Deferred Revenue at 1.3 Times RevenueWide moat

Palo Alto Networks (PANW) — moat facet

Palo Alto's customers have prepaid about $14.8 billion, more than a full year of revenue, for services not yet delivered.

Palo Alto's customers pay it well in advance, and the balance sheet shows how far. At 31 July 2026 deferred revenue was $7,747 million current and $7,009 million long-term1, a total of $14,756 million, about 1.29 times fiscal 2026 revenue2.

Deferred revenue at fiscal year-end ($M)2,889FY20195,024FY20219,296FY202312,752FY202514,756FY2026Palo Alto filings and SEC EDGAR XBRL; current plus long-term, summed
Five times larger in seven years.

That money is cash the company already has for services it has not yet delivered. It is why operating cash flow was $4,553 million in fiscal 2026 while net income was $307 million3. In the year, Palo Alto recognised about $6.2 billion of revenue from amounts that had been deferred a year earlier4.

Advance payment is a moat signal in two ways. It shows that customers are willing to commit for years, which they only do for products they expect to keep. And it funds the business: the company does not need to borrow to grow, and can invest the float, holding $2,514 million of cash, $557 million of short-term and $4,835 million of long-term investments at year end5.

The balance has grown fast. Deferred revenue was $2,888.7 million in fiscal 20196 and $12,751.9 million in fiscal 20257.

Holding the float carries an interest-rate exposure. The 10-K says a 100 basis point rise in interest rates across all maturities would reduce the fair value of the investment portfolio by $128 million8, a small number against deferred revenue of $14,756 million9, but a reminder that the float is invested in bonds.

The deferred balance is the promise customers have already paid for. Its size relative to revenue, about 1.29 times in fiscal 202610, is the measure; a steady fall below one year of revenue would mean customers are no longer willing to pay upfront for multi-year terms.

Moat trajectory: Holding steady

Deferred revenue $14,756M, 1.29 times revenue.

The number that tests this moat
Reported
Deferred revenue, current plus long-term
$14,756M (31 July 2026)

Revenue customers have already paid for; a fall below one year of revenue would mean shorter or later payments.

Source: Palo Alto Networks Q4 FY2026 results release ↗
⚠ Threats to the moat
⚠ THREAT 01
Deferred Revenue That Arrived by Acquisition
Without the $776 million of deferred revenue bought with CyberArk, Palo Alto's prepaid balance grew slower than its sales.
References
  1. ReportedAt 31 July 2026 deferred revenue was $7,747 million current and $7,009 million long-term, a total of $14,756 million, about 1.29 times fiscal 2026 revenue.
    Palo Alto Networks fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1 - income statement, non-GAAP reconciliation, balance sheet, cash flow, Next-Generation Security ARR, remaining performance obligations and fiscal 2027 guidance - balance sheet and cash flow statement. — Q4 FY2026 · publ. 1 September 2026 · source ↗
  2. Moat Explorer calcAt 31 July 2026 deferred revenue was $7,747 million current and $7,009 million long-term, a total of $14,756 million, about 1.29 times fiscal 2026 revenue.
    Moat Explorer calculation from Palo Alto Networks' reported figures ($ millions unless stated; fiscal years end 31 July). Growth: revenue FY2026 11,480 / 9,221.5 - 1 = 24.5%; FY2025 9,221.5 / 8,027.5 - 1 = 14.9%; FY2024 8,027.5 / 6,892.7 - 1 = 16.5%; FY2023 25.3%; FY2022 29.3%; FY2021 24.9%; FY2020 17.5%; FY2024 to FY2026 11,480 / 8,027.5 - 1 = 43%; compound FY2015-FY2026 (11,480 / 928.1)^(1/11) - 1 = 25.7%, about 26%. By type FY2026: product 2,280 / 1,801.9 - 1 = 26.5%; subscription 6,239 / 4,974.4 - 1 = 25.4%; support 2,961 / 2,445.2 - 1 = 21.1%. Product FY2025 12.4%, FY2024 1,603.3 / 1,578.4 - 1 = 1.6%, FY2020 1,064.2 / 1,096.2 - 1 = -2.9%. Subscription FY2017 53.7%, FY2019 36.2%, FY2021 35.1%, FY2023 31.4%, FY2024 25.6%, FY2025 18.8%. Support FY2022 29.3%, FY2023 23.7%, FY2024 13.0%, FY2025 9.4%. Compound FY2015-FY2026: subscription (6,239 / 212.7)^(1/11) - 1 = 36.0%; support (2,961 / 222.7)^(1/11) - 1 = 26.5%; product (2,280 / 492.7)^(1/11) - 1 = 14.9%. Product outgrew subscription in FY2026 (26.5% against 25.4%), which it did not in any year FY2016-FY2025. Organic: FY2026 (11,480 - 930) / 9,221 - 1 = 14.4%; Q4 acquisition revenue 930 - 388 = 542; Q4 (3,410 - 542) / 2,536 - 1 = 13.1%, about 13%; pro forma 12,312 / 10,486 - 1 = 17.4%; FY2027 guidance 14.15 / 12.312 - 1 = 14.9%, about 15%. Margins: gross margin FY2026 8,077 / 11,480 = 70.4% (FY2025 6,769.9 / 9,221.5 = 73.4%; FY2024 5,968.3 / 8,027.5 = 74.3%); Q4 GAAP 2,304 / 3,410 = 67.6%. Product gross margin (2,280 - 568) / 2,280 = 75.1% (FY2025 (1,801.9 - 413) / 1,801.9 = 77.1%); subscription and support (9,200 - 2,835) / 9,200 = 69.2% (FY2025 (7,419.6 - 2,038) / 7,419.6 = 72.5%). Operating margin 695 / 11,480 = 6.1% (FY2025 1,242.9 / 9,221.5 = 13.5%); non-GAAP 3,356 / 11,480 = 29.2% (FY2025 2,652 / 9,221.5 = 28.8%); Q4 non-GAAP 1,011 / 3,410 = 29.6%; gap 3,356 - 695 = 2,661. R&D 