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Palo Alto Networks beats Q3 targets

Palo Alto CEO Mark McLaughlin steps down from his post later this week.

Palo Alto Networks released its third quarter earnings and revenue report Monday before the bell, beating market estimates.

The cybersecurity firm delivered non-GAAP second quarter earnings of $95.1 million, or 99 cents a share, on revenue of $567.1 million, up from $431.8 million a year ago.

Analysts were expecting the security-software vendor to report earnings of 96 cents a share on revenue of $545.7 million.

In what's likely his final statement as Palo Alto's CEO, Mark McLaughlin said the company captured market share during the third quarter "at rates that far outpace the competition." McLaughlin is stepping down as chief executive and board chairman on Wednesday. Nikesh Arora, former COO at SoftBank and as chief business officer at Google, will take over.

As for the rest of the balance sheet, Palo Alto's billings grew to $721 million. Product revenue was $215.2 million while subscription and support revenue rang up to $352 million.

In terms of guidance, the company expects fourth quarter revenue in the range of $625 to $635 million, with earnings between $1.15 to $1.17.

Wall Street expects revenue of $618.2 million with non-GAAP earnings of $1.21 a share.

Palo Alto shares were up more than two percent in pre-market trading.