Stock Analysis on Net
Stock Analysis on Net

Palo Alto Networks Inc. (NASDAQ:PANW)

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Common-Size Balance Sheet: Liabilities and Stockholders’ Equity

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Palo Alto Networks Inc., common-size consolidated balance sheet: liabilities and stockholders’ equity

Microsoft Excel
Jul 31, 2024 Jul 31, 2023 Jul 31, 2022 Jul 31, 2021 Jul 31, 2020 Jul 31, 2019
Accounts payable
Accrued compensation
Accrued and other liabilities
Deferred revenue
Current portion of convertible senior notes, net
Current liabilities
Convertible senior notes, net, excluding current portion
Long-term deferred revenue
Deferred tax liabilities
Long-term operating lease liabilities
Other long-term liabilities
Long-term liabilities
Total liabilities
Temporary equity
Preferred stock; $0.0001 par value; none issued and outstanding
Common stock and additional paid-in capital; $0.0001 par value
Accumulated other comprehensive income (loss)
Retained earnings (accumulated deficit)
Stockholders’ equity
Total liabilities, temporary equity and stockholders’ equity

Based on: 10-K (reporting date: 2024-07-31), 10-K (reporting date: 2023-07-31), 10-K (reporting date: 2022-07-31), 10-K (reporting date: 2021-07-31), 10-K (reporting date: 2020-07-31), 10-K (reporting date: 2019-07-31).

The analysis of the financial structure over the examined periods reveals several key trends in the composition of liabilities and equity components.

Current liabilities
There was a significant increase in current liabilities as a percentage of total liabilities and equity from 31.15% in 2019 to a peak of 67.79% in 2022, followed by a decline to 38.43% by 2024. This indicates a period of elevated short-term obligations, which were subsequently reduced.
Long-term liabilities
Long-term liabilities showed a decreasing trend from 44.79% in 2019 to 30.5% in 2022, then a moderate increase to 35.71% in 2024. The fluctuation suggests active management of long-term debt or obligations, possibly through repayments or refinancing strategies.
Convertible senior notes
The current portion of convertible senior notes appeared from 2021 at 15.21%, peaked at 30.01% in 2022, and sharply declined to 4.82% in 2024. Conversely, the long-term portion decreased markedly from 34.02% in 2020 to zero in 2022 onwards. This shift implies conversion, repayment, or reclassification of debt instruments over time.
Deferred revenue
Both current and long-term deferred revenue exhibited growth, with the current portion rising from 24% in 2019 to a peak of 32.24% in 2023 before decreasing to 27.72% in 2024, and the long-term portion increasing steadily from 19.82% to 29.71%. This pattern suggests expanding advance payments or unearned revenue, with greater recognition of liabilities associated with future goods or services.
Stockholders’ equity
Stockholders’ equity as a percentage of total liabilities and equity showed an initial decline from 24.06% in 2019 to a low of 1.71% in 2022, followed by recovery to 25.86% in 2024. Similarly, retained earnings shifted from negative to positive territory in 2024, moving from an accumulated deficit of -13.67% in 2019 to a surplus of 6.75%. This turnaround indicates improved accumulated profitability or capital injections.
Common stock and additional paid-in capital
These components decreased from 37.79% in 2019 to 15.77% in 2022, then rose to 19.11% by 2024, reflecting changes potentially from equity financing activities or share issuance/redemption.
Other liabilities and comprehensive income
Other long-term liabilities decreased steadily until 2022 but rose sharply in 2024 to 2.16%. Accumulated other comprehensive income/loss fluctuated modestly around zero with minimal impact on overall equity composition.
Total liabilities
Total liabilities approached nearly full leverage, moving from 75.94% in 2019 to a peak of 98.29% in 2022, then declining to 74.14% in 2024. The peak leverage in 2022 aligns with the increased current liabilities and convertible senior notes, followed by deleveraging.

In summary, the company experienced considerable shifts in its capital structure over the analyzed periods, characterized by a rise and fall in current liabilities and convertible debt, growth in deferred revenue balances, and a notable recovery in equity levels by 2024. These changes point to active financial management aimed at optimizing leverage, improving equity position, and managing deferred obligations.