Palo Alto Networks forecast fiscal 2025 revenue and profit above Wall Street estimates, a sign of growing demand for its cyber security products as the digital threat landscape evolves.
Its shares rose about two percent in extended trading, as the company announced an additional US$500 million ($744.6 million) for share repurchases.
They dipped briefly during the post-earnings call after CEO Nikesh Arora said the recent global IT outage has caused several customers to reevaluate their options.
A surge in online threats have triggered demand for companies such as Palo Alto offering cyber security products.
However, analysts have said the July 19 outage, linked to CrowdStrike’s software update, has exposed risks of dependence on a single vendor.
Beginning this quarter, the company will give next-generation security annual recurring revenue as the key financial metric for revenue projections both quarterly and annually, CFO Dipak Golechha said.
“It was a strong quarter and better-than-expected beat and raise as PANW continues to scale its Next-Gen Security business while balancing profitable growth,” said Shrenik Kothari, lead sector analyst at Baird.
The company, whose products include cloud security suite Prisma and the AI-powered Cortex portfolio, expects its annual revenue to be between US$9.10 billion and US$9.15 billion, compared with analysts’ average estimate of US$9.11 billion, according to LSEG data.
Palo Alto expects its annual adjusted profit per share in the range of US$6.18 to US$6.31, compared with estimates of US$6.19.
Its fourth-quarter revenue rose about 12 percent to US$2.19 billion, beating expectations of US$2.16 billion.
The company, which counts NetApp, Iron Mountain and a US federal agency as customers, posted an adjusted profit per share of US$1.51, exceeding estimate of US$1.41.
Earlier this month, rival Fortinet raised its annual revenue forecast.