New York, February 24, 2026, 11:46 (EST) — Regular session
- Palo Alto Networks dropped about 0.5% on Tuesday, with the stock touching a 52-week low earlier in the day.
- Cybersecurity stocks have seesawed since Anthropic rolled out its code-security AI tool, which rattled software shares.
- Analyst revisions remain in focus for traders, ahead of the company’s next earnings update expected in late May.
Palo Alto Networks (PANW.O) traded down about 0.5% to $143.39 at 11:35 a.m. EST, just above its recent 52-week low of $142.43. The Nasdaq gained 0.8%. That left the cybersecurity name lagging most tech stocks.
Palo Alto is in the spotlight, quickly becoming shorthand for the broader “AI disrupts software” story—even in pockets that used to feel reliable to investors. Security budgets don’t typically budge, but when they do, traders don’t always see it coming. At this stage, there’s a scramble to figure out where workflow automation faces cuts, and which segments are just experiencing budget reshuffles.
Cybersecurity stocks fell hard Monday. Palo Alto Networks slid nearly 3%, while CrowdStrike and Datadog each plunged about 11%, following Anthropic’s rollout of a new AI-driven security product. “A continuation of a panic-driven, narrative-led selloff,” is how Shrenik Kothari at Robert W. Baird put it. He argued the market is getting ahead of itself, noting Anthropic’s new tool isn’t a direct replacement for the comprehensive threat detection and incident response capabilities of established players. Reuters
Doubts are cropping up about how quickly AI can overhaul business operations. “You definitely need human intervention, otherwise problems develop,” said Robert Pavlik, senior portfolio manager at Dakota Wealth. Ken Polcari at Slatestone Wealth described a market that’s reacting fast—software names whipping back and forth every time a new AI story lands. Reuters
Daiwa Securities cut its price target on Palo Alto to $175, down from $212, though it’s sticking with the “outperform” rating, MT Newswires reported. Even with the lower target, there’s implied upside, but with shares slipping lately, the tone has turned more guarded. MarketScreener
Palo Alto posted $2.6 billion in revenue for its fiscal second quarter last week, up 15%, with non-GAAP earnings at $1.03 per share. Looking ahead to fiscal 2026, the company put revenue guidance in the $11.28 billion to $11.31 billion range, and sees non-GAAP EPS landing between $3.65 and $3.70. These non-GAAP results strip out acquisition-related expenses and similar items. Next-Generation Security ARR stood at $6.3 billion—a core subscription figure—while remaining performance obligations came in at $16.0 billion, reflecting contracted revenue yet to be recognized.
Disruption risk grabs attention, but there’s more in play. Nvidia on Monday said it’s teaming up with Palo Alto and a roster of other partners to inject accelerated computing and AI into the operational technology cybersecurity space—the nuts-and-bolts systems that keep energy, manufacturing, and utilities ticking. When failures strike here, the consequences land instantly and tangibly.
PANW is up against the strong chance that ongoing AI hype could keep swinging its valuation wildly, regardless of actual performance. If customers decide that AI-powered code scanning meets the bar for some security functions—particularly when it’s cheaper—platform vendors could feel price pressure and notice slower growth in some segments, even as attacks become more frequent.
Palo Alto is set to report next on May 26—that’s circled in red for investors. Everyone’s looking for hard evidence that those platform deals, subscriptions, and the latest acquisitions are having an impact. Billings and cash flow? Both are expected to face close scrutiny.
Cybersecurity shares are under the microscope, with traders watching for signs of a steadier footing after the AI-fueled shakeout. The risk: new target cuts and a shifting “narrative” could push the group down even further.