2,552 / 11,480 = 22.2%; sales and marketing 3,931 / 11,480 = 34.2%; capital expenditure 440 / 11,480 = 3.8%. Tax 229 / (307 + 229 = 536) = 42.7%. Mix: product share 492.7 / 928.1 = 53.1% (FY2015), 2,280 / 11,480 = 19.9% (FY2026); subscription 212.7 / 928.1 = 22.9%, 6,239 / 11,480 = 54.3%; support 222.7 / 928.1 = 24.0%, 2,961 / 11,480 = 25.8%; one point of share 1% x 11,480 = 115. Recurring share 435.4 / 928.1 = 46.9% (FY2015), 1,393.8 / 2,273.6 = 61.3% (FY2018), 3,135.8 / 4,256.1 = 73.7% (FY2021), 6,424.2 / 8,027.5 = 80.0% (FY2024). Subscription and support per dollar of product 435.4 / 492.7 = 0.88 (FY2015), 1,393.8 / 879.8 = 1.58 (FY2018), 3,135.8 / 1,120.3 = 2.80 (FY2021), 6,424.2 / 1,603.3 = 4.01 (FY2024), 9,200 / 2,280 = 4.04 (FY2026). Hardware about 10% x 11,480 = about 1,150, about 50% of product. NGS ARR 9.10 / 11.48 = 79% of revenue. United States 7,108 / 11,480 = 61.9% (FY2016 901.8 / 1,378.5 = 65.4%). Q4 share of year 3,410 / 11,480 = 29.7%, about 30%. Prisma AIRS ARR 100 / 11,480 = under 1%. ARR and RPO: Q3 acquired ARR 1.6 / 8.1 = 20%, about a fifth; Q3 organic 8.1 - 1.6 = 6.5; Q3 acquired RPO 1.8 / 18.4 = 10%; FY2023 NGS ARR 4.2 / 1.43 = about 2.9; FY2025 growth 5.6 / 4.2 - 1 = 33%; Q1 FY2027 net new 9.54 - 9.10 = 0.44 to 9.56 - 9.10 = 0.46 billion; FY2030 target (20 / 9.1)^(1/4) - 1 = 21.8% a year; RPO / revenue 21.2 / 11.48 = 1.85; RPO due in 12 months 1.7 / 3.1 = 55% (FY2019), 2.2 / 4.3 = 51% (FY2020), 3.1 / 5.9 = 53% (FY2021), 4.1 / 8.2 = 50% (FY2022), 5.1 / 10.6 = 48% (FY2023), 5.9 / 12.7 = 46% (FY2024), 7.0 / 15.8 = 44% (FY2025), 9.3 / 21.2 = 44% (FY2026); RPO beyond 12 months 21.2 - 9.3 = 11.9 billion; Idira guidance 1.5 / 1.26 - 1 = 19%; Network and AI Security FY2025 8.35 / 1.17 = about 7.14 billion. Revenue from prior deferred 6.2 / 5.5 - 1 = 13%. Cash, deferred revenue and stock pay: free cash flow margin 4,113 / 11,480 = 35.8%; share-based compensation (cash flow) 1,774 / 11,480 = 15.5%; 1,774 / 1,295 - 1 = 37%; 1,774 / 4,113 = 43%; free cash flow after stock pay 4,113 - 1,774 = 2,339, 2,339 / 11,480 = 20.4%, 2,339 / 306,540 = 0.76%; free cash flow 4,113 / 306,540 = 1.3% and 4,113 / 27,492 = 15%. Stock pay share of revenue FY2016 392.8 / 1,378.5 = 28.5%, FY2020 658.4 / 3,408.4 = 19.3%, FY2024 1,076 / 8,027.5 = 13.4%, FY2025 1,295 / 9,221.5 = 14.0%. 10-K share-based compensation 1,815 / 1,079 - 1 = 68%. Equity plan (26.1 + 24.3) / 818 = 6%. Net cash 2,514 + 557 + 4,835 - 1,774 = 6,132; cash and investments 2,514 + 557 + 4,835 = 7,906, about 7.9 billion. Deferred revenue 1,582.1 + 1,306.6 = 2,888.7 (FY2019); 2,741.9 + 2,282.1 = 5,024.0 (FY2021); 4,674.6 + 4,621.8 = 9,296.4 (FY2023); 6,302.2 + 6,449.7 = 12,751.9 (FY2025); 7,747 + 7,009 = 14,756 (FY2026); 14,756 / 11,480 = 1.29 times; 2,888.7 / 2,899.6 = about one year (FY2019); growth 14,756 / 12,751.9 - 1 = 15.7%; excluding CyberArk (14,756 - 776) / 12,751.9 - 1 = 9.6%. Billings FY2025 9,221.5 + (12,751.9 - 11,480.5) = 10,493, 10,493 / 10,208.1 - 1 = 2.8%; FY2026 11,480 + (14,756 - 12,752) - 776 = about 12,708, 12,708 / 10,493 - 1 = 21%; February 2024 guidance cut 10.7 - 10.1 = 0.6 billion. Acquisitions: fiscal 2019 378.1 + 474.2 + 158.2 + 292.9 + 82.7 + 36.8 + 103.1 = 1,526; fiscal 2020 144.1 + 66.4 = 210.5; fiscal 2021 797.2 + 227.7 + 156.9 + 27.0 = 1,209; fiscal 2024 255.4 + 458.6 = 714; fiscal 2025 1,143 + 635 = 1,778; fiscal 2026 2,951 + 21,061 + 231 + 117 = 24,360, about 24.4 billion; all twenty-two FY2019-FY2026 including Cider 198.3 = 29,996, about 30.0 billion; FY2026 against FY2019-FY2025 24,360 / 5,636 = 4.3 times; after year end 325 + 500 = 825; AI security 635 + 231 + 117 = 983. CyberArk shares 18,488 / 112 = about 165 a share; 25,000 - 21,061 = about 3.9 billion; 112 x 374.74 = about 42.0 billion; 112 / 818 = 14%. Chronosphere 2,951 / 160 = about 18 times ARR. Goodwill and intangibles (22,010 + 7,017) / 48,460 = 60%; other assets 48,460 - 29,027 = 19,433. Headcount 21,921 - 4,223 = 17,698, 17,698 / 16,068 - 1 = 10%. Revenue per employee 928.1 / 2,637 = 0.35; 9,221.5 / 16,068 = 0.57; 11,480 / 21,921 = 0.52. Convertible loss Q1-Q3 562 - 524 = 38. Distributors: FY2019 31.8 + 22.1 + 10.7 + 10.0 = 74.6%; FY2021 33.2 + 12.2 + 10.6 = 56.0%; FY2023 25.0 + 12.8 + 11.9 = 49.7%; FY2024 21.2 + 13.2 + 13.2 + 11.4 = 59.0%; FY2025 18.8 + 14.4 + 11.0 = 44.2%; FY2026 15 + 15 = 30%; largest 34.4% (FY2020) to 15% (FY2026); receivables FY2019 29.9 + 18.9 + 14.2 = 63.0%. Valuation: market value over fiscal revenue at calendar year-end 15.13 / 0.928 = 16.3 (2015), 11.47 / 1.3785 = 8.3 (2016), 42.19 / 5.5015 = 7.7 (2022), 92.98 / 6.8927 = 13.5 (2023), 119.40 / 8.0275 = 14.9 (2024), 128.39 / 9.2215 = 13.9 (2025); 306.54 / 11.48 = 26.7; 306.54 / 0.307 = 998; 374.74 / 3.84 = 97.6; market value against Fortinet 306.54 / 130.12 = 2.4, against CrowdStrike 306.54 / 267.43 = 1.15; analyst target 395.70 / 374.74 - 1 = 6% - valuation, cash flow, stock pay, deferred revenue, billings and acquisitions. — FY2015-FY2027 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Palo Alto Networks' Forms 10-K and results releases, the Q4 FY2026 earnings call and market data; operands shown in the source line.
