NEW YORK, June 6, 2026, 15:15 EDT
Palo Alto Networks ended Friday down 2.6% at $272.05, sliding as tech shares lost ground days after the company raised its annual forecast. U.S. cash equity markets stayed closed Saturday, so the latest trading level is still Friday’s finish.
Palo Alto just raised its price tag as growth picked up speed, but then tech shares dropped hard. The Nasdaq Composite slid 4.2% Friday, ending the week down 4.7%. The S&P 500 lost 2.6% on the day, snapping a 10-week winning streak with a weekly drop.
Palo Alto is back in focus as a way to gauge if AI-fueled cybersecurity demand can outweigh investor concerns about high valuations, rising rates and a tough week for growth names.
Palo Alto Networks’ fiscal third quarter delivered numbers that kept bulls engaged. Revenue climbed 31% to $3.0 billion, with $388 million from CyberArk and Chronosphere. Next-Generation Security ARR jumped 60% to $8.1 billion. Remaining performance obligation was up 36% at $18.4 billion. CEO Nikesh Arora said AI advances had “increased the level of urgency around cybersecurity.” Palo Alto Networks
Palo Alto boosted its fiscal 2026 revenue outlook to $11.415 billion to $11.425 billion. That’s higher than its previous forecast of $11.28 billion to $11.31 billion. The company’s third-quarter revenue beat LSEG estimates of $2.94 billion, Reuters said. Shares jumped 7.4% after hours on the news.
Things got trickier as the week went on. Palo Alto’s results showed that budgets for cloud, identity and AI security weren’t falling off, but Friday, shares in long-duration tech names got hit as investors pulled back from companies where profits are further out.
Peers also traded lower. Fortinet lost 3.3% Friday and CrowdStrike was down 6.7%. Palo Alto’s drop wasn’t as steep as some in security and software, but shares still closed in the red.
Palo Alto Networks saw price targets climb after its results landed. Argus raised its target to $320 from $222, according to MarketBeat. Morgan Stanley, Barclays, Mizuho, Oppenheimer and Goldman Sachs either bumped up or stuck with bullish targets following the earnings. The consensus tracked was “Moderate Buy” with an average price target at $306.59. MarketBeat
But risk remains. Palo Alto is bringing in big deals like CyberArk and Chronosphere, raising questions about how much new growth is organic. On the earnings call, CFO Dipak Golechha said the company is “closely monitoring rising component costs,” with memory and storage especially called out, and flagged a 10% hardware price increase set in April. The Motley Fool
Palo Alto Networks still trades at a high valuation even after Friday’s drop. MarketBeat shows the stock’s price-to-earnings ratio above 220, with a 52-week high of $302.95. That leaves little safety if growth cools, AI-security takeup slows, or the company’s acquisitions fall short.
Investors head into the week without another major single-company event bigger than the June 2 earnings print already digested. With that out of the way, Monday sets up as a test to see if Friday’s move was about de-risking across sectors or if the market is ready to give up ground on one of the top cybersecurity names this year.
Palo Alto raised its outlook and posted better growth, but shares still slid by the end of the week. The focus shifts to next week, where the question is if the stock’s AI-security premium can hold up in weaker markets.
