New York, Feb 20, 2026, 18:45 EST — After-hours
Palo Alto Networks shares were down 1.5% at $148.70 in after-hours trading on Friday, extending a volatile week for the cybersecurity firm. The stock swung between $158.17 and $148.41 during the session, with about 25.8 million shares traded.
The pressure follows Palo Alto’s move this week to trim its fiscal 2026 adjusted profit forecast, pointing to higher integration costs tied to a string of acquisitions, including its $25 billion CyberArk deal. “The profitability ‘cut’ is mostly due to the firm’s acquisitions,” Morningstar analyst Malik Ahmed Khan said, while Truist Securities analysts said they would “lean in on weakness” as the integration story settles; TD Cowen flagged identity and observability as the next pillars of the platform push. (Adjusted profit strips out certain costs, and observability refers to tools that track how applications and systems behave.) (Reuters)
That integration theme is now spilling into capital-structure clean-up. In a tender-offer filing tied to the CyberArk takeover, Palo Alto laid out a cash offer for any and all of CyberArk’s 0.00% convertible senior notes due 2030 — bonds that can be exchanged for shares under certain terms — with noteholders able to demand repurchase at par plus accrued special interest; about $1.25 billion principal amount was outstanding as of Feb. 19, the filing showed. (SEC)
Cybersecurity stocks were mixed on Friday, even as broader markets rose. CrowdStrike slid nearly 8% and Fortinet fell about 2%, while Cisco gained around 1%, according to MarketWatch data. (MarketWatch)
Why it matters now is simple: investors have been willing to pay for growth in security, but they are getting less patient about near-term margin hits when the deal pipeline is heavy. The question is whether Palo Alto can keep revenue momentum while absorbing the costs and disruption that come with stitching large products together.
The note repurchase mechanics also matter at the margin for equity traders. Cash used for buybacks of inherited debt can tighten flexibility, while conversion features can raise dilution questions if holders choose stock instead of cash.
But the downside case is not hard to sketch. If integration takes longer than management expects — or if customers pause spending while product roadmaps are reworked — the company may need to defend profitability again, and the market tends to punish that in high-multiple software.
With the U.S. cash market heading into the weekend, Monday’s open will be another read on whether buyers step in after the post-guidance selloff, or whether the stock remains treated as a “show me” story until costs peak and the platform pitch lands.
The next concrete milestone is March 20, when CyberArk noteholders have until 5:00 p.m. New York time to tender or convert under the offer; the repurchase date is March 24. (Paloaltonetworks)