  3. ReportedIt is why operating cash flow was $4,553 million in fiscal 2026 while net income was $307 million.
    Palo Alto Networks fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1 - income statement, non-GAAP reconciliation, balance sheet, cash flow, Next-Generation Security ARR, remaining performance obligations and fiscal 2027 guidance - balance sheet and cash flow statement. — Q4 FY2026 · publ. 1 September 2026 · source ↗
  4. ReportedIn the year, Palo Alto recognised about $6.2 billion of revenue from amounts that had been deferred a year earlier.
    Palo Alto Networks Form 10-K for fiscal 2026 (year ended 31 July 2026) - financial statements and notes: deferred revenue, obligations, convertible notes, share-based pay, capital returns and receivables. — FY2026 · publ. 10 September 2026 · source ↗
  5. ReportedAnd it funds the business: the company does not need to borrow to grow, and can invest the float, holding $2,514 million of cash, $557 million of short-term and $4,835 million of long-term investments at year end.
    Palo Alto Networks fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1 - income statement, non-GAAP reconciliation, balance sheet, cash flow, Next-Generation Security ARR, remaining performance obligations and fiscal 2027 guidance - balance sheet and cash flow statement. — Q4 FY2026 · publ. 1 September 2026 · source ↗
  6. Moat Explorer calcDeferred revenue was $2,888.7 million in fiscal 2019 and $12,751.9 million in fiscal 2025.
    Moat Explorer calculation from Palo Alto Networks' reported figures ($ millions unless stated; fiscal years end 31 July). Growth: revenue FY2026 11,480 / 9,221.5 - 1 = 24.5%; FY2025 9,221.5 / 8,027.5 - 1 = 14.9%; FY2024 8,027.5 / 6,892.7 - 1 = 16.5%; FY2023 25.3%; FY2022 29.3%; FY2021 24.9%; FY2020 17.5%; FY2024 to FY2026 11,480 / 8,027.5 - 1 = 43%; compound FY2015-FY2026 (11,480 / 928.1)^(1/11) - 1 = 25.7%, about 26%. By type FY2026: product 2,280 / 1,801.9 - 1 = 26.5%; subscription 6,239 / 4,974.4 - 1 = 25.4%; support 2,961 / 2,445.2 - 1 = 21.1%. Product FY2025 12.4%, FY2024 1,603.3 / 1,578.4 - 1 = 1.6%, FY2020 1,064.2 / 1,096.2 - 1 = -2.9%. Subscription FY2017 53.7%, FY2019 36.2%, FY2021 35.1%, FY2023 31.4%, FY2024 25.6%, FY2025 18.8%. Support FY2022 29.3%, FY2023 23.7%, FY2024 13.0%, FY2025 9.4%. Compound FY2015-FY2026: subscription (6,239 / 212.7)^(1/11) - 1 = 36.0%; support (2,961 / 222.7)^(1/11) - 1 = 26.5%; product (2,280 / 492.7)^(1/11) - 1 = 14.9%. Product outgrew subscription in FY2026 (26.5% against 25.4%), which it did not in any year FY2016-FY2025. Organic: FY2026 (11,480 - 930) / 9,221 - 1 = 14.4%; Q4 acquisition revenue 930 - 388 = 542; Q4 (3,410 - 542) / 2,536 - 1 = 13.1%, about 13%; pro forma 12,312 / 10,486 - 1 = 17.4%; FY2027 guidance 14.15 / 12.312 - 1 = 14.9%, about 15%. Margins: gross margin FY2026 8,077 / 11,480 = 70.4% (FY2025 6,769.9 / 9,221.5 = 73.4%; FY2024 5,968.3 / 8,027.5 = 74.3%); Q4 GAAP 2,304 / 3,410 = 67.6%. Product gross margin (2,280 - 568) / 2,280 = 75.1% (FY2025 (1,801.9 - 413) / 1,801.9 = 77.1%); subscription and support (9,200 - 2,835) / 9,200 = 69.2% (FY2025 (7,419.6 - 2,038) / 7,419.6 = 72.5%). Operating margin 695 / 11,480 = 6.1% (FY2025 1,242.9 / 9,221.5 = 13.5%); non-GAAP 3,356 / 11,480 = 29.2% (FY2025 2,652 / 9,221.5 = 28.8%); Q4 non-GAAP 1,011 / 3,410 = 29.6%; gap 3,356 - 695 = 2,661. R&D 2,552 / 11,480 = 22.2%; sales and marketing 3,931 / 11,480 = 34.2%; capital expenditure 440 / 11,480 = 3.8%. Tax 229 / (307 + 229 = 536) = 42.7%. Mix: product share 492.7 / 928.1 = 53.1% (FY2015), 2,280 / 11,480 = 19.9% (FY2026); subscription 212.7 / 928.1 = 22.9%, 6,239 / 11,480 = 54.3%; support 222.7 / 928.1 = 24.0%, 2,961 / 11,480 = 25.8%; one point of share 1% x 11,480 = 115. Recurring share 435.4 / 928.1 = 46.9% (FY2015), 1,393.8 / 2,273.6 = 61.3% (FY2018), 3,135.8 / 4,256.1 = 73.7% (FY2021), 6,424.2 / 8,027.5 = 80.0% (FY2024). Subscription and support per dollar of product 435.4 / 492.7 = 0.88 (FY2015), 1,393.8 / 879.8 = 1.58 (FY2018), 3,135.8 / 1,120.3 = 2.80 (FY2021), 6,424.2 / 1,603.3 = 4.01 (FY2024), 9,200 / 2,280 = 4.04 (FY2026). Hardware about 10% x 11,480 = about 1,150, about 50% of product. NGS ARR 9.10 / 11.48 = 79% of revenue. United States 