Palo Alto Networks to buy Aporeto for $150M

Palo Alto Networks to buy Aporeto for $150M

Comes after acquisitions of Zingbox and Twistlock

Credit: Dreamstime

Palo Alto Networks has said it will buy Aporeto for US$150 million in cash. The Santa Clara-based company has been on an acquisition spree as it looks to bolster its market share in a highly competitive cyber security industry.

Earlier this year, it had acquired companies including IoT security provider Zingbox and Twistlock.

Palo Alto competes in a market dominated by traditional firewall provider Cisco Systems Inc, Check Point Software Technologies and Juniper Networks Inc. 

The acquisition announcement comes as Palo Alto Networks forecasts second-quarter profit well below Wall Street expectations, as the cyber security firm grapples with higher costs and rising competition, sending its shares down about 8 per cent in extended trading.

The company expects second-quarter adjusted profit between US$1.11 and US$1.13 per share, while analysts were expecting $1.30, according to IBES data from Refinitiv.

Meanwhile, net loss widened to US$59.6 million, or 62 cents per share, from US$38.3 million, or 41 cents per share, a year earlier.

Palo Alto's operating expenses jumped about 20 per cent to US$606 million in the quarter.

Excluding items, the company earned US$1.05 per share, and analysts' on average were expecting a profit of US$1.03 a share.

Revenue rose 18 per cent to US$771.9 million in the first quarter ended Oct. 31, beating analysts' expectations of US$767.8 million, according to IBES data from Refinitiv.

Shares of the company have risen about 33 per cent this year.

(Reporting by Chinmay Rautmare in Bengaluru; Editing by Amy Caren Daniel)

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