Palo Alto Networks Shares Fall Despite Strong Q3 Results

Analysts remain bullish, raising price targets as CEO asserts high demand despite weak billings forecast

Palo Alto Networks reported Q3 FY23 results with an EPS of $1.38, beating the analyst consensus estimate of $1.16, and revenue of $1.88 billion, surpassing the analyst consensus estimate of $1.84 billion.
Despite strong earnings, the company's shares fell due to a weaker billings forecast than expected, with full-year 2024 total billings expected to be between $10.7 billion and $10.8 billion, down from the prior forecast of $10.9 billion to $11 billion.
Several analysts raised their price targets for Palo Alto Networks following the Q3 results, with Needham analysts reiterating a Buy and price target of $305, and Oppenheimer analyst maintaining the Outperform rating and $310 price target.
Palo Alto Networks CEO Nikesh Arora stated that despite the weak billings forecast, demand remains high and the company is hitting all the profitability and cash flow metrics on the market.
Shares of Palo Alto Networks fell by around 5% in pre-market trading following the release of the company's first-quarter earnings results.