7,108 / 11,480 = 61.9% (FY2016 901.8 / 1,378.5 = 65.4%). Q4 share of year 3,410 / 11,480 = 29.7%, about 30%. Prisma AIRS ARR 100 / 11,480 = under 1%. ARR and RPO: Q3 acquired ARR 1.6 / 8.1 = 20%, about a fifth; Q3 organic 8.1 - 1.6 = 6.5; Q3 acquired RPO 1.8 / 18.4 = 10%; FY2023 NGS ARR 4.2 / 1.43 = about 2.9; FY2025 growth 5.6 / 4.2 - 1 = 33%; Q1 FY2027 net new 9.54 - 9.10 = 0.44 to 9.56 - 9.10 = 0.46 billion; FY2030 target (20 / 9.1)^(1/4) - 1 = 21.8% a year; RPO / revenue 21.2 / 11.48 = 1.85; RPO due in 12 months 1.7 / 3.1 = 55% (FY2019), 2.2 / 4.3 = 51% (FY2020), 3.1 / 5.9 = 53% (FY2021), 4.1 / 8.2 = 50% (FY2022), 5.1 / 10.6 = 48% (FY2023), 5.9 / 12.7 = 46% (FY2024), 7.0 / 15.8 = 44% (FY2025), 9.3 / 21.2 = 44% (FY2026); RPO beyond 12 months 21.2 - 9.3 = 11.9 billion; Idira guidance 1.5 / 1.26 - 1 = 19%; Network and AI Security FY2025 8.35 / 1.17 = about 7.14 billion. Revenue from prior deferred 6.2 / 5.5 - 1 = 13%. Cash, deferred revenue and stock pay: free cash flow margin 4,113 / 11,480 = 35.8%; share-based compensation (cash flow) 1,774 / 11,480 = 15.5%; 1,774 / 1,295 - 1 = 37%; 1,774 / 4,113 = 43%; free cash flow after stock pay 4,113 - 1,774 = 2,339, 2,339 / 11,480 = 20.4%, 2,339 / 306,540 = 0.76%; free cash flow 4,113 / 306,540 = 1.3% and 4,113 / 27,492 = 15%. Stock pay share of revenue FY2016 392.8 / 1,378.5 = 28.5%, FY2020 658.4 / 3,408.4 = 19.3%, FY2024 1,076 / 8,027.5 = 13.4%, FY2025 1,295 / 9,221.5 = 14.0%. 10-K share-based compensation 1,815 / 1,079 - 1 = 68%. Equity plan (26.1 + 24.3) / 818 = 6%. Net cash 2,514 + 557 + 4,835 - 1,774 = 6,132; cash and investments 2,514 + 557 + 4,835 = 7,906, about 7.9 billion. Deferred revenue 1,582.1 + 1,306.6 = 2,888.7 (FY2019); 2,741.9 + 2,282.1 = 5,024.0 (FY2021); 4,674.6 + 4,621.8 = 9,296.4 (FY2023); 6,302.2 + 6,449.7 = 12,751.9 (FY2025); 7,747 + 7,009 = 14,756 (FY2026); 14,756 / 11,480 = 1.29 times; 2,888.7 / 2,899.6 = about one year (FY2019); growth 14,756 / 12,751.9 - 1 = 15.7%; excluding CyberArk (14,756 - 776) / 12,751.9 - 1 = 9.6%. Billings FY2025 9,221.5 + (12,751.9 - 11,480.5) = 10,493, 10,493 / 10,208.1 - 1 = 2.8%; FY2026 11,480 + (14,756 - 12,752) - 776 = about 12,708, 12,708 / 10,493 - 1 = 21%; February 2024 guidance cut 10.7 - 10.1 = 0.6 billion. Acquisitions: fiscal 2019 378.1 + 474.2 + 158.2 + 292.9 + 82.7 + 36.8 + 103.1 = 1,526; fiscal 2020 144.1 + 66.4 = 210.5; fiscal 2021 797.2 + 227.7 + 156.9 + 27.0 = 1,209; fiscal 2024 255.4 + 458.6 = 714; fiscal 2025 1,143 + 635 = 1,778; fiscal 2026 2,951 + 21,061 + 231 + 117 = 24,360, about 24.4 billion; all twenty-two FY2019-FY2026 including Cider 198.3 = 29,996, about 30.0 billion; FY2026 against FY2019-FY2025 24,360 / 5,636 = 4.3 times; after year end 325 + 500 = 825; AI security 635 + 231 + 117 = 983. CyberArk shares 18,488 / 112 = about 165 a share; 25,000 - 21,061 = about 3.9 billion; 112 x 374.74 = about 42.0 billion; 112 / 818 = 14%. Chronosphere 2,951 / 160 = about 18 times ARR. Goodwill and intangibles (22,010 + 7,017) / 48,460 = 60%; other assets 48,460 - 29,027 = 19,433. Headcount 21,921 - 4,223 = 17,698, 17,698 / 16,068 - 1 = 10%. Revenue per employee 928.1 / 2,637 = 0.35; 9,221.5 / 16,068 = 0.57; 11,480 / 21,921 = 0.52. Convertible loss Q1-Q3 562 - 524 = 38. Distributors: FY2019 31.8 + 22.1 + 10.7 + 10.0 = 74.6%; FY2021 33.2 + 12.2 + 10.6 = 56.0%; FY2023 25.0 + 12.8 + 11.9 = 49.7%; FY2024 21.2 + 13.2 + 13.2 + 11.4 = 59.0%; FY2025 18.8 + 14.4 + 11.0 = 44.2%; FY2026 15 + 15 = 30%; largest 34.4% (FY2020) to 15% (FY2026); receivables FY2019 29.9 + 18.9 + 14.2 = 63.0%. Valuation: market value over fiscal revenue at calendar year-end 15.13 / 0.928 = 16.3 (2015), 11.47 / 1.3785 = 8.3 (2016), 42.19 / 5.5015 = 7.7 (2022), 92.98 / 6.8927 = 13.5 (2023), 119.40 / 8.0275 = 14.9 (2024), 128.39 / 9.2215 = 13.9 (2025); 306.54 / 11.48 = 26.7; 306.54 / 0.307 = 998; 374.74 / 3.84 = 97.6; market value against Fortinet 306.54 / 130.12 = 2.4, against CrowdStrike 306.54 / 267.43 = 1.15; analyst target 395.70 / 374.74 - 1 = 6% - growth rates and margins. — FY2015-FY2027 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Palo Alto Networks' Forms 10-K and results releases, the Q4 FY2026 earnings call and market data; operands shown in the source line.
