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© 2026 Palo Alto Networks, Inc. All rights reserved. © 2026 Palo Alto Networks, Inc. All rights reserved. Q4 Fiscal Year 2026 Earnings Call September 1, 2026
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© 2026 Palo Alto Networks, Inc. All rights reserved. Safe Harbor This presentation contains “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical or current facts, including, without limitation, statements concerning the following: expectations regarding the cybersecurity landscape and demand; expectations regarding our platformization strategy and related progress and opportunities, our product development strategy, and drivers of and factors affecting growth in our business; expectations regarding annual recurring revenue and remaining performance obligations; expectations regarding artificial intelligence (AI); expectations regarding our strategic partnerships; financial outlook for the first quarter of fiscal 2027 and fiscal year 2027, mid- and long-term financial expectations, the performance advantages of our products and subscription and support offerings and the potential benefits to our customers; the expected future benefits and synergies of our acquisitions; the integration of capabilities from our recent acquisitions and the benefits they will deliver; expectations regarding customer acquisitions; the expectations regarding the proposed accretion to free cash flow, revenue growth, annual recurring revenue growth, remaining performance obligations, and gross margin, expectations regarding our total addressable market, modeling points, business and economic conditions and challenges, and other financial, operational and business expectations, made in this presentation are forward-looking. We use words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potentially,” “projects,” “will,” “will be,” will continue,” “will likely result,” “would,” and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these identifying words. There are a significant number of factors that could cause actual results to differ materially from forward-looking statements made or implied in this presentation, including: unfavorable economic and market conditions and the uncertain geopolitical environment; our ability to effectively manage future growth and improve our systems, processes, and controls; our ability to maintain our revenue growth rate or profitability; variability and seasonality in our operating results; our ability to sell new and additional products, subscriptions, and support offerings to existing and new customers; the delayed recognition of revenue from subscription and support offerings; revenue volatility from consumption- or usage-based offerings and customer usage optimization behavior; potential decreases in the sales prices of our products, subscriptions, and support offerings; our reliance on channel partners; credit and liquidity risk exposure; challenges associated with sales to government entities; intense competition in our markets; risks associated with the evolving definition of the identity security market; customer trends toward vendor consolidation in cybersecurity; competition from cloud infrastructure providers offering native security capabilities; risks related to past and future acquisitions; our ability to predict, prepare for, and respond to rapidly evolving technological and market developments; the need to maintain a broad ecosystem of third-party technology integrations; risks related to the development, deployment, or use of AI, including AI agents as a new class of identity; the impact of network or data security incidents; defects, errors, or vulnerabilities in our products and subscriptions; reliance on customers to configure and use our products securely; the quality of our technical support services; our ability to meet service-level commitments; our reliance on data center facilities operated by third-party cloud service providers; intellectual property claims and our ability to protect proprietary rights; risks associated with open source software; our reliance on third-party technology licenses; dependence on manufacturing partners and limited sources of supply; our ability to attract, retain, and motivate key personnel; risks associated with international sales and operations, including export and import controls; fluctuations in foreign currency exchange rates; risks associated with operations and employees located in Israel; costs and risks related to compliance with privacy and data protection laws; potential tax liabilities; risks related to estimates, judgments, and critical accounting policies; our ability to maintain proper and effective internal control over financial reporting; risks related to corporate responsibility matters; dilution from issuance of additional common stock; risks related to our convertible senior notes, including our ability to settle conversions, repurchase, or repay such notes and the potential effect of capped call transactions. Additional risks and uncertainties on these and other factors that could affect our financial results and cause actual results to differ materially from those described in the forward-looking statements we make in this presentation are included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our annual reports on Form 10-K and quarterly reports on Form 10-Q, which are available on our website at investors.paloaltonetworks.com and on the SEC’s website at www.sec.gov. Additional information will also be set forth in other documents that we file with or furnish to the SEC from time to time. All forward-looking statements in this presentation are based on our current beliefs and information available to management as of the date hereof and are inherently uncertain, and we do not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law. Non-GAAP Financial Measures All information in this presentation is as of September 1, 2026. This presentation contains non-GAAP financial measures and key metrics relating to the company’s past and expected future performance. We have not reconciled diluted non-GAAP earnings per share guidance to GAAP earnings per diluted share, non-GAAP operating margin to GAAP operating margin, adjusted free cash flow margin guidance to GAAP net cash from operating activities, or non-GAAP effective tax rate to GAAP effective tax rate because we do not provide guidance on GAAP operating margin, GAAP net income (loss), net cash from operating activities, or GAAP effective tax rate and would not be able to present the various reconciling cash and non-cash items between GAAP and non-GAAP financial measures because certain items that impact these measures are uncertain or out of our control, or cannot be reasonably predicted, including share-based compensation expense, without unreasonable effort. The actual amounts of such reconciling items will have a significant impact on the company's GAAP net income per diluted share, GAAP operating margin and GAAP net cash from operating activities. 2
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© 2026 Palo Alto Networks, Inc. All rights reserved.
