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Palo Alto Networks’ Firewall Comeback: Can 40% Booking Growth Extend The Runway?

Palo Alto Networks reported its fiscal third quarter 2026 results, highlighting a record performance that surpassed guided expectations across key metrics. The company delivered $8.13 billion in next-generation security (NGS) annual recurring revenue (ARR), reflecting a 60% year-over-year increase, driven by strong organic bookings growth and contributions from recent acquisitions including CyberArk and Chronosphere. Excluding acquisition impacts, organic NGS ARR rose 28%, accompanied by a 22% growth in remaining performance obligation (RPO) adjusted for acquisitions. Total revenue reached $3 billion, up 31% year-over-year, with product and service revenues growing similarly. Geographic expansion contributed to growth with all major regions showing over 25% revenue increases. Network security remained the largest segment, accounting for approximately 70% of revenue, and showed its strongest third-quarter performance in years. Hardware sales grew notably, with next-generation firewall bookings increasing nearly 40% year-over-year, aided by demand from emerging AI data center deployments.