  7. Moat Explorer calcDeferred revenue was $2,888.7 million in fiscal 2019 and $12,751.9 million in fiscal 2025.
    Moat Explorer calculation from Palo Alto Networks' reported figures ($ millions unless stated; fiscal years end 31 July). Growth: revenue FY2026 11,480 / 9,221.5 - 1 = 24.5%; FY2025 9,221.5 / 8,027.5 - 1 = 14.9%; FY2024 8,027.5 / 6,892.7 - 1 = 16.5%; FY2023 25.3%; FY2022 29.3%; FY2021 24.9%; FY2020 17.5%; FY2024 to FY2026 11,480 / 8,027.5 - 1 = 43%; compound FY2015-FY2026 (11,480 / 928.1)^(1/11) - 1 = 25.7%, about 26%. By type FY2026: product 2,280 / 1,801.9 - 1 = 26.5%; subscription 6,239 / 4,974.4 - 1 = 25.4%; support 2,961 / 2,445.2 - 1 = 21.1%. Product FY2025 12.4%, FY2024 1,603.3 / 1,578.4 - 1 = 1.6%, FY2020 1,064.2 / 1,096.2 - 1 = -2.9%. Subscription FY2017 53.7%, FY2019 36.2%, FY2021 35.1%, FY2023 31.4%, FY2024 25.6%, FY2025 18.8%. Support FY2022 29.3%, FY2023 23.7%, FY2024 13.0%, FY2025 9.4%. Compound FY2015-FY2026: subscription (6,239 / 212.7)^(1/11) - 1 = 36.0%; support (2,961 / 222.7)^(1/11) - 1 = 26.5%; product (2,280 / 492.7)^(1/11) - 1 = 14.9%. Product outgrew subscription in FY2026 (26.5% against 25.4%), which it did not in any year FY2016-FY2025. Organic: FY2026 (11,480 - 930) / 9,221 - 1 = 14.4%; Q4 acquisition revenue 930 - 388 = 542; Q4 (3,410 - 542) / 2,536 - 1 = 13.1%, about 13%; pro forma 12,312 / 10,486 - 1 = 17.4%; FY2027 guidance 14.15 / 12.312 - 1 = 14.9%, about 15%. Margins: gross margin FY2026 8,077 / 11,480 = 70.4% (FY2025 6,769.9 / 9,221.5 = 73.4%; FY2024 5,968.3 / 8,027.5 = 74.3%); Q4 GAAP 2,304 / 3,410 = 67.6%. Product gross margin (2,280 - 568) / 2,280 = 75.1% (FY2025 (1,801.9 - 413) / 1,801.9 = 77.1%); subscription and support (9,200 - 2,835) / 9,200 = 69.2% (FY2025 (7,419.6 - 2,038) / 7,419.6 = 72.5%). Operating margin 695 / 11,480 = 6.1% (FY2025 1,242.9 / 9,221.5 = 13.5%); non-GAAP 3,356 / 11,480 = 29.2% (FY2025 2,652 / 9,221.5 = 28.8%); Q4 non-GAAP 1,011 / 3,410 = 29.6%; gap 3,356 - 695 = 2,661. R&D 2,552 / 11,480 = 22.2%; sales and marketing 3,931 / 11,480 = 34.2%; capital expenditure 440 / 11,480 = 3.8%. Tax 229 / (307 + 229 = 536) = 42.7%. Mix: product share 492.7 / 928.1 = 53.1% (FY2015), 2,280 / 11,480 = 19.9% (FY2026); subscription 212.7 / 928.1 = 22.9%, 6,239 / 11,480 = 54.3%; support 222.7 / 928.1 = 24.0%, 2,961 / 11,480 = 25.8%; one point of share 1% x 11,480 = 115. Recurring share 435.4 / 928.1 = 46.9% (FY2015), 1,393.8 / 2,273.6 = 61.3% (FY2018), 3,135.8 / 4,256.1 = 73.7% (FY2021), 6,424.2 / 8,027.5 = 80.0% (FY2024). Subscription and support per dollar of product 435.4 / 492.7 = 0.88 (FY2015), 1,393.8 / 879.8 = 1.58 (FY2018), 3,135.8 / 1,120.3 = 2.80 (FY2021), 6,424.2 / 1,603.3 = 4.01 (FY2024), 9,200 / 2,280 = 4.04 (FY2026). Hardware about 10% x 11,480 = about 1,150, about 50% of product. NGS ARR 9.10 / 11.48 = 79% of revenue. United States 7,108 / 11,480 = 61.9% (FY2016 901.8 / 1,378.5 = 65.4%). Q4 share of year 3,410 / 11,480 = 29.7%, about 30%. Prisma AIRS ARR 100 / 11,480 = under 1%. ARR and RPO: Q3 acquired ARR 1.6 / 8.1 = 20%, about a fifth; Q3 organic 8.1 - 1.6 = 6.5; Q3 acquired RPO 1.8 / 18.4 = 10%; FY2023 NGS ARR 4.2 / 1.43 = about 2.9; FY2025 growth 5.6 / 4.2 - 1 = 33%; Q1 FY2027 net new 9.54 - 9.10 = 0.44 to 9.56 - 9.10 = 0.46 billion; FY2030 target (20 / 9.1)^(1/4) - 1 = 21.8% a year; RPO / revenue 21.2 / 11.48 = 1.85; RPO due in 12 months 1.7 / 3.1 = 55% (FY2019), 2.2 / 4.3 = 51% (FY2020), 3.1 / 5.9 = 53% (FY2021), 4.1 / 8.2 = 50% (FY2022), 5.1 / 10.6 = 48% (FY2023), 5.9 / 12.7 = 46% (FY2024), 7.0 / 