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Letter from our Chair
"As AI transforms every industry, we are transforming cybersecurity - uniting Network Security, SASE, Cloud Security, Security Operations, and soon Identity Security into an integrated platform."
Dear Fellow Shareholders:
I am personally more excited than ever about what lies ahead. Fiscal 2025 was a pivotal year, distinguished by unwavering disciplined execution and accelerated strategic advancements across all our initiatives. The robust results we achieved are a direct and compelling reflection of a long-term strategy meticulously crafted over several years - a strategy centered on actively anticipating where the cybersecurity market is headed and proactively developing innovative solutions before the demand fully materializes. As I have consistently expressed in communications and this letter over the past several years, I am immensely proud of the collaborative work Palo Alto Networks has undertaken with our esteemed customers and valued partners. Together, we are tirelessly striving to achieve our shared vision: to create a world where each day is safer and more secure than the one before.
FISCAL 2025 ACHIEVEMENTS
Fiscal 2025 stands out as another period of robust financial achievement for Palo Alto Networks, underscoring the effectiveness of our strategic approach. Our total revenue reached an impressive $9.22 billion, marking a 15% increase compared to the previous year. This growth was further amplified by our Next-Generation Security Annual Recurring Revenue (NGS ARR), which grew to $5.58 billion, a 32% year-over-year increase, and our remaining performance obligations (RPO), which grew to $15.8 billion, a 24% increase from the prior year. This financial performance underscores the resonance of our platformization strategy with our customers, translating into sustained and increasing demand for our comprehensive cybersecurity solutions.
At the core of this exceptional performance is our unwavering commitment to innovation across all our security platforms. In Network Security, we observed particularly strong growth, fueled by an increasing adoption of our software firewall offerings and Secure Access Service Edge (SASE) solutions. This contributed to Network Security NGS ARR reaching $3.9 billion, a 35% year-over-year increase, while product revenue in this segment grew by 19% in fiscal 2025 driven by a higher software mix. Beyond Network Security, we witnessed broad-based momentum across our Security Operations platform. Here, NGS ARR reached $1.7 billion, an approximate 25% year-over-year increase, encompassing both our Cortex® and Prisma® Cloud offerings. A key highlight in this area was the robust expansion of our Cortex XSIAM® customer base, which experienced an over twofold increase year-over-year, showcasing the strong adoption of our advanced security operations capabilities.
None of these accomplishments are possible without the dedication and engagement of our over 16,000 employees, located all around the world. Our dedicated employees are the driving force behind our industry leadership, consistently developing cutting-edge products and services. Their unwavering commitment to innovation enables us to effectively protect our customers' assets from the escalating frequency and sophistication of artificial intelligence-powered cyberattacks.
CREATING THE END-TO-END SECURITY COMPANY FOR THE AI ERA
The cybersecurity landscape is undergoing a monumental shift, propelled by the emergence of generative and agentic artificial intelligence (AI). This new technological paradigm, where AI can autonomously generate, reason, and act, fundamentally reweaves the fabric of technology and consequently introduces a new, vast, and complex attack surface. In response to this transformative era, our focus in fiscal 2025 was on evolving our product offerings to safeguard both our customers' adoption of AI tools and the valuable AI assets they generate. This commitment culminated in the launch of Prisma AIRS™, the most comprehensive AI security platform available today. Prisma AIRS is a unified solution designed to enable organizations to confidently embrace AI by delivering end-to-end security across all AI applications, agents, models, and data sets. It helps address critical security gaps and secure AI deployments, fostering both confidence and compliance.
Letter from our Chair
For important information regarding our use of forward-looking statements, please see page 10of this Proxy Statement.
Fiscal 2025 also marked a pivotal moment with the rise of AI agents, which has given birth to new AI security categories and is redefining the delivery of Identity Security. Having extensively observed and analyzed the Identity Security landscape for many years, we are convinced that the time is opportune to reshape this category and assume a leadership role. This conviction led to our announcement on July 30, 2025, of our intent to acquire CyberArk, the global leader in Identity Security. CyberArk possesses the foundational leadership in both Privileged Access Management (PAM) and Machine Identity crucial for managing security permissions for AI agents. Following the closing of the proposed transaction, we expect that the combination of Palo Alto Networks and CyberArk will establish the preeminent platform for end-to-end AI security-from managing access for agentic identities to enforcing security policies for AI applications and agents in runtime.
We foresee Identity Security evolving into the next major pillar of our multi-platform strategy, augmenting our leadership in Network Security, Secure Access Service Edge (SASE), Cloud Security, and Security Operations. Our objective is to seamlessly integrate these best-of-breed platforms, enabling customers to respond more rapidly to escalating AI threats. We believe this strategic move will accelerate our mission to double the value of our combined businesses over the next five years.
In essence, we believe the integrated company will serve as the definitive cyber guardian for our customers, empowering them to concentrate on their core business objectives and AI adoption. This further propels our overarching mission for our customers: "A world where each day is safer and more secure than the one before."
OUR ANNUAL MEETING
As in the past, this year's Proxy Statement is constructed to maximize clarity and understanding about the company's strategies, successes, and challenges.
Several of our key highlights are worth prefacing here.
Shareholder Engagement. We remain guided by, and appreciative of, the perspectives of our shareholders as expressed through their engagement with us. We again engaged in meaningful and robust shareholder outreach, holding discussions with shareholders representing approximately 53% of our outstanding shares as of June 30, 2025. These discussions covered a wide variety of topics, including executive compensation, business strategy, risk management oversight, sustainability, mergers and acquisitions, and corporate governance. We understand the importance of having a true dialogue with our investors, and we are committed to meaningful outreach and engagement with our shareholders again in the coming year.
Executive Compensation. We remain committed to an executive compensation program that is truly pay-for-performance. For fiscal 2025, 100% of our named executive officers' equity compensation awards were performance-based, with different performance targets than the cash incentive plan awards. In addition, approximately 98% of my total compensation and an average of approximately 94% of the total compensation across our other current executive officers was performance-based and at risk. Recognizing the feedback received through the results of both our 2023 and 2024 "Say-on-Pay" vote results and our discussions with you, our Compensation and People Committee made a number of meaningful changes to our fiscal 2025 executive compensation programs, and those for fiscal 2026, particularly to the equity compensation program. In the pages that follow, our Lead Independent Director, John M. Donovan, and our Compensation and People Committee describe these changes to you in detail.
Our Commitment to Responsible Business Practices. We protect people's digital lives and secure the systems that society depends upon. Through our corporate responsibility efforts we maintain trust with our stakeholders and help sustain long-term business success. Elsewhere in this Proxy Statement, we discuss our efforts throughout fiscal 2025 to advance environmental sustainability, to invest in our people, and to operate with integrity in all we do. Your Board and executive leadership team take seriously their duty to oversee these corporate responsibility strategies.
