Palo Alto Networks CEO Nikesh Arora told CNBC that artificial intelligence is increasing demand for cybersecurity—not displacing it—as enterprises scramble to prepare for AI-powered attacks.
Arora appeared on “Mad Money with Jim Cramer” after the company posted stronger-than-expected quarterly results and raised its full-year outlook, saying Palo Alto has fielded roughly 1,200 customer meeting requests in recent weeks tied to AI-related risk.
Earnings Beat and Raised Outlook
Palo Alto reported results that exceeded expectations on Tuesday:
- Revenue: $3 billion, up 31% year over year
- Adjusted EPS: 85 cents
- Guidance: Full-year outlook raised
The print added to evidence that early-2026 fears of AI disrupting cybersecurity vendors may have been overdone. In recent weeks, Palo Alto and peer stocks have rallied, erasing prior sell-offs tied to the “SaaSpocalypse” narrative.
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Arora said customer engagement has surged as organizations seek help preparing for rapidly evolving AI threats. Palo Alto received about 1,200 inquiries in recent weeks; the company has already met with roughly 800 customers and has about 400 remaining.
“Just to give you a sense, we did 1,200 meetings all of last year. We’ve done 800 in the last 12 weeks,” Arora said. “So we’re busy.”
Customers are not asking only to fix today’s problems, he added—they want to know how to prepare for the next generation of AI-powered threats.
“Fighting AI With AI” and the SaaSpocalypse Rebuttal
Arora declared the “SaaSpocalypse” dead for cybersecurity—referencing investor worries that generative AI would hollow out software-as-a-service models across the sector.
Instead, he framed Palo Alto as a beneficiary of the AI boom: “We are a net enabler of better cybersecurity. We’re not a victim of AI.”
His thesis aligns with a broader industry argument that AI-powered attacks require AI-augmented defenses—raising the bar for security spending rather than eliminating it.
Stock and Sector Context
CNBC noted that cybersecurity names including Palo Alto have rebounded as AI-disruption fears eased. Peer CrowdStrike was set to report earnings shortly after Palo Alto’s interview.
Jim Cramer’s Charitable Trust (CNBC Investing Club portfolio) holds Palo Alto and CrowdStrike; the Club raised its price target on Palo Alto following Tuesday’s results, CNBC reported.
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Bottom Line
AI is reshaping enterprise software—but in cybersecurity, Arora argues the effect is demand acceleration, not obsolescence. A 31% revenue jump, raised guidance, and a meeting backlog that dwarfs last year’s pace suggest customers are buying the “fight AI with AI” story with budgets, not just headlines. Whether that holds across the whole SaaS stack remains debated; for security vendors, the current quarter reads like a reprieve from the SaaSpocalypse scare.
Frequently Asked Questions
Q: Why are Palo Alto customer meetings surging?
A: Arora said organizations are seeking guidance on AI-related security risks; Palo Alto logged ~1,200 meeting requests in recent weeks versus ~1,200 for all of last year.
Q: Did Palo Alto beat earnings expectations?
A: Yes. CNBC reported $3B revenue (+31% YoY), 85 cents adjusted EPS, and a raised full-year outlook on June 2, 2026.
Q: What did Arora say about AI disrupting cybersecurity?
A: He declared the “SaaSpocalypse” dead for the sector and said Palo Alto is a “net enabler” of better security—not a victim of AI.