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© 2026 Palo Alto Networks, Inc. All rights reserved.4 ~220 Net New Platformizations +44% y/y We Had a Strong Finish to a Transformative Year in FY'26, With Accelerating Top-line Growth and Nearly $1B Net New NGS ARR $3.84 FY’26 EPS (Non-GAAP) +15% y/y $21.2B Q4’26 Total RPO +34% y/y $9.10B Q4’26 NGS ARR¹ +63% y/y Accelerating Proforma Bookings & NGS ARR Growth Strong Free Cash Flow Growth & Profitability 29.2% FY’26 Operating Margin (Non-GAAP) +40 bps y/y 38.4% FY’26 Adj. FCF Margin (Non-GAAP) $4.41B FY26 Adj. FCF, +26% y/y $3.41B Q4’26 Total Revenue +34% y/y ~$970M Net New NGS ARR +98% y/y Record Platformizations Drove Nearly $1B Net New NGS ARR in Q4 ¹Our Next-Generation Security Annualized Recurring Revenue ("NGS ARR") represents the annualized allocated revenue of all active contracts as of the final day of the reporting period related to all product, subscription and support offerings, excluding revenue from hardware products, and legacy attached subscriptions, support offerings and professional services. Reconciliations of historical non-GAAP measures can be found in the Appendix. Fiscal year ending on July 31.
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© 2026 Palo Alto Networks, Inc. All rights reserved. Record Net New Platformizations in Q4 Continues to Keep Us on Track Towards Our Long-Term Targets ~630 * Reflects pro forma platformizations, inclusive of Observability platformizations and pro forma Identity platformizations, assuming the CyberArk acquisition had closed in our Q2'26. 1 Platformization/Platformized defined as: Active ELA contract or >$1M SASE ARR or >$500k SWFW ARR with Prisma AIRS for Network Security; >$1M ARR for Cloud Security; active XSIAM contract or >$100k QRadar SIEM ARR with Cortex XDR/XSOAR for Security Operations; >$500k Identity Security ARR; >$500k Observability ARR. Total Platformizations defined as a count of all platformizations across customers, with each customer having a maximum of five Platformizations. Platformizations are counted within our 5,000 largest customers, based on ARR as of the final day of the reporting period. 2 Excludes the contribution of Identity and Observability due to the absence of comparable historical information. 5 NetSec & Cortex Platformizations1 Identity & Observability Platformizations1 ~220 Record Net New Platformizations in Q4 >120%2 Net Retention Rate among Platformized Customers On Track to Deliver 4K+ Platformizations Driving The Majority of $20B NGS ARR by FY’30 >65% of NGS ARR is from Platformized Customers ~1,450 ~1,550 ~1,650 ~2,280 ~1,400 ~150 Net New ~610 ~630~2,160* ~2,500 ~670 ~1,830 ~1,000 ~90 Net New
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© 2026 Palo Alto Networks, Inc. All rights reserved.6 Our Largest Q4 Wins Show Platformization in Action Telecommunications Leader Global Technology Services Paypal $126M Deal $72M Deal Full NetSec Platformization led by SASE & NGFW, as customer standardized network security on PANW, complemented by cross-sell of Idira and Cortex XSIAM. Platformized on NetSec, Idira cross-sell and Cortex Cloud with 8+ figure purchase from each. Customers¹ with >$10M NGS ARR 78 | +50% y/y Customers¹ with >$5M NGS ARR 223 | +45% y/y 1 Customer counts and growth rates exclude contributions from CyberArk and Chronosphere due to the absence of comparable historical information. $53M Deal $42M Deal Platformized on Cortex, including XSIAM and Agentic Endpoint Security to drive AI modernization. Expanded on NetSec with NGFW, SASE and Secure Browser. Global Payments Platform Regional Bank Platformized across multiple NetSec form factors (SASE, NGFW, SWFW) including nearly $10M in AIRS.
