After Palo Alto Networks reported an earnings beat on Monday, CEO Nikesh Arora told CNBC’s Jim Cramer about his company’s “platformization” strategy, saying it’s important for the cybersecurity outfit’s long-term success.
“It doesn’t matter whose platform you buy, you can’t go back. You can’t go back to point solutions and start stitching them. It’s like, it’s like a one-way street — once you come this way, there’s no going back,” Arora said. “So, our incentive is, when we have the technological advantage, the platform, we’ve got to get ahead of this, we’ve got to move fast, we’ve got to get our customers onboarded with this, which allows us to win the long term game.”
“Platformization” is essentially a bundling of the company’s products and services, and Palo Alto had cut its full-year guidance back in February because of its pivot to this strategy. But after this quarter, Arora said he’s excited about the pace of “platformization,” and that he wished the company had made the move to the strategy earlier.
The company said in its earnings presentation that its business in the previous quarter was drive by “early momentum in platformization.”
Arora also discussed Palo Alto’s artificial intelligence services, claiming that the company has been successful in selling tangible AI services to customers.
“We’re very excited, we crossed $200 million in ARR in AI, real AI, selling products to our customers—this is not ideas, thoughts, things we’re trying,” he said.
Palo Alto reported earnings after close, and the stock was up more than 2.5% in after hours trading.
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Disclaimer The CNBC Investing Club Charitable Trust holds shares of Palo Alto Networks.
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