Palo Alto Networks (NASDAQ:PANW) Posts Quarterly Earnings Results, Beats Expectations By $0.09 EPS

Palo Alto Networks (NASDAQ:PANW) announced its quarterly earnings data on Tuesday. The network technology company reported $1.03 EPS for the quarter, topping analysts’ consensus estimates of $0.94 by $0.09, FiscalAI reports. The firm had revenue of $2.59 billion for the quarter, compared to the consensus estimate of $2.58 billion. Palo Alto Networks had a return on equity of 18.42% and a net margin of 12.96%.The firm’s revenue was up 14.9% compared to the same quarter last year. During the same quarter last year, the business posted $0.81 earnings per share. Palo Alto Networks updated its FY 2026 guidance to 3.650-3.700 EPS and its Q3 2026 guidance to 0.780-0.800 EPS.

Here are the key takeaways from Palo Alto Networks’ conference call:

• Company reported strong operating performance with NGS ARR up 33% to $6.33B (organic +28%), revenue $2.59B, and a 30.3% non‑GAAP operating margin, plus robust free cash flow (TTM $3.75B), all above expectations.
• Palo Alto emphasized platform momentum — SASE surpassed $1.5B ARR (~40% growth), XIM exceeded $500M ARR, and Prisma AIRS reached 100+ customers — and introduced AgentiX and planned Koi integration to secure agentic endpoints.
• Management closed two large strategic acquisitions — Chronosphere (~$200M ARR) and CyberArk (~$1.2B ARR) — positioning the company to expand observability and identity security and backing guidance that includes meaningful M&A contributions.
• Acquisitions and financing will have material near-term cash impact (≈$4.9B combined outlay, 112M shares issued, and assumed CyberArk note repurchase obligations), creating integration and balance‑sheet execution risk that could pressure the stock if disruptions occur.

Palo Alto Networks Stock Performance

NASDAQ PANW opened at $152.35 on Thursday. The firm has a market cap of $106.19 billion, a price-to-earnings ratio of 84.17, a PEG ratio of 3.91 and a beta of 0.75. The firm has a 50 day simple moving average of $180.25 and a 200-day simple moving average of $191.93. Palo Alto Networks has a one year low of $144.15 and a one year high of $223.61.

Analyst Upgrades and Downgrades

A number of equities research analysts recently issued reports on the stock. UBS Group set a $215.00 price objective on shares of Palo Alto Networks and gave the company a “neutral” rating in a report on Tuesday, January 13th. BMO Capital Markets cut their target price on Palo Alto Networks from $230.00 to $200.00 and set an “outperform” rating for the company in a research note on Wednesday. Cantor Fitzgerald reaffirmed an “overweight” rating on shares of Palo Alto Networks in a research note on Wednesday. DA Davidson set a $190.00 price target on Palo Alto Networks and gave the stock a “buy” rating in a report on Wednesday. Finally, Deutsche Bank Aktiengesellschaft cut their price objective on Palo Alto Networks from $240.00 to $220.00 and set a “buy” rating for the company in a research report on Wednesday. Thirty-three investment analysts have rated the stock with a Buy rating and nine have issued a Hold rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and an average target price of $215.68.

Insider Buying and Selling at Palo Alto Networks

In other Palo Alto Networks news, Director James J. Goetz sold 12,500 shares of the business’s stock in a transaction on Monday, December 8th. The shares were sold at an average price of $195.33, for a total value of $2,441,625.00. Following the completion of the transaction, the director owned 75,184 shares in the company, valued at $14,685,690.72. The trade was a 14.26% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at the SEC website. Also, EVP Lee Klarich sold 120,768 shares of the stock in a transaction on Thursday, January 8th. The shares were sold at an average price of $191.03, for a total value of $23,070,311.04. Following the completion of the sale, the executive vice president owned 298,887 shares in the company, valued at approximately $57,096,383.61. The trade was a 28.78% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 260,542 shares of company stock valued at $49,910,995 in the last quarter. Corporate insiders own 1.40% of the company’s stock.

Institutional Trading of Palo Alto Networks

A number of large investors have recently made changes to their positions in the company. Darwin Wealth Management LLC purchased a new position in Palo Alto Networks in the second quarter worth approximately $25,000. Palisade Asset Management LLC purchased a new stake in shares of Palo Alto Networks in the 3rd quarter valued at approximately $33,000. JPL Wealth Management LLC acquired a new stake in shares of Palo Alto Networks in the 3rd quarter valued at $35,000. McIlrath & Eck LLC lifted its position in shares of Palo Alto Networks by 127.7% during the 2nd quarter. McIlrath & Eck LLC now owns 214 shares of the network technology company’s stock worth $44,000 after purchasing an additional 120 shares during the last quarter. Finally, J.Safra Asset Management Corp purchased a new stake in shares of Palo Alto Networks during the 4th quarter worth $40,000. 79.82% of the stock is currently owned by hedge funds and other institutional investors.

Key Stories Impacting Palo Alto Networks

Here are the key news stories impacting Palo Alto Networks this week:

• Positive Sentiment: Beat and revenue lift — PANW reported fiscal Q2 EPS of $1.03 and revenue of $2.59B, with Next‑Gen Security ARR up ~33% and full‑year revenue guidance raised toward ~$11.3B. These results confirm underlying demand and platform traction. Palo Alto Networks Reports Fiscal Second Quarter 2026 Financial Results
• Positive Sentiment: Strong fundamentals and balance sheet — commentary and analyst notes highlight durable ARR growth, solid margins on the quarter, and a robust balance sheet that supports M&A and longer‑term platform expansion. MarketBeat coverage
• Neutral Sentiment: New acquisition (Koi) announced — management is buying technology to secure “agentic endpoints”; strategically sensible for AI security but adds near‑term execution and integration risk. Palo Alto Announces Intent to Acquire Koi
• Neutral Sentiment: Analyst support mixed — several firms reaffirm buy/outperform ratings (RBC, Wedbush, BTIG, Rosenblatt, etc.), showing continued conviction from parts of the sell‑side even as targets are adjusted. Benzinga analyst roundup
• Negative Sentiment: Profit guidance disappointed — management warned that integration and deal costs will reduce near‑term profit; Q3 EPS guidance was weaker than some expectations and the company trimmed annual profit outlook, triggering the sell‑off. Reuters: Palo Alto cuts annual profit forecast
• Negative Sentiment: Integration costs from big deals (including CyberArk and other buys) are a material near‑term headwind that analysts say will pressure margins and free cash flow. Reuters: Deal costs pile up
• Negative Sentiment: Price‑target cuts and downgrades — numerous firms trimmed targets (Deutsche, Goldman, Scotiabank, Loop, Needham, BMO, Mizuho) and at least one downgrader is cited as driving further near‑term selling pressure. Mizuho forecast / American Banking News
• Negative Sentiment: Market reaction and sector headwinds — PANW shares fell after hours and into the next session as investors punished the earnings‑for‑guidance mismatch amid broader AI/software valuation pressures. CNBC: Shares sink as CEO defends strategy

Palo Alto Networks Company Profile

Palo Alto Networks (NASDAQ: PANW) is a cybersecurity company founded in 2005 and headquartered in Santa Clara, California. The firm develops a broad suite of security products and services designed to prevent successful cyberattacks and protect enterprise networks, clouds, and endpoints. Built around a platform strategy, its offerings target threat prevention, detection, response and governance across hybrid and multi-cloud environments.

The company’s product portfolio includes next‑generation firewalls as a core on‑premises capability, alongside cloud‑delivered security services and software for securing public and private clouds.