Palo Alto Networks Inc.
PANWFinancial Analysis · Updated May 12, 2026 · Coverage 2026-Q2
Financial Snapshot
ticker: PANW step: 04 generated: 2026-05-12 source: quick-research
Palo Alto Networks, Inc. (PANW) — Financial Snapshot
Note: PANW's fiscal year ends in late July. "FY2025" = fiscal year ended July 2025.
Income Statement Summary
| Metric | FY2023 | FY2024 | FY2025 | YoY |
|---|---|---|---|---|
| Total Revenue | $6.9B | $8.0B | $9.22B | +15% |
| NGS ARR (year-end) | $3.5B | $4.5B | $5.58B | +24% |
| Non-GAAP Operating Margin | 25% | 27% | 28% | +1pp |
| Non-GAAP EPS | $4.44 | $5.45 | $6.65 | +22% |
| Free Cash Flow | $2.8B | $3.1B | $3.4B | +10% |
Q1 FY2026 Highlights
| Metric | Q1 FY26 | YoY |
|---|---|---|
| Revenue | $2.5B | +16% |
| NGS ARR | $5.9B | +29% |
| RPO | $15.5B | +24% |
Q2 FY2026 Highlights
| Metric | Q2 FY26 | YoY |
|---|---|---|
| Revenue | $2.59B | +15% |
| NGS ARR | $6.33B | +33% (beat $6.11-6.14B guide) |
| RPO | $16.0B | +23% |
| Non-GAAP EPS | $1.03 | +27% |
| Net new platform customers | ~110 | |
| Total platform customers | ~1,550 | |
| Q2 new platformizations | ~75 (vs 45 prior year) |
NGS ARR Trajectory
| Period | NGS ARR | YoY Growth |
|---|---|---|
| FY24 exit | $4.5B | +43% |
| FY25 exit | $5.58B | +24% |
| Q1 FY26 | $5.9B | +29% |
| Q2 FY26 | $6.33B | +33% (accelerating) |
| FY26 guide | $8.52-8.62B | +53-54% |
Platform Strategy Metrics
| Metric | Value |
|---|---|
| Total platformized customers | 1,550 (+35% YoY) |
| Net retention rate (platform) | ~119% |
| Platform churn | Low single-digit |
| New platformizations Q2 FY26 | 75 |
Cash Flow & Balance Sheet (FY2025)
| Metric | Value |
|---|---|
| Operating Cash Flow | ~$3.5B |
| Capital Expenditures | ~$0.1B |
| Free Cash Flow | $3.4B (37% FCF margin) |
| Cash & Investments | ~$9B |
| Total Debt | ~$0 (debt-free) |
| Net Cash Position | ~$9B (pre-CyberArk) |
Key Ratios (approximate, May 2026)
- P/E (forward): ~44x | EV/Sales: ~11.7x | FCF Yield: ~3%
- Net Cash Position: ~$9B (pre-CyberArk close)
- Rule of 40: ~50 (15% growth + 37% FCF margin)
Growth Profile
NGS ARR accelerating: +24% (FY25) → +29% (Q1 FY26) → +33% (Q2 FY26). FY26 NGS ARR guide $8.52-8.62B = +53-54%. Platform consolidation working — 35% growth in platformized customers + 119% net retention. Free cash flow margin 37%. CEO Nikesh Arora insider buy of $10M March 2026 = strong confidence signal.
Forward Estimates
- FY2026E Revenue: ~$10.7B (+16%)
- FY2026E NGS ARR: $8.52-8.62B (mgmt; +53%+)
- FY2026E Non-GAAP EPS: ~$7.65
- FY2027E Revenue: ~$12.5B
- FY2027E EPS: ~$9 (+18%)
- Long-term Rule of 40 target: 50+
Capital Return
- No dividend
- Buybacks moderated for CyberArk acquisition
- Net cash $9B provides flexibility
Deeper Financial Analysis
The fundamental tier adds 8 additional research dimensions for $PANW.
Revenue Breakdown
Segment revenue, geographic mix, product-line contribution margins, and cohort dynamics.
Financial Trends
Quarter-over-quarter momentum, leading indicators, and inflection point analysis.
Balance Sheet
Debt structure, liquidity runway, dilution risk, and working capital dynamics.
Capital Allocation
ROIC trends, buyback cadence, M&A appetite, and reinvestment efficiency.
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