How did Palo Alto Networks perform in fiscal Q4 and full-year 2025?

Fiscal Q4 2025 revenue grew 16% to $2.54 billion, and full-year revenue grew 15% to $9.22 billion. Next-Generation Security ARR grew 32% to $5.6 billion and RPO grew 24% to $15.8 billion. Operating income for the quarter was $497.2 million, up from $238.4 million a year earlier.

Why did GAAP earnings decline while non-GAAP earnings rose?

GAAP net income fell to $253.8 million from $357.7 million mainly because the company recorded a $338.0 million tax provision in Q4 2025, compared with a $38.7 million tax benefit in Q4 2024. Non-GAAP results exclude that tax item, along with share-based compensation and other adjustments, so non-GAAP net income rose to $673.0 million. Investors should weigh the large share-based compensation charges of $372.7 million in the quarter when evaluating non-GAAP figures.

What is the outlook for fiscal 2026?

Management guides to total revenue of $10.475–$10.525 billion (about 14% growth), NGS ARR of $7.00–$7.10 billion (26%–27% growth), RPO of $18.6–$18.7 billion, non-GAAP diluted EPS of $3.75–$3.85, and an adjusted free cash flow margin of 38%–39%. The guidance does not reflect the pending CyberArk transaction.

What leadership changes were announced?

Nir Zuk, the company's founder and CTO, resigned as CTO and as a director effective August 14, 2025, and will provide advisory services through November 2, 2026. Lee Klarich, previously Chief Product Officer, was appointed to the board as a Class I director and named Chief Product and Technology Officer. He will also chair the board's Security Committee.

What risks should investors consider?

The filing's forward-looking statements highlight risks including the pending CyberArk acquisition (closing conditions, integration difficulties, management distraction, and effects on the share price), the success of platformization and AI product offerings, competition, and changes in the fair value of contingent consideration. The technology leadership transition and the tax-driven GAAP earnings decline are additional points to monitor.

PANW 8-K: Earnings & Results, Leadership Changes & More

01—Abstract

Summary

Summary of the 8-K filed August 18, 2025. Cited figures are marked; the original filing is the authoritative source.

Palo Alto Networks (PANW) reported fiscal Q4 and full-year 2025 results (quarter ended July 31, 2025) that showed strong top-line momentum.

Fiscal Q4 revenue grew 16% year over year to $2.54 billion^a, and fiscal 2025 revenue grew 15% to $9.22 billion. Next-Generation Security ARR rose 32% to $5.6 billion and remaining performance obligation (RPO) grew 24% to $15.8 billion. GAAP net income for the quarter fell to $253.8 million ($0.36 per diluted share) from $357.7 million a year earlier, largely because of a $338.0 million tax provision versus a prior-year tax benefit, while non-GAAP net income rose to $673.0 million ($0.95 per diluted share) from $522.2 million ($0.75).

Management highlighted that the company remained a 'Rule-of-50' company for the fifth consecutive year. Fiscal 2026 guidance calls for total revenue of $10.475 billion to $10.525 billion^b (about 14% growth), Next-Generation Security ARR of $7.00 to $7.10 billion (26% to 27% growth), non-GAAP diluted EPS of $3.75 to $3.85, and adjusted free cash flow margin of 38% to 39%. Guidance does not reflect the pending CyberArk acquisition, which the forward-looking statements flag as a source of integration, closing, and disruption risk.

Leadership changed as well. Founder and CTO Nir Zuk resigned from his CTO and board roles effective August 14, 2025, and will provide advisory services through November 2, 2026. Chief Product Officer Lee Klarich was appointed to the board and named Chief Product and Technology Officer.

The company also adopted amended bylaws, including a federal forum provision for Securities Act claims. Investors should weigh the strong growth and cash generation against GAAP earnings pressure, the transition in technology leadership, and the integration risk tied to CyberArk.

02—Key points

Key Highlights

Fiscal Q4 2025 revenue rose 16% year over year to $2.54 billion; full-year FY2025 revenue rose 15% to $9.22 billion, surpassing a $10 billion annual revenue run-rate.
Next-Generation Security ARR grew 32% to $5.6 billion, and RPO grew 24% to $15.8 billion, indicating strong forward visibility.
GAAP diluted EPS fell to $0.36 from $0.51 in Q4 due to a $338.0 million tax provision, while non-GAAP diluted EPS rose to $0.95 from $0.75.
FY2026 guidance: revenue of $10.475–$10.525 billion (about 14% growth), NGS ARR of $7.00–$7.10 billion, and non-GAAP diluted EPS of $3.75–$3.85.
Adjusted free cash flow margin guidance of 38%–39% and non-GAAP operating margin guidance of 29.2%–29.7% for FY2026.
Founder and CTO Nir Zuk resigned effective August 14, 2025, and will serve as an advisor through November 2, 2026.
Lee Klarich, Chief Product Officer, joined the board and was named Chief Product and Technology Officer; the company also adopted amended bylaws with a federal forum provision for Securities Act claims.

03—Questions

Frequently Asked Questions

How did Palo Alto Networks perform in fiscal Q4 and full-year 2025?
Fiscal Q4 2025 revenue grew 16% to $2.54 billion, and full-year revenue grew 15% to $9.22 billion. Next-Generation Security ARR grew 32% to $5.6 billion and RPO grew 24% to $15.8 billion. Operating income for the quarter was $497.2 million, up from $238.4 million a year earlier.
Why did GAAP earnings decline while non-GAAP earnings rose?
GAAP net income fell to $253.8 million from $357.7 million mainly because the company recorded a $338.0 million tax provision in Q4 2025, compared with a $38.7 million tax benefit in Q4 2024. Non-GAAP results exclude that tax item, along with share-based compensation and other adjustments, so non-GAAP net income rose to $673.0 million. Investors should weigh the large share-based compensation charges of $372.7 million in the quarter when evaluating non-GAAP figures.
What is the outlook for fiscal 2026?
Management guides to total revenue of $10.475–$10.525 billion (about 14% growth), NGS ARR of $7.00–$7.10 billion (26%–27% growth), RPO of $18.6–$18.7 billion, non-GAAP diluted EPS of $3.75–$3.85, and an adjusted free cash flow margin of 38%–39%. The guidance does not reflect the pending CyberArk transaction.
What leadership changes were announced?
Nir Zuk, the company's founder and CTO, resigned as CTO and as a director effective August 14, 2025, and will provide advisory services through November 2, 2026. Lee Klarich, previously Chief Product Officer, was appointed to the board as a Class I director and named Chief Product and Technology Officer. He will also chair the board's Security Committee.
What risks should investors consider?
The filing's forward-looking statements highlight risks including the pending CyberArk acquisition (closing conditions, integration difficulties, management distraction, and effects on the share price), the success of platformization and AI product offerings, competition, and changes in the fair value of contingent consideration. The technology leadership transition and the tax-driven GAAP earnings decline are additional points to monitor.

04—Continue

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