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© 2026 Palo Alto Networks, Inc. All rights reserved.7 April: The Mythos Moment The pivotal use case of AI coding has also unearthed the other side of the coin - weaponizing AI to discover and exploit vulnerabilities in the same code, leaving nowhere to hide and requiring real time defense. June: Open Weight Models Normalize As enterprises seek sovereign control of their own weights, context becomes even more important, and every AI deployment creates more surface area to secure. January: The Open Claw Catalyst The world is evolving from prompting LLMs to one where AI has agency. Autonomous agents will far outnumber humans - creating more traffic that must be inspected, data that must be observed, and credentials that must be secured. Three Major AI Inflections Are Accelerating the Evolution of Cybersecurity
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© 2026 Palo Alto Networks, Inc. All rights reserved.8 Growth Accelerated Across Hardware and Software Firewalls Total Firewall Bookings Growth (HW+SW), y/y Software Firewall AI Traffic >4x Since June’26 NGFW Competitive Displacements >$250M FY’26 TCV Bookings NetSec: The AI Infrastructure Build Out and the Rise in Agentic AI Traffic is a Multi-Year Tailwind for Our Largest Business 1Growth rate for competitive displacements is for Prisma Access only and based on cumulative Q1-Q4'FY26 displacements compared to cumulative Q1-Q4'FY25 displacements. We Continue to Platformize the SASE Market ~$450M ~2X y/y across ~100 accounts Competitive Displacements (TCV)1 Strong Growth Across the SASE Platform >9x Over the last 9 months SASE Agentic Traffic Prisma Access SD-WAN Secure Browser Licenses >30% FY’26 Bookings Growth, y/y >80% FY’26 Bookings Growth, y/y >2x Growth y/y, Totaling ~15M to Date Software Firewall ARR +29% Q4’26 Growth, y/y 13% 17%
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© 2026 Palo Alto Networks, Inc. All rights reserved.9 Platform Evolution Since Launch Spotlight | Prisma AIRS Surpassed $100M ARR in Four Quarters, Driven by the Need to Secure the Rapid Rise in Enterprise AI Deployments ~$120M Achieved in 1 year since General Availability Prisma AIRS ARR¹ >800 >2X q/q Prisma AIRS Customers² >100 up ~2.5x since Koi Close Agentic Endpoint Security (AES) Logos Prisma AIRS Launch Apr’25 Prisma AIRS Evolved From Securing AI Models & Apps to Rising AI Agents Today Comprehensive AI Security Platform AI Runtime Security AI Security Posture Mgmt. AI Access Agentic Threat Prevention Agentic Runtime Security Agentic Identity Security Agent Artifact Scanning Agent Red Teaming Agent Security Posture Management Agent Observability Agentic Endpoint Security AI Agent Gateway AI Model Scanning AI Red Teaming 1 Prisma AIRS ARR is based on the portion of software NGFW credits purchased by a customer and allocated to Prisma AIRS on the booked quote. Customers may elect to consume purchased software NGFW credits flexibly across several NGFW products and services. 2 Prisma AIRS customer count is based on customers with a booked quote for software NGFW credits that included Prisma AIRS.
