Palo Alto Networks
Cybersecurity firm Palo Alto Networks reported better-than-expected results on greater demand for network security hardware and online security solutions.
Total revenue for the fiscal third quarter slowed slightly, growing 29% year over year to $1.4 billion. (Revenue was up 30% in the previous quarter). Product grew 22% and total services grew by 32%. By geography, growth was balanced, with the Americas growing 30%, EMEA up 28%, and JAPAC growing by 29%.
Non-GAAP net income jumped 38.4% year over year to $193.1 million, or $1.79 per diluted share.
Palo Alto said that reduced economic activity was not yet being seen but that it had experienced supply shortages, which it expects to persist for another year. On inflationary pressures, the hardware-maker said higher component and shipping costs narrowed the company’s adjusted gross margin in the quarter to 72.9%, down 170 basis points.
The company said it has seen a marked increase in Russian cyberattacks since the war in Eastern Europe began, with a resulting increase in interest from corporations and government agencies across Europe for digital protection.
Chairman and CEO Nikesh Arora said the trend that started with the pandemic such as widespread cyberattacks, network transformation, cloud transformation, and fortifying one's infrastructure continue to be strong. The company raised its guidance for the full year and now expects adjusted earnings of $7.43 to $7.46 per share on $5.481 billion to $5.501 billion in revenue.