Key points:
- Palo Alto jumps on solid q3 earnings, beating on top and bottom lines
- EPS came in at $1.79 per share on a consensus of $1.68
- Strong demand has been fuelled by fear from Russian cyberattacks
Palo Alto Networks (NASDAQ: PANW) announced solid Q3 earnings after the closing bell on Thursday as the cybersecurity specialist saw a spike in demand fueled by the Russia/Ukraine conflict and the increase in cyberattacks. PANW shares are currently trading at an impressive gain of 12%, up 32% year over year.Â
The company’s third-quarter earnings were pegged at $1.79 per share, beating the analyst consensus of $1.68. Similar growth can be seen on the top line, with revenue coming in at $1.39B against the wider consensus of $1.36B. The cybersecurity giant saw revenue growth of 29% year over year.Â
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Cybersecurity has exploded alongside growing technological innovation, but following the outbreak of war in Ukraine, Palo Alto Networks has noticed a strong uptick in interest from corporations and government agencies across Europe. Higher component and shipping costs have hit Palo Alto too, weighing on gross margins across the quarter, with delays expected to continue for forthcoming quarters. On the upside, Palo Alto noted no direct hit from inflation, which has been a prominent weight on company earnings recently.
The most recent quarter has also seen the unveiling of Palo Alto’s new next-generation firewall tool, available solely through Amazon’s public cloud.Â
Following the strong quarter and the continuation of the conflict in Ukraine, management has raised its outlook for the rest of the year, now expecting adjusted earnings of between $7.43 and $7.46 on revenue of between $5.48B and $5.5B. Analysts are looking for adjusted earnings of $7.29 per share.Â