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© 2026 Palo Alto Networks, Inc. All rights reserved. Cortex: We Continued to See Strong Growth in XSIAM and Observability in Q4 10 XSIAM Scaling Rapidly as Machine-Speed Attacks Make AI SOC a Top Priority ~1K Customers1, >2x y/y +45% Y/Y Growth in $10M+ deals1 ~70% y/y ARR More Than Doubled in 2 Quarters, as the Leading AI-Natives Adopt Chronosphere Signed one of the fastest-growing AI Inference providers serving tens of trillions of tokens daily $20M Deal of Observability Q4 net new logos included XSIAM cross-sell in 2H’26 50% >2.5x XSIAM ARR Observability ARR 1 XSIAM active customers and growth in $10M deals are all as of Q4’26.
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© 2026 Palo Alto Networks, Inc. All rights reserved. 11 Idira: CyberArk is Accelerating Inside our Platform as the Demand For Securing Machine Identities Grows Integration Efforts Are Yielding Early Success Shared leads sourced between PANW and CYBR sales teams, up ~50% from May 2026¹ >400 CyberArk new logo wins from core PANW installed base2 >200 Increase in $5M+ Deals, y/y in Q4’26 +50% CyberArk ACV Growth, y/y 1 Shared leads as of August 12, 2026 compared to shared leads as of May 27, 2026 2 New logo wins from Palo Alto Networks installed base, excluding CyberArk and Chronosphere installed base, following the CyberArk acquisition close on February 11, 2026. Secrets & AI Bookings ~40% FY’26 growth, y/y
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© 2026 Palo Alto Networks, Inc. All rights reserved. Looking Ahead, We Expect AI Tailwinds Driving Cybersecurity Demand Will Only Grow Stronger in FY27 and Beyond 12 More capex will be deployed in the next 5 years than the last 25, creating a surge in infrastructure hardware to secure and more traffic to inspect. AI increases the need for real-time cybersecurity, accelerating the urgency to modernize one trillion dollars of legacy security infrastructure within the next decade. Agents will drive significantly more traffic - governance, security and kill switch requirements create a new platform for AI security.
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© 2026 Palo Alto Networks, Inc. All rights reserved. 13
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© 2026 Palo Alto Networks, Inc. All rights reserved.14 Next-Generation Security ARR Remaining Performance Obligations Record Top Line Results Across the Board in Q4’26 Total RPO Total ARR Total ARR Growth y/yTotal RPO Growth y/y Revenue Total Revenue Total Revenue Growth y/y ~$970M Record Net New ARR in Q4’26
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© 2026 Palo Alto Networks, Inc. All rights reserved. Revenue Momentum Was Driven Across Platforms 15 Cortex Network & AI Security Idira Network & AI Security Revenue Cortex Revenue Idira Pro Forma Revenue1 $0.61B Reported Reported platform revenue included in appendix & Q4’26 Supplemental Financial Information. Fiscal year ending on July 31. 1 Idira pro forma revenue includes CyberArk revenue attributable to pre-closing periods that have been aligned to Palo Alto Networks' fiscal year ending July 31. For Palo Alto Networks' FY'26, Idira revenue reported was $0.61B. +17% y/y +25% y/y +21% y/y Proforma Growth
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© 2026 Palo Alto Networks, Inc. All rights reserved. Q4’26 Operating Margin & Adj. Free Cash Flow Margin Non-GAAP Operating Margin TTM Adj Free Cash Flow Margin 16 Non-GAAP Operating Margin TTM Adj. Free Cash Flow Margin Reconciliations of historical non-GAAP measures can be found in the Appendix.
