Tearsheet

Palo Alto Networks (PANW)


Market Price (5/30/2026): $281.37 | Market Cap: $198.1 Bil
Sector: Information Technology | Industry: Systems Software

Palo Alto Networks (PANW)


Market Price (5/30/2026): $281.37
Market Cap: $198.1 Bil
Sector: Information Technology
Industry: Systems Software

Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.

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Attractive cash flow generation
CFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 40%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 36%, CFO LTM is 4.0 Bil, FCF LTM is 3.6 Bil

Low stock price volatility
Vol 12M is 38%

Megatrend and thematic drivers
Megatrends include Cybersecurity, Cloud Computing, and Artificial Intelligence. Themes include Network Security, Show more.

Trading close to highs
Dist 52W High is 0.0%, Dist 3Y High is 0.0%

Expensive valuation multiples
P/EBITPrice/EBIT or Price/(Operating Income) ratio is 106x, P/CFOPrice/(Cash Flow from Operations). CFO is cash before capital expenditures. is 50x, P/EPrice/Earnings or Price/(Net Income) is 155x

Significant share based compensation
SBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 14%

Yield minus risk free rate is negative
ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -3.2%

Key risks
PANW key risks include [1] its premium pricing model, Show more.

0 Attractive cash flow generation
CFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 40%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 36%, CFO LTM is 4.0 Bil, FCF LTM is 3.6 Bil
1 Low stock price volatility
Vol 12M is 38%
2 Megatrend and thematic drivers
Megatrends include Cybersecurity, Cloud Computing, and Artificial Intelligence. Themes include Network Security, Show more.
3 Trading close to highs
Dist 52W High is 0.0%, Dist 3Y High is 0.0%
4 Expensive valuation multiples
P/EBITPrice/EBIT or Price/(Operating Income) ratio is 106x, P/CFOPrice/(Cash Flow from Operations). CFO is cash before capital expenditures. is 50x, P/EPrice/Earnings or Price/(Net Income) is 155x
5 Significant share based compensation
SBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 14%
6 Yield minus risk free rate is negative
ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -3.2%
7 Key risks
PANW key risks include [1] its premium pricing model, Show more.

Valuation, Metrics & Events

Price Chart

Why The Stock Moved

Qualitative Assessment

AI Analysis | Feedback

Updated on 5/22/2026
Palo Alto Networks (PANW) stock has gained about 60% since 1/31/2026 because of the following key factors:

1. Strong Fiscal Second Quarter 2026 Earnings Beat and Upbeat Fiscal Year 2026 Outlook.

Palo Alto Networks reported robust fiscal Q2 2026 results on February 18, 2026, with diluted non-GAAP net income per share of $1.03, surpassing analysts' consensus estimates of $0.94 by $0.09. Quarterly revenue also exceeded expectations, growing 14.9% year-over-year to $2.59 billion against an estimate of $2.58 billion. The company demonstrated strong performance in its Next-Generation Security (NGS) segment, with Annual Recurring Revenue (ARR) increasing 33% year over year to $6.3 billion. Furthermore, Palo Alto Networks provided an optimistic outlook for fiscal year 2026, projecting NGS ARR of $8.52 billion to $8.62 billion, representing a significant year-over-year growth of 53% to 54%.

2. Aggressive AI-Driven Platformization Strategy and Strategic Acquisitions.

Palo Alto Networks has actively pursued a "platformization" strategy, focusing on integrating AI capabilities and making strategic acquisitions to enhance its comprehensive cybersecurity offerings. Key acquisitions within the specified period include the completion of Chronosphere on January 29, 2026, to unify observability and security, and CyberArk on February 11, 2026, to secure the AI era. The company also acquired Koi on April 14, 2026, and Portkey on May 29, 2026, specifically to secure agentic endpoints and AI agents, respectively. These moves aim to position Palo Alto Networks as a leader in securing the evolving AI landscape, with its CEO stating the need to "secure every identity -- human, machine, and agent" due to the emerging wave of AI agents.

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Stock Movement Drivers

Fundamental Drivers

The 59.2% change in PANW stock from 1/31/2026 to 5/29/2026 was primarily driven by a 43.8% change in the company's P/E Multiple.
(LTM values as of)13120265292026Change
Stock Price ($)176.97281.6959.2%
Change Contribution By: 
Total Revenues ($ Mil)9,5569,8933.5%
Net Income Margin (%)11.7%13.0%10.9%
P/E Multiple107.6154.743.8%
Shares Outstanding (Mil)679704-3.6%
Cumulative Contribution59.2%

LTM = Last Twelve Months as of date shown

Market Drivers

1/31/2026 to 5/29/2026
ReturnCorrelation
PANW59.2% 
Market (SPY)9.6%27.5%
Sector (XLK)32.9%36.9%

Fundamental Drivers

The 27.9% change in PANW stock from 10/31/2025 to 5/29/2026 was primarily driven by a 18.5% change in the company's P/E Multiple.
(LTM values as of)103120255292026Change
Stock Price ($)220.24281.6927.9%
Change Contribution By: 
Total Revenues ($ Mil)9,2219,8937.3%
Net Income Margin (%)12.3%13.0%5.4%
P/E Multiple130.5154.718.5%
Shares Outstanding (Mil)672704-4.5%
Cumulative Contribution27.9%

LTM = Last Twelve Months as of date shown

Market Drivers

10/31/2025 to 5/29/2026
ReturnCorrelation
PANW27.9% 
Market (SPY)11.5%31.8%
Sector (XLK)27.4%40.8%

Fundamental Drivers

The 50.7% change in PANW stock from 4/30/2025 to 5/29/2026 was primarily driven by a 57.5% change in the company's P/E Multiple.
(LTM values as of)43020255292026Change
Stock Price ($)186.93281.6950.7%
Change Contribution By: 
Total Revenues ($ Mil)8,5709,89315.4%
Net Income Margin (%)14.6%13.0%-11.5%
P/E Multiple98.2154.757.5%
Shares Outstanding (Mil)659704-6.4%
Cumulative Contribution50.7%

LTM = Last Twelve Months as of date shown

Market Drivers

4/30/2025 to 5/29/2026
ReturnCorrelation
PANW50.7% 
Market (SPY)38.0%33.4%
Sector (XLK)83.0%40.3%

Fundamental Drivers

The 208.8% change in PANW stock from 4/30/2023 to 5/29/2026 was primarily driven by a 2225.4% change in the company's Net Income Margin (%).
(LTM values as of)43020235292026Change
Stock Price ($)91.23281.69208.8%
Change Contribution By: 
Total Revenues ($ Mil)6,1569,89360.7%
Net Income Margin (%)0.6%13.0%2225.4%
P/E Multiple1,608.1154.7-90.4%
Shares Outstanding (Mil)605704-14.1%
Cumulative Contribution208.8%

