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Palo Alto Networks’ shares jump 9% on solid earnings
Palo Alto Networks Inc. saw its shares jump almost 9 percent in Tuesday morning trading after the cybersecurity company posted first-fiscal quarter results that sailed past Wall Street’s expectations.
The company saw strong growth, posting revenue of $505.5 million, up 27 percent from a year ago. It also reported a profit after certain costs such as stock compensation of $69.8 million, or 74 cents per share, up from 55 cents a year ago.
Wall Street’s forecasts had the company down for adjusted earnings of 69 cents per share on revenue of $489 million. Investors pushed up Palo Alto Networks’ share price to $154.75 Tuesday, though later in the day, they fell back to $150, a 5 percent gain.
Chief Executive Officer Mark McLaughlin said the company was already reaping the benefits of sales changes it made in the previous fiscal year. “In the quarter we added over 2,500 new customers and are now privileged to serve over 45,000 customers globally,” he said in a conference call.
Steffan Tomlinson, Palo Alto Network’s outgoing chief financial officer, added that the company had seen strong adoption of its Next-Generation Security Platform in the quarter. “Once again, we grew significantly faster than the market and our competition,” he said. “In addition, the power of our hybrid SaaS model was evident in record deferred revenue that continues to be driven by our ongoing mix shift to subscription and support.”
The company also announced Tomlinson’s replacement. Kathy Bonanno was named as the firm’s new CFO, having served in several senior finance roles at the company prior to her promotion. Before that, Bonnano cut her teeth at companies including Symantec Corp. and American Airlines Inc. “I believe we have a truly unique opportunity to continue to disrupt the security market, take share at scale and increase operating leverage,” Bonanno said on the call.
The company also updated its guidance for the second quarter, saying it expects to see adjusted earnings of 78 to 80 cents per share on revenue of $518 million to $528 million. For its full fiscal 2018, the firm expects earnings per share in the region of $3.35 to $3.41 per share on revenue of $2.145 billion to $2.185 billion.
Image: Palo Alto Networks
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