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© 2026 Palo Alto Networks, Inc. All rights reserved. We Have Consistently Expanded Margins and Sustained Robust Free Cash Flow While Integrating Multiple Recent Acquisitions 17 Non-GAAP Operating Margin Adjusted Free Cash Flow Margin Reconciliations of historical non-GAAP measures can be found in the Appendix. Scaling Profitably with Over 500 bps of Operating Margin Expansion Since FY’23 Consistently Delivered 38%+ Adj. FCF Margins Since FY’23 ~26% FY23-FY26 Op-Income CAGR ~18% ‘23-‘26 Adj. FCF CAGR Reaffirming 40%+ FY’28 Adj. Free Cash Flow Margin
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© 2026 Palo Alto Networks, Inc. All rights reserved.18 2025 20302018 $19B (Firewall) $19B $59B (Firewall, SASE) $117B (SOC, Observability, Cloud) $29B (Identity Security) $90B Network & AI Security (Firewall, SASE, AIRS) $180B Cortex (SOC, Observability, Cloud) $67B Idira (Identity Security) Our Large and Growing TAM Garner Confidence in Achieving $20B NGS ARR by FY30 ~$200B ~$340B Estimates and figures related to total addressable markets or market sizes (TAMs) are based on Palo Alto Networks estimates using third-party data. TAM data are for calendar years. In particular, for 2018 and 2025 for firewall, SASE, Security Operations, and Cloud, the third-party data includes the sources described in the appendix to Palo Alto Networks Q4'23 Earnings Call and Medium Term Update Investor Presentation available on Palo Alto Networks' website. For 2025 for Observability, the third party data includes Gartner ITOM Software Forecast 2Q’24, "Health & Performance Analysis" TAM; and for Identity Security, IDC Semiannual Security Products Tracker - Forecast for Identity and Access Management, May 2025. For 2030, the data includes the following sources: Gartner, Forecast: AI Spending, Worldwide, 2025-2030, 2Q26 (July 2026); Gartner, Forecast: Information Security, Worldwide, 2024-2030, 2Q26 (June 2026); Gartner, Forecast: Enterprise Infrastructure Software, Worldwide, 2023-2029, 4Q25 (March 2026); IDC, Worldwide Security Spending Guide (July 2026); IDC, Worldwide Semiannual Security Products Tracker (April 2026); Dell'Oro Group, SASE/SD-WAN Market Forecast (July 2026); Dell'Oro Group, Network Security Market Forecast (July 2026); Dell'Oro Group, AI and Cloud-native Security Advanced Research Report (May 2026); Westlands Advisory, Industrial OT Cybersecurity Forecast (August 2025); Omdia, Infrastructure Security Products Market Database – 4Q25 (June 2026). Reaffirming$20B NGS ARR by FY’30
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© 2026 Palo Alto Networks, Inc. All rights reserved. Q4’26 Metrics Summary Q4’26 Guidance (as of 6/2/26) Q4’26 Actual Total Revenue $3.345B - $3.355B 32% y/y $3.41B 34% y/y Product Revenue $738M Remaining Performance Obligations $20.9B - $21.0B 32% - 33% y/y $21.2B 34% y/y Next-Gen Security ARR $8.90 - $8.95B 59% - 60% y/y $9.10B 63% y/y Gross Margin (Non-GAAP) 74.8% Operating Income (Non-GAAP) $1,011M Operating Margin (Non-GAAP) 29.6% Diluted EPS (Non-GAAP) $0.96 - $0.98 $1.02 Diluted EPS (GAAP) ($0.35) Adj. Free Cash Flow (Non-GAAP) $1,289M Reconciliations of historical non-GAAP measures can be found in the Appendix. Fiscal year ending on July 31. 19
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© 2026 Palo Alto Networks, Inc. All rights reserved. Q1’27 Guidance (as of 9/1/26) FY’27 Guidance (as of 9/1/26) Next-Gen Security ARR $9.54B - $9.56B 63% y/y $11.075B - $11.175B 22% - 23% y/y Remaining Performance Obligations $20.8B - $20.9B 34% - 35% y/y $25.2B - $25.4B 19% - 20% y/y Total Revenue $3,300M - $3,310M 33% - 34% y/y $14.10B - $14.20B 23% -24% y/y Operating Margin (Non-GAAP) 29.5% +30 bps y/y Diluted EPS (Non-GAAP) $0.96 - $0.98 $4.16 - $4.19 Adj. Free Cash Flow Margin (Non-GAAP) 38.0% Fiscal year ending on July 31. 20 Q1 & Fiscal Year 2027 Guidance
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© 2026 Palo Alto Networks, Inc. All rights reserved. © 2026 Palo Alto Networks, Inc. All rights reserved. Q&A
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© 2026 Palo Alto Networks, Inc. All rights reserved. © 2026 Palo Alto Networks, Inc. All rights reserved. Appendix
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© 2026 Palo Alto Networks, Inc. All rights reserved. Modeling Points ● Q1’27 and FY’27 non-GAAP effective tax rate of 22%1 ● Q1’27 net interest and other income of $75M – $80M ● Q1’27 diluted shares outstanding 837 – 844 million ● FY’27 diluted shares outstanding 844 – 847 million ● 2H FY’27 represents 60%-61% of full year Net New NGS ARR ● FY’27 Revenue Platforms Modeling Points: ○ Network & AI Security revenue growth of low double-digits year-over-year ○ Cortex revenue up approximately 30% year-over-year ○ Idira revenue of approximately $1.5B, representing pro forma growth of high-teens to 20% year-over-year 23 We established a long-term non-GAAP effective tax rate of 22%. This long-term rate reflects our target tax structure under our ongoing business model, removing the effects of significant discrete GAAP tax events such as one-time tax adjustments, valuation allowance releases, and tax effects related to share-based compensation. We periodically evaluate this long-term rate for significant changes in tax legislation, geographic revenue mix, and business operations.
