Palo Alto Networks (PANW) on Monday reported fiscal third-quarter earnings and revenue that modestly beat Wall Street targets amid lowered expectations and slowing growth in its core network firewall market. Profit and revenue guidance for Palo Alto stock met consensus estimates.
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On the stock market today, Palo Alto stock fell more than 8% to 294.80 in extended trading.
In the quarter ended April 30, Palo Alto earnings rose 20% to $1.32 a share on an adjusted basis. Further, revenue climbed 15% to $2 billion, including acquisitions.
Analysts expected earnings of $1.25 a share on sales of $1.97 billion.
Also, billings rose 3% to $2.334 billion versus estimates for 3.3% growth. Billings, a sales growth metric, have been an issue for Palo Alto stock.
Palo Alto Stock: Billings Guidance
For the current quarter ending in July, the cybersecurity firm predicted profit of $1.41 per share, meeting expectations. Further, Palo Alto forecast revenue of $2.16 billion at the midpoint of guidance, in line with estimates of $2.16 billion.
The company predicted billings of $3.55 billion, slightly above estimates of $3.45 billion.
In addition, sales for firewall network appliances have slowed. Firewall appliances protect computer networks by blocking online intrusions and monitoring web-based apps.
However, Palo Alto has built a broad cloud-based security platform through acquisitions. Cloud software revenue is becoming a larger part of overall sales.
Heading into the Palo Alto earnings report, the cybersecurity stock had retreated 11% in 2023.
Palo Alto stock holds an outstanding Composite Rating of 97, according to IBD Stock Checkup.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
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Jessica Roberts is a seasoned business writer who deciphers the intricacies of the corporate world. With a focus on finance and entrepreneurship, she provides readers with valuable insights into market trends, startup innovations, and economic developments.
