Palo Alto Networks Earnings: Here’s Why Investors are Not Excited Now

Palo Alto Networks (NYSE:PANW) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 15%.

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Palo Alto Networks Earnings Cheat Sheet

Revenue: Rose 54.19% to $101.3 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Palo Alto Networks reported adjusted EPS income of $0.06 per share. By that measure, the company beat the mean analyst estimate of $0.05. It missed the average revenue estimate of $103.46 million.

Quoting Management: “In our fiscal third quarter, we continued to gain market share, rapidly acquire new customers and extend our penetration within existing customers,” said Mark McLaughlin, president and chief executive officer of Palo Alto Networks. “Revenue grew 54 percent year-over-year despite a tough macroeconomic environment and, during the quarter, we added over 1,000 new end-customers for the sixth consecutive quarter.”

Key Stats (on next page)…

EPS increased 20% from $0.05 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $0.07 and has not changed. For the current year, the average estimate is a profit of $0.21, which is the same with that ninety days ago.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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