) will release earnings results for its second quarter, after the closing bell on Tuesday, Feb. 17.Analysts expect the Santa Clara, California-based company to report quarterly earnings at 94 cents per share, up from 81 cents per share in the year-ago period. The consensus estimate for Palo Alto's quarterly revenue is $2.58 billion, versus $2.26 billion a year earlier, according to data from Benzinga Pro.According to recent news, Palo Alto Networks, on Feb. 11, said that ...

Palo Alto Networks, Inc. (NASDAQ:PANW) will release earnings results for its second quarter, after the closing bell on Tuesday, Feb. 17.Analysts expect the Santa Clara, California-based company to report quarterly earnings at 94 cents per share, up from 81 cents per share in the year-ago period. The consensus estimate for Palo Alto's quarterly revenue is $2.58 billion, versus $2.26 billion a year earlier, according to data from Benzinga Pro.According to recent news, Palo Alto Networks, on Feb. 11, said that ...