15.8 = 44% (FY2025), 9.3 / 21.2 = 44% (FY2026); RPO beyond 12 months 21.2 - 9.3 = 11.9 billion; Idira guidance 1.5 / 1.26 - 1 = 19%; Network and AI Security FY2025 8.35 / 1.17 = about 7.14 billion. Revenue from prior deferred 6.2 / 5.5 - 1 = 13%. Cash, deferred revenue and stock pay: free cash flow margin 4,113 / 11,480 = 35.8%; share-based compensation (cash flow) 1,774 / 11,480 = 15.5%; 1,774 / 1,295 - 1 = 37%; 1,774 / 4,113 = 43%; free cash flow after stock pay 4,113 - 1,774 = 2,339, 2,339 / 11,480 = 20.4%, 2,339 / 306,540 = 0.76%; free cash flow 4,113 / 306,540 = 1.3% and 4,113 / 27,492 = 15%. Stock pay share of revenue FY2016 392.8 / 1,378.5 = 28.5%, FY2020 658.4 / 3,408.4 = 19.3%, FY2024 1,076 / 8,027.5 = 13.4%, FY2025 1,295 / 9,221.5 = 14.0%. 10-K share-based compensation 1,815 / 1,079 - 1 = 68%. Equity plan (26.1 + 24.3) / 818 = 6%. Net cash 2,514 + 557 + 4,835 - 1,774 = 6,132; cash and investments 2,514 + 557 + 4,835 = 7,906, about 7.9 billion. Deferred revenue 1,582.1 + 1,306.6 = 2,888.7 (FY2019); 2,741.9 + 2,282.1 = 5,024.0 (FY2021); 4,674.6 + 4,621.8 = 9,296.4 (FY2023); 6,302.2 + 6,449.7 = 12,751.9 (FY2025); 7,747 + 7,009 = 14,756 (FY2026); 14,756 / 11,480 = 1.29 times; 2,888.7 / 2,899.6 = about one year (FY2019); growth 14,756 / 12,751.9 - 1 = 15.7%; excluding CyberArk (14,756 - 776) / 12,751.9 - 1 = 9.6%. Billings FY2025 9,221.5 + (12,751.9 - 11,480.5) = 10,493, 10,493 / 10,208.1 - 1 = 2.8%; FY2026 11,480 + (14,756 - 12,752) - 776 = about 12,708, 12,708 / 10,493 - 1 = 21%; February 2024 guidance cut 10.7 - 10.1 = 0.6 billion. Acquisitions: fiscal 2019 378.1 + 474.2 + 158.2 + 292.9 + 82.7 + 36.8 + 103.1 = 1,526; fiscal 2020 144.1 + 66.4 = 210.5; fiscal 2021 797.2 + 227.7 + 156.9 + 27.0 = 1,209; fiscal 2024 255.4 + 458.6 = 714; fiscal 2025 1,143 + 635 = 1,778; fiscal 2026 2,951 + 21,061 + 231 + 117 = 24,360, about 24.4 billion; all twenty-two FY2019-FY2026 including Cider 198.3 = 29,996, about 30.0 billion; FY2026 against FY2019-FY2025 24,360 / 5,636 = 4.3 times; after year end 325 + 500 = 825; AI security 635 + 231 + 117 = 983. CyberArk shares 18,488 / 112 = about 165 a share; 25,000 - 21,061 = about 3.9 billion; 112 x 374.74 = about 42.0 billion; 112 / 818 = 14%. Chronosphere 2,951 / 160 = about 18 times ARR. Goodwill and intangibles (22,010 + 7,017) / 48,460 = 60%; other assets 48,460 - 29,027 = 19,433. Headcount 21,921 - 4,223 = 17,698, 17,698 / 16,068 - 1 = 10%. Revenue per employee 928.1 / 2,637 = 0.35; 9,221.5 / 16,068 = 0.57; 11,480 / 21,921 = 0.52. Convertible loss Q1-Q3 562 - 524 = 38. Distributors: FY2019 31.8 + 22.1 + 10.7 + 10.0 = 74.6%; FY2021 33.2 + 12.2 + 10.6 = 56.0%; FY2023 25.0 + 12.8 + 11.9 = 49.7%; FY2024 21.2 + 13.2 + 13.2 + 11.4 = 59.0%; FY2025 18.8 + 14.4 + 11.0 = 44.2%; FY2026 15 + 15 = 30%; largest 34.4% (FY2020) to 15% (FY2026); receivables FY2019 29.9 + 18.9 + 14.2 = 63.0%. Valuation: market value over fiscal revenue at calendar year-end 15.13 / 0.928 = 16.3 (2015), 11.47 / 1.3785 = 8.3 (2016), 42.19 / 5.5015 = 7.7 (2022), 92.98 / 6.8927 = 13.5 (2023), 119.40 / 8.0275 = 14.9 (2024), 128.39 / 9.2215 = 13.9 (2025); 306.54 / 11.48 = 26.7; 306.54 / 0.307 = 998; 374.74 / 3.84 = 97.6; market value against Fortinet 306.54 / 130.12 = 2.4, against CrowdStrike 306.54 / 267.43 = 1.15; analyst target 395.70 / 374.74 - 1 = 6% - growth rates and margins. — FY2015-FY2027 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Palo Alto Networks' Forms 10-K and results releases, the Q4 FY2026 earnings call and market data; operands shown in the source line.