LTM = Last Twelve Months as of date shown

Market Drivers

4/30/2023 to 5/29/2026
ReturnCorrelation
PANW208.8% 
Market (SPY)89.0%44.6%
Sector (XLK)158.6%48.1%

Return vs. Risk

Price Returns Compared

 202120222023202420252026Total [1]
Returns
PANW Return57%-25%111%23%1%40%335%
Peers Return60%-39%66%22%19%22%184%
S&P 500 Return27%-19%24%23%16%10%101%

Monthly Win Rates [3]
PANW Win Rate83%42%58%58%67%60% 
Peers Win Rate72%33%67%60%53%52% 
S&P 500 Win Rate75%42%67%75%67%60% 

Max Drawdowns [4]
PANW Max Drawdown-20%-35%-20%-30%-27%-27% 
Peers Max Drawdown-20%-47%-24%-27%-28%-26% 
S&P 500 Max Drawdown-5%-25%-10%-8%-19%-9% 


[1] Cumulative total returns since the beginning of 2021
[2] Peers: FTNT, CRWD, ZS, CSCO, MSFT. See PANW Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 5/29/2026 (YTD)

How Low Can It Go

EventPANWS&P 500
2025 US Tariff Shock
  % Loss-25.7%-18.8%
  % Gain to Breakeven34.6%23.1%
  Time to Breakeven93 days79 days
2024 Yen Carry Trade Unwind
  % Loss-12.7%-7.8%
  % Gain to Breakeven14.6%8.5%
  Time to Breakeven9 days18 days
Summer-Fall 2023 Five Percent Yield Shock
  % Loss-14.5%-9.5%
  % Gain to Breakeven17.0%10.5%
  Time to Breakeven14 days24 days
2022 Inflation Shock & Fed Tightening
  % Loss-19.8%-24.5%
  % Gain to Breakeven24.7%32.4%
  Time to Breakeven96 days427 days
2020 COVID-19 Crash
  % Loss-46.7%-33.7%
  % Gain to Breakeven87.6%50.9%
  Time to Breakeven114 days140 days
Q4 2018 Fed Policy Error / Growth Scare
  % Loss-26.1%-19.2%
  % Gain to Breakeven35.4%23.8%
  Time to Breakeven81 days105 days

Compare to FTNT, CRWD, ZS, CSCO, MSFT

In The Past

Palo Alto Networks's stock fell -25.7% during the 2025 US Tariff Shock. Such a loss loss requires a 34.6% gain to breakeven.

Preserve Wealth

Limiting losses and compounding gains is essential to preserving wealth.

Asset Allocation

Actively managed asset allocation strategies protect wealth. Learn more.

EventPANWS&P 500
2025 US Tariff Shock
  % Loss-25.7%-18.8%
  % Gain to Breakeven34.6%23.1%
  Time to Breakeven93 days79 days
2020 COVID-19 Crash
  % Loss-46.7%-33.7%
  % Gain to Breakeven87.6%50.9%
  Time to Breakeven114 days140 days
Q4 2018 Fed Policy Error / Growth Scare
  % Loss-26.1%-19.2%
  % Gain to Breakeven35.4%23.8%
  Time to Breakeven81 days105 days
2016-2017 Trump Reflation Bond Selloff
  % Loss-30.1%-3.7%
  % Gain to Breakeven43.1%3.9%
  Time to Breakeven288 days6 days
2015-2016 China Devaluation / Global Growth Scare
  % Loss-34.2%-12.2%
  % Gain to Breakeven51.9%13.9%
  Time to Breakeven753 days62 days
2013 Taper Tantrum
  % Loss-23.5%-0.2%
  % Gain to Breakeven30.6%0.2%
  Time to Breakeven165 days1 days

Compare to FTNT, CRWD, ZS, CSCO, MSFT

In The Past

Palo Alto Networks's stock fell -25.7% during the 2025 US Tariff Shock. Such a loss loss requires a 34.6% gain to breakeven.

Preserve Wealth

Limiting losses and compounding gains is essential to preserving wealth.

Asset Allocation

Actively managed asset allocation strategies protect wealth. Learn more.

About Palo Alto Networks (PANW)

Palo Alto Networks, Inc. provides cybersecurity solutions worldwide. The company offers firewall appliances and software; Panorama, a security management solution for the control of firewall appliances and software deployed on an end-customer's network and instances in public or private cloud environments, as a virtual or a physical appliance; and virtual system upgrades, which are available as extensions to the virtual system capacity that ships with physical appliances. It also provides subscription services covering the areas of threat prevention, malware and persistent threat, uniform resource locator filtering, laptop and mobile device protection, and firewall; and DNS security, Internet of Things security, SaaS security API, and SaaS security inline, as well as threat intelligence, and data loss prevention. In addition, the company offers cloud security, secure access, security analytics and automation, and threat intelligence and cyber security consulting; professional services, including architecture design and planning, implementation, configuration, and firewall migration; education services, such as certifications, as well as online and in-classroom training; and support services. Palo Alto Networks, Inc. sells its products and services through its channel partners, as well as directly to medium to large enterprises, service providers, and government entities operating in various industries, including education, energy, financial services, government entities, healthcare, Internet and media, manufacturing, public sector, and telecommunications. The company was incorporated in 2005 and is headquartered in Santa Clara, California.

AI Analysis | Feedback

Here are 1-3 brief analogies to describe Palo Alto Networks:

  • Like a Microsoft for enterprise cybersecurity.
  • The Cisco of digital security infrastructure.

AI Analysis | Feedback

Palo Alto Networks Major Products and Services

  • Firewall Appliances and Software: Provides hardware appliances and software for comprehensive network security.
  • Panorama: A centralized security management solution for controlling firewall deployments across various environments.
  • Virtual System Upgrades: Offers extensions to increase the virtual system capacity that ships with physical firewall appliances.
  • Advanced Security Subscription Services: A comprehensive suite of subscription services including threat prevention, malware protection, URL filtering, DNS security, IoT security, SaaS security, threat intelligence, and data loss prevention.
  • Cloud Security Solutions: Delivers specialized security for public and private cloud environments.
  • Secure Access Solutions: Ensures secure connectivity and access for users, applications, and devices.
  • Security Analytics and Automation: Offers tools and platforms for analyzing security data and automating security operations.
  • Cyber Security Consulting: Provides expert advice, strategic guidance, and specialized services related to cyber threats.
  • Professional Services: Includes architecture design, planning, implementation, configuration, and firewall migration assistance.
  • Education Services: Offers certifications, along with online and in-classroom training for cybersecurity professionals.
  • Support Services: Provides ongoing technical assistance and maintenance for Palo Alto Networks products and solutions.

