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Fourth-quarter results were well received by the market

Palo Alto Networks posted better-than-expected results for its fiscal fourth quarter, lifting its shares by about 2% in after-hours trading. The gain came after the stock ended the regular session down 5%.

The company said quarterly revenue rose 34% from $2.54 billion in the same period a year earlier. In contrast, after reporting net income of $254 million last year, the company posted a net loss of $282 million, or 35 cents per share, this quarter.

Investors focused on how much demand for the company’s products was being driven by AI-related cyber threats and how that growth would show up in the revenue outlook. The stock has performed strongly since the start of the year, while interest in next-generation security tools has also increased.

AI risks boosted both demand and acquisitions

Chief Executive Nikesh Arora said accelerating AI attacks are pushing customers toward faster and stronger cyber defense solutions. According to the company, concerns over so-called “agentic” attacks that can plan independently are creating a new wave of security spending.

What do customer meetings and new purchases show?

Palo Alto Networks said the number of customer briefing calls it held after Anthropic announced its Mythos model rose to more than 2,000 from roughly 1,200. The company also said it had acquired Console to strengthen its AI security capabilities.

The company’s accelerated acquisition strategy over the past year and more was another key theme of the earnings period. During that time, it paid $25 billion for identity security firm CyberArk and about $3.4 billion for Chronosphere.

Strong revenue outlook topped market expectations

The company’s forward guidance pointed to continued revenue growth. Palo Alto Networks forecast first-quarter revenue of $3.30 billion-$3.31 billion, above analysts’ estimate of $3.22 billion.

  • Fiscal 2026 revenue outlook: $14.10 billion-$14.20 billion
  • Adjusted earnings per share outlook: $4.16-$4.19

Those projections topped market expectations for $13.79 billion in revenue and $4.11 in adjusted earnings per share. Strong results last week from CrowdStrike and Okta also suggested that AI-powered cybersecurity spending is becoming a broader financial theme across the sector.

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