New York, Feb 24, 2026, 17:57 EST — After-hours
- Palo Alto Networks lost 1.7% by the bell, then edged up modestly in after-hours trading.
- Daiwa lowered its price target to $175, though it’s still holding on to that “outperform” call.
- Traders continue to weigh if fresh AI tools pose risks to segments of the security software stack.
Palo Alto Networks slipped 1.7% to $141.67 by the end of Tuesday’s session. In after-hours moves, the stock ticked up roughly 0.5%. The action came as Daiwa Securities cut its price target for the cybersecurity company. (MarketScreener)
The slide adds weight to a stock that’s been caught between robust cybersecurity demand and new anxieties over AI-driven automation. Palo Alto is pushing hard on “platformization,” rolling multiple security functions into one package as buyers look to simplify and trim their roster of vendors. (Palo Alto Networks)
Volatility in software and cybersecurity names picked up this week after AI startup Anthropic claimed its tech can automate jobs that used to require dozens of people, while investors grew skittish that a fresh AI-based security launch might chip away at established market segments. (Reuters)
Anthropic introduced a batch of enterprise plug-ins on Tuesday, targeting everything from deal reviews to HR processes. Previous launches from the company have already rattled established software stocks. “It’s not a product that’s trying to own every workflow,” said Scott White, who leads enterprise product at Anthropic. (Reuters)
Several analysts think the selloff has been about sentiment and positioning, not a fundamental change in demand. J.P. Morgan’s Brian Essex called it “driven more by fear than fundamentals,” highlighting ongoing demand for security as AI adoption continues. (Barron’s)
Palo Alto has been touting a pickup in AI security demand. “We also saw steady and strong adoption of AI security,” CEO Nikesh Arora said in the company’s latest results, which also highlighted integration efforts from recent acquisitions. (Palo Alto Networks)
Palo Alto Networks pointed to a new partnership with ServiceNow and Bell Canada, targeting large customers who want easier workflows. The trio plans to roll out an app connecting security operations directly with service management. (Palo Alto Networks)
But where the stock heads from here hinges on whether investors see AI tools as demand-boosters or as substitutes that pressure prices — and on the pace at which deal costs show up in forward guidance.
Eyes now shift to potential analyst updates and fresh spending cues from other cybersecurity firms, as Palo Alto’s next earnings date—May 26, according to Investing.com—draws closer. (investing.com)
