Palo Alto : Q3 FY2025 Earnings Presentation

Q3 Fiscal Year 2025 Earnings Call

May 20, 2025

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Palo Alto Networks Q3 at a Glance

NGS ARR

Surpasses

$5B milestone

Q3'25 NGS ARR1

$5.09B

+19% y/y

Durable top line growth and operating leverage

Q3'25 Revenue Q3'25 Operating Income (non-GAAP)

$2.29B $627M

+23% y/y

Q3'25 EPS (non-GAAP) Q3'25 Adj. Free Cash Flow (non-GAAP)

$0.80 $578M

1 ARR = Annualized Recurring Revenue. Next-Gen Security ARR is annualized allocated revenue of all active contracts as of the final day of the reporting period for Prisma and Cortex offerings inclusive of the VM-Series and related services, and certain cloud-delivered security services. Beginning Q1'25, NGS ARR includes revenue attributable to QRadar software as a service contracts.

Reconciliations of historical non-GAAP measures can be found in the Appendix. Fiscal year ending on July 31.

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Continued Robust Demand for Cybersecurity in Q3

AI Transformation causing urgency for enterprise data architectures and transformation

Critical need to secure AI transformation

in the enterprise

Rising vendor consolidation as enterprises look to simplify their security infrastructure

Heightened threat environment, including 100x faster1 AI-powered ransomware attacks

1 Palo Alto Networks Unit 42 Threat Research.

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Q3 Platformizations Keep Us on Track to Long Term Goals

Total Platformizations

~1,250

~1,100 ~1,150

~1,000

~850

~900

Customers with >$10M NGS ARR

44 | +63% y/y

Customers with >$5M NGS ARR

130 | +41% y/y

~90

Net New Platformizations1 in Q3'25

1 Platformization/Platformized defined as: Active ELA contract or >$1M SASE ARR for Network Security; >$1M ARR for Cloud Security; active XSIAM contract or >$100k QRadar SIEM ARR with Cortex XDR/XSOAR for Security Operations. Total Platformizations defined as a count of all platformizations across customers, with a customer platformized on all three platforms counting as three platformizations, a customer platformized on two platforms counting as two platformizations, and a customer platformized on one platform counting as one platformization. Platformizations are counted within our 5,000 largest customers, based on ARR.

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