AI Analysis | Feedback

Based on the provided information, Palo Alto Networks (PANW) sells its products and services primarily to other companies and organizations, rather than individuals.

The company's major customers, as described in the background, fall into the following categories:

  • Medium to large enterprises
  • Service providers
  • Government entities

These customers operate across various industries, including education, energy, financial services, healthcare, Internet and media, manufacturing, public sector, and telecommunications.

The provided background text does not identify specific names of major customer companies or their public symbols.

AI Analysis | Feedback

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Nikesh Arora, Chairman and Chief Executive Officer

Nikesh Arora has served as Chairman and CEO of Palo Alto Networks since June 2018. Prior to joining Palo Alto Networks, he was a senior executive at Google from 2004 to 2014, where he held various leadership positions including senior vice president and chief business officer. He also served as the president and chief operating officer of SoftBank Group from October 2014 to June 2016. Earlier in his career, Mr. Arora founded T-Motion PLC in 2000, a mobile multimedia subsidiary of T-Mobile International, which later merged with Deutsche Telekom in 2002. He also held management positions at Fidelity Investments and Putnam Investments.

Dipak Golechha, Chief Financial Officer

Dipak Golechha joined Palo Alto Networks in 2020 and serves as Chief Financial Officer. Before his tenure at Palo Alto Networks, he was the CEO of Excelligence Learning Corporation, an education company backed by private equity. He also served as CFO for Chobani, where he was involved in structuring the company through capital raising and private equity partnerships, and as CFO at The Nature's Bounty Company, a consumer products company. Mr. Golechha spent 18 years at Procter & Gamble, holding various global finance and operations leadership roles, including global divisional CFO and chief operating officer for Pringles.

Lee Klarich, Chief Product and Technology Officer

Lee Klarich has been with Palo Alto Networks since early product inception in 2006, initially leading product management and overseeing the company's product strategy and roadmap. He became Chief Product and Technology Officer in August 2025, responsible for driving the company's technology vision and leading both the engineering and product organizations. Before joining Palo Alto Networks, Mr. Klarich was the director of product management for Juniper Networks, where he managed firewall/VPN platforms and software. His experience at Juniper Networks included working on the same product line after the acquisition of NetScreen Technologies.

Amit Singh, Chief Business Officer

Amit Singh serves as the President and Chief Business Officer at Palo Alto Networks, where he is responsible for all go-to-market functions, including sales, support, consulting, business development, partnerships, and enablement. He joined Palo Alto Networks in 2018. Prior to this, Mr. Singh held several leadership roles at Google, including founding and building Google's Cloud business and overseeing operations for Google's AR and VR efforts. He also spent 20 years at Oracle in various product, engineering, sales, and strategy roles.

Meerah Rajavel, Chief Information Officer

Meerah Rajavel is the Chief Information Officer at Palo Alto Networks, responsible for the company's global information technology functions and driving innovative solutions. She joined Palo Alto Networks in 2022. Before her current role, Ms. Rajavel served as CIO at Citrix and held leadership positions at companies such as McAfee, Forcepoint, Cisco, and Infosys.

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AI Analysis | Feedback

The key risks to Palo Alto Networks' business include intense competition within the cybersecurity market and the rapidly evolving threat landscape, challenges associated with integrating numerous acquisitions, and the need to maintain sales momentum and drive adoption of its platform solutions.

  1. Intense Competition and Evolving Threat Landscape: Palo Alto Networks operates in a highly competitive and dynamic cybersecurity market. The company faces significant competition from other cloud-native players, such as Wiz and Crowdstrike. The cybersecurity landscape is constantly changing, with new threats, including increasingly sophisticated AI-driven attacks, emerging regularly. The company's continued success depends on its ability to anticipate and respond to these technological changes and market developments, requiring continuous innovation and substantial investment in research and development to maintain its competitive position.
  2. Acquisition and Integration Risks: Palo Alto Networks has historically pursued an aggressive growth strategy that includes numerous acquisitions, having completed 21 throughout its lifecycle to expand its market share and product offerings. This strategy inherently carries risks related to the successful integration of acquired companies, their technologies, and their personnel. Failure to effectively integrate acquired businesses could lead to operational disruptions, difficulties in realizing expected synergies, and potential dilution of stockholder value. The company's recent acquisition of CyberArk has also been highlighted as presenting integration risks.
  3. Maintaining Sales Momentum and Platform Adoption: The company's future revenue growth is contingent on its ability to continue attracting new customers, especially large enterprises, and effectively selling its new products and subscription services. A key part of Palo Alto Networks' strategy is driving the adoption of its integrated security platform, a process referred to as "platformization." Slower conversion of these platform deals or a broader slowdown in IT security spending could modestly pressure growth in the short term. The company relies heavily on its channel partners for sales, and any issues with this distribution strategy could also negatively impact its financial results.

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Palo Alto Networks (PANW) Addressable Markets

Palo Alto Networks operates within a substantial and growing cybersecurity market, addressing various segments with its diverse product and service offerings. The addressable markets for its main products and services are primarily global, with specific regional data available for North America in some categories.

Overall Cybersecurity Market

  • The total addressable market (TAM) for cybersecurity is estimated at $110 billion, with a projected growth rate of 14% Compound Annual Growth Rate (CAGR).
  • More broadly, the global cybersecurity market is projected to reach $878.48 billion by 2034 or $699.39 billion by 2034, exhibiting a CAGR of 13.8% from 2026.
  • Wells Fargo estimates the overall cybersecurity market that Palo Alto Networks participates in to exceed $300 billion globally.

Network Security (Strata & Prisma SASE)

  • The network security total addressable market is growing at a 9% CAGR from 2021 to 2024.
  • The software firewalls segment is growing at a 13% CAGR.
  • The Secure Access Service Edge (SASE) segment is expanding at a remarkable 36% CAGR. The global SASE market was valued at approximately $4.94 billion in 2025 and is projected to grow to $44.11 billion by 2034, exhibiting a CAGR of 27.54%. Other estimates for the global SASE market include reaching $103.33 billion by 2032 with a CAGR of 11.20%, or $139.1 billion by 2034 at a CAGR of 24.5%.
  • The global Next-Generation Firewall (NGFW) market size is calculated at $6.73 billion in 2025 and is predicted to increase to $19.47 billion by 2035, expanding at a CAGR of 11.21%.
  • The global enterprise firewall market size was valued at $13.45 billion in 2024 and is expected to reach $34.43 billion by 2033, growing at a CAGR of 11.01%. North America holds the largest share in the global enterprise firewall market.
  • The global Firewall as a Service (FWaaS) market size was valued at $2.53 billion in 2022 and is expected to expand at a CAGR of 22.3% from 2023 to 2030. North America dominated this market with a 34.4% share in 2022.