You are cordially invited to attend the 2025 Annual Meeting of Shareholders of Palo Alto Networks, Inc. to be held on Tuesday, December 9, 2025 at 11:00 A.M., Pacific Time.
This year's annual meeting will be a virtual meeting conducted via a live webcast. You will be able to listen to the annual meeting, submit your questions, and vote during the live webcast of the meeting by visiting https://www.virtualshareholdermeeting.com/ PANW2025 and entering the 16-digit control number included on the accompanying proxy card or in the instructions that accompanied your proxy materials. If you did not receive a 16-digit control number, please reach out to your broker for
further instructions.
On behalf of our Board, we thank you for your investment in Palo Alto Networks and for your continued trust. We look forward to the annual meeting on December 9, 2025.
Thank you,
Nikesh Arora
Chair and Chief Executive Officer
Letter from our Lead Independent Director
"On behalf of our entire Board, we thank you for your continued support. The Board remains committed to lead the Company for our shareholders' benefit. We value the input of our investors and have taken meaningful actions in response to shareholder feedback."
Dear Fellow Shareholders:
As Lead Independent Director of the Palo Alto Networks Board of Directors, my foremost responsibility is ensuring that the Board provides independent and effective oversight of the Company's efforts to deliver meaningful and sustainable value to our shareholders. We highly value the perspectives of our investors and your input has directly informed Board deliberations on strategy, governance, and executive compensation.
FISCAL 2025 IS AN INFLECTION POINT FOR PALO ALTO NETWORKS
Seven years ago, we entrusted Nikesh Arora with the role of Chief Executive Officer, tasking him with transforming Palo Alto Networks from a leader in next-generation firewalls into the world's preeminent cybersecurity company. Our fiscal 2025 results are a testament to our transformation. It was a period of strong financial performance, yielding record totals: total revenue reached $9.22 billion, NGS ARR grew to $5.58 billion, and our RPO climbed to $15.8 billion. These achievements are underscored by our commitment to developing and integrating best-of-breed products across various categories into cohesive platforms.
Under Nikesh's leadership, our strategy has consistently involved identifying and capitalizing on market inflection points. For example, recognizing the shift towards hybrid work environments, we proactively entered the SASE category. Our early investment in endpoint security allowed us to pioneer the inflection point toward XDR, and we've continued to revolutionize Security Operations with XSIAM. Our foresight in developing a secure browser also placed us ahead of market trends as others race to build browsers in the AI era.
With the recently announced agreement to acquire CyberArk, we are once again seeking to seize a crucial inflection point, this time within the Identity Security space. The emergence of AI agents signals another significant shift, creating new AI security categories and fundamentally reshaping how Identity Security is delivered. We believe that integrating CyberArk's category-leading technology following the close of the proposed transaction will strategically position the combined company to address evolving identity security needs, especially as the widespread deployment of AI agents elevates the importance of privileged controls. The Board looks forward to welcoming the CyberArk team into the Palo Alto Networks family after closing.
LEADERSHIP TRANSITIONS
After more than two decades, our visionary founder, Nir Zuk, a true giant in the industry, has announced his retirement. Nir's name is synonymous with Palo Alto Networks, and his monumental impact cannot be overstated. He did not merely establish a company; he ignited a revolution with the next-generation firewall, irrevocably transforming the cybersecurity landscape. The fierce competitive spirit that defines our culture is a direct testament to his legacy. His influence extends beyond our groundbreaking products; it is deeply rooted in our talented people. On behalf of the Board, I want to extend our deepest gratitude to Nir.
Nir's retirement marks a seamless and natural transition as we pass the torch to Lee Klarich, who now serves as our Chief Product and Technology Officer and a member of our Board. For nearly as many years as Nir, Lee has been the chief architect of our product strategy, masterfully turning our vision into the industry-leading platforms we have today. His appointment as Chief Product and Technology Officer and to our Board of Directors reflects the profound trust we have in his leadership to ensure our deep commitment to innovation not only continues but accelerates into the future. The Board looks forward to his many contributions in the years to come.
We also announce that Mr. Hamers will not stand for reelection at our upcoming 2025 Annual Meeting of Shareholders. Mr. Hamers has made significant contributions to our Board since joining it in early 2025, but due to new responsibilities he is undertaking in his own portfolio, we have agreed to a different role for him to ensure that the Company can continue to benefit from his distinctive skills and experience. Following the Annual Meeting, Mr. Hamers will become a special advisor to the CEO of our EMEA (Europe, Middle East, and Africa) region, Helmut Reisinger. Given Mr. Hamers' track record of exemplary leadership across EMEA, including within prominent financial institutions, the Board is confident that, in this newly-created role, he will provide unique and valuable insights into the complexities and opportunities in the region.
SHAREHOLDER ENGAGEMENT AND EXECUTIVE COMPENSATION
At our 2024 annual meeting of shareholders, a majority of the votes cast were in favor of our fiscal 2024 executive compensation program, which is an encouraging increase from 38% of the votes cast in favor of our fiscal 2023 executive compensation program.
However, we acknowledge that this result shows us that we are still not where you would like us to be and we had work to do.
Accordingly, once again, I personally led our shareholder outreach efforts to ensure that I, on behalf of the Board, heard from you directly. Collectively, the Chair of our Compensation and People Committee and I personally met with shareholders representing 35% of our outstanding shares, and I offered meetings to 45%.
14Meetings with investors
Representing 35% of our outstanding shares, while offering meetings to investors representing 45% of our outstanding shares (each as of June 30, 2025).
From your feedback, we distilled a number of important changes to our executive compensation programs. During the course of my engagement with you during fiscal 2025, I was heartened by the overwhelming support we received for making these changes, many of which we previewed in our 2024 Proxy Statement. And we didn't stop there. For fiscal 2026, we introduced meaningful changes to incorporate your feedback, consistent with our commitment to our shareholders to continually evolve our executive compensation best practices and benefit from their important insights. The changes include:
Reducing the maximum payout of our executive performance-based restricted stock units ("PSUs") by 33.3%, from 600% to 400% of the target number of PSUs, for fiscal 2025, fiscal 2024, and fiscal 2023 PSUs, and maintaining the 400% maximum payout for fiscal 2026 PSUs.
Updating the financial measures used in our PSUs, including for all remaining performance periods in our fiscal 2023 and fiscal 2024 PSUs, to NGS ARR and annual non-GAAP earnings per diluted share, further aligning executive compensation to the success of our platformization strategy and focus on profitability.
Defining clear threshold performance levels for each performance metric in our fiscal 2025 cash incentive plan such that if either metric's performance is more than 10% below its respective target, then there is no funding or payout.
