Palo Alto Networks Shares rose 12% in after-hours trading on Thursday after network security hardware makers announced better-than-expected third-quarter results.
The company’s way is as follows.
- Revenue: According to Refinitiv, analysts expected $ 1.68 per share, compared to adjusted $ 1.79 per share.
- Revenue: According to Refinitiv, it’s $ 1.39 billion, compared to what analysts expected at $ 1.36 billion.
Nikesh Arora, CEO of Palo Alto Networks, said in a statement, “We saw strong top-line growth in the third quarter, which is part of the team leveraging strong cybersecurity demand trends. It’s a proof of execution. “
Palo Alto Networks has been observing Russia’s cyberattacks since the outbreak of the war during the quarter, raising interest in protection from businesses and government agencies across Europe, Arora said in a conference call. I told the analyst.
Supply shortages pose a challenge, Arora said. Rising parts and shipping costs reduced the company’s adjusted gross profit for the quarter, said Dipak Golechha, chief financial officer. The constraints “are likely to last for another year,” Arora said.
Commodity prices are rising both in the United States and abroad. But so far, it’s not a big challenge for Palo Alto Networks.
“There is no pressure in terms of inflation or declining economic activity,” Arora said.
Palo Alto Networks in the quarter publication Next Generation Firewall Tool Exclusively Available Through Amazon Public cloud.The company too publication A tool that helps businesses detect vulnerabilities in their software supply chain following issues caused by malicious updates to SolarWinds’ Orion software.
Executives have raised their full-year guidance. They are currently expecting adjusted earnings of $ 7.43 to $ 7.46 per share for revenues of $ 5.481 billion to $ 5.501 billion. Analysts surveyed by Refinitiv expected revenue of $ 5.46 billion and adjusted earnings per share of $ 7.29.
Guidance takes into account wage inflation, Arora said. This is partly due to the proximity of California-based Palo Alto Networks to Silicon Valley’s leading technology companies.
“We aren’t hiring as many people as we expect in this market,” he said. “As you can see, it’s a very tight labor market at the moment. That said, in my personal opinion, the labor market will be easier in the next 6-12 months.”
He said an employee of the company had left to join a startup six months ago. Now that has changed.
“The rationalization of the market has led people to buy shares and say,’Wait, do you really want to do this?'” Arora said.
Pre-trading stock prices have fallen almost 21% since the beginning of 2022, while the S & P 500 Index has fallen about 18% over the same period.