Cloud Security (Prisma Cloud)

  • The global cloud security market size was valued at approximately $51.11 billion in 2025 and is projected to grow to $224.16 billion by 2034, registering a CAGR of 17.80%.
  • Other estimates for the global cloud security market include a valuation of $40.81 billion in 2025, reaching $133.39 billion by 2035 with a CAGR of 12.57%, or an estimated size of $35.84 billion in 2024, growing to $75.26 billion by 2030 at a CAGR of 13.3%.
  • North America dominated the cloud security market with a market share of 38.00% in 2025.

Security Operations (Cortex)

  • Palo Alto Networks' Cortex platform targets the Security Information and Event Management (SIEM) market, estimated at $40 billion.
  • The global security analytics market size was valued at $16.2 billion in 2024 and is poised to grow to $62.57 billion by 2033, growing at a CAGR of 16.2%. North America dominated this market with a revenue share of 39.5% in 2023.
  • The global security automation market size is expected to reach $21.2 billion by 2030, rising at a market growth of 13.5% CAGR. North America led this market in 2022 by generating the highest revenue share.

Threat Intelligence

  • The global threat intelligence market size was estimated at $14.59 billion in 2023 and is projected to reach $36.53 billion by 2030, growing at a CAGR of 14.7%.
  • North America accounted for the largest market share of 35.1% in the global threat intelligence market in 2023.

AI Analysis | Feedback

Palo Alto Networks (PANW) is expected to drive future revenue growth over the next 2-3 years through several key initiatives and market trends:

  1. Continued Platformization and Growth in Next-Generation Security (NGS) Offerings: Palo Alto Networks' strategy of platformization, which involves integrating its various security products into a unified platform, is a significant driver. This approach is leading to increased Annual Recurring Revenue (ARR) per customer as more clients adopt the comprehensive Next-Generation Security portfolio, encompassing cloud security, SASE, and XSIAM. The company consistently emphasizes this strategy as central to its long-term growth.
  2. Expansion of Cloud Security Solutions, including SASE: The company is strategically focused on expanding its cloud security offerings, such as Prisma Cloud and Secure Access Service Edge (SASE). This segment has shown robust growth, with SASE ARR surpassing $1.3 billion and serving a substantial number of customers, including a third of the Fortune 500.
  3. Growth in Software-based Security Products: A significant portion of Palo Alto Networks' product revenue growth is being driven by the increasing adoption of its software form factors, particularly software firewalls and PAN-OS SD-WAN. This shift towards software-defined security solutions provides essential runtime protection for cloud workloads and new AI data centers.
  4. Leveraging Artificial Intelligence (AI) for Enhanced Security: Palo Alto Networks is actively integrating AI into its security offerings and launching new AI-driven products. Innovations like the Cortex Cloud platform, AI copilots, and the rapidly scaling Prisma AIRS platform are positioned to address evolving cyber threats and are expected to contribute to future revenue as enterprises accelerate their AI transformation.
  5. Strategic Mergers and Acquisitions (M&A): The company's recent and planned strategic acquisitions, such as CyberArk and Chronosphere, are expected to expand its market reach and enhance its capabilities in areas like identity security and observability. These acquisitions create cross-selling opportunities and are projected to contribute meaningfully to Next-Generation Security ARR and overall revenue growth.

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Share Repurchases

  • Palo Alto Networks authorized an additional $1.0 billion for share repurchases through December 31, 2026.
  • The company recently repurchased $1.0 billion of common stock, approximately 6.8 million shares, between February 20 and February 24, 2026, at an average price of $147.69 per share.
  • This new authorization follows the full utilization of a prior $4.1 billion share repurchase authorization as of March 6, 2026.

Share Issuance

  • Palo Alto Networks' shares outstanding increased year-over-year, with 0.709 billion shares in 2025 (a 0.2% increase from 2024), 0.708 billion shares in 2024 (a 3.42% increase from 2023), and 0.685 billion shares in 2023 (a 15.78% increase from 2022).
  • Approximately 811 million shares of common stock were outstanding as of March 6, 2026.

Outbound Investments

  • Palo Alto Networks acquired Chronosphere, a cloud-native observability platform, in January 2026 for $3.35 billion.
  • The company announced plans to acquire Koi in February 2026 to enhance AI-driven enterprise endpoint security solutions.
  • Palo Alto Networks also acquired CyberArk, with some reports indicating a $25 billion purchase expected to close in the second half of fiscal 2026, which is integrated into recent guidance.

Capital Expenditures

  • Palo Alto Networks' annual capital expenditures for 2025 were $246.2 million, a 57.02% increase from the previous year.
  • Annual capital expenditures were $156.8 million in 2024 and $146.3 million in 2023.
  • The trailing twelve months (TTM) annual capital expenditures were $408.6 million.

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Recent Active Movers

Peer Comparisons

Peers to compare with:

Financials

PANWFTNTCRWDZSCSCOMSFTMedian
NamePalo Alt.Fortinet CrowdStr.Zscaler Cisco Sy.Microsoft 
Mkt Price281.69137.97731.00139.73120.42450.24210.71
Mkt Cap198.3101.9184.622.5475.93,343.5191.5
Rev LTM9,8937,1104,8123,17460,746318,2738,501
Op Inc LTM1,4222,211-293-14914,408148,9571,816
FCF LTM3,5662,4361,24189011,78872,9163,001
FCF 3Y Avg3,1402,0651,07971012,33470,9522,603
CFO LTM3,9742,8041,6121,10113,025170,1413,389
CFO 3Y Avg3,3822,3951,38791313,277136,9912,888