Increasing the relative total shareholder return ("TSR") modifier performance target needed to achieve a 1.0x modifier in our fiscal 2026 PSUs to be attaining a 55th percentile rank from the 50th percentile rank.
Requiring exceeding the target for NGS ARR by at least $400 million for the particular fiscal year-an increase of 33.3%-in order to attain the maximum achievement of 300% for the NGS ARR performance measure in our fiscal 2026 PSUs, while the threshold for no payout has similarly been lowered to missing the target by at least $400 million.
We encourage you to read the letter from our Compensation and People Committee, as well as our entire Compensation Discussion and Analysis. We believe that you will conclude that your Board has taken to heart the feedback we have received from our shareholders and designed an executive compensation program deserving of your support.
On behalf of our Board, I thank you for your investment in Palo Alto Networks and your continued trust. I look forward to the Annual Meeting on December 9, 2025.
Thank you,
John M. Donovan
Lead Independent Director
Notice of 2025 Annual Meeting of Shareholders
Date and Time Tuesday, December 9, 2025
11:00 AM Pacific Time
Voting Items
Virtual Meeting Site www.virtualshareholder meeting.com/PANW2025
Who Can Vote Shareholders of record as of October 15, 2025 are entitled to vote
For Further
Items of Business Board Vote Recommendation Details
To elect three Class II directors named in the accompanying Proxy Statement to serve until our 2028 annual meeting of shareholders and until their successors are duly elected and qualified.
To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending July 31, 2026.
To approve, on an advisory basis, the compensation of our named executive officers.
To approve an amendment to the Palo Alto Networks, Inc. 2021 Equity Incentive Plan to increase the number of plan shares reserved
for issuance.
To consider and vote upon a shareholder proposal, if properly presented at the Annual Meeting, regarding a policy addressing the impact of share repurchases on financial performance metrics.
To consider and vote upon a shareholder proposal, if properly presented at the Annual Meeting, regarding electing each of our directors annually.
"FOR" each director nominee
Page 51
"FOR" Page 69
"FOR" Page 72
"FOR" Page 128
"AGAINST" Page 140
"AGAINST" Page 143
HOW TO VOTE
Online
Visit https://www.proxyvote.com prior to the Annual Meeting, 24 hours a day, seven days a week.
By Phone
Call the phone number located on the accompanying proxy card or voting instruction form.
By Mail
Complete, sign, date and return the accompanying proxy card or voting instruction form in the
envelope provided.
QR CODE
Scan the QR code on your voting materials to vote with your mobile device
Shareholders will also act on such other business that may properly come before the 2025 Annual Meeting of Shareholders (the "Annual Meeting") or any adjournments or postponements thereof.
YOUR VOTE IS IMPORTANT. Please act as soon as possible to vote your shares, even if you plan to attend the Annual Meeting. For instructions to vote your shares and more information, see "About the Annual Meeting" on page 149.
We appreciate your continued support of Palo Alto Networks and look forward to receiving your proxy.
By Order of the Board of Directors,
Bruce Byrd
Executive Vice President, General Counsel and Corporate Secretary November 7, 2025
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING TO BE HELD ON DECEMBER 9, 2025: THE NOTICE OF 2025 ANNUAL SHAREHOLDERS' MEETING, PROXY STATEMENT, AND 2025 ANNUAL REPORT ON FORM 10-K ARE AVAILABLE AT https://WWW.PROXYVOTE.COM.
69 | Proposal No. 2 Ratification of Appointment of Independent Registered Public Accounting Firm | ||
69 | Fees Paid to the Independent Registered Public Accounting Firm | ||
69 | Auditor Independence | ||
70 | Audit Committee Policy on Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm | ||
71 | Report of the Audit Committee | ||
72 | Proposal No. 3 Advisory Vote on the Compensation of our Named Executive Officers | ||
73 | Executive Compensation | ||
73 | Letter from our Compensation and People Committee | ||
76 | Compensation Discussion and Analysis | ||
81 | We Continue to Meet Our Commitments | ||
82 | Compensation-Setting Process | ||
85 | CEO and Other NEO Pay Mix for Fiscal 2025 | ||
104 | Fiscal 2026 Compensation Decisions | ||
105 | Other Aspects of Our Executive Compensation Programs | ||
110 | Report of the Compensation and People Committee | ||
111 | Executive Compensation Tables | ||
126 | Executive Officers | ||
128 | Proposal No. 4 Amendment to Our 2021 Equity Incentive Plan | ||
128 | Why Should Shareholders Vote to Approve the Amendment to the 2021 Plan? | ||
132 | Summary of the 2021 Plan | ||
140 | Proposal No. 5 Shareholder Proposal - Impact of Share Repurchases on Performance Metrics | ||
140 | Shareholder's Proposal and Supporting Statement | ||
141 | Company Opposing Statement | ||
143 | Proposal No. 6 Shareholder Proposal - Elect Each Director Annually | ||
143 | Shareholder's Proposal and Supporting Statement | ||
144 | Company Opposing Statement | ||
146 | Security Ownership of Certain Beneficial Owners and Management | ||
148 | Related Person Transactions | ||
149 | About the Annual Meeting | ||
155 | Other Matters | ||
155 Delinquent Section 16(a) Reports | |||
155 Fiscal 2025 Annual Report and SEC Filings | |||
156 | Appendix A | ||
Table of Contents
3 Letter from our Chair
6 Letter from our Lead Independent Director
8 Notice of 2025 Annual Meeting of Shareholders
11 About Us
14 Our Board at a Glance
Our Corporate Governance at a Glance
Shareholder Engagement at a Glance
Executive Compensation at a Glance
Our Compensation Best Practices
Significant At-Risk Compensation
Corporate Responsibility at a Glance
Proxy Roadmap
Corporate Governance
23 Corporate Governance Highlights
24 Board Responsiveness to Shareholders
27 Leadership Structure
30 Board Committees and Responsibilities
35 Annual Board and Committee Self-Evaluations
37 Board's Role in Strategy Oversight
37 Board's Role in Risk Oversight
Select Oversight Areas
Enterprise Risk Management Program
Succession Planning
Communications with the Board of Directors
Corporate Governance Guidelines and Code of Business Conduct and Ethics
42 Compensation and People Committee Interlocks and Insider Participation
43 Corporate Responsibility
43 Overview
43 Board Oversight
Advancing Environmental Sustainability
Investing in People
Operating with Integrity
49 Voting Roadmap
51
52 Director Tenure and Refreshment
Board Makeup
Board Skills and Experience Matrix
Directors
65 Identification and Evaluation of Director Nominees
66 Director Independence
66 Director Compensation
68 Director Stock Ownership Guidelines
68 Director Attendance
159
Calculation of Billings and Organic Operating Margin
Calculation of Adjusted Operating Income and Operating Margin and Non-GAAP Net Income Per Diluted Share
Non-GAAP Financial Measures and Other Key Metrics
Appendix B
Amended and Restated 2021 Equity Incentive Plan
Highlights 14 Our Board at a Glance 17 Our Corporate Governance at a Glance 19 Executive Compensation at a Glance 49 Voting Roadmap 53 Board Skills and Experience Matrix 73 Letter from our Compensation and People Committee 76 Compensation Discussion and Analysis 128 Amendment to Our 2021 Equity Incentive Plan | Forward-Looking Statements This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical or current facts, including statements regarding our future prospects, expectations regarding the proposed acquisition of CyberArk Software Ltd., corporate responsibility matters and plans, governance matters and plans, and executive compensation programs and plans, made in this document are forward-looking. We use words such as "anticipates," "believes," "continue," "estimate," "expects," "future," "intends", "may," "plan," and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements reflect management's current expectations and are inherently uncertain. Actual results could differ materially for a variety of reasons. Risks and uncertainties that could cause our actual results to differ materially from those expected or implied in any forward-looking statement include, but are not limited to those discussed in the section titled "Risk Factors" in our 2025 Annual Report on Form 10-K, our Registration Statement on Form S-4 (File No. 333-290235), and other filings we may file with the SEC from time to time. Unless otherwise provided herein, all statements in this Proxy Statement are as of the date of the filing of this Proxy Statement, and we do not assume any obligation to update forward-looking statements. References to our website in this Proxy Statement are not intended to function as a hyperlink and the information contained on our website is not intended to be part of this Proxy Statement. In this Proxy Statement, the terms "the Company," "we," and "our" refer to Palo Alto Networks, Inc. and the term "Board" refers to the Board of Directors of Palo Alto Networks, Inc. To the extent that this Proxy Statement has been or will be specifically incorporated by reference into any other filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, the Letters from our Chair, our Lead Independent Director and our Compensation and People Committee, and the sections of this Proxy Statement titled "Report of the Audit Committee" and "Report of the Compensation and People Committee" shall not be deemed to be so incorporated, unless specifically stated otherwise in such filing. Note on per share figures After the close of trading on December 12, 2024, we effected a two-for-one stock split. Accordingly, all share and per-share amounts presented in this Proxy Statement have been retroactively adjusted to reflect the stock split. |
About Us
Our Company
Palo Alto Networks® is a global cybersecurity provider with a vision of a world where each day is safer and more secure than the one before. We were incorporated in Delaware in 2005 and are headquartered in Santa Clara, California. Our principal executive offices are located at 3000 Tannery Way, Santa Clara, CA 95054.
Our mission is to be the cybersecurity partner of choice for enterprises, organizations, service providers, and government entities to protect our digital way of life. Our cybersecurity platforms and services help secure enterprise users, networks, clouds, and endpoints by delivering comprehensive cybersecurity backed by artificial intelligence and automation. A key element of our strategy is to help our customers simplify their security architectures through consolidating disparate point products. We execute on this strategy by developing our capabilities and packaging our offerings into platforms which are able to cover many of our customers' needs in the markets in which we operate.
Our platformization strategy combines various products and services into a tightly integrated architecture for more secure, faster and cost-effective outcomes. We focus on delivering value across four sectors of the cybersecurity industry: Network Security, Cloud Security, Security Operations, and Threat Intelligence and Advisory Services.
Our Corporate Values
Our corporate values, which were co-created by our employees, serve as the foundation of our culture and the guide for our corporate decisions. Foremost among these is integrity, which is the foundation of everything we do and every decision we make. We believe that collaboration enhances our ability to disrupt entrenched beliefs, which we think ultimately leads to innovation. Our ability to execute on our innovations and deliver products and services that address the cybersecurity needs of our customers is critical to our long-term success. Finally, we are intentional about including varied points of view, perspectives, experiences, and ideas in our decision-making process. We believe that our core values make us a better company.
Recognized in "Top 100 Global Most Loved Workplaces" by Newsweek (2025)
Recognized in "America's Best Large Employers" by Forbes (2025)
Recognized in multiple categories including Company Outlook, Leadership, Engineering, and Women by Comparably (2025)
Our Fiscal 2025 Highlights
Our strategic approach and disciplined execution has delivered another year of exceptional financial results for our shareholders. Highlights include:
Total revenue increased to
$9.22 billion, by 15% year over year
Next-Generation Security annual recurring revenue, or "NGS ARR", increased to $5.58 billion, by 32% year over year(1)
Remaining performance obligations, or "RPO", increased to $15.8 billion, by 24% year over year
Non-GAAP net income per diluted share ("Non-GAAP EPS") increased to $3.34, by 18% year over year(2)
Driving innovation with several new offerings, including Prisma® Access Browser 2.0, Cortex Cloud™, Prisma AIRS™ and Cortex XSIAM® 3.0
Capitalizing on industry inflection points with our acquisition of Protect AI, Inc. for AI security, and our proposed acquisition of CyberArk Software Ltd. ("CyberArk"), to enter the Identity Security space following the closing of the proposed transaction
Delivering Robust Financial Performance Underscored by Platformization
Total Revenue
($ in billions)
RPO
($ in billions)
NGS ARR
($ in billions)
Non-GAAP Earnings Per Diluted Share(2)
($)
(1) Our NGS ARR represents the annualized allocated revenue of all active contracts as of the final day of the reporting period related to all product, subscription and support offerings, excluding revenue from hardware products, legacy attached subscriptions, support offerings and professional services. For more information, please see Appendix A.
(2) See Appendix A for a reconciliation of GAAP to non-GAAP metrics and other information.
Delivering Continued Superior Shareholder Returns
Five-Year Total Shareholder Return
Our total shareholder return over the past five years significantly outperformed the S&P 500 (by nearly three times) and our 2025 compensation peer group (by nearly four times). See "Compensation Discussion and Analysis-Compensation Process-Competitive Positioning" for the list of our 2025 compensation peer group.
Source: S&P Capital IQ, based on the latest closing price as of the beginning of the period and as of July 31, 2025. The compensation peer group TSR is the weighted-average TSR, based on the respective market capitalization of each peer at the beginning of each fiscal year, over the time period, and includes only publicly-traded companies as of such date.
Our Board at a Glance
Our Board comprises a group of highly qualified leaders in their respective fields who bring unique perspectives. All directors have either held senior leadership positions at large companies or otherwise gained significant and wide-ranging management experience in their respective fields (including strategic, financial, public company financial reporting, compliance, risk management, and leadership development). Many of our directors also have public company experience (serving as chief executive officer, chief operating officer, or chief financial officer, or on boards of directors and board committees), and as a result have a deep understanding of corporate governance practices, including risk and management oversight.
Our Board at a Glance
Skills and Experience
Our directors have the breadth and depth of expertise necessary to guide our business strategy and create shareholder value. The Board is independent, with varied backgrounds, experience and perspectives.
Leadership & Governance
Senior Leadership Experience
11/11
Global/International Experience
10/11
Public Company Board Experience and Corporate Governance
Risk Management | Financial Knowledge and Expertise | Human Capital Management | ||||||
Risk Management Experience | Financial Knowledge and Expertise | Human Capital Management | ||||||
11/11 | 11/11 | |||||||
Strategic | ||||||||
Industry and IT/ Technical Expertise | Cybersecurity/Information Security/Security | Backgrounds and Experiences | ||||||
6/11 | 11/11 |
Emerging Technologies and Business Models Experience
Sales, Marketing and Brand Management Experience
Our Corporate Governance at a Glance
1 |
2 |
3 |
4 |
5 |
BOARD COMPOSITION
Consider candidates and nominees in light of current skill sets and needs of the Board
Candidates and nominees evaluated for their expertise, experience, leadership and background
Balance the background and experience of the Board, considering the background of candidates and nominees on broad principles such as the ability to improve the breadth of perspective and expertise
Appointed two new directors in fiscal 2025, who have brought unique insights to the global reach of our company
Annual assessment of Board composition against anticipated future needs, including succession planning
See Page 27
BOARD LEADERSHIP AND STRUCTURE
Board leadership structure reviewed annually
Clearly defined roles for Board leadership
Strong Lead Independent Director, who leads executive sessions of the Board
Strong Board independence, with nine independent directors
Fully independent Audit Committee, Compensation and People Committee, and Governance and Sustainability Committee, with frequent and robust executive sessions
Strong partnership between Chair and Lead Independent Director
See Page 35
BOARD EFFECTIVENESS
Annual Board evaluation process led by the Lead Independent Director and includes assessments and reviews of the Board, committees and individual directors
Director orientation and continuing director education
High standards of corporate governance
Board meeting agendas set by Chair in collaboration with Lead Independent Director
See Page 37
ENGAGED OVERSIGHT
Frequent review of oversight during the year, including in respect of significant risks in:
Financial reporting, internal controls over financial reporting, and enterprise risk relating to financial matters (Audit Committee)
Culture, employee retention and human capital management (Compensation and People Committee)
Corporate governance and corporate responsibility (Governance and Sustainability Committee)
Security and cybersecurity (Security Committee)
Mergers, acquisitions and other strategic transactions (Corporate Development Committee)
Engaged in setting corporate strategy
Engaged in management succession planning to ensure next generation of leadership
Strong Lead Independent Director, who actively engages in management oversight and CEO evaluation
See Page 24
BOARD ACCOUNTABILITY
Transparent lines of accountability to our shareholders
A robust and interactive shareholder engagement program based on dialogue, transparency and responsiveness to shareholder feedback
Implement changes in response to shareholder feedback, such as:
Adopting majority voting for uncontested elections of directors, including a resignation policy if a director does not receive a majority of the vote
Several changes to our executive compensation program design, such as reducing maximum potential payouts while ensuring deep alignment to our business strategies and pay-for-performance philosophy
Appropriate director compensation structured in a manner that is aligned with shareholder interests and informed by market data provided by our independent compensation consultant
Shareholder Engagement at a Glance
We are proud of our investor engagement program and committed to maintaining outreach that is truly a dialogue with our shareholders. Our relationship with our shareholders is an important part of our Company's success. In fiscal 2025, we had robust shareholder engagement, with a focus on executive compensation, corporate governance, and corporate responsibility, as well as other matters of importance to our shareholders. Our Lead Independent Director played a central role in this program, and once again actively participated in our shareholder engagement efforts in fiscal 2025.
Our Lead Independent Director and management team regularly update our Board and its committees on our engagement efforts, providing summaries and analyses of our shareholders' feedback. We place great value in the feedback we receive from our shareholders and make meaningful and impactful changes as a result, such as our fiscal 2025 changes to our executive compensation program designs, which included reducing the maximum potential payout in our executive performance-based restricted stock units ("PSUs") and deepening our commitment to pay-for-performance, and our adoption in May 2022 of majority voting for uncontested elections of our directors.
We believe that our approach to engaging directly and openly with our investors drives increased corporate accountability, improves decision making, and leads to creating long-term shareholder value. The following statistics regarding our shareholder engagement represent shareholder ownership, to our knowledge, as of June 30, 2025.
56%Contacted
We contacted shareholders representing 56% of our outstanding shares
53%Engaged
We engaged in discussions with investors representing 53% of our outstanding shares (all shareholders willing to engage with us)
35%14
meetings with Lead Independent Director
Lead Independent Director
Engaged
Lead Independent Director participated in discussions with investors representing 35% of our outstanding shares, while offering meetings to investors representing 45% of our outstanding shares
Below are the key elements of our shareholder engagement cycle:
Spring/SummerImplement changes to align with investor feedback
Conduct proactive off-season investor outreach
Investor meetings and conferences
Summer/Fall
Prepare and publish Annual Report
Engage with investors on enhanced proxy disclosures
Prepare and publish Proxy Statement
Investor meetings and conferences
Winter/Spring
Consider voting results and investor feedback
Consider changes to align with investor feedback
Investor meetings and conferences
Engage with shareholders about voting matters
Review proxy advisory firms' analyses of voting matters and proxy disclosures
Hold Annual Meeting of Shareholders in December
Receive and publish voting results
Investor meetings and conferences
Fall/Winter
Executive Compensation at a Glance
Our Compensation Best Practices
Our executive compensation program is based on a robust pay-for-performance philosophy, and is designed to drive value creation for our shareholders by directly linking compensation to the achievement of our strategic and financial goals.
Maintaining a competitive compensation program that can retain and motivate our leadership team is critical to our
long-term success. Accordingly, our compensation programs reflect recognized best practices supported by the market.
ROBUST AND INDEPENDENT COMPENSATION DECISION-MAKING, ALIGNED WITH OUR CORPORATE VALUES
100% Independent Compensation and People Committee
Independent compensation consultant
Annual review of compensation strategy
Consideration of annual Say-on-Pay vote and other shareholder feedback
Maintain our commitments to our shareholders in our 2024 Proxy Statement
COMPENSATION BEST PRACTICESPay for Performance Compensation Policies What We Don't Do
Significant majority of compensation is performance-based and at-risk
100% of short-term incentive cash compensation is performance-based and at-risk
Inclusion of Corporate Responsibility modifier to cash incentive plan
Use of multiple different performance measures in both cash incentive plan and longterm equity incentive program
100% of equity awards granted to our NEOs in fiscal 2025 were performance-based and use different performance metrics than the cash incentive plan
Robust stock ownership guidelines for NEOs
One-year post-vesting holding period for all NEOs, including our Chief Executive Officer, subject to limited exceptions
Meaningful compensation recovery and clawback policies
Limited perquisites and personal benefits
Assessing and implementing the advice of independent compensation consultant, including a decision-making framework to further ensure alignment of executive compensation decision with our pay-for-performance philosophy
No single trigger vesting of equity awards on occurrence of a change in control
No dividends paid on unvested equity
No hedging or pledging, except limited pledging permitted
with the prior approval of the Governance and Sustainability Committee
No defined benefit plans or special executive retirement plans
Executive Compensation at a Glance
Significant At-Risk Compensation
Our executive compensation program is tied to our strategic and financial goals and operational performance. The graphs below illustrate the predominance of performance-based components included in our fiscal 2025 executive compensation program for our Chief Executive Officer and other NEOs, based on total target annual compensation.
CEO Average of Other NEOs1(1) Mr. Zuk received no equity grant for fiscal 2025 and, as such, approximately 50 percent of Mr. Zuk's target compensation was performance-based in fiscal 2025. Accordingly, Mr. Zuk has been omitted from the analysis in this graphic for presentation purposes.
Executive Compensation Program Changes
In fiscal 2025, we implemented a number of changes to our executive compensation program that were outlined in our 2024 Proxy Statement. In addition, while we were encouraged by the year-over-year improvement in our "Say-on-Pay" vote result at the 2024 annual meeting of shareholders, where a majority of the votes cast were in favor of the "Say-on Pay" advisory resolution, we continue to remain committed to further refinements to address your feedback. Accordingly, we have made further refinements to our executive compensation program in fiscal 2026.
Fiscal 2025 Executive Compensation Program ChangesMaximum payout of performance-based restricted
stock units ("PSUs") has been lowered by 33.3% from 600% to 400% of the target number of PSUs for outstanding PSUs
Updated the financial measures in our PSUs, including the remaining performance periods for outstanding PSUs, to tightly align with our strategies and pay for performance philosophy-using NGS ARR to focus on platformization, and adding annual Non-GAAP EPS as an equally-weighted second financial measure to focus on profitability
Clearly identified the threshold performance
levels for each financial measure that is required for funding and payout of the cash incentive plan as achieving a level of at least 10% below target for each financial performance measure
Added a new commitment to not grant Mr. Arora, our Chief Executive Officer, additional one-time equity awards with vesting or performance metrics that would overlap with the one-time PSU retention award granted to him in June 2023
New for Fiscal 2026 Performance-Based Equity ProgramRelative total shareholder return modifier target for a For the NGS ARR performance measure,
1.0x modifier achievement has been increased to the the maximum achievement of 300% now requires 55th percentile rank from the 50th percentile rank exceeding the target by at least $400 million instead
of $300 million-an increase of 33.3%-while the threshold for no payout has similarly been lowered to being below target by at least $400 million
Corporate Responsibility at a Glance
We protect people's digital lives and secure the systems that society depends upon. Through our corporate responsibility efforts we maintain trust with our stakeholders and help sustain long-term business success. Information about our corporate responsibility strategy is presented in the visual below and detailed elsewhere in this Proxy Statement.
Proxy Roadmap
Corporate Governance
Corporate Governance Highlights
Our Board is governed by our Corporate Governance Guidelines, which are amended from time to time to incorporate certain current best practices in corporate governance. Our Corporate Governance Guidelines can be found on our website at https://investors.paloaltonetworks.com.
In addition to a strong, independent Board, we are committed to corporate governance structures that promote long-term shareholder value creation through a sound leadership structure and by providing our shareholders with both the opportunity to provide direct feedback, and substantive rights and policies to ensure accountability.
BOARD CORPORATE GOVERNANCE PRACTICES AND SHAREHOLDER RIGHTS INCLUDE:
Majority voting for uncontested elections of board members, with an associated resignation policy
Strong Lead Independent Director
Board composed of 82% independent directors
100% Independent Audit Committee, Compensation and People Committee, and Governance and Sustainability Committee
Annual review of Board leadership structure Board refreshment
Changes in director circumstances actively assessed Board and Committee access to management Annual Board and Committee Evaluations Independent compensation consultant
Board and Committee authority to retain outside advisors
Board and Committee risk oversight Board Continuing Education Program No "Poison Pill"
Single Class of Shares
Board-level Security Committee with oversight over security issues, including cybersecurity
Annual review of Committee charters and governance policies
Fair director compensation practices
Active Board oversight of management succession Active management of director conflicts of interest Annual "Say-on-Pay" vote
Continuous shareholder engagement program
Stock ownership guidelines for directors and executive officers
Code of Business Conduct and Ethics for Directors, Officers and Employees
Anti-Hedging Policy Restrictive Pledging Policy
SEC and Nasdaq-compliant Compensation Recovery Policy and an additional Clawback Policy
Regular meetings of independent directors without management present
Proxy Access Bylaws
Board Responsiveness to Shareholders
Our Board is committed to actively engaging with our shareholders, and maintaining outreach that is truly a dialogue with our shareholders. Through year-round engagement and outreach, we regularly provide shareholders with opportunities to deliver feedback on our corporate governance, compensation programs, and corporate responsibility practices. We regularly meet with investors, prospective investors, and investment analysts. These meetings can include participation by our Chair and Chief Executive Officer, Chief Financial Officer, Chief Product and Technology Officer, General Counsel and Corporate Secretary, or other business leaders, and can often focus on Company strategy, financial performance, product strategy and corporate responsibility philosophy. Members of our Investor Relations team also participate in meetings with our shareholders and, as appropriate, members of the Board participate. In fiscal 2025, our Lead Independent Director participated in 14 meetings with investors representing 35% of our outstanding shares, while offering meetings to investors representing 45% of our outstanding shares (each, as of June 30, 2025).
In fiscal 2025, including following our 2024 annual meeting of shareholders, we once again reinvigorated our approach and practices to shareholder engagement and implemented a strategy that focused on extensive engagement on a wide range of topics. Our Lead Independent Director played an active and central role in our shareholder engagement efforts in fiscal 2025, and our management team regularly communicated topics discussed and shareholder feedback to the Board and our Board committees for consideration in their decision-making.
