Palo Alto Networks Q4 Earnings and Revenues Surpass Estimates

Palo Alto Networks PANW delivered fourth-quarter fiscal 2025 non-GAAP earnings of 95 cents per share, which beat the Zacks Consensus Estimate by 7.9%. The figure improved 27% year over year.Palo Alto Networks’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 5%.Palo Alto Networks’ fourth-quarter fiscal 2025 revenues of $2.54 billion surpassed the Zacks Consensus Estimate by 1.6%. This compares to year-ago revenues of $2.19 billion.Buoyed by better-than-expected results, shares of Palo Alto Networks were up 5.92% in the after-market hours. Palo Alto Networks’ strong performance in the fourth quarter of fiscal 2025 can be attributed to a robust year-over-year rise in its Subscription & Support revenues, alongside a solid gain in Product revenues. Shares of Palo Alto Networks have gained 1.4%, underperforming the Zacks Security industry’s return of 7.2% year to date.Palo Alto Networks, Inc. Price, Consensus and EPS Surprise Palo Alto Networks, Inc. price-consensus-eps-surprise-chart | Palo Alto Networks, Inc. QuotePalo Alto Networks’ Q4 2025 DetailsProduct revenues rose 19.4% year over year to $573.9 million, accounting for 22.6% of total revenues. Subscription and Support revenues, which represented 77.4% of total revenues, grew 14.8% to $1.96 billion, driven by continued momentum across Prisma and Cortex offerings.Deferred revenues at the end of the fiscal fourth quarter were $6.30 billion. Remaining performance obligation climbed to $15.8 billion, up 24% year over year. Meanwhile, Next-Generation Security annualized recurring revenues hit $5.58 billion, representing a 32% year-over-year increase and a 9.6% sequential rise.Non-GAAP gross profit rose to $1.92 billion, up 14.3% year over year, while the non-GAAP gross margin contracted 100 basis points to 75.8%. Non-GAAP operating income increased 30.6% to $768.2 million, and the non-GAAP operating margin improved 340 basis points to 30.3% compared to the year-ago period.PANW’s Balance Sheet & Cash FlowAs of July 31, 2025, Palo Alto Networks had $2.9 billion in cash, cash equivalents, and short-term investments, down from $3.3 billion as of April 30, 2025.The company generated $1.02 billion in operating cash flow and reported a non-GAAP adjusted free cash flow of $ 954.5 million in the fourth quarter of fiscal 2025.Palo Alto Networks Initiates FY26 GuidanceFor fiscal 2026, Palo Alto Networks expects revenues between $10.48 billion and $10.53 billion. The Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $10.43 billion, indicating a rise of 13.6%. Remaining Performance Obligation is projected in the range of $18.6-$18.7 billion. Next-Gen Security ARR is estimated in the band of $7.00-$7.10 billion.Palo Alto Networks’ fiscal 2025 non-GAAP operating margin is projected in the range of 29.2- 29.7%. Its adjusted free cash flow margin is estimated in the range of 38-39%. The company expects non-GAAP earnings per share in the range of $3.75-$3.85. After a two-for-one stock split of PANW shares on Nov. 20, 2024, the outstanding share count is in the band of 710-716 million. The consensus mark for fiscal 2025 earnings is pinned at $3.65 per share, suggesting an improvement of 11.4%. The figure has been revised upward by a penny over the past 30 days.For the first quarter of fiscal 2026, Palo Alto Networks projects revenues between $2.45 billion and $2.47 billion, which suggests year-over-year growth of 14-15%. The Zacks Consensus Estimate for fourth-quarter fiscal 2025 revenues is pegged at $2.44 billion, indicating a rise of 13.9%. Remaining Performance Obligations are anticipated between $15.4 billion and $15.5 billion. Next-Gen Security ARR is expected in the band of $5.82-$5.84 billion.Non-GAAP earnings are projected in the range of 88-90 cents per share. The Zacks Consensus Estimate for non-GAAP earnings is pegged at 84 cents per share, which has been revised upward by a penny over the past 30 days, indicating a year-over-year improvement of 7.7%.Zacks Rank and Stocks to ConsiderCurrently, Palo Alto Networks carries a Zacks Rank #4 (Sell).Amphenol APH, Qualys QLYS and F5 FFIV are some better-ranked stocks that investors can consider in the broader Zacks Computer & Technology sector. Amphenol, Qualys and F5 sport a Zacks Rank #1 (Strong Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.Amphenol shares have gained 59.9%, year to date. The Zacks Consensus Estimate for Amphenol’s full-year 2025 earnings is pegged at $3.02 per share, up by 4 cents over the past seven days, suggesting a growth of 59.8% from the year-ago quarter’s reported figure.Qualys shares have declined 6.9%, year to date. The Zacks Consensus Estimate for Qualys’s full-year fiscal 2025 earnings has been revised upward to $6.35 in the past 30 days, suggesting year-over-year growth of 3.6%.F5 shares have gained 25.7%, year to date. The Zacks Consensus Estimate for F5’s full-year 2025 earnings is pegged at $15.38 per share, implying a rise of 15% from the year-ago quarter’s levels.See our %%CTA_TEXT%% report – free today!7 Best Stocks for the Next 30 DaysWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amphenol Corporation (APH): Free Stock Analysis Report F5, Inc. (FFIV): Free Stock Analysis Report Palo Alto Networks, Inc. (PANW): Free Stock Analysis Report Qualys, Inc. (QLYS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks