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<p class="has-drop-cap">Palo Alto Networks (NASDAQ: PNAW), a leading cybersecurity company, announced its <a aria-label="third-quarter earnings results (opens in a new tab)" href="https://investors.paloaltonetworks.com/financial-information/quarterly-results" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">third-quarter earnings results</a> on Tuesday, revealing slower revenue growth and a cautious fourth-quarter outlook. <br><br>Following the announcement, the company’s shares experienced a significant decline in <a href="https://tokenist.com/investing/how-to-trade-after-hours/" rel="noopener noreferrer nofollow" class="deco-link">after-market trading</a>, reflecting investor disappointment in its performance and guidance.</p>
<h3 id="palo-alto-reports-mixed-q3">Palo Alto Reports Mixed Q3</h3>
<p>Palo Alto Networks reported a 15% increase in revenue to $1.98 billion for the third quarter, the slowest growth since early 2020. The company’s fourth-quarter revenue forecast of $2.15 billion to $2.17 billion fell slightly below analyst expectations. However, the company’s fourth-quarter billings projection of $3.43 billion to $3.48 billion was largely in line with expectations.</p>
<p>Despite the mixed results, the company highlighted its strong performance in new subscription sales and next-generation product offerings. The company’s next-generation annualized recurring revenue reached $3.79 billion, exceeding the $3.71 billion estimate and growing by 47%. The remaining performance obligations also increased by 23% to $11.3 billion. <br><br>The company attributed the growth to its platformization strategy, although this approach has led to increased bookings with deferred payments due to higher client borrowing costs.</p>
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<h3 id="stock-price-performance">Stock Price Performance</h3>
<p>As of the most recent market data, Palo Alto Networks’ stock was trading at $307.34, down 5.07%. The stock experienced a significant decline of up to 10% in after-market trading following the announcement of the earnings forecast. Before this decline, the stock had gained about 11% in the month leading up to the earnings announcement.</p>
<p>Despite the current volatility, the company’s stock has shown strong long-term performance, with a 1-year return of +62.91% compared to the <a href="https://tokenist.com/the-bull-and-bear-case-for-spx-in-2024/" rel="noopener noreferrer nofollow" class="deco-link">S&amp;P 500</a>‘s +26.64%. <br><br>Analysts remain optimistic about the company’s long-term growth potential, especially with its focus on AI and new subscription models. Analyst price targets for the stock range from a low of $270.00 to a high of $385.00, with a market capitalization of approximately $99.302 billion and a <a href="https://tokenist.com/investing/p-e-ratio/" class="deco-link" rel="noopener noreferrer nofollow">PE Ratio</a> (TTM) of 50.12.</p>
<p>The company’s earnings announcement also had a broader market impact, with shares of peers such as CrowdStrike (NASDAQ: CRWD), Zscaler (NASDAQ: ZS), and Fortinet (NASDAQ: FTNT) declining in extended trading.</p> <iframe src="https://tokenist.substack.com/embed" width="100%" height="320" style="border:1px solid #EEE; background:white;" frameborder="0" scrolling="no"></iframe>
<p><strong><em>Do you think Palo Alto Networks is currently a buying opportunity? Let us know in the comments below.</em></strong></p>
<p><em>Disclaimer: The author does not hold or have a position in any securities discussed in the article.</em></p>
<h3 id="br"><br></h3>
<p>The post <a rel="noopener noreferrer nofollow" href="https://tokenist.com/palo-alto-networks-reports-mixed-q3-results-shares-decline/">Palo Alto Networks Reports Mixed Q3 Results, Shares Decline</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://tokenist.com">Tokenist</a>.</p>

Palo Alto Networks Reports Mixed Q3 Results, Shares Decline

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