Who we met withInvestors holding 53% of shares outstanding engaged with in discussions, which
is all shareholders that expressed willingness to engage with us
Offered meetings with Lead Independent Director to shareholders holding 45%
of shares outstanding
Investors holding 35% of shares outstanding met with Lead Independent Director
Lead Independent Director (participated in 14 meetings)
Investor Relations team
General Counsel & Corporate Secretary
People team (human resources)
Corporate Responsibility team
Executive compensation
Board structure
Board composition and governance, including Board refreshment
Board risk oversight
Board leadership
Shareholder engagement
Corporate Responsibility
Adopted a majority voting requirement for uncontested elections of directors, including a resignation policy in the event a director does not receive a majority of the vote
Board Governance
Classified Board, dual role of CEO and Chairman and annual election of all Board members
Annual review of our Board leadership structure, including whether an independent director should be the Chair of our Board
Maintaining a strong Lead Independent Director
Annual review to determine whether maintaining a classified Board is appropriate for our Company
Annual survey of the members of our Board and self-evaluation of the Board and its committees
Added two new independent directors in 2025, further demonstrating our commitment to independent director oversight
Board Oversight of Risks, Including Cybersecurity and Corporate Responsibility Risks
How the Board is addressing oversight of increased, varied and new risks
Board Refreshment
The duration of Board service by certain long-standing directors, and the makeup of the Board and the
rationale therefore
Reallocated Corporate Responsibility matters among our Board committees, clearly identifying the responsibilities of each Committee
Formed a Security Committee of our Board to enhance oversight over security issues facing our Company, including cybersecurity, which is now chaired by our Chief Product and Technology Officer providing deep technical expertise and leadership
Reconstituted our Nominating and Corporate Governance Committee as the Governance and Sustainability Committee to enhance the Board's oversight of Corporate Responsibility matters
Appointed Lorraine Twohill as co-Chair of our Governance and Sustainability Committee
Added additional disclosure in this Proxy Statement relating to Board oversight
Since the 2024 annual meeting of shareholders, we appointed three new directors
Since April 2019, we appointed six new independent directors, five of whom are currently serving on the board
Expanded disclosure in our Proxy Statement of the rationales as to why each of our directors continue to serve on our Board
Shareholder Engagement Continued investor outreach on executive compensation, Corporate Responsibility, and other matters of interest to our shareholders
Conducted extensive shareholder and investor outreach
In fiscal 2025, engaged in discussions with shareholders holding 53% of our outstanding shares, as of June 30, 2025
In fiscal 2025, our Lead Independent Director participated in 14 meetings, engaged in discussion with shareholders holding 35% of our outstanding shares, and offered meetings to 45% (each, as of June 30, 2025)
Modified our executive compensation program as a result of shareholder feedback
STAKEHOLDER FEEDBACK HOW WE RESPONDEDPublish an annual Corporate Responsibility Report with details on our programs and progress
Added more disclosure in our Annual Report on Form 10-K and our Proxy
Corporate Responsibility Initiatives and Disclosures
We heard from stakeholders over the years that they would like to see more information about how we develop and manage our corporate
responsibility programs
Statement describing our corporate responsibility programs
Communicated our decarbonization pathway, that includes operational efficiencies, procuring 100% renewable energy, and reducing emissions
Detailed our comprehensive approach to attract, hire, onboard, enable, listen to, and engage employees, in order to enable a workforce that is high-performing and innovative
Outlined Responsible AI Principles in our Responsible Use of Artificial Intelligence Policy that guides our development and use of AI technologies, both within our products and services and across our business operations
Operationalized our corporate responsibility governance structure through a cross-functional Corporate Responsibility Steering Committee, which reports regularly to our Corporate Responsibility Executive Council and the Board
Executive Compensation
Prioritize and ensure the retention of Chief Executive Officer and executive leadership, stand by our pay-for-performance philosophy and the commitments made in our 2024 Proxy Statement relating to our executive compensation program and enhanced disclosure, reduce stock-based compensation expense as a percentage of revenue, and continue to be responsive to shareholder input on our executive compensation program
Incentivized our Chief Executive Officer and executive leadership to remain at the Company for the long term to enhance our prospects of delivering sustained shareholder value
Committed not to grant our Chief Executive Officer additional one-time equity awards of any variety with vesting or performance metrics that would overlap with the one-time performance-based restricted stock unit retention award granted to him in June 2023
100% of the equity awards granted to our NEOs in fiscal 2025 were performance-based, with different performance targets than the cash incentive plan
Maintained our robust stock ownership guidelines for our NEOs, including our Chief Executive Officer
Maintained a Corporate Responsibility modifier to our cash incentive plan, and in response to shareholder feedback, expanded our disclosure in our proxy statement to include data regarding the scorecard measures
Maintained a one-year post-vesting holding period for all NEOs, including our Chief Executive Officer, subject to limited exceptions for equity grants made as part of first becoming an executive officer
Reduced stock-based compensation expense as a percentage of revenue from 21.8% in fiscal 2021 to 14.1% in fiscal 2025
For fiscal 2025, we meaningfully redesigned executive performance-based equity awards ("PSUs") to reduce the maximum payout by 33.3%, and update the financial measures to align with our strategy and drive balanced focus on platformization and profitability
For fiscal 2026, we again refined our executive PSUs, providing that the maximum achievement of 300% requires exceeding the target NGS ARR for the particular fiscal year by at least $400 million-an increase of 33.3%-and that a target relative TSR modifier of 1.0x is only achieved if our three-year TSR is at the 55th percentile rank
Leadership Structure
Our Corporate Governance Guidelines provide that our Board is free to choose its chairperson (the "Chair") based on our Board's view of what is in the best interest of the Company and our shareholders. The Chair and the Chief Executive Officer may, but need not be, the same person.
Annual Evaluation of Leadership Structure
As part of its annual review and evaluation process, the Board reviews its leadership structure and whether combining or separating the roles of Chair and Chief Executive Officer is in the best interests of the Company and our shareholders.
The Board also considers:
The effectiveness of the policies, practices, and people in place at the Company to help ensure strong, independent Board oversight.
The importance of consistent, unified leadership to execute and oversee the Company's strategy.
The strength of Chief Executive Officer's vision for the Company and the quality of his leadership.
Our performance and the effect the leadership structure could have on our performance.
The Board's performance and the effect the leadership structure could have on the Board's performance.
The meaningful and robust responsibilities and the performance of our Lead Independent Director.
The views of our shareholders through our ongoing engagement efforts.
The practices at other companies and trends in governance.
The current state of our Company.
In the circumstance that the Board determines that it remains in the best interests of the Company and its shareholders that our Chief Executive Officer also serve as our Chair, the independent members of the Board then appoint a Lead Independent Director as provided in our Corporate Governance Guidelines.
Why Our Leaders Are Ideally Suited for Their Roles
The Board believes that the independent Board members should have the flexibility to respond to changing circumstances and choose the Board leadership structure that best fits the then-current situation. As it does annually, in August 2025, the Board reviewed our leadership structure. Following that review, the Board determined that the combination of the Chair and Chief Executive Officer roles, along with the robust authority given to our experienced Lead Independent Director, effectively maintains independent oversight of management. The Board consists of nine independent directors, and exercises a strong, independent oversight function through frequent executive sessions, independent Board committees and by having a strong Lead Independent Director with clearly delineated and comprehensive duties.
