Palo Alto Networks Partners Investing Big As Company Continues To Notch Wins In Q4

Palo Alto Networks closed the year with a bang, with CEO Mark McLaughlin saying on the company's Q4 and full fiscal 2015 earnings call that the company saw significant sales and partner growth and continues to see itself pulling ahead of the competition.

Revenue for the quarter was $283.9 million, up 59 percent year over year, with a net loss of $46 million, compared with a net loss of $32.1 million in Q4 of last year. Non-GAAP net income for the quarter was $25 million, up from $9.1 million last year.

For the full year, revenue rose 55 percent year over year, to $928.1 million. Net loss for the full year was $165 million, compared with $226.5 million last year. Non-GAAP net income was $75.2 million, up 136 percent from the year before.

[Related: Here's What Innovations To Expect From Palo Alto Networks In The Coming Months]

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A significant part of those sales gains were big wins over the competition, McLaughlin said -- an area where he said he sees Palo Alto Networks continuing to pull ahead.

"We're more convinced than ever of our ability to take market share and distance ourselves from the competition," McLaughlin said.

For example, in the most recent quarter, McLaughlin said, big customer wins for Palo Alto Networks included a North American brokerage bank, where it replaced Cisco; a large utility company deal, in which it won out over both Check Point and Cisco; a government agency, where it replaced Cisco; and one of the world's largest airlines, where it replaced Check Point. The company added more than 2,000 new customers overall in the past quarter, he said.

Those customer wins have translated into significant wins for partners and more big name solution providers, such as CDW, investing big in the security vendor. CDW, for example, grew its business with Palo Alto Networks by 50 percent in fiscal 2015, McLaughlin said. That growth is expected to continue, McLaughlin said, as more than 12,000 partners invested in training and capabilities around the platform over the past year.

"It is clear to the partner community that Palo Alto Networks is leading the market and taking share from legacy and point solution providers," McLaughlin said.

While products such as WildFire continue to gain traction in the marketplace, adding 7,000 more customers over the past year, investments in R&D and key acquisitions are starting to pay off, McLaughlin said. In particular, McLaughlin highlighted the growth of the company's endpoint solution Traps, which launched at the beginning of the year. In that area, McLaughlin said, Palo Alto Networks is seeing wins over traditional endpoint security vendors as well as specialist startups in the endpoint market.

"We're seeing gains pretty much everywhere we compete, and also now on the endpoint side as well," McLaughlin said.

That investment in new solutions to add to the platform will continue, he said, with the upcoming rollouts of threat intelligence solution AutoFocus and sanctioned Software-as-a-Service application security offering Aperture (from the company's May acquisition of CirroSecure).

Palo Alto Networks expects the skyrocketing growth to continue, with revenue forecasts for Q1 2016 to be between $280 million and $284 million, a rise of 46 percent to 48 percent over the year before. The company expects earnings per share to be between $0.31 and $0.32 per share.