Name: Palo Alto Networks Inc. (NASDAQ:PANW) | Liabilities and Stockholders’ Equity
Creator: Stock Analysis on Net

Balance Sheet: Liabilities and Stockholders’ Equity

The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.

Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.

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

US$ in millions

	Jul 31, 2026	Jul 31, 2025	Jul 31, 2024	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021
Accounts payable	290)	232)	116)	132)	128)	57)
Accrued compensation	1,048)	608)	555)	548)	461)	431)
Accrued and other liabilities	838)	846)	507)	391)	399)	329)
Deferred revenue	7,747)	6,302)	5,541)	4,675)	3,641)	2,742)
Short-term convertible senior notes	—)	—)	964)	1,992)	3,677)	1,558)
Current liabilities	9,923)	7,988)	7,683)	7,738)	8,306)	5,117)
Long-term convertible senior notes	1,774)	—)	—)	—)	—)	1,668)
Long-term deferred revenue	7,009)	6,450)	5,939)	4,622)	3,353)	2,282)
Deferred tax liabilities	251)	89)	388)	28)	—)	—)
Long-term operating lease liabilities	726)	338)	381)	279)	276)	313)
Other long-term liabilities	1,285)	887)	431)	86)	108)	98)
Long-term liabilities	11,045)	7,764)	7,139)	5,015)	3,737)	4,361)
Total liabilities	20,968)	15,752)	14,821)	12,753)	12,044)	9,478)
Temporary equity	—)	—)	—)	—)	—)	129)
Preferred stock; $0.0001 par value; none issued and outstanding	—)	—)	—)	—)	—)	—)
Common stock and additional paid-in capital; $0.0001 par value	24,772)	5,292)	3,821)	3,019)	1,933)	2,311)
Accumulated other comprehensive income (loss)	(71)	48)	(2)	(43)	(56)	(10)
Retained earnings (accumulated deficit)	2,791)	2,484)	1,350)	(1,227)	(1,667)	(1,667)
Stockholders’ equity	27,492)	7,824)	5,170)	1,748)	210)	635)
Total liabilities, temporary equity and stockholders’ equity	48,460)	23,576)	19,991)	14,501)	12,254)	10,242)

Based on: 10-K (reporting date: 2026-07-31), 10-K (reporting date: 2025-07-31), 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).

The balance sheet exhibits a trajectory of aggressive expansion between 