Growth & Margins

PANWFTNTCRWDZSCSCOMSFTMedian
NamePalo Alt.Fortinet CrowdStr.Zscaler Cisco Sy.Microsoft 
Rev Chg LTM15.4%15.7%21.7%24.6%9.2%17.9%16.8%
Rev Chg 3Y Avg17.2%14.6%29.1%29.1%3.5%15.3%16.3%
Rev Chg Q14.9%20.1%23.3%25.4%12.0%18.3%19.2%
QoQ Delta Rev Chg LTM3.5%4.6%5.4%5.7%2.9%4.2%4.4%
Op Inc Chg LTM50.9%14.2%-152.0%-20.7%19.0%22.0%16.6%
Op Inc Chg 3Y Avg877.4%27.5%-190.1%13.3%0.8%20.7%17.0%
Op Mgn LTM14.4%31.1%-6.1%-4.7%23.7%46.8%19.0%
Op Mgn 3Y Avg11.1%28.8%-3.2%-5.6%24.0%45.6%17.6%
QoQ Delta Op Mgn LTM1.1%0.4%2.4%0.1%0.5%0.1%0.5%
CFO/Rev LTM40.2%39.4%33.5%34.7%21.4%53.5%37.1%
CFO/Rev 3Y Avg39.0%38.5%35.5%35.4%23.2%49.5%37.0%
FCF/Rev LTM36.0%34.3%25.8%28.1%19.4%22.9%26.9%
FCF/Rev 3Y Avg36.4%33.1%27.7%27.4%21.6%26.1%27.6%

Valuation

PANWFTNTCRWDZSCSCOMSFTMedian
NamePalo Alt.Fortinet CrowdStr.Zscaler Cisco Sy.Microsoft 
Mkt Cap198.3101.9184.622.5475.93,343.5191.5
P/S20.014.338.47.17.810.512.4
P/Op Inc139.546.1-629.6-151.033.022.427.7
P/EBIT106.441.8-1,865.7-770.330.621.325.9
P/E154.752.2-1,136.2-290.239.826.733.2
P/CFO49.936.3114.520.436.519.736.4
Total Yield0.6%1.9%-0.1%-0.3%3.9%4.5%1.3%
Dividend Yield0.0%0.0%0.0%0.0%1.4%0.8%0.0%
FCF Yield 3Y Avg2.8%3.4%1.3%2.7%5.1%2.5%2.7%
D/E0.00.00.00.10.10.00.0
Net D/E-0.0-0.0-0.0-0.10.0-0.0-0.0

Returns

PANWFTNTCRWDZSCSCOMSFTMedian
NamePalo Alt.Fortinet CrowdStr.Zscaler Cisco Sy.Microsoft 
1M Rtn55.2%60.2%61.6%3.7%34.4%6.3%44.8%
3M Rtn89.2%74.6%96.5%-4.9%52.4%14.9%63.5%
6M Rtn48.2%70.1%43.6%-44.4%58.2%-8.1%45.9%
12M Rtn51.6%35.2%59.3%-44.4%95.4%-1.1%43.4%
3Y Rtn165.1%101.3%360.9%3.7%160.8%39.2%131.0%
1M Excs Rtn48.9%54.0%55.4%-2.5%28.2%0.1%38.6%
3M Excs Rtn79.0%64.4%86.3%-15.1%42.2%4.7%53.3%
6M Excs Rtn39.2%58.6%30.6%-63.8%47.5%-17.2%34.9%
12M Excs Rtn21.3%3.3%27.2%-73.6%65.8%-29.5%12.3%
3Y Excs Rtn114.1%19.8%325.1%-70.6%84.7%-36.7%52.2%

Financials

Segment Financials

Revenue by Segment
$ Mil20252024202320222021
Subscription4,1883,3352,5391,8991,405
Support2,2361,9791,5991,237939
Product1,6031,5781,3631,1201,064
Total8,0286,8935,5024,2563,408


Price Behavior

Price Behavior
Market Price$281.69 
Market Cap ($ Bil)198.3 
First Trading Date07/20/2012 
Distance from 52W High0.0% 
   50 Days200 Days
DMA Price$191.42$189.41
DMA Trendupup
Distance from DMA47.2%48.7%
 3M1YR
Volatility47.9%36.6%
Downside Capture-4.52117.00
Upside Capture233.55130.53
Correlation (SPY)23.8%32.5%
PANW Betas & Captures as of 4/30/2026

 1M2M3M6M1Y3Y
Beta1.140.690.950.991.001.20
Up Beta0.460.560.850.980.881.23
Down Beta-12.32-0.110.531.070.941.28
Up Capture188%150%102%65%83%150%
Bmk +ve Days15223166141428
Stock +ve Days15293663136421
Down Capture543%42%117%119%120%103%
Bmk -ve Days4183056108321
Stock -ve Days7142861113329

[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
Annualized
Return
Annualized
Volatility
Sharpe
Ratio
Correlation
with PANW
PANW46.9%37.6%1.10-
Sector ETF (XLK)66.5%20.7%2.3640.2%
Equity (SPY)30.3%11.8%1.9432.2%
Gold (GLD)37.5%26.7%1.17-2.1%
Commodities (DBC)39.6%18.8%1.63-0.2%
Real Estate (VNQ)12.5%13.1%0.645.5%
Bitcoin (BTCUSD)-31.8%41.6%-0.8127.5%

Smart multi-asset allocation framework can stack odds in your favor. Learn How
Based On 5-Year Data
Annualized
Return
Annualized
Volatility
Sharpe
Ratio
Correlation
with PANW
PANW35.5%41.4%0.86-
Sector ETF (XLK)23.9%24.8%0.8451.9%
Equity (SPY)14.3%17.0%0.6648.5%
Gold (GLD)18.8%18.0%0.851.0%
Commodities (DBC)10.2%19.4%0.418.4%
Real Estate (VNQ)3.4%18.8%0.0825.6%
Bitcoin (BTCUSD)14.6%54.6%0.4622.6%

Smart multi-asset allocation framework can stack odds in your favor. Learn How
Based On 10-Year Data
Annualized
Return
Annualized
Volatility
Sharpe
Ratio
Correlation
with PANW
PANW28.1%38.7%0.77-
Sector ETF (XLK)26.0%24.5%0.9551.9%
Equity (SPY)15.9%17.9%0.7648.6%
Gold (GLD)13.3%16.0%0.692.6%
Commodities (DBC)7.3%17.9%0.3315.0%
Real Estate (VNQ)5.7%20.7%0.2428.2%
Bitcoin (BTCUSD)67.0%66.9%1.0614.9%

Smart multi-asset allocation framework can stack odds in your favor. Learn How

Short Interest

Short Interest: As Of Date5152026
Short Interest: Shares Quantity28.0 Mil
Short Interest: % Change Since 430202611.1%
Average Daily Volume8.2 Mil
Days-to-Cover Short Interest3.4 days
Basic Shares Quantity704.0 Mil
Short % of Basic Shares4.0%

