Palo Alto Networks Momentum Reinforces Cybersecurity Market Strength

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Amid financial jitters across Wall Street, some calming news has arrived from Palo Alto Networks. Indeed, the cybersecurity company delivered stronger-than-expected quarterly results on May 19, 2022 -- and also offered an upbeat financial forecast for the rest of 2022.

The Palo Alto Networks financial news is a welcome development for MSSPs and MDR (managed detection & response) service providers. Indeed, Palo Alto Networks works with a strong base of MSSPs and MSPs to mitigate end-customer risk.

Among the latest financial metrics to note: For Palo Alto Networks' Q3 of fiscal 2022...

  • Total revenue was $1.4 billion, up grew 29% compared to $1.1 billion for the fiscal third quarter 2021; and
  • GAAP net loss was $73.2 million, compared with GAAP net loss of $145.1 million for the corresponding quarter last year.

Those upbeat figures arrived a day after Cisco Systems delivered disappointing quarterly results. Cisco blamed the earnings and revenue weakness on supply chain issues, China lockdowns and the Russia-Ukraine war. Rumors about a Cisco Security business reorganization have also surfaced in recent weeks.

Attack Surface Management and SOC Automation

Back at Palo Alto Networks, key areas of growth include the Cortex Xpanse business, where transactions have grown more than 100% in the last 12 months, CEO Nikesh Arora told Wall Street analysts during the company's quarterly earnings call. The Xpanse growth shows "attack surface management is now seeing an inflection in mainstream demand." Still, Palo Alto Networks did not announce actual revenue figures associated with Xpanse.

Another recent platform launch -- called Cortex Extended Security Intelligence & Automation Management (XSIAM) -- is "making progress in our goal to initiate co-design work with 10 partners and we expect to be on track at the end of this quarter with our plans," added Arora. "XSIAM will ultimately enable us to achieve our Cortex vision around SOC automation, delivering what we expect to be a very unique value to our customers and disrupting the multibillion-dollar SIEM category by offering a modern alternative that leverages AI and ML."

We'll be watching for more news about the initial 10 XSIAM partners, while also exploring how Palo Alto Networks will roll out the service to its broader partner ecosystem.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.