Palo Alto Networks Taps Founder Nir Zuk To Lead Application Framework Team

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Palo Alto Networks has selected its co-founder, Nir Zuk, to spearhead the company's Application Framework team to help get more focused leadership across key product areas.

The Santa Clara, Calif.-based platform security vendor said Zuk -- who is also the company's chief technology officer -- will be tasked with accelerating Palo Alto Networks' development engine, ensuring the company stays ahead of the evolving threat landscape, and moving the Application Framework team in line with the overall strategy, according to Nikesh Arora, who took over as chairman and CEO in June.

Giving each key product area a go-to-market leader should help ensure the company is able to leverage the benefit of its scale without giving up the ability to move or react quickly, Arora said. These "product speedboats" should provide Palo Alto Networks with a better understanding of how each of these areas can become big and win for the company, according to Arora.

[Related: New Palo Alto Networks CEO: We're Still Very Early In The Cloud Revolution For Enterprises]

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From an Application Framework perspective, Arora said Palo Alto Networks is focused on getting its big products to work together much better. Specifically, he said the company is working hard to drive more and more integration between its firewall and endpoint products, including its recently-acquired Endpoint Detection and Response (EDR) capabilities from Secdo.

At the same time, Arora said Palo Alto Networks plans to onboard more third parties onto its application framework to provide customers with the ability to look at their threats and security posture across multiple parts of the infrastructure.

"Our bet on the application framework is the right one, and I'm pleased to report that it's progressing well," Arora told Wall Street analysts during an earnings call Thursday.

Channel partners have historically focused on just four or five different vendors since extensive training was needed to be successful, according to President Mark Anderson. But with the Application Framework abstracting the complexity by addressing many of the integration and provisioning requirements, Anderson said solution providers can now easily partners with many more vendors.

In addition, Anderson said partners have been attempting to build applications themselves to take advantage of the Palo Alto Networks Framework and deepen ties with existing customers. Arora said the company's first 30 beta partners are pleased that they can now build their own apps on top of the Application Framework data.

Palo Alto’s sales for the quarter ended July 31 skyrocketed to $658.1 million, up 29.3 percent from $509.1 million the year prior. That crushed Seeking Alpha's estimate of $633.1 million.

Palo Alto recorded a net loss of $2.3 million, or $0.02 per share, 94 percent better than a net loss of $38.2 million, or $0.42 per share, the year before. On a non-GAAP basis, net income jumped to $125 million, or $1.28 per diluted share, up 46.2 percent from $85.5 million, or $0.92 per share, last year. That beat Seeking Alpha's net income projection of $1.17 per share.

On a full-year basis, Palo Alto Networks recorded revenue of $2.27 billion, up 29 percent from $1.76 billion a year ago. The company's fiscal 2018 net loss came in at $147.9 million, or $1.61 per share, improved 31.7 percent from a net loss of $216.6 million, or $2.39 per share, last year.

The company's stock rose more than 5 percent to $232.52 per share in after-hours trading Thursday. That's the highest-ever trading price for Palo Alto Networks stock since going public in July 2012.

Subscription and support revenue for Palo Alto Networks soared to $390.5 million, up 31.6 percent from $296.8 million the year before. And product revenue jumped to $267.6 million, up 26 percent from $212.3 million last year.

Sales in the Americas increased by 24 percent in the quarter, according to Chief Financial Officer Kathy Bonanno.

For the coming quarter, Palo Alto Networks expects non-GAAP net income of $1.04 per diluted share to $1.06 per diluted share on total sales of $625 million to $635 million. Seeking Alpha had been projecting non-GAAP net income of $1.04 per diluted share on earnings of $620.1 million.