Palo Alto revenue rises 49 percent, settles lawsuits with Juniper
(Reuters) - Cyber security software maker Palo Alto Networks Inc reported a better-than-expected 49 percent jump in quarterly revenue as it added more customers, and said it settled patent litigation with network gear maker Juniper Networks Inc.
Palo Alto's shares rose about 12 percent after the bell.
The company, which sells firewalls that prevent data breaches and block malware and viruses, forecast adjusted earnings of 10-11 cents per share on revenue of $158 million-$162 million for the fourth quarter ending July.
Analysts on average were expecting 10 cents per share on revenue of $158.4 million, according to Thomson Reuters I/B/E/S.
Palo Alto said it paid about $175 million to Juniper in cash and stock to settle patent infringement lawsuits. It also said it has struck a deal with Juniper not to sue each other for eight years.
"It was viewed that Juniper was not going to settle so the fact that they even settled is like investors getting an ice cream sundae when they were expecting dry broccoli," said Daniel Ives, analyst at FBR Capital Markets and Co.
The settlement amount was much lower than the market expected, he added.
Palo Alto's net loss, however, widened to $139.1 million, or $1.86 per share, in the quarter ended April 30, from $7.3 million, or 10 cents per share, a year earlier.
Operating expenses rose threefold to $249.3 million and included legal expenses of $113.7 million.
Revenue jumped to $150.7 million, ahead of analysts' average estimate of $146.2 million.
The results were helped by a seven-figure deal to secure the entire network of one of America's largest airports and a win at a premier sports network production company to secure video traffic, Chief Executive Mark McLaughlin said on a post-earnings conference call.
Excluding one-time items, the company earned 11 cents per share, beating the average analyst estimate by 1 cent.
Palo Alto's shares closed at $69.51 on the New York Stock Exchange on Wednesday.
(Reporting By Sampad Patnaik in Bangalore; Editing by Don Sebastian)