Palo Alto Networks (PANW) : 18-month performance

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Palo Alto Networks, Inc. offers a network security platform in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan. The company's platform comprises Next-Generation Firewall that delivers application, user, and content visibility and control. It delivers its platform in the form of a hardware or virtual appliance, and includes a suite of subscription services, as well as support and maintenance services. The company's products include firewall appliances; Panorama, a centralized security management solution for the global control of appliances deployed on an end-customer's network as a virtual appliance or a physical appliance; and Virtual System Upgrades, which are available as extensions to the virtual system capacity that ships with the appliance. Its subscription services include threat detection and prevention, URL filtering, laptop and mobile devices protection, and malware and threats protection. The company also offers professional services, which include on-location planning, designing, and deployment of security solutions; application traffic management, solution design and planning, configuration, and firewall migration; and education services. Its platform enables enterprises, service providers, and government entities to identify, control, and safely enable applications running on their networks, as well as protect against cyber threats in real time. The company serves the enterprise network security market, which consists of firewall, unified threat management, Web gateway, intrusion detection and prevention, and virtual private network technologies. The company primarily sells its products and services through its channel partners, as well as directly to end-customers operating in various industries, including education, energy, financial services, healthcare, Internet and media, manufacturing, public sector, and telecommunications. Palo Alto Networks, Inc. was founded in 2005 and is headquartered in Santa Clara, California.

Palo Alto Networks (PANW) Q4 loss narrows, revenue jumps; stock drops a/h

Palo Alto Networks Inc.'s (PANW) fiscal fourth-quarter loss narrowed as the network security firm's revenue strengthened.

The company, which went public in July, makes hardware and software that provides computer-network security. Its products are used to replace older systems operated by companies or government agencies, and the company said it reduces expenses for its customers by simplifying network-security systems.

For the quarter ended July 31, Palo Alto reported a loss of $4.6 million, or 18 cents a share, compared with a year-earlier loss of $6 million, or 40 cents a share. Excluding stock-based compensation, earnings were three cents a share compared with a year-earlier loss of 34 cents a share. Revenue climbed 88% to $75.6 million.

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Analysts polled by Thomson Reuters projected earnings to break even on a per-share basis, and revenue of $71 million.

Gross margin eased to 71.5% from 71.8%. Operating expenses were up 70%.

Product revenue, which makes up the bulk of its top line, jumped 70% while services revenue more than doubled.

The company added more than 1,000 new end customers in quarter, bringing its customer base to more than 9,000.

Shares slipped 7.1% after hours. Through the close, the stock has jumped 71% since its IPO price of $42.

Palo Alto Networks (PANW) started trading on the NYSE on July 20, 2012

Palo Alto Networks Inc. of Santa Clara, Calif. — also had a successful IPO this week. The enterprise software maker priced its initial public offering shares at $42 on Thursday, raising $260 million. Trading under the symbol PANW, its shares closed at $53.13 on Friday, 26 percent over the initial price.

The next wave of tech IPOs

After a year of high-profile consumer Internet IPOs—from Groupon Inc., LinkedIn Corp. and Zynga Inc. last year to Yelp Inc. and Facebook Inc. now—a slew of Silicon Valley companies that sell technology mainly to businesses are also getting ready to hit the stock market.

This new crop of IPO-ready companies are solving problems that businesses are willing to spend money on, such as improved security or better insight into customer behavior.

Splunk Inc., a San Francisco company that helps businesses capture and analyze the data they generate, and Infoblox Inc.(BLOX), a Santa Clara, Calif., maker of network-automation technology, in January both filed to go public in IPOs aiming to raise around $125 million each.

Now other enterprise-tech makers are lining up to get out of the gate. According to people familiar with the matter, security-technology maker Palo Alto Networks Inc., online human resources software company Workday Inc. and tech-management software maker ServiceNow Inc. have picked bankers or are in the final stages of choosing and informing bankers for their IPO process. Atlassian Inc., which provides software building blocks to developers, is also aiming to file for an IPO this year, said another person familiar with the matter.

Spokespeople for Atlassian, Splunk (SPLK), Palo Alto Networks (PANW) and Workday declined to comment, while ServiceNow didn't immediately respond to a request for comment.

While well-known Silicon Valley consumer Web companies could still go public—such as Twitter Inc.—2012 marks "the revenge of the enterprise tech sector," said Jim Goetz, a board member of Palo Alto Networks and a venture capitalist at Sequoia Capital, which also backed ServiceNow.

Start-ups that target businesses traditionally take longer to turn a profit than consumer Web companies. But working in these companies' favor, bankers say, are predictable revenue streams based on recurring monthly subscription fees for their products.

Splunk is still unprofitable but its revenue rose 79% to $77.8 million for the nine months ended Oct. 31 on the backs of big customers such as Bank of America Corp., Comcast Corp. and Harvard University. Palo Alto Networks, meanwhile, said in August that its run rate exceeded $200 million in bookings and that it had been cash flow positive for five consecutive quarters.