Palo Alto Networks beats on earnings and revenue, misses on gross margin

Palo Alto Networks beats on earnings and revenue, misses on gross margin


Palo Alto Networks signage displays on the screen at the Nasdaq Market in New York City, U.S., March 25, 2025.

Jeenah Moon | Reuters

Palo Alto Networks reported better-than-expected earnings and revenue for the latest quarter but its gross margin was below estimates. The stock dropped 4% in extended trading on Tuesday.

Here’s how the company did, compared to analysts’ consensus estimates from LSEG:

  • Earnings per share: 80 cents, adjusted vs. 77 cents expected
  • Revenue: $2.29 billion vs. $2.28 billion expected

Sales in the company’s fiscal third-quarter grew 15% from $1.98 billion a year earlier. Net income fell to $262.1 million, or 37 cents per share, from $278.8 million, or 39 cents per share, a year ago.

The company said its fourth-quarter adjusted earnings will come be between 87 cents and 89 per share, ahead of analysts estimates of 86 cents.

Palo Alto Networks said that its non-GAAP gross margin was 76%, which trailed analysts’ estimates of 77.2%.

The company said capital expenditures for its latest quarter were $68.3 million, below Wall Street estimates of $70.8 million.

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