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© 2026 Palo Alto Networks, Inc. All rights reserved. Revenue by Platform Definitions & Classifications 24 ● Network & AI Security - Includes Secure Access Service Edge (“SASE”), Hardware and Software Firewalls, Prisma AIRS and Cloud-Delivered Security Services (“CDSS”). This platform also includes Next-Generation Trust Security, the Certificate LifeCycle Management (CLM) business that was previously part of the CyberArk portfolio. ● Cortex - Encompasses Security Operations (XSIAM, XDR, XSOAR, Xpanse, Cloud Security, and others), and Observability offerings. ● Idira - Represents our Identity Security portfolio. This platform excludes Certificate LifeCycle Management (CLM) which is included in Network & AI Security. ● Other - Consists of activities not allocated to the operating platforms, including Unit 42, professional services, and financing income. Fiscal year ends on July 31. $ In millions Revenue by platform: Q126 Q226 Q326 Q426 FY'25 FY'26 Network & AI Security $1,904 $2,025 $2,094 $2,331 $7,131 $8,354 Cortex 422 431 481 586 1,539 1,920 Idira - - 278 336 - 614 Other 148 138 149 157 551 592 Total revenue $2,474 $2,594 $3,002 $3,410 $9,221 $11,480
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© 2026 Palo Alto Networks, Inc. All rights reserved. GAAP to Non-GAAP Reconciliations – Gross Margin (1) Consists of share-based compensation related to the cash settlement of certain equity awards and costs to terminate certain employment contracts of the acquired companies. (2) Consists of the amortization of intellectual property licenses and covenant not to sue. Fiscal year ends on July 31. $ In millions Non-GAAP gross profit and gross margin: Q425 Q426 FY'25 FY'26 $ % $ % $ % $ % GAAP gross profit and gross margin $1,857 73.2% $2,304 67.6% $6,770 73.4% $8,077 70.4% Share-based compensation-related charges 40 1.6% 59 1.6% 159 1.7% 197 1.6% Acquisition-related costs⁽¹⁾ - 0.0% 3 0.1% - 0.0% 8 0.1% Amortization expense of acquired intangible assets 23 0.9% 184 5.4% 109 1.2% 416 3.6% Litigation-related charges⁽²⁾ 2 0.1% 2 0.1% 7 0.1% 7 0.1% Non-GAAP gross profit and gross margin $1,922 75.8% $2,552 74.8% $7,045 76.4% $8,705 75.8% 25
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© 2026 Palo Alto Networks, Inc. All rights reserved. (1) Consists of acquisition transaction costs, share-based compensation related to the cash settlement of certain equity awards, change in fair value of contingent consideration liability, and costs to terminate certain employment, operating lease, and other contracts of the acquired companies. In Q1'26 through Q4’26, also includes integration costs related to our acquisition of CyberArk Software Ltd. (2) Consists of the amortization of intellectual property licenses and covenant not to sue, and legal contingency charges. Also includes a litigation settlement charge in Q2’26. Fiscal year ends on July 31. GAAP to Non-GAAP Reconciliations – Operating Margin $ In millions Non-GAAP operating income and operating margin: Q425 Q126 Q226 Q326 Q426 $ % $ % $ % $ % $ % GAAP operating income (loss) and operating margin $497 19.6% $309 12.5% $397 15.3% ($183) -6.1% $172 5.0% Share-based compensation-related charges 372 14.7% 387 15.7% 321 12.4% 517 17.2% 487 14.3% Acquisition-related costs⁽¹⁾ (142) -5.6% 5 0.2% 24 0.9% 198 6.6% 68 2.0% Amortization expense of acquired intangible assets 37 1.5% 39 1.6% 38 1.5% 280 9.3% 281 8.2% Litigation-related charges⁽²⁾ 4 0.1% 6 0.2% 5 0.2% 2 0.1% 3 0.1% Non-GAAP operating income and operating margin $768 30.3% $746 30.2% $785 30.3% $814 27.1% $1,011 29.6% 26
