Palo Alto Networks stock crashed 9% in early trading after the company reported fiscal Q4 earnings that, while beating revenue and adjusted profit expectations, showed a wider-than-expected GAAP loss. Revenue grew 34% year over year to $3.4 billion, surpassing the $3.35 billion analysts had forecast, and adjusted earnings came in at $1.02 per share, four cents above estimates. However, the company posted a GAAP loss of $0.35 per share, reversing a $0.36 profit in the year-ago quarter, and full-year GAAP profit plunged 75% to $0.40 per share. Free cash flow for the quarter was $1.3 billion, and for the full year it rose 17% to $4.1 billion. Despite the strong adjusted results, the market's negative reaction reflects concerns over the GAAP loss and the stock's rich valuation, trading at roughly 72 times free cash flow.
Palo Alto Networks IncQ4 GAAP loss wider than expected and full-year profit plunge despite revenue beat
NVIDIA Corporation