Earnings Recap — Q4 FY2026
CY Q3 2026 · Reported September 1, 2026 · Beat 6 of last 7 quarters
Palo Alto Networks, Inc. reported Q4 FY2026 revenue of $3.41B, a beat of 1.7% against consensus, and EPS of $1.02, a beat of 4.3%.
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Palo Alto Networks' record quarter underscores the accelerating demand for security and observability as AI infrastructure scales. The company's growth in network security, SASE, and observability (Chronosphere) reflects the need to secure and monitor the massive data center buildout and agentic traffic. Management's commentary on the $5 trillion capex cycle and the rise of sovereign and neo-cloud buyers signals continued tailwinds for cybersecurity and observability platforms.
Palo Alto Networks delivered a record Q4, exceeding guidance across all metrics. NGS ARR reached $9.1B, up 63% YoY, with nearly $1B added in the quarter. RPO surpassed $20B for the first time, ending at $21.2B, up 34%. The company closed the acquisitions of Console and Embrace, and reported strong momentum across platforms, including SASE bookings growth of 40%, XSIAM ARR growth of 70%, and Prisma AIRS surpassing $100M ARR. CyberArk (now Idira) and Chronosphere integrations are exceeding expectations, with observability ARR more than doubling since the Chronosphere acquisition.
Management did not provide specific guidance numbers in the provided transcript. They highlighted three AI inflections—agentic AI, cyber-capable models (Mythos), and open-weight model proliferation—as structural tailwinds driving demand for platformization and real-time defense. They also noted continued cost headwinds from hardware commodity costs and cloud hosting, but expect operating leverage and M&A synergies to offset these.
“We achieved record RPO, surpassing the $20 billion threshold for the first time, to close the year at $21.2 billion representing a growth rate of 34%.”
on Record RPO
“As I have said before, AI is a long term tailwind for cybersecurity. While these models are becoming increasingly proficient at uncovering vulnerabilities, detection is merely the opening act.”
on AI tailwind
“We are now securing a whole new castle of machine identities with autonomous permissions. This surge in traffic data, and identity complexity represents a significant long term tailwind across every 1 of our platforms.”
on Agentic AI and identity
How are you thinking about M&A and potential transformational acquisitions given the rapid market shifts?
Nikesh Arora said M&A is not a strategy but a consequence of product development. He noted that as AI shifts from LLMs to agents to open-weight models, security architecture needs to adapt, and they may acquire companies that have the right technology trend. He mentioned they have visibility into 40-50 funded companies in the category.
Can you provide more detail on the CyberArk integration, including the 200 net new logos and revenue synergies?
Nikesh Arora said they are excited about CyberArk, with cost synergies ahead of plan and margins reverting to standalone levels in about two quarters. He highlighted the launch of Modern PAM, a new expansion category, and strong go-to-market collaboration with over 400 shared leads and 200 net new logos. He emphasized the opportunity in non-human identities and agents.
How is buying behavior changing as AI threats become the new normal? Are customers more willing to platformize?
Nikesh Arora said that since Mythos, every CEO wants to discuss AI-driven vulnerabilities, leading to conversations about modernizing cyber estates and platformization. He noted that customers are moving toward consolidated platforms rather than fragmented point products, which is a tailwind for larger players. He expects this to be a long-term trajectory change, with potential major breaches driving further demand.