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© 2026 Palo Alto Networks, Inc. All rights reserved. (1) Consists of acquisition transaction costs, share-based compensation related to the cash settlement of certain equity awards, change in fair value of contingent consideration liability, and costs to terminate certain employment, operating lease, and other contracts of the acquired companies. In FY'26, also includes integration costs related to our acquisition of CyberArk Software Ltd. (2) Consists of the amortization of intellectual property licenses and covenant not to sue, and a legal contingency charge (credit). Also includes litigation settlement charges in FY'24 and FY'26. (3) Consists of adjustments to restructuring and other costs. Fiscal year ends on July 31. GAAP to Non-GAAP Reconciliations – Operating Margin $ In millions Non-GAAP operating income and operating margin: FY'23 FY'24 FY'25 FY'26 $ % $ % $ % $ % GAAP operating income (loss) and operating margin $387 5.6% $684 8.5% $1,243 13.5% $695 6.1% Share-based compensation-related charges 1,145 16.6% 1,162 14.5% 1,386 15.0% 1,712 14.9% Acquisition-related costs⁽¹⁾ 20 0.3% 13 0.2% (110) -1.2% 295 2.6% Amortization expense of acquired intangible assets 103 1.5% 119 1.5% 164 1.8% 638 5.6% Litigation-related charges⁽²⁾ 7 0.1% 212 2.6% (31) -0.3% 16 0.1% Restructuring and other costs⁽³⁾ (2) 0.0% - 0.0% - 0.0% - 0.0% Non-GAAP operating income and operating margin $1,660 24.1% $2,190 27.3% $2,652 28.8% $3,356 29.2% 27
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© 2026 Palo Alto Networks, Inc. All rights reserved. GAAP to Non-GAAP Reconciliations – EPS (1) Consists of acquisition transaction costs, share-based compensation related to the cash settlement of certain equity awards, change in fair value of contingent consideration liability, and costs to terminate certain employment, operating lease, and other contracts of the acquired companies. In Q4'26 and FY'26, also includes integration costs related to our acquisition of CyberArk Software Ltd. (2) Consists of the amortization of intellectual property licenses and covenant not to sue, and legal contingency charges (credit). Also includes litigation settlement charge in FY'26. (3) Consists of changes in fair value of convertible senior notes acquired from CyberArk Software Ltd. that are included in earnings and changes in fair value of the related capped calls. (4) Consists of income tax adjustments related to our long-term non-GAAP effective tax rate. In FY'25, it included a one-time deferred tax provision adjustment relating to the enactment of One Big Beautiful Bill. Fiscal year ends on July 31. Non-GAAP net income per share, diluted: Q426 FY'25 FY'26 GAAP net income (loss) per share, diluted ($0.35) $1.60 $0.40 Share-based compensation-related charges 0.59 1.98 2.23 Acquisition-related costs⁽¹⁾ 0.08 (0.15) 0.39 Amortization expense of acquired intangible assets 0.34 0.23 0.84 Litigation-related charges⁽²⁾ 0.00 (0.04) 0.02 Change in fair value of convertible senior notes and capped calls⁽³⁾ 0.64 0.00 0.74 Income tax and other tax adjustments⁽⁴⁾ (0.28) (0.28) (0.78) Non-GAAP net income per share, diluted $1.02 $3.34 $3.84 28
