Core Insights - Palo Alto Networks Inc (PANW) stock is down 3.5% to $192.99 despite better-than-expected fiscal first-quarter earnings and revenue, with guidance aligning with expectations and plans to acquire Chronosphere for $3.35 billion [1][2] Group 1: Financial Performance - PANW reported fiscal first-quarter earnings and revenue that exceeded expectations [1] - The company's guidance for future performance was in line with market expectations [1] Group 2: Stock Performance - PANW has struggled to maintain positive momentum since reaching a record high of $223.61 on October 23, now showing only a 5% year-to-date gain [2] - The stock is on track for its sixth loss in seven sessions, although the 200-day moving average is providing support during this pullback [2] Group 3: Market Activity - Options traders are actively engaging with PANW, with 29,000 calls and 27,000 puts purchased today, which is six times the average amount typically seen [3] - The most popular options are the November 190 put and 205 call, with sell-to-open activity occurring at both [3] - Short interest in PANW has decreased by 8.1% over the past two reporting periods, now accounting for 6.6% of the stock's total available float, equating to seven days' worth of buying power [3]

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Core Insights - Zscaler is set to report its first-quarter fiscal 2026 results on November 25, 2025, with anticipated revenues between $772 million and $774 million, reflecting a year-over-year growth of 23.2% [1] - The company expects non-GAAP earnings per share in the range of 85-86 cents, with a Zacks Consensus Estimate of 85 cents per share, indicating a year-over-year decline of 10.4% [2] Revenue and Earnings Expectations - Zscaler's revenue guidance for Q1 is $772 million to $774 million, driven by its security and networking solutions, particularly in Zero Trust and Data Security [9][6] - The expected earnings per share for the fiscal first quarter is between 85-86 cents, with the consensus estimate remaining unchanged over the past 60 days [2][3] Customer Dynamics and Market Trends - Strong momentum with Global 2000 and Fortune 500 customers, along with $1 million ARR customers, is attributed to ongoing digital transformation and the rise of hybrid work [7] - The adoption of Software-Defined Wide Area Network (SD-WAN) solutions is projected to contribute to growth, with the market size expected to reach $109.9 billion by 2035, growing at a CAGR of 31.6% [8] Competitive Landscape - Zscaler faces intense competition from established cybersecurity players like Palo Alto Networks, CyberArk, and CrowdStrike, which are investing heavily in Agentic Operations [18][19] - The company is increasing investments in sales and marketing, as well as research and development, to counter competitive pressures [20] Stock Performance and Valuation - Zscaler's shares have increased by 61.7% year-to-date, outperforming the Zacks Security industry's growth of 17.6% [12] - The stock is currently trading at a forward 12-month price-to-sales ratio of 13.32X, compared to the industry's 12.65X, indicating a premium valuation [13]

Group 1 - Palo Alto Networks Inc (NASDAQ: PANW) exceeded Street estimates in its fiscal Q1 results [1] - The company provided slightly better-than-expected guidance for the full year [1] - The cybersecurity industry continues to show resilience amid ongoing challenges [1]

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Group 1 - Palo Alto Networks (PANW) reported fiscal first-quarter earnings that left investors underwhelmed, leading to a decline in stock price [1] - The company announced the acquisition of Chronosphere for $3.35 billion, which operates a cloud-based "observability" platform [1] - The jobless rate in the U.S. is reported at 4.4%, with 119,000 jobs added in September [1]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $26.4 million, representing a 14% year-over-year increase [5][12] - Non-GAAP operating income was $3.7 million, compared to $1.1 million in Q3 2024 [14][15] - Non-GAAP net income was $4.6 million, or $0.10 per diluted share, compared to $1.3 million, or $0.03 per diluted share, in the same quarter last year [15] - Cash and investments totaled $81 million as of September 30, 2025, up from $59 million at the end of 2024 [15][16] - Recurring revenue as a percentage of total revenue increased to 63% in Q3 2025 from 58% in Q3 2024 [13] Business Line Data and Key Metrics Changes - Revenue from the CCAS (Cybersecurity as a Service) segment was $7.3 million, up 60% year-over-year, accounting for 28% of total revenue [12][5] - CCAS annual recurring revenue (ARR) as of September 2025 was $27.6 million [12] - The Smart product line also contributed to