Earnings Returns History

Updated 5/29/2026
Expand for More
 Forward Returns
Earnings Date1D Returns5D Returns21D Returns
2/17/2026-6.8%-13.4%3.3%
11/19/2025-7.4%-7.3%-5.2%
8/18/20253.1%4.8%15.3%
5/20/2025-6.8%-3.4%2.4%
2/13/2025-0.9%-5.4%-8.4%
11/20/20241.2%-2.2%-4.9%
8/19/20247.2%1.1%-4.0%
5/20/2024-3.7%-4.9%-3.9%
...
SUMMARY STATS   
# Positive151515
# Negative999
Median Positive7.2%10.0%14.4%
Median Negative-5.4%-4.9%-5.2%
Max Positive18.6%23.1%28.6%
Max Negative-28.4%-14.0%-23.0%

SEC Filings

Expand for More
Report DateFiling DateFiling
01/31/202602/18/202610-Q
10/31/202511/20/202510-Q
07/31/202508/29/202510-K
04/30/202505/21/202510-Q
01/31/202502/14/202510-Q
10/31/202411/21/202410-Q
07/31/202409/06/202410-K
04/30/202405/21/202410-Q
01/31/202402/21/202410-Q
10/31/202311/17/202310-Q
07/31/202309/01/202310-K
04/30/202305/24/202310-Q
01/31/202302/22/202310-Q
10/31/202211/18/202210-Q
07/31/202209/06/202210-K
04/30/202205/20/202210-Q

Recent Forward Guidance

Updated 5/28/2026

Latest: Q2 2026 Earnings Reported 2/17/2026

Forward GuidanceGuidance Change
MetricLowMidHigh% Chg% DeltaChangePrior
Q3 2026 Next-Generation Security ARR7.94 Bil7.95 Bil7.96 Bil29.8% Higher NewGuidance: 6.12 Bil for Q2 2026
Q3 2026 Remaining performance obligation17.85 Bil17.90 Bil17.95 Bil13.3% Higher NewGuidance: 15.80 Bil for Q2 2026
Q3 2026 Revenue2.94 Bil2.94 Bil2.94 Bil14.1% Higher NewGuidance: 2.58 Bil for Q2 2026
Q3 2026 EPS0.780.790.8-16.0% Lower NewGuidance: 0.94 for Q2 2026
2026 Next-Generation Security ARR8.52 Bil8.57 Bil8.62 Bil21.6% RaisedGuidance: 7.05 Bil for 2026
2026 Remaining performance obligation20.20 Bil20.25 Bil20.30 Bil8.6% RaisedGuidance: 18.65 Bil for 2026
2026 Revenue11.28 Bil11.29 Bil11.31 Bil7.4% RaisedGuidance: 10.52 Bil for 2026
2026 Operating Margin28.5%28.75%29.0%-3.4%-1.0%LoweredGuidance: 29.75% for 2026
2026 EPS3.653.673.7-4.5% LoweredGuidance: 3.85 for 2026

Prior: Q1 2026 Earnings Reported 11/19/2025

Forward GuidanceGuidance Change
MetricLowMidHigh% Chg% DeltaChangePrior
Q2 2026 Next-Generation Security ARR6.11 Bil6.12 Bil6.14 Bil   
Q2 2026 Remaining performance obligation15.75 Bil15.80 Bil15.85 Bil   
Q2 2026 Revenue2.57 Bil2.58 Bil2.59 Bil   
Q2 2026 EPS0.930.940.95   
2026 Next-Generation Security ARR7.00 Bil7.05 Bil7.10 Bil0 AffirmedGuidance: 7.05 Bil for 2026
2026 Remaining performance obligation18.60 Bil18.65 Bil18.70 Bil0 AffirmedGuidance: 18.65 Bil for 2026
2026 Revenue10.50 Bil10.52 Bil10.54 Bil0.2% RaisedGuidance: 10.50 Bil for 2026
2026 Operating Margin29.5%29.75%30.0%1.0%0.3%RaisedGuidance: 29.45% for 2026
2026 EPS3.83.853.91.3% RaisedGuidance: 3.8 for 2026
2026 Free Cash Flow0.380.390.390 AffirmedGuidance: 0.39 for 2026

Insider Activity

Updated 5/27/2026
Expand for More
#OwnerTitleHoldingActionFiling DatePriceSharesTransacted
Value
Value of
Held Shares
Form
1Klarich, LeeEVP Chief Product & Tech OfcrDirectSell5272026258.6562,90416,270,35261,037,874Form
2Paul, Josh DChief Accounting OfficerDirectSell5222026236.9540094,78019,604,295Form
3Key, John P DirectSell4102026173.321,572272,4593,466,400Form
4Paul, Josh DChief Accounting OfficerDirectSell4032026161.401,100177,54013,418,150Form
5Golechha, DipakEVP, Chief Financial OfficerDirectSell4032026160.425,000802,07724,102,405Form

PANW Trade Sentinel


Stock Conviction

AVOID (Score 1-2)

CONVICTION RATIONALE

The probability-adjusted skew is well below 1.0x, indicating an unfavorable risk/reward profile. The downside scenario of multiple compression to peer levels presents a significant -34% risk, which is not adequately compensated by the modest +15% upside potential. The core issue is the speculative valuation in the face of decelerating key growth metrics. While the underlying business is strong, the stock price does not offer an attractive entry point.

STOCK ARCHETYPE
High-Beta Compounder

Palo Alto Networks is characterized by high, albeit decelerating, growth in its core software subscription offerings (NGS ARR +29% YoY), operates in the secular growth cybersecurity sector, and commands a premium valuation (P/E > 90x). The investment thesis is primarily centered on the durability of its growth and the strength of its competitive moat against key rivals, fitting the 'High-Beta Compounder' archetype.

Looking for high-conviction positions with a better risk/reward profile? See what's currently in the Trefis High Quality Portfolio.
INVESTMENT THESIS
Enterprise Platformization Shift to Consolidated Security Architecture

The primary driver for Palo Alto Networks is the durable enterprise trend of vendor consolidation. CISOs, pressured by budget scrutiny and operational complexity, are actively moving away from managing dozens of point solutions and consolidating spend onto a single, integrated security platform. PANW is uniquely positioned to capture this shift as the only vendor offering a deeply integrated, best-of-breed platform across the three core pillars of enterprise security: network (Strata), cloud (Prisma), and SOC (Cortex).