  8. ReportedThe 10-K says a 100 basis point rise in interest rates across all maturities would reduce the fair value of the investment portfolio by $128 million, a small number against deferred revenue of $14,756 million, but a reminder that the float is invested in bonds.
    Palo Alto Networks Form 10-K for fiscal 2026 (year ended 31 July 2026) - financial statements and notes: deferred revenue, obligations, convertible notes, share-based pay, capital returns and receivables. — FY2026 · publ. 10 September 2026 · source ↗
  9. ReportedThe 10-K says a 100 basis point rise in interest rates across all maturities would reduce the fair value of the investment portfolio by $128 million, a small number against deferred revenue of $14,756 million, but a reminder that the float is invested in bonds.
    Palo Alto Networks fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1 - income statement, non-GAAP reconciliation, balance sheet, cash flow, Next-Generation Security ARR, remaining performance obligations and fiscal 2027 guidance - balance sheet and cash flow statement. — Q4 FY2026 · publ. 1 September 2026 · source ↗
  10. Moat Explorer calcIts size relative to revenue, about 1.29 times in fiscal 2026, is the measure; a steady fall below one year of revenue would mean customers are no longer willing to pay upfront for multi-year terms.
    Moat Explorer calculation from Palo Alto Networks' reported figures ($ millions unless stated; fiscal years end 31 July). Growth: revenue FY2026 11,480 / 9,221.5 - 1 = 24.5%; FY2025 9,221.5 / 8,027.5 - 1 = 14.9%; FY2024 8,027.5 / 6,892.7 - 1 = 16.5%; FY2023 25.3%; FY2022 29.3%; FY2021 24.9%; FY2020 17.5%; FY2024 to FY2026 11,480 / 8,027.5 - 1 = 43%; compound FY2015-FY2026 (11,480 / 928.1)^(1/11) - 1 = 25.7%, about 26%. By type FY2026: product 2,280 / 1,801.9 - 1 = 26.5%; subscription 6,239 / 4,974.4 - 1 = 25.4%; support 2,961 / 2,445.2 - 1 = 21.1%. Product FY2025 12.4%, FY2024 1,603.3 / 1,578.4 - 1 = 1.6%, FY2020 1,064.2 / 1,096.2 - 1 = -2.9%. Subscription FY2017 53.7%, FY2019 36.2%, FY2021 35.1%, FY2023 31.4%, FY2024 25.6%, FY2025 18.8%. Support FY2022 29.3%, FY2023 23.7%, FY2024 13.0%, FY2025 9.4%. Compound FY2015-FY2026: subscription (6,239 / 212.7)^(1/11) - 1 = 36.0%; support (2,961 / 222.7)^(1/11) - 1 = 26.5%; product (2,280 / 492.7)^(1/11) - 1 = 14.9%. Product outgrew subscription in FY2026 (26.5% against 25.4%), which it did not in any year FY2016-FY2025. Organic: FY2026 (11,480 - 930) / 9,221 - 1 = 14.4%; Q4 acquisition revenue 930 - 388 = 542; Q4 (3,410 - 542) / 2,536 - 1 = 13.1%, about 13%; pro forma 12,312 / 10,486 - 1 = 17.4%; FY2027 guidance 14.15 / 12.312 - 1 = 14.9%, about 15%. Margins: gross margin FY2026 8,077 / 11,480 = 70.4% (FY2025 6,769.9 / 9,221.5 = 73.4%; FY2024 5,968.3 / 8,027.5 = 74.3%); Q4 GAAP 2,304 / 3,410 = 67.6%. Product gross margin (2,280 - 568) / 2,280 = 75.1% (FY2025 (1,801.9 - 413) / 1,801.9 = 77.1%); subscription and support (9,200 - 2,835) / 9,200 = 69.2% (FY2025 (7,419.6 - 2,038) / 7,419.6 = 72.5%). Operating margin 695 / 11,480 = 6.1% (FY2025 1,242.9 / 9,221.5 = 13.5%); non-GAAP 3,356 / 11,480 = 29.2% (FY2025 2,652 / 9,221.5 = 28.8%); Q4 non-GAAP 1,011 / 3,410 = 29.6%; gap 3,356 - 695 = 2,661. R&D 2,552 / 11,480 = 22.2%; sales and marketing 3,931 / 11,480 = 34.2%; capital expenditure 440 / 11,480 = 3.8%. Tax 229 / (307 + 229 = 536) = 42.7%. Mix: product share 492.7 / 928.1 = 53.1% (FY2015), 2,280 / 11,480 = 19.9% (FY2026); subscription 212.7 / 928.1 = 22.9%, 6,239 / 11,480 = 54.3%; support 222.7 / 928.1 = 24.0%, 2,961 / 11,480 = 25.8%; one point of share 1% x 11,480 = 115. Recurring share 435.4 / 928.1 = 46.9% (FY2015), 1,393.8 / 2,273.6 = 61.3% (FY2018), 3,135.8 / 4,256.1 = 73.7% (FY2021), 6,424.2 / 8,027.5 = 80.0% (FY2024). Subscription and support per dollar of product 435.4 / 492.7 = 0.88 (FY2015), 1,393.8 / 879.8 = 1.58 (FY2018), 3,135.8 / 1,120.3 = 2.80 (FY2021), 6,424.2 / 1,603.3 = 4.01 (FY2024), 9,200 / 2,280 = 4.04 (FY2026). Hardware about 10% x 11,480 = about 1,150, about 50% of product. NGS ARR 9.10 / 11.48 = 79% of revenue. United States 7,108 / 11,480 = 61.9% (FY2016 901.8 / 1,378.5 = 65.4%). Q4 share of year 3,410 / 11,480 = 29.7%, about 