Shares of Palo Alto Networks soared Wednesday after the cybersecurity software specialist trounced earnings views, helped by what are known as next-generation cloud products. PANW stock jumped by double digits just after the opening bell.
Late Tuesday, Palo Also reported second-quarter earnings rose 81% year over year to $1.05 per share on an adjusted basis. Including acquisitions, revenue rose 26% to $1.7 billion. Analysts expected earnings of 78 cents a share on sales of $1.65 billion.
PANW stock vaulted 11.9% to 186.79 during the first minutes of the regular session on the stock market today.
Palo Alto said annual recurring revenue from next-generation cloud products surged 63% to $2.33 billion, topping estimates of $2.25 billion. The company added billings rose 26% to $2 billion, topping estimates of $1.96 billion.
PANW Stock: Cloud Products A Bright Spot
For the current quarter ending in April, Palo Alto projected earnings of 92 cents a share on revenue in a range of $1.69 billion to $1.72 billion. Analysts had estimated profit of 79 cents a share on revenue of $1.74 billion.
Palo Alto also raised its revenue outlook for next-generation cloud-based software products to a range of $2.75 billion to $2.8 billion. That topped its earlier outlook of $2.65 billion to $2.7 billion.
Prior to Wednesday's gains, PANW stock had advanced nearly 20% for 2023 through Tuesday's close. It holds a Relative Strength Rating of 67 out of a best-possible 99, according to IBD Stock Checkup.
Meanwhile, the company has spent over $3.4 billion making 10 acquisitions over the past three years. With roots in the "firewall" network security market, Palo Alto aims to build a broad cloud-based security platform. Firewall appliances protect computer networks by blocking online intrusions and monitoring web-based apps.
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