Palo Alto Networks (PANW) reported a 29% year-over-year growth in its next-generation security (NGS) annual recurring revenue (ARR), reaching $5.85 billion in the first quarter of fiscal 2026. This growth was driven by increased adoption of its software firewalls, Secure Access Service Edge (SASE), and Cortex Extended Security Intelligence and Automation Management (XSIAM), as customers increasingly choose to utilize multiple Palo Alto products.
The company added approximately 60 new platform customers, with those achieving over $5 million in NGS ARR rising to nearly 170, and over $10 million customers increasing to 50, both showing a 50% growth from the previous year. Notable large deals included an $85 million contract for XSIAM with a U.S. telecom and a $33 million SASE contract with a U.S. federal agency, indicating customer preference for streamlined security operations.
Palo Alto Networks is also pursuing acquisitions of CyberArk Software and Chronosphere to enhance its offerings in identity security and observability, respectively. The Zacks Consensus Estimate forecasts revenue growth of approximately 14.1% and 13.3% for fiscal 2026 and 2027, respectively.
