Palo Alto Networks, Inc.

(NASDAQ Global Select)
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Bullish +72

Palo Alto Networks Reports Fiscal Fourth Quarter and Fiscal Year 2026 Financial Results - PR Newswire

AI-generated analysis

πŸ“ˆ Palo Alto Networks reported total revenue of $3.41 billion for the fiscal fourth quarter, representing a 34% year-over-year increase.

πŸš€ Next-Generation Security ARR grew 63% year over year to reach $9.10 billion in the latest quarter.

πŸ’° Non-GAAP operating income for the quarter was $1.0 billion, compared to $768 million in the same period last year.

πŸ€– The company acquired Console, an AI-native platform enabling agentic workflows, to expand its Cortex ecosystem.

πŸ“… For fiscal first quarter 2027, the company expects NGS ARR between $9.54 billion and $9.56 billion.

πŸ”­ Full fiscal year 2027 revenue is guided between $14.10 billion and $14.20 billion with 23% to 24% growth.

πŸ’΅ Adjusted free cash flow for the quarter was $1.3 billion, yielding a fiscal year 2026 margin of 38.4%.

🎯 Management reaffirmed confidence in achieving a 40% adjusted free cash flow margin by fiscal year 2028.

πŸ“‰ GAAP net loss for the quarter was $282 million, or ($0.35) per diluted share, due to non-cash adjustments.

Bullish Signals
  • Palo Alto Networks delivered a strong finish to a record year, exceeding guidance across the board with total revenue growing 34% year over year to $3.41 billion.
  • Next-Generation Security ARR surged 63% year over year to $9.10 billion, driven by strength in Network & AI Security, Cortex, and Idira platforms.
  • The company successfully acquired Console, an AI-native platform that will expand the role of its Cortex platform across enterprise agentic transformation.
  • Adjusted free cash flow for the quarter reached $1.3 billion, with a fiscal year 2026 adjusted free cash flow margin of 38.4%, demonstrating effective scaling of its profitable growth framework.
  • Management provided robust guidance for fiscal first quarter 2027, expecting NGS ARR between $9.54 billion and $9.56 billion with 63% year-over-year growth.
  • Full fiscal year 2027 revenue is guided between $14.10 billion and $14.20 billion, representing 23% to 24% year-over-year growth.
  • The company reaffirmed its long-term confidence in achieving a 40% adjusted free cash flow margin by fiscal year 2028.
Full Analysis
Palo Alto Networks reported strong financial results for its fiscal fourth quarter and fiscal year ended July 31, 2026, driven by significant growth in its Next-Generation Security (NGS) portfolio. Total revenue surged 34% year over year to $3.41 billion, while NGS Annual Recurring Revenue (ARR) jumped 63% to $9.10 billion. The company highlighted the acquisition of Console, an AI-native platform designed to expand its Cortex capabilities across enterprise agentic workflows, reinforcing its position as a global AI cybersecurity leader. The company exceeded its guidance across all key metrics, fueled by strength in its Network & AI Security, Cortex, and Idira platforms. GAAP operating income was $172 million, though non-GAAP operating income reached $1.0 billion, reflecting the exclusion of share-based compensation and other non-cash items. Adjusted free cash flow for the quarter was $1.3 billion, resulting in a fiscal year 2026 adjusted free cash flow margin of 38.4%, demonstrating effective scaling of its profitable growth framework. Looking ahead to fiscal first quarter 2027, Palo Alto Networks provided robust guidance expecting NGS ARR between $9.54 billion and $9.56 billion (63% year-over-year growth) and total revenue in the range of $3.300 billion to $3.310 billion. For the full fiscal year 2027, the company projects NGS ARR growth of 22% to 23%, with total revenue expected between $14.10 billion and $14.20 billion. Management reaffirmed confidence in achieving a 40% adjusted free cash flow margin by fiscal year 2028.