Shares of Palo Alto Networks (NASDAQ:) tumbled 9% as the corporate’s gentle billings outlook overshadowed its fiscal third-quarter earnings beat.
The cybersecurity chief reported a income enhance of 15% to $2.0 billion, surpassing each the analyst consensus of $1.97 billion and the earlier yr’s $1.7 billion. Adjusted earnings per share (EPS) for the quarter additionally exceeded expectations at $1.32, in comparison with the anticipated $1.25.
The corporate’s remaining efficiency obligations grew by 23% year-over-year (YoY) to $11.3 billion, barely above the estimate of $11.28 billion.
Chairman and CEO Nikesh Arora attributed the sturdy quarter to buyer enthusiasm for the corporate’s platformization technique, which integrates synthetic intelligence into safety measures.
CFO Dipak Golechha highlighted disciplined execution and funding in market and innovation as key drivers of the corporate’s constant, worthwhile progress.
Wanting forward, Palo Alto Networks offered steerage for the fiscal fourth quarter with an EPS vary of $1.40 to $1.42, which brackets the consensus of $1.41. Income is projected between $2.15 billion and $2.17 billion, according to the consensus of $2.16 billion.
Nevertheless, the billings outlook for the fourth quarter and the total fiscal yr, starting from $3.43 billion to $3.48 billion for This fall and $10.13 billion to $10.18 billion for the yr, fell barely wanting analysts’ expectations. This has doubtless contributed to the detrimental investor sentiment mirrored in PANW inventory’s decline.
For the total fiscal yr 2024, the corporate up to date its steerage, forecasting a income vary of $7.99 billion to $8.01 billion, up from the earlier vary of $7.95 billion to $8.00 billion, and above the consensus estimate of $7.98 billion.
Adjusted EPS is anticipated to be between $5.56 and $5.58, topping the consensus estimate of $5.52. The corporate additionally anticipates an adjusted working margin between 26.8% and 27.0%, and an adjusted free money stream margin within the vary of 38.5% to 39.0%.