revenue growth, with a strong backlog and visibility heading into the next year [9][10] Market Data and Key Metrics Changes - Increased sales in the Americas were noted, aligning with the strategy to boost business in this region [12] - The company is seeing strong traction among major telecom operators for its cybersecurity solutions [7][8] Company Strategy and Development Direction - The company is focused on a cybersecurity-first strategy and a renewed go-to-market approach [7][10] - There is an emphasis on expanding the CCAS offering and enhancing the Smart product line to maintain technology leadership [9][10] - The company is optimistic about long-term growth, expecting CCAS ARR to surpass 60% year-over-year growth by year-end 2025 [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strong financial position and growth trajectory, citing a robust pipeline and backlog [10][11] - The competitive landscape is viewed as more favorable, with unique technology providing a competitive edge [29] - Management raised full-year 2025 revenue guidance to between $100 million and $103 million [11] Other Important Information - The company completed a $46 million follow-on share offering, enhancing its financial resources [15] - Allot has no debt, positioning it well for future growth [16] Q&A Session Summary Question: Increased traction with major telecom customers - Management noted positive trends in both tax rates and new service launches contributing to significant growth in CCAS revenue and ARR [18] Question: Details on the first customer for OPNET Secure - The first customer aims for 24/7 protection for their customers, combining Allot's network security with OPNET [19][20] Question: Continued strength in the Smart pipeline - Management confirmed a strong pipeline with opportunities from both new and existing customers, particularly for the Terra 3 product [23] Question: Drivers of CCAS growth - Growth is primarily from new customer contracts and existing accounts expanding their services [27] Question: Competitive landscape for network intelligence offerings - The competitive environment is currently favorable, with unique technology providing a competitive edge [29] Question: Impact of ad campaigns on CCAS adoption - Management identified four drivers for CCAS growth, including new customer additions and upselling existing services [31][32]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $26.4 million, representing a 14% year-over-year increase [5][12] - Non-GAAP operating income was $3.7 million, compared to $1.1 million in Q3 2024 [14][15] - Non-GAAP net income was $4.6 million, or $0.10 per diluted share, compared to $1.3 million, or $0.03 per diluted share, in the same quarter last year [15] - Cash and investments totaled $81 million as of September 30, 2025, up from $59 million at the end of 2024, with no debt [15][16] Business Line Data and Key Metrics Changes - Revenue from Cybersecurity as a Service (CCAs) was $7.3 million, up 60% year-over-year, comprising 28% of total revenue [12][5] - CCAs Annual Recurring Revenue (ARR) as of September 2025 was $27.6 million [12] - The Smart product line also contributed to growth, with a strong performance and a robust pipeline [9][10] Market Data and Key Metrics Changes - Increased sales in the Americas, particularly from a large Smart order and growing contributions from the U.S. market [12] - Recurring revenue as a percentage of total revenue increased to 63% in Q3 2025 from 58% in Q3 2024 [13] Company Strategy and Development Direction - The company is executing a cybersecurity-first strategy and focusing on a renewed go-to-market approach [7][10] - The launch of OPNET Secure aims to enhance cybersecurity protection for end customers, expanding the service beyond the operator's infrastructure [8] - The company is optimistic about long-term growth, with expectations for CCAs ARR to surpass 60% year-over-year growth by year-end 2025 [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strong financial position and growth strategy, highlighting the positive momentum in CCAs and network intelligence solutions [10][11] - The competitive landscape is viewed as more favorable, with unique technology providing a competitive edge [29] - Management raised full-year 2025 revenue guidance to between $100 million and $103 million [11] Other Important Information - The company completed a $46 million follow-on share offering, with $40 million received in Q2 and $6 million in Q3 [15] - The company reported positive operating cash flow of $4 million for the third consecutive quarter [15] Q&A Session Summary Question: Increased traction with major telecom customer - Management noted positive trends in both tax rates and new services launched, contributing