Palo Alto Networks Cuts Profit Guidance Amid Acquisition Costs, Shares Drop 8%
Palo Alto Networks slashed its full-year profit forecast, sending shares tumbling nearly 8% in after-hours trading. The cybersecurity firm now expects adjusted EPS of $3.65-$3.70 for FY2026, down from prior guidance of $3.80-$3.90. Integration challenges from recent acquisitions—including CyberArk, Chronosphere, and Israeli startup Koi—are pressuring near-term margins.
Revenue growth remains robust, but the market is scrutinizing Palo Alto's ability to absorb these strategic purchases while maintaining platform dominance. The moves come as global competition in enterprise cybersecurity intensifies, with investors weighing short-term pain against long-term positioning in identity security and AI-driven protection markets.