AI hackers become the norm! Palo Alto Networks (PANW.US) emerges as the biggest winner, with 2027 fiscal year guidance exceeding expectations across the board

According to Golden Ten Data, cybersecurity company Palo Alto Networks (PANW.US) issued a full-year profit forecast exceeding Wall Street expectations, mainly driven by strong demand for protection as enterprises seek to defend against increasingly advanced artificial intelligence systems. Financial results show the company’s fourth quarter fiscal 2026 revenue reached $3.41 billion, a year-on-year increase of 34.3%, surpassing expectations by $60 million; adjusted earnings per share were $1.02, beating expectations by $0.04.

In a statement on Tuesday, the company said it expects adjusted earnings per share for fiscal year 2027 to be between $4.16 and $4.19. This is higher than the Wall Street average estimate of $4.11.

The annual recurring revenue (ARR) for next-generation security business is projected to be between $11.075 billion and $11.175 billion, an increase of 22% to 23% year-on-year, also higher than market expectations.

Remaining performance obligations are expected to be between $25.2 billion and $25.4 billion, a year-on-year increase of 19% to 20%.

As of Tuesday’s close, Palo Alto Networks has risen 97% so far this year, significantly outperforming the S&P 500’s gain of 11% in the same period.

The company also announced on Tuesday that it has acquired Console, which aims to help enterprises build AI agents to automate internal IT tasks.

With growing concerns over AI-driven attacks and data breaches, cybersecurity stocks have continued to rise in recent months. Last week, CrowdStrike’s third quarter earnings outlook exceeded analyst expectations; at the same time, Okta Inc. raised its annual revenue outlook for the second time this year and recorded a record backlog of unfulfilled orders.

It has been shown that some AI models are becoming increasingly skilled at carrying out hacking attacks independently. In recent weeks, Anthropic PBC, OpenAI, and Meta Platforms Inc. each revealed that their models bypassed test environments, accessed the public internet, and infiltrated real-world victim systems during testing.

Even before these events occurred, Anthropic had decided this spring to restrict the release of its Mythos model due to concerns over its excessive hacking capabilities—a move that drew attention from government and security officials.

Chief Executive Officer Nikesh Arora stated, “The latest advances in AI are putting cybersecurity at the top of the CIO’s priority list and will be a long-term driver.”

As the company’s strong momentum continued into the fourth quarter, it also issued a first-quarter fiscal 2027 sales outlook above expectations. The company expects revenue to be between $3.3 billion and $3.31 billion, whereas analysts’ expectations were $3.21 billion.

The company’s initial success was based on firewalls—a security tool for monitoring incoming and outgoing traffic in computer networks. Today, the company is among the world’s largest suppliers of cybersecurity products and is increasingly focusing its business on protecting enterprises from AI-related threats.