Palo Alto Networks' stock surged 9.48% in after-hours trading on Tuesday, following the release of the cybersecurity company's fiscal third-quarter financial results.
The company reported adjusted earnings per share of $0.85, beating the consensus estimate of $0.80. Revenue for the quarter reached $3 billion, exceeding expectations of $2.94 billion and representing a 31% year-over-year increase. Palo Alto Networks also raised its full-year outlook, now projecting revenue between $11.42 billion and $11.43 billion and adjusted EPS between $3.77 and $3.79, both above analyst forecasts.
CEO Nikesh Arora attributed the strong performance to accelerating organic bookings growth as customers seek to secure their AI deployments at scale. He stated that advancements in AI have increased urgency around cybersecurity, driving demand for the company's platform. The results demonstrated that fears of AI displacing legacy cybersecurity providers are misplaced, with AI actually acting as a tailwind for the industry as customers deploy more modern solutions to counter AI-enabled threats.