Palo Alto Networks Q3 Earnings and Revenues Surpass Estimates

Palo Alto Networks PANW delivered third-quarter fiscal 2026 non-GAAP earnings of 85 cents per share, which beat the Zacks Consensus Estimate of 81 cents by 4.9%. The figure improved 6.3% year over year. Palo Alto Networks’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 7.03%.PANW reported third-quarter fiscal 2026 revenues of $3 billion, which topped the Zacks Consensus Estimate of $2.92 billion by 2%. Revenues increased 31% year over year from $2.29 billion in the year-ago quarter. Management attributed the quarter’s strength to accelerating organic bookings momentum as customers turned to the company to secure AI deployments at scale.PANW’s Q3 in DetailProduct revenues increased to $594 million from $453 million in the year-ago quarter, accounting for 19.8% of total revenues. Subscription and support revenues, which represented 80.2% of total revenues, rose to $2.41 billion from $1.84 billion, reflecting the company’s continued shift toward recurring revenues.      Palo Alto Networks, Inc. Price, Consensus and EPS Surprise Palo Alto Networks, Inc. price-consensus-eps-surprise-chart | Palo Alto Networks, Inc. QuoteRemaining performance obligation (RPO) rose to $18.4 billion, up 36% year over year, including contributions from CyberArk and Chronosphere. Next-Generation Security ARR climbed to $8.13 billion, up 60% year over year, supported by platform adoption and growth across the company’s next-generation portfolio. Non-GAAP gross profit grew to $2.27 billion compared to a non-GAAP gross margin at 75.8%. Non-GAAP operating income increased to $814 million, while the non-GAAP operating margin remained strong at 27.1%, reflecting continued profitability strength.PANW’s Balance Sheet & Cash FlowAs of April 30, 2026, Palo Alto Networks had $3.11 billion in cash and cash equivalents and short-term investments.Cash generation strengthened year over year. Net cash provided by operating activities was $871 million, up from $554 million in the prior quarter. Adjusted free cash flow was $910 million compared with $502 million in the prior quarter, while the trailing 12-month adjusted free cash flow margin was 38.5%, up 430 basis points year over year.PANW’s FY26 GuidanceFor fiscal 2026, Palo Alto Networks now expects revenues in the range of $11.41 billion to $11.42 billion, suggesting year-over-year growth of 24%. The Zacks Consensus Estimate for fiscal 2026 revenues is pegged at $11.3 billion.RPO is projected to be in the range of $20.9-$21.0 billion, while Next-Gen Security ARR is forecasted between $8.9 billion and $8.95 billion, implying 59-60% annual growth. The company projects a non-GAAP operating margin in the range of 28.9% to 29.2% and an adjusted free cash flow margin of 37.5%.PANW’s non-GAAP earnings per share (EPS) are expected in the band of $3.77 to $3.79. The Zacks Consensus Estimate for fiscal 2026 earnings is pegged at $3.70.For the fiscal fourth quarter of 2026, Palo Alto Networks expects revenues in the range of $3.34 billion to $3.35 billion, indicating year-over-year growth of 32%. The Zacks Consensus Estimate for the fourth quarter of fiscal 2026 revenues is pegged at $3.28 billion.The company also guided Next-Generation Security ARR to $8.90 billion to $8.95 billion, suggesting growth of 59% to 60%, and RPO in the range of $20.9 billion to $21.0 billion. Non-GAAP EPS for the fiscal fourth quarter are projected in the range of 96 cents to 98 cents. The Zacks Consensus Estimate for fourth-quarter fiscal 2026 earnings is pegged at 96 cents.Zacks Rank and Stocks to ConsiderPalo Alto Networks has a Zacks Rank #4 (Sell) at present.Here are some better-ranked stocks from the Zacks Computer and Technology sector.Amphenol APH carries a Zacks Rank #2 (Buy) at present. Amphenol shares have gained 9.8% in the year-to-date period. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Analog Devices ADI carries a Zacks Rank #2 at present. Analog Devices’ shares have surged 56% in the year-to-date period.Ciena CIEN sports a Zacks Rank #1 at present. Ciena shares have surged 168.1% in the year-to-date period.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>This article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks