Palo Alto Networks tops Street view, raises outlook; shares slip

The company reported a fiscal first-quarter loss of $103.6 million, or $1.06 a share, compared with a loss of $92.2 million, or 97 cents a share, in the year-ago period. Adjusted earnings, which exclude share-based compensation charges and other items, were $1.64 a share, compared with $1.62 in the year-ago period.

Revenue rose to $1.25 billion from $946 million in the year-ago quarter. Billings, which reflects future business under contract, rose to $1.38 billion, compared with $1.08 billion a year ago.

Analysts surveyed by FactSet had forecast earnings of $1.57 a share on revenue of $1.2 billion and billings of $1.31 billion. Palo Alto Networks had forecast $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.

“Q1 was a strong start to fiscal year 2022, driven by strength in both our product and Next-Generation Security businesses, giving us confidence to raise our revenue and billings guidance for the year,” said Nikesh Arora, Palo Alto Networks chairman and chief executive, in a statement.

Palo Alto Networks expects adjusted fiscal-second quarter earnings of $1.63 to $1.66 a share on revenue of $1.27 billion to $1.29 billion and billings of $1.51 billion to $1.53 billion, while analysts had forecast $1.64 a share on revenue of $1.27 billion and billings of $1.52 billion.

For the year, Palo Alto Networks kept its adjusted earnings forecast of $7.15 to $7.25 a share, and raised its forecast revenue range to between $5.35 billion to $5.4 billion, up from $5.28 billion to $5.33 billion. Analysts expect $7.24 a share on revenue of $5.31 billion.

The company also raised its forecast billings range to between $6.68 billion and $6.73 billion, from a previous $6.6 billion to $6.65 billion, while analysts forecast $6.65 billion.

Palo Alto Networks shares are up 85% over the past 12 months. In comparison, the ETFMG Prime Cyber Security ETF HACK, -0.88% is up 36%, the S&P 500 index  SPX, +0.34% is up 32%, and the tech-heavy Nasdaq Composite Index  COMP, +0.45%  is up 35%.