30%. Prisma AIRS ARR 100 / 11,480 = under 1%. ARR and RPO: Q3 acquired ARR 1.6 / 8.1 = 20%, about a fifth; Q3 organic 8.1 - 1.6 = 6.5; Q3 acquired RPO 1.8 / 18.4 = 10%; FY2023 NGS ARR 4.2 / 1.43 = about 2.9; FY2025 growth 5.6 / 4.2 - 1 = 33%; Q1 FY2027 net new 9.54 - 9.10 = 0.44 to 9.56 - 9.10 = 0.46 billion; FY2030 target (20 / 9.1)^(1/4) - 1 = 21.8% a year; RPO / revenue 21.2 / 11.48 = 1.85; RPO due in 12 months 1.7 / 3.1 = 55% (FY2019), 2.2 / 4.3 = 51% (FY2020), 3.1 / 5.9 = 53% (FY2021), 4.1 / 8.2 = 50% (FY2022), 5.1 / 10.6 = 48% (FY2023), 5.9 / 12.7 = 46% (FY2024), 7.0 / 15.8 = 44% (FY2025), 9.3 / 21.2 = 44% (FY2026); RPO beyond 12 months 21.2 - 9.3 = 11.9 billion; Idira guidance 1.5 / 1.26 - 1 = 19%; Network and AI Security FY2025 8.35 / 1.17 = about 7.14 billion. Revenue from prior deferred 6.2 / 5.5 - 1 = 13%. Cash, deferred revenue and stock pay: free cash flow margin 4,113 / 11,480 = 35.8%; share-based compensation (cash flow) 1,774 / 11,480 = 15.5%; 1,774 / 1,295 - 1 = 37%; 1,774 / 4,113 = 43%; free cash flow after stock pay 4,113 - 1,774 = 2,339, 2,339 / 11,480 = 20.4%, 2,339 / 306,540 = 0.76%; free cash flow 4,113 / 306,540 = 1.3% and 4,113 / 27,492 = 15%. Stock pay share of revenue FY2016 392.8 / 1,378.5 = 28.5%, FY2020 658.4 / 3,408.4 = 19.3%, FY2024 1,076 / 8,027.5 = 13.4%, FY2025 1,295 / 9,221.5 = 14.0%. 10-K share-based compensation 1,815 / 1,079 - 1 = 68%. Equity plan (26.1 + 24.3) / 818 = 6%. Net cash 2,514 + 557 + 4,835 - 1,774 = 6,132; cash and investments 2,514 + 557 + 4,835 = 7,906, about 7.9 billion. Deferred revenue 1,582.1 + 1,306.6 = 2,888.7 (FY2019); 2,741.9 + 2,282.1 = 5,024.0 (FY2021); 4,674.6 + 4,621.8 = 9,296.4 (FY2023); 6,302.2 + 6,449.7 = 12,751.9 (FY2025); 7,747 + 7,009 = 14,756 (FY2026); 14,756 / 11,480 = 1.29 times; 2,888.7 / 2,899.6 = about one year (FY2019); growth 14,756 / 12,751.9 - 1 = 15.7%; excluding CyberArk (14,756 - 776) / 12,751.9 - 1 = 9.6%. Billings FY2025 9,221.5 + (12,751.9 - 11,480.5) = 10,493, 10,493 / 10,208.1 - 1 = 2.8%; FY2026 11,480 + (14,756 - 12,752) - 776 = about 12,708, 12,708 / 10,493 - 1 = 21%; February 2024 guidance cut 10.7 - 10.1 = 0.6 billion. Acquisitions: fiscal 2019 378.1 + 474.2 + 158.2 + 292.9 + 82.7 + 36.8 + 103.1 = 1,526; fiscal 2020 144.1 + 66.4 = 210.5; fiscal 2021 797.2 + 227.7 + 156.9 + 27.0 = 1,209; fiscal 2024 255.4 + 458.6 = 714; fiscal 2025 1,143 + 635 = 1,778; fiscal 2026 2,951 + 21,061 + 231 + 117 = 24,360, about 24.4 billion; all twenty-two FY2019-FY2026 including Cider 198.3 = 29,996, about 30.0 billion; FY2026 against FY2019-FY2025 24,360 / 5,636 = 4.3 times; after year end 325 + 500 = 825; AI security 635 + 231 + 117 = 983. CyberArk shares 18,488 / 112 = about 165 a share; 25,000 - 21,061 = about 3.9 billion; 112 x 374.74 = about 42.0 billion; 112 / 818 = 14%. Chronosphere 2,951 / 160 = about 18 times ARR. Goodwill and intangibles (22,010 + 7,017) / 48,460 = 60%; other assets 48,460 - 29,027 = 19,433. Headcount 21,921 - 4,223 = 17,698, 17,698 / 16,068 - 1 = 10%. Revenue per employee 928.1 / 2,637 = 0.35; 9,221.5 / 16,068 = 0.57; 11,480 / 21,921 = 0.52. Convertible loss Q1-Q3 562 - 524 = 38. Distributors: FY2019 31.8 + 22.1 + 10.7 + 10.0 = 74.6%; FY2021 33.2 + 12.2 + 10.6 = 56.0%; FY2023 25.0 + 12.8 + 11.9 = 49.7%; FY2024 21.2 + 13.2 + 13.2 + 11.4 = 59.0%; FY2025 18.8 + 14.4 + 11.0 = 44.2%; FY2026 15 + 15 = 30%; largest 34.4% (FY2020) to 15% (FY2026); receivables FY2019 29.9 + 18.9 + 14.2 = 63.0%. Valuation: market value over fiscal revenue at calendar year-end 15.13 / 0.928 = 16.3 (2015), 11.47 / 1.3785 = 8.3 (2016), 42.19 / 5.5015 = 7.7 (2022), 92.98 / 6.8927 = 13.5 (2023), 119.40 / 8.0275 = 14.9 (2024), 128.39 / 9.2215 = 13.9 (2025); 306.54 / 11.48 = 26.7; 306.54 / 0.307 = 998; 374.74 / 3.84 = 97.6; market value against Fortinet 306.54 / 130.12 = 2.4, against CrowdStrike 306.54 / 267.43 = 1.15; analyst target 395.70 / 374.74 - 1 = 6% - valuation, cash flow, stock pay, deferred revenue, billings and acquisitions. — FY2015-FY2027 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Palo Alto Networks' Forms 10-K and results releases, the Q4 FY2026 earnings call and market data; operands shown in the source line.
Sources
Generated September 26, 2026