Palo Alto Networks stock rallies as results, outlook blow past Wall Street estimates

Palo Alto Networks reported a fiscal fourth-quarter loss of $119.3 million, or $1.23 a share, compared with a loss of $58.9 million, or 61 cents a share, in the year-ago period. Adjusted earnings, which exclude share-based compensation charges and other items, were $1.60 a share, compared with $1.48 in the year-ago period.

Revenue rose to $1.22 billion from $950.4 million in the year-ago quarter. Billings, which reflects future business under contract, rose to $1.87 billion, compared with $1.39 billion a year ago.

Analysts surveyed by FactSet had forecast earnings of $1.43 a share on revenue of $1.17 billion and billings of $1.71 billion. Palo Alto Networks had forecast $1.42 to $1.44 a share on revenue of $1.17 billion to $1.18 billion, and billings of $1.7 billion to $1.72 billion.

“Our strong Q4 performance was the culmination of executing on our strategy throughout the year, including product innovation, platform integration, business model transformation and investments in our go-to-market organization,” said Nikesh Arora, Palo Alto Networks chairman and chief executive, in a statement. “In particular, we saw notable strength in large customer transactions with strategic commitments across our Strata, Prisma and Cortex platforms.”  

Palo Alto Networks expects adjusted fiscal-first quarter earnings of $1.55 to $1.58 a share on revenue of $1.19 billion to $1.21 billion and billings of $1.29 billion to $1.31 billion, while analysts had forecast $1.59 a share on revenue of $1.15 billion and billings of $1.25 billion.

For the year, Palo Alto Networks expects adjusted earnings of $7.15 to $7.25 a share on revenue of $5.28 billion to $5.33 billion, while analysts expect $7.03 a share on revenue of $5 billion. The company also sees billings of $6.6 billion to $6.65 billion, while analysts forecast $6.18 billion.

Palo Alto Networks shares are up 38% for the past 12 months. In comparison, the ETFMG Prime Cyber Security ETF  HACK, +1.38%  is up 29%, while both the S&P 500 index  SPX, +0.85% and the tech-heavy Nasdaq Composite Index  COMP, +1.55% are up 32%.