Palo Alto Earnings Guidance Tops Expectations Amid Coronavirus Emergency
Palo Alto Networks (PANW) reported fiscal third-quarter earnings Thursday that fell from a year earlier but still topped expectations. The Palo Alto earnings news and guidance sent shares in the cybersecurity firm surging in extended trading.
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Palo Alto stock rose 5.6% to near 229 in after-hours trading on the stock market today. In Thursday's regular session, shares fell 2.2%. Like many cybersecurity stocks, Palo Alto has rebounded from March lows amid the coronavirus outbreak. Meanwhile, analysts have lowered earnings estimates.
The coronavirus lockdown has left many companies using virtual private networks as more employees work from home. VPNs enable employees to remotely access internal computer systems.
At the same time, companies need VPN-ready computer security gear. Palo Alto's "firewall" security network technology protects VPNs from hackers.
Earnings came in at $1.17 a share, down 11% from the year-earlier period, amid acquisitions. Santa Clara, Calif.-based Palo Alto said revenue rose 20% to $869.4 million.
Analysts expected earnings of 93 cents a share on sales of $829.5 million for the period ended April 30. A year earlier, Palo Alto earnings were $1.31 a share on sales of $726.6 million.
Palo Alto Earnings Guidance
Palo Alto said billings rose 24% to $1 billion, topping estimates of $979 million.
For the current quarter ending in July, Palo Alto expects earnings in a range of $1.37 to $1.40 per share with revenue of $920 million at its midpoint of guidance. Analysts had estimated earnings of $1.30 a share on revenue of $916 million.
Heading into the earnings report, Palo Alto stock had a Relative Strength Rating of 77 out of a possible 99 from Investor's Business Daily.
Palo Alto primarily competes in the "firewall" network security market, facing off against Cisco Systems (CSCO), Fortinet (FTNT) and others. Firewalls monitor web-based apps and block unauthorized traffic from entering a private network.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
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