Palo Alto Networks Exceeds Earnings Estimates in Q2
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 17 2026
0mins
Should l Buy PANW?
Source: Benzinga
- Strong Earnings Report: Palo Alto Networks reported Q2 revenue of $2.59 billion, exceeding analyst expectations of $2.58 billion, with a year-over-year growth of 15%, indicating robust performance in the cybersecurity sector.
- Improved Profitability: The adjusted earnings per share reached $1.03, surpassing the analyst estimate of $0.94, reflecting the company's success in cost management and business expansion, which further boosts investor confidence.
- Future Growth Guidance: The company expects Q3 revenue to be between $2.941 billion and $2.945 billion, significantly above the market estimate of $2.60 billion, while raising its fiscal 2026 revenue guidance to $11.28 billion to $11.31 billion, demonstrating optimism about future performance.
- Adjusted Earnings Outlook: Despite the revenue guidance increase, Palo Alto lowered its full-year adjusted earnings guidance to a range of $3.65 to $3.70 per share, below the market expectation of $3.86, which may raise concerns among investors regarding profitability.
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Analyst Views on PANW
Wall Street analysts forecast PANW stock price to rise
34 Analyst Rating
28 Buy
5 Hold
1 Sell
Strong Buy
Current: 168.120
Low
157.00
Averages
232.49
High
265.00
Current: 168.120
Low
157.00
Averages
232.49
High
265.00
About PANW
Palo Alto Networks, Inc. is a global artificial intelligence (AI) cybersecurity company, with a comprehensive portfolio of cybersecurity solutions and platforms across network, cloud, security operations, AI and Identity. Its network security platform includes Secure Access Service Edge (SASE), Next-Generation Firewalls, Cloud Delivered Security Services (CDSS), Prisma AIRS, and Strata Cloud Manager (SCM). It delivers security operations capabilities that unifies standalone Security Information and Event Management (SIEM) tools, endpoint security, security automation, cloud detection and response (CDR), as well as attack surface management (ASM) capabilities on its Cortex platform. It delivers comprehensive security across the cloud application development lifecycle through Cortex Cloud. Its Unit 42 brings together expertise across threat research, incident response, and security consulting to deliver intelligence-driven, response-ready outcomes that help customers reduce cyber risk.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Partnership Collaboration: In partnership with global cybersecurity leader Palo Alto Networks, Danet will provide cybersecurity and information security products and services for network infrastructure, aimed at protecting the customer's critical network infrastructure and enhancing market competitiveness.
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- Future Opportunities: This win not only solidifies Danet's position in the information security sector but may also lead to additional orders from other organizations in Israel, further expanding its business scope and market share.
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- Key Issues: Major concerns include the supply of raw materials, rising interest rates, and the potential for a cyberwar.
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- Profitability Outlook: Although CrowdStrike has yet to achieve GAAP profitability, it is expected to become profitable in fiscal 2027, with a projected net income CAGR of 100% over the following two years, significantly enhancing its market appeal.
- Valuation Comparison: Palo Alto trades at a forward P/E ratio of 45, while CrowdStrike's is much higher at 91; despite CrowdStrike's slightly faster growth, Palo Alto's reasonable valuation may make it more attractive in the current market environment.
See More
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- Impact of Stryker Incident: Michigan-based medtech company Stryker recently faced a cyberattack linked to Iran, disrupting its daily operations and causing a 3.6% drop in stock price on Wednesday, illustrating the direct impact of cybersecurity incidents on corporate operations and market confidence.
- AI Development Boosts Security Sector: The widespread adoption of artificial intelligence presents new growth opportunities for the cybersecurity industry, as AI tools enhance workflow efficiency but also introduce potential vulnerabilities, with hackers leveraging AI capabilities to become more dangerous, thereby increasing demand for cybersecurity solutions.
- CrowdStrike Stock Recovery: Following a brutal sell-off in mid-February, CrowdStrike's stock has rebounded to approximately $442, although still below its 2026 closing high of nearly $477, reflecting market recognition of its strong earnings report and optimistic growth outlook.
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- Stock Buyback Announcement: Palo Alto Networks announced a $1 billion increase in its share repurchase authorization, indicating management's strategic timing as they bought 6.8 million shares at an average price of $147.69 last month, with shares rising about 13% since then.
- Cybersecurity Market Dynamics: Although we downgraded Palo Alto Networks to a 3 rating (sell into strength), the escalating cyber threat environment due to the Iran conflict keeps us optimistic about its leadership in cybersecurity, as enterprises seek to consolidate with top technology providers for system protection.
- Upcoming Earnings Reports: After the closing bell, Adobe, Rubrik, SentinelOne, ServiceTitan, and Ulta Beauty are set to report earnings, with market attention on their performance, while the Federal Reserve's preferred inflation gauge, the PCE price index, will be released before the bell, potentially influencing market sentiment.
See More
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- Market Reaction: Stock futures are lower this morning due to rising oil prices, reflecting market concerns about the ongoing Iran conflict, and until there is evidence of resolution, the risk of elevated oil prices remains.
- Layoffs and Investment: Atlassian announced a 10% workforce reduction, equating to about 1,600 employees, with the CEO stating this will help self-fund further investments in AI and enterprise sales, highlighting challenges in the traditional software model.
- Private Fund Restrictions: Morgan Stanley and Cliffwater have restricted withdrawals on private credit funds, with Morgan Stanley fulfilling less than half of an 11% redemption request on an $8 billion fund, indicating liquidity issues in the private credit market.
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