By Jaspreet Singh
(Reuters) – Palo Alto Networks (NASDAQ:) forecast fiscal 2025 revenue and profit above Wall Street estimates on Monday, a sign of growing demand for its cybersecurity products as the digital threat landscape evolves.
Its shares rose about 2% in extended trading, as the company announced an additional $500 million for share repurchases. They dipped briefly during the post-earnings call after CEO Nikesh Arora said the recent global IT outage has caused several customers to reevaluate their options.
A surge in online threats have triggered demand for companies such as Palo Alto offering cybersecurity products. However, analysts have said the July 19 outage, linked to CrowdStrike (NASDAQ:)’s software update, has exposed risks of dependence on a single vendor.
Beginning this quarter, the company will give next-generation security annual recurring revenue as the key financial metric for revenue projections both quarterly and annually, CFO Dipak Golechha said.
“It was a strong quarter and better-than-expected beat and raise as PANW continues to scale its Next-Gen Security business while balancing profitable growth,” said Shrenik Kothari, lead sector analyst at Baird.
The company, whose products include cloud security suite Prisma and the AI-powered Cortex portfolio, expects its annual revenue to be between $9.10 billion and $9.15 billion, compared with analysts’ average estimate of $9.11 billion, according to LSEG data.
Palo Alto expects its annual adjusted profit per share in the range of $6.18 to $6.31, compared with estimates of $6.19.
Its fourth-quarter revenue rose about 12% to $2.19 billion, beating expectations of $2.16 billion.
The company, which counts NetApp (NASDAQ:), Iron Mountain (NYSE:) and a U.S. federal agency as customers, posted an adjusted profit per share of $1.51, exceeding estimate of $1.41.
Earlier this month, rival Fortinet (NASDAQ:) raised its annual revenue forecast.