Mechanism: PANW captures value by leveraging its massive firewall installed base to cross-sell its higher-growth, higher-margin cloud and AI-operations platforms. This 'platformization' leads to larger, multi-year deals with high switching costs, driving strong growth in Remaining Performance Obligations (RPO) and expanding wallet share within existing customers, as evidenced by a Net Revenue Retention rate of 120% for platform customers.
Supporting Evidence:
  • Remaining Performance Obligation (RPO) of $15.5B, up 24% YoY, significantly outpacing current revenue growth and providing strong forward visibility.
  • PANW is dominant in the 'Consolidation CISO' customer segment, which is the prevailing buying center in the current market.
  • A Forrester study found PANW's Strata Platform delivered a 174% ROI, validating the TCO reduction that drives consolidation.
  • PANW is winning large consolidation deals, such as a $90M agreement with a financial firm to replace multiple EDR and SIEM competitors with Cortex.
PRIMARY RISK
Next-Generation Security (NGS) ARR Growth Deceleration

The most significant risk is the clear and persistent deceleration of the company's primary growth engine, Next-Generation Security (NGS) Annual Recurring Revenue (ARR). This key metric has slowed sequentially over three quarters, from 34% to 32%, and most recently to 29% YoY. Management's forward guidance projects this slowdown will continue. This trend suggests the hyper-growth phase is maturing, potentially faster than the market's premium valuation implies.

Mechanism: The thesis breaks if the NGS growth rate falls into the low 20s or high teens, which would signal that the platformization strategy is hitting a ceiling, competition from Zscaler in SASE and Fortinet in the mid-market is taking a greater toll, or the total addressable market is becoming saturated. Such a deceleration would trigger a significant valuation multiple compression, as the stock is priced for sustained high growth.
Supporting Evidence:
  • NGS ARR growth has decelerated from 34% in Q3 FY25 to 29% in Q1 FY26.
  • Official FY26 guidance projects NGS ARR growth to slow further to 26-27%.
  • Overall revenue growth guidance for FY26 is 14%, a deceleration from the 16% reported in Q1 FY26.
Key KPI Watchlist
KPI Threshold Rationale
Next-Gen Security (NGS) ARR Growth YoYMaintain above 25%This is the primary engine of growth and the most scrutinized metric. A drop below 25% would confirm the bear case that the hyper-growth phase is over, triggering a multiple compression.
Remaining Performance Obligations (RPO) Growth YoYMaintain above 20%This is the best leading indicator of future revenue and the health of the platform consolidation thesis. It reflects large, multi-year commitments. If RPO growth falls below 20%, it signals the core alpha driver is weakening.
Non-GAAP Operating MarginSustain above 30% and show expansionMargin expansion is a key part of the EPS growth story. Failure to expand margins towards peer levels (Fortinet at 37%+) would indicate a loss of pricing power or poor cost discipline, undermining the earnings compounder thesis.
Core Investment Debate

Platform RPO Strength vs. NGS Growth Deceleration

BULL VIEW

Bulls focus on the $15.5B RPO (+24% YoY), seeing it as a leading indicator of durable, large-scale enterprise deals that secures future revenue and validates the platform thesis.

CORE TENSION

Whether strong Remaining Performance Obligation (RPO) growth from platform consolidation can offset the clear, ongoing deceleration in the key Next-Generation Security (NGS) ARR growth engine.


PREVAILING SENTIMENT
BEARISH

The company's official FY26 guidance, projecting NGS ARR growth to slow to 26-27% (down from 29% in Q1) and overall revenue growth to 14% (down from 16%), confirms the bear stance.

BEAR VIEW

Bears focus on the sequential NGS ARR deceleration (from 34% to 29% YoY) and management's guidance for a further slowdown, signaling the hyper-growth phase is ending.

Next 6 months: Risks and Catalysts
Timeline Event & Metric To Watch
February 17, 2026
Q2 FY2026 Earnings Release & Guidance
Watch: NGS ARR growth relative to guided 26-27% and billings growth vs. consensus. Any deviation from the deceleration trend is key.
Next 6 Months
Major Enterprise Competitive Announcement
Watch: Public announcements from Microsoft or Zscaler detailing a major customer win at a Fortune 500 company, specifically displacing Palo Alto Networks' platform.
Ongoing
US Federal Reserve Rate Decision / Bond Market Volatility
Watch: 10-Year Treasury yield breaking and holding above 4.5%, signaling a higher cost of capital that pressures high-duration growth stock valuations.
Key Events in Last 6 Months
Date Event Stock Impact
Aug 22, 2025
Q4 FY2025 Earnings Report
Details: Company reported full-year fiscal 2025 results, capping a year of growth but setting the stage for the deceleration narrative. The stock reaction was muted.
Muted (-0.7%)
$185.88 -> $184.55
Sep 18, 2025
Major CEO Insider Selling
Details: The CEO sold over $172 million worth of stock in a single day. The market reaction was muted, with the stock posting a modest gain the following day.
Modest 1.2% gain
$205.68 -> $208.19
Oct 8, 2025
Strategic Acquisition of Chronosphere
Details: Palo Alto Networks announced its acquisition of Chronosphere to bolster its observability and cloud security offerings, a key part of its platformization strategy. The stock pulled back modestly.
Slight -1.2% pullback
$217.79 -> $215.17
Nov 20, 2025
Q1 FY2026 Earnings & Guidance
Details: Company beat estimates but reported decelerating NGS ARR growth (29% vs 32% prior quarter) and guided for further slowing revenue growth. The stock saw a slight pullback.
Slight -1.2% pullback
$185.07 -> $182.91
Jan 23, 2026
Executive Insider Selling
Details: The EVP/Chief Product Officer sold a reported $23 million in stock. The market disregarded the sale, with the stock rising notably over the next trading session.
Rose significantly by 2.2%
$180.18 -> $184.22
Jan 29, 2026
China Ban on US Cybersecurity Software
Details: Reports emerged that the Chinese government ordered domestic firms to stop using PANW software. Despite the negative news, the stock changed little in the following session.
Flat (0.4%)
$176.21 -> $176.97
Risk Management
Position Sizing

1% - 3%

CONSERVATIVE

The Moderate volatility is deceptive. Bearish sentiment, driven by decelerating growth, a contested moat, and speculative valuation, creates a poor risk/reward. We cap exposure until growth visibility improves.

Diversification Alternatives
FTNT
SECTOR

Unlike PANW's speculative valuation, FTNT has a more reasonable forward P/E, superior operating margins (37.3%), and a defensible moat in the price-sensitive market via its custom ASICs.