to significant growth in CCAs revenue and ARR [18] Question: Details on the first customer for OPNET Secure - Management indicated that the first customer values 24/7 protection and is looking to enhance their service with OPNET [19][21] Question: Continued strength in the Smart pipeline - Management confirmed a strong pipeline with opportunities from both new and existing customers, particularly for the Terra 3 product [23] Question: Drivers of CCAs growth - Growth is primarily from new contracts and the onboarding of additional customers, with a focus on strategic accounts [27] Question: Competitive landscape for network intelligence offerings - Management described the competitive landscape as easier, with unique technology providing a competitive edge [28] Question: Drivers of growth in larger CCAs contracts - Management identified new customer additions, upselling, and cross-selling as key growth drivers [32] Question: Progress with Verizon Live's penetration - Management refrained from discussing specific customers but expressed overall satisfaction with progress [39] Question: Role of Terra 3 in customer conversations - Management highlighted a good mix of new opportunities and discussions with existing customers, focusing on customer success [41]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $26.4 million, representing a 14% year-over-year increase [5][11] - Non-GAAP operating income was $3.7 million, compared to $1.1 million in Q3 2024 [12] - Non-GAAP net income was $4.6 million, or $0.10 per diluted share, compared to $1.3 million, or $0.03 per diluted share, in the same quarter last year [13][14] - Cash and investments totaled $81 million as of September 30, 2025, up from $59 million at the end of 2024, with no debt [15] Business Line Data and Key Metrics Changes - Cybersecurity as a Service (CCAS) revenue was $7.3 million in Q3 2025, up 60% year-over-year, comprising 28% of total revenue [11][12] - CCAS Annual Recurring Revenue (ARR) as of September 2025 was $27.6 million [11] - The Smart product for network intelligence also contributed to growth, with a strong pipeline and backlog [8][9] Market Data and Key Metrics Changes - Increased sales in the Americas, particularly from a large Smart order and growing contributions from the U.S. market [11] - Recurring revenue as a percentage of total revenue increased to 63% in Q3 2025, up from 58% in Q3 2024 [12] Company Strategy and Development Direction - The company is executing a cybersecurity-first strategy and focusing on a renewed go-to-market approach [6][9] - The introduction of OPNET Secure aims to enhance cybersecurity protection for end customers, expanding the service beyond the operator's infrastructure [7][19] - The company is optimistic about long-term growth, with expectations for CCAS ARR to surpass 60% year-over-year growth by year-end 2025 [10][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strong financial position and growth strategy, highlighting the positive momentum in CCAS and network intelligence solutions [6][9] - The competitive landscape is viewed as more favorable, with unique technology providing a competitive edge [25] - Management anticipates continued growth in both CCAS and Smart product lines, supported by a robust pipeline and backlog [9][11] Other Important Information - The company completed a $46 million follow-on share offering, enhancing its financial resources for growth initiatives [14] - The company reported positive operating cash flow for the third consecutive quarter, totaling $4 million in Q3 2025 [14] Q&A Session Summary Question: Increased traction with major telecom customers - Management noted positive trends in both tax rates and new services launched, contributing to significant growth in CCAS revenue and ARR [17] Question: Details on the first customer for OPNET Secure - The first customer aims for 24/7 protection for their customers, combining network security with OPNET services [19][20] Question: Drivers of CCAS growth - Growth is primarily from new customer contracts and the onboarding of additional customers from existing contracts [23] Question: Competitive landscape for network intelligence offerings - The competitive environment is currently more favorable, with unique technology providing a competitive edge [25] Question: Drivers of growth in larger CCAS contracts - Growth is driven by new customer additions and upselling additional services to existing customers [28] Question: Terra 3's role in customer conversations - The company is focusing on customer success and maintaining a healthy mix of new and existing customer opportunities [35]

Group 1 - Cybersecurity giant Palo Alto Networks announced the acquisition of Chronosphere in a deal valued at $3 billion [1]