The Board strongly believes that its leadership structure strikes the right balance of allowing our Chair and Chief Executive Officer to promote a clear, unified vision of the Company's strategies, while ensuring robust, independent oversight by the Board and our Lead Independent Director. The Board also believes there is value in presenting a single face to our customers through combining the Chair and Chief Executive Officer roles, and that this structure of having the Board and management operate under the unified leadership of a highly experienced Chief Executive Officer best positions the Company to successfully implement its strategies and deliver value to our shareholders.
Accordingly, in August 2025, the Board determined that it is in the best interests of our shareholders to maintain our current Board leadership structure with Mr. Arora serving as Chair and John M. Donovan serving as our Lead Independent Director.
Nikesh Arora
Chair and
Chief Executive Officer
John M. Donovan
Lead Independent Director
Substantial knowledge and deep understanding of our business and the challenges we face
Substantial international business experience and business acumen and valued strategic, financial and operational insights
Day-to-day insight into our prospects, opportunities, strategies and challenges facilitates the timely deliberation by the Board of the most
important matters
Brings a unique, shareholder-focused insight to assist the Company to most effectively execute its strategy and business plans to maximize shareholder value
Serves as an important bridge between the Board and management, and provides critical leadership for carrying out our strategic initiatives and confronting our challenges
Provides the Board with more complete and timely information about the Company
Provides a unified structure and consistent leadership direction internally and externally, allowing the Company to act rapidly and proactively to address new and evolving technology
Proven success in leading Palo Alto Networks since joining the Company
Independence, confidence and gravitas, enabling strong oversight of executive leadership
Deep understanding of our business
Strong working relationship with our Chair and Chief Executive Officer
Strength and effectiveness of communication with our Chair and Chief Executive Officer, resulting in active and visible oversight of the issues, plans and prospects of the Company
Strong working relationship with other management and our independent directors
Substantial experience leading a large multinational company
Strong background in corporate governance
Strong background as a technologist
Dedicated to his service as Lead Independent Director, as demonstrated by the fact that, during fiscal 2025, he held 14 meetings with shareholders holding 35% of our outstanding shares and offered to meet with shareholders holding 45% of our outstanding shares
Promotes a collaborative and collegial environment for Board decision making
Actively and effectively engages with our shareholders on an annual basis
OVERVIEW OF LEAD INDEPENDENT DIRECTOR RESPONSIBILITIES
The responsibilities of the Lead Independent Director are well-defined. The Lead Independent Director engages in regular communication between the independent directors and Mr. Arora, keeping Mr. Arora apprised of any concerns, issues, or determinations made during the independent sessions, and consults with Mr. Arora on other matters pertinent to the Company and the Board. As part of the Board's annual review and evaluation, the Board further defined the role and responsibilities of our Lead Independent Director to include:
Presiding at meetings of the Board at which the Chair is not present, including calling and presiding over executive sessions of the independent directors.
Serving as liaison between the Chair and the independent directors.
Developing agendas for Board meetings in collaboration with the Chair, communicating with independent Board members to ensure that matters of interest are being included on agendas for Board meetings, and ensuring adequate time is allocated for Board discussions.
Communicating with independent Board members and with management to affirm that appropriate briefing materials are being provided to Board members sufficiently in advance of Board meetings to allow for proper preparation and participation at meetings.
Ensuring the Board exercises appropriate risk management oversight, including providing direction related thereto to management.
Having the authority to call meetings of the independent directors .
Preparing agendas for meetings of the independent directors.
Organizing and leading the Board's evaluation of the Chief Executive Officer.
Leading the Board's annual self-evaluation and assessing areas of current and future improvement in Board performance.
If requested by major shareholders, ensuring that he is available, as necessary, for consultation and direct communication.
In addition to the responsibilities outlined above, our Lead Independent Director also:
Has biennial one-on-one discussions with each independent director, as part of the Board's annual evaluation process.
Has access to all committee materials.
Has the authority to engage independent consultants.
Interviews Board candidates, and assesses future Board needs.
Spends time with senior management outside of Board meetings, as necessary, to ensure a deep understanding of the business and strategy of the Company.
Participates in shareholder engagement planning and activities.
Independent Director Sessions
A meeting of the independent directors is scheduled at every regular Board meeting for the independent directors to meet in an executive session. These independent sessions are organized and chaired by our Lead Independent Director, and our Lead Independent Director provides direct feedback to Mr. Arora after these executive sessions.
Independent Committee Leadership
The Audit Committee, Compensation and People Committee, and Governance and Sustainability Committee are each composed solely of, and led by, independent directors, and provide independent oversight of management. In addition, with respect to these committees:
Each committee chair meets with management in advance of meetings to review and refine agendas, add topics of interest, and review and comment on materials to be delivered to the committee.
Every independent director has access to all committee materials.
Each committee chair provides a report summarizing committee meetings to the full Board at each regular meeting of the Board.
Each committee meeting includes adequate time for executive session and the committees meet in executive session on a regular basis with no members of management present (unless otherwise requested by the committee).
Each committee effectively manages its Board-delegated duties and communicates regularly with the Chair, Lead Independent Director, the Board, and members of management.
With respect to the Compensation and People Committee, it has an effective process for monitoring and evaluating Mr. Arora's compensation and performance, as well as succession planning.
Board Committees and Responsibilities
Our Board has a standing Audit Committee, Compensation and People Committee, Corporate Development Committee, Governance and Sustainability Committee, and Security Committee, which have the composition and responsibilities described below. Directors serve on these committees until their resignation or until otherwise determined by our Board.
The membership and meetings during fiscal 2025 and the primary functions of each of the standing committees are described below. Mr. Hamers is not standing for reelection at the Annual Meeting.
Board of Directors | Audit Committee | Compensation and People Committee | Corporate Development Committee | Governance and Sustainability Committee | Security Committee | ||
Nikesh Arora | ● | ||||||
Aparna Bawa* | ● | ● | ● | ● | |||
John M. Donovan** | ● | ● | |||||
Carl Eschenbach* | ● | ||||||
James J. Goetz* | ● | ● | ● | ||||
Ralph Hamers* | ● | ● | |||||
Rt Hon Sir John Key* | ● | ● | |||||
Lee Klarich | |||||||
Mary Pat McCarthy* | ● | ● | |||||
Helle Thorning-Schmidt* | ● | ● | |||||
Lorraine Twohill* | ● |
Member
** Lead Independent Director
* Independent Director
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Palo Alto Networks Inc. published this content on November 10, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on November 10, 2025 at 04:30 UTC.
