palo alto networks CEO Nikesh Arora said artificial intelligence is making cybersecurity more important, with companies forced to strengthen their defenses as AI-powered attacks become increasingly sophisticated.
“I think we’ve officially declared ‘SaaSpocalypse’ over for cybersecurity,” Arora said Tuesday on CNBC’s “Mad Money,” referring to investor concerns earlier this year that software-as-a-service (SaaS) companies would be disrupted by AI models.
Palo Alto on Tuesday reported better-than-expected quarterly results and raised its full-year outlook. Revenue was $3 billion, up 31% from the same period last year, and adjusted earnings per share were 85 cents. The results were another sign that fears that AI will disrupt cybersecurity companies may be overblown. Shares of Palo Alto and its peers have soared in recent weeks, erasing losses from earlier this year.
Arora said customer demand has skyrocketed due to the heightened threat environment. He said Palo Alto has received about 1,200 customer inquiries in recent weeks from organizations seeking guidance on how to prepare for rapidly evolving AI risks. The company has already interviewed about 800 of these customers, with 400 remaining.
“For your information, we’ve had 1,200 meetings over the last year. We’ve had 800 meetings in the last 12 weeks,” he said. “That’s why we’re busy.”
Arora said customers “don’t just want to solve today’s problems.” Instead, more and more questions are being asked about how to prepare for the next generation of AI-powered threats.
Rather than becoming a victim of the AI boom, Palo Alto is benefiting from the growing need for cybersecurity solutions, Arora said.
“We are a net enabler for better cybersecurity,” he said. “We are not victims of AI.”
Cramer’s Charitable Trust, a portfolio used by the CNBC investment club, owns shares of Palo Alto and cybersecurity peer CrowdStrike, and will report its earnings Wednesday night. The club raised its price target on Palo Alto stock following Tuesday’s results.
