Palo Alto Networks Beats Wall Street Expectations, But Faces Slow Growth in Core Firewall Market

Palo Alto Networks (PANW) reported fiscal third-quarter earnings and revenue that exceeded Wall Street expectations on Monday. However, the company is facing slowing growth in its core network firewall market. Despite this, profit and revenue guidance for Palo Alto stock was in line with consensus estimates.

On the stock market today, Palo Alto stock fell more than 8% to 295.10 in extended trading. In the quarter ended April 30, Palo Alto earnings rose 20% to $1.32 a share on an adjusted basis. Revenue also increased by 15% to $2 billion, including acquisitions. Analysts had predicted earnings of $1.25 a share on sales of $1.97 billion.

For the current quarter ending in July, the cybersecurity firm projected profit of $1.41 per share, meeting expectations. Additionally, Palo Alto forecasted revenue of $2.16 billion at the midpoint of guidance, in-line with estimates of $2.16 billion. The company predicted billings of $3.55 billion, slightly above estimates of $3.45 billion.

Sales for firewall network appliances have slowed down, but Palo Alto has expanded its cloud-based security platform through acquisitions