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© 2026 Palo Alto Networks, Inc. All rights reserved. (1) Consists of a land purchase of $91 million in Q2'26. (2) Consists of a one-time purchase of a corporate asset which was paid through July 2026. (3) Consists of payments of acquisition-related costs in connection with our acquisition of CyberArk Software Ltd. and Koi Security Ltd. (4) Consists of a non-recurring litigation settlement payment in Q2’26. Fiscal year ends on July 31. GAAP to Non-GAAP Reconciliations – Adjusted Free Cash Flow $ In millions Free cash flow and adjusted free cash flow (non-GAAP): Q425 Q426 TTM Q425 TTM Q126 TTM Q226 TTM Q326 TTM Q426 Net cash provided by operating activities $1,021 $1,357 $3,716 $3,977 $3,974 $4,217 $4,553 Less: purchases of property, equipment, and other assets 87 103 247 287 409 424 440 Free cash flow (non-GAAP) $934 $1,254 $3,469 $3,690 $3,565 $3,793 $4,113 Add: capital expenditures for headquarters⁽¹⁾ - - - - 91 91 91 Add: capital expenditures for certain corporate assets⁽²⁾ 20 7 38 53 68 55 42 Add: payments of acquisition-related costs⁽³⁾ - 28 - 11 19 136 164 Add: litigation-related payment⁽⁴⁾ - - - - 4 4 4 Adjusted free cash flow (non-GAAP) $954 $1,289 $3,507 $3,754 $3,747 $4,079 $4,414 Adjusted free cash flow margin (non-GAAP) 37.6% 37.8% 38.0% 39.3% 37.9% 38.5% 38.4% 29
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© 2026 Palo Alto Networks, Inc. All rights reserved. (1) Consists of a land purchase of $91 million in FY’26. (2) Consists of a one-time purchase of a corporate asset which was paid through July 2026. (3) Consists of payments of acquisition-related costs in connection with our acquisitions of CyberArk Software Ltd. and Koi Security Ltd. (4) Consists of non-recurring litigation settlement payments in FY’24 and FY’26. Fiscal year ends on July 31. GAAP to Non-GAAP Reconciliations – Adjusted Free Cash Flow $ In millions Free cash flow and adjusted free cash flow (non-GAAP): FY'23 FY'24 FY'25 FY'26 Net cash provided by operating activities $2,777 $3,258 $3,716 $4,553 Less: purchases of property, equipment, and other assets 146 157 247 440 Free cash flow (non-GAAP) $2,631 $3,101 $3,469 $4,113 Add: capital expenditures for headquarters⁽¹⁾ - - - 91 Add: capital expenditures for certain corporate assets⁽²⁾ - - 38 42 Add: payments of acquisition-related costs⁽³⁾ - - - 164 Add: cash payment related to tax settlement 40 - - - Add: litigation-related payments⁽⁴⁾ - 20 - 4 Adjusted free cash flow (non-GAAP) $2,671 $3,121 $3,507 $4,414 Adjusted free cash flow margin (non-GAAP) 38.8% 38.9 % 38.0 % 38.4 % 30
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© 2026 Palo Alto Networks, Inc. All rights reserved. Comparison: Palo Alto Networks NGS ARR vs. Previous Idira ARR Definition PANW NGS ARR Definition CYBR Previous Subscription ARR Definition ARR is calculated as the total contract value allocated to products/services that had revenue recognized (per ASC 606) on the final day of the reporting period. ARR is calculated based on the annualized value of the contracts (Bookings) on the final day of the reporting period independent of revenue recognition. Subscription portion of ARR is defined as the annualized value of active SaaS and self-hosted subscription contracts in effect at the end of the reported period. The subscription portion of ARR excludes maintenance contracts related to the perpetual licenses. Next-Generation Security Annualized Recurring Revenue ("NGS ARR") represents the annualized allocated revenue of all active contracts as of the final day of the reporting period related to all product, subscription and support offerings, excluding revenue from hardware products, and legacy attached subscriptions, support offerings and professional services. 31
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© 2026 Palo Alto Networks, Inc. All rights reserved. © 2026 Palo Alto Networks, Inc. All rights reserved. Proprietary and confidential information. Thank You