Core Thesis: The thesis is built on a structural cost advantage, providing best-in-class price-to-performance that is resilient and captures a segment where PANW is structurally disadvantaged.
CRWD
SECTOR

Offers a cleaner, best-of-breed growth story in endpoint security, avoiding the complex and costly M&A integration risks inherent in PANW's 'all-in-one' platform strategy.

Core Thesis: The core thesis is a superior, cloud-native architecture winning in the crucial endpoint security market, driven by a strong product-led growth model that is less reliant on large, complex enterprise deals.
How Is The Market Pricing PANW?

Palo Alto Networks is re-rating from a network firewall vendor to the dominant, all-in-one cybersecurity platform, driven by the consolidation of security tools and growth in its subscription-based Next-Generation Security (NGS) offerings.

Filter all news through the lens of the 'platformization' thesis: is the company successfully consolidating customers onto its integrated Strata, Prisma, and Cortex platforms, thereby accelerating high-margin, recurring revenue?

What will confirm the thesis

Next-Generation Security (NGS) ARR growth >30% YoY; Remaining Performance Obligation (RPO) growth >20% YoY; addition of >100 'platformized' customers per quarter; successful integration of major acquisitions like CyberArk and Chronosphere without margin degradation.

What will damage the thesis

Deceleration of NGS ARR or RPO growth below 20%; major cyber breach at a platformized customer; significant customer churn or pushback on bundled platform pricing; execution failures in integrating large acquisitions leading to product gaps or customer dissatisfaction.

Noise: Real but irrelevant to thesis

Quarterly hardware revenue fluctuations – the strategic focus is on recurring software and subscriptions; competitor announcements of new point solutions – the thesis is that platforms win over individual 'best-of-breed' tools; minor beats or misses on quarterly EPS driven by opex timing – focus on ARR and RPO as the true forward indicators.

Repricing Catalyst

The successful 'platformization' of the enterprise customer base is the primary catalyst. By bundling network security (Strata), cloud security (Prisma), and AI-driven operations (Cortex), PANW aims to displace smaller competitors and lock in customers, driving NGS ARR. Management reported adding a record ~110 new platformized customers in Q2 FY2026, bringing the total to ~1,550, with a high net retention rate of 119% among this cohort.

What PANW Makes & Who Pays
TTM figures based on Q2 FY2026 Earnings Press Release, Feb 17 2026
Subscription & Support (Recurring Revenue)
$8.3B TTM (80% of Total) · 74% Margin
What It Is

Recurring subscriptions for: Prisma (Cloud Security), Cortex (AI Security Operations/XDR), Strata (Software-based firewalls, SASE), and Threat Prevention, DNS Security, and WildFire services.

Who Pays & How

Enterprises like a global automotive leader pay for multi-platform deals (e.g., a ~$50M deal for SASE and XSIAM) to consolidate dozens of point solutions into one integrated platform, reducing complexity and total cost of ownership. The deep integration across network, cloud, and security operations creates significant switching costs.

Annual Recurring Revenue (ARR) from subscriptions.
Competition
Zscaler (in SASE/Zero Trust), CrowdStrike (in Endpoint/XDR).
Zscaler has a pure cloud-native architecture for Zero Trust security. CrowdStrike has a strong position in the AI-native endpoint security market with its single-agent Falcon platform.
PANW's moat is its comprehensive, integrated platform. It can offer a single vendor solution for network, cloud, and SOC, which is compelling for large enterprises looking to consolidate vendors.
Product (Hardware & Licenses)
$2.1B TTM (20% of Total) · 73% Margin
What It Is

Physical firewall appliances (Next-Generation Firewalls - NGFW) and related perpetual software licenses.

Who Pays & How

Enterprises with significant on-premise data centers or network infrastructure purchase hardware appliances as the foundation of their network security. However, this is a declining portion of the business as workflows move to the cloud.

One-time payment for hardware appliance and perpetual software license.
Competition
Fortinet - FortiGate Firewalls.
Fortinet uses proprietary ASIC chips in its hardware, which it claims provides a performance and cost advantage for on-premise deployments.
Palo Alto Networks' advantage is the integration of its hardware with its broader cloud and AI platform (Prisma and Cortex), creating a consistent security policy across hybrid environments.
PANW Evolution: Price Return by Era
2005–2017 · The Firewall Revolution
Disrupting the Firewall Market +~500% (IPO in 2012 to 2017)
Founded in 2005, Palo Alto Networks launched its first next-generation firewall (NGFW) in 2007. This era was defined by establishing market leadership in the network security hardware space, displacing legacy vendors by providing application-level visibility and control.
2018–2024 · The Pivot to Cloud & Platform
Building the Platform via M&A +~350% (2018 to 2024)
Recognizing the shift to the cloud, CEO Nikesh Arora initiated an aggressive M&A strategy. The company spent billions acquiring companies to build out its Prisma (cloud security) and Cortex (AI/SOAR) pillars, transforming the business model towards a recurring revenue, software-based platform.
2025–Present · The Platformization Era
Consolidating the Market Volatile, pending execution of large-scale M&A integration
With the core platform components in place, the focus shifted to 'platformization'—convincing large enterprises to consolidate their security vendors and adopt PANW's integrated suite. This era is marked by massive, multi-pillar deals and a focus on growing high-margin Next-Generation Security (NGS) ARR.
Market Appears To Be Aligned With Core Thesis
Price structure is strongly bullish. The regime, trend, and proximity to highs all point towards intact institutional trend. Relative to SPY: Decisively outperforming and improving. Potential evidence of active institutional rotation. Volume and momentum are strongly confirming. The institutional accumulation is evident and momentum is accelerating. Earnings history is neutral. The market reaction and subsequent drift do not give a clear directional signal.
① Structure
+4
Structural pillar score (-4 to +4). Driven by trend regime, SMA cross events, proximity to 52W high, and relative strength vs SPY.
② Volume / Momentum
+3
Volume/Momentum pillar score (-4 to +4). Driven by institutional footprint score, OBV divergence, and momentum character.
③ Catalyst
0
Catalyst pillar score (-4 to +4). Driven by earnings day reaction, 20D post-earnings drift, and post-earnings volume character.
Combined Score
7 / 12
1 Price Structure & Trend Trending Up · Golden Cross
2 Momentum Accelerating
3 Relative Strength vs. SPY Strong Outperformance
4 Institutional Footprint & Volume Mild Accumulation
5 Volatility Normal
6 Key Price Levels Range · Vol Flat
7 Earnings Reaction History Emerging Resilience
8 How the Verdict Is Derived Three Pillars
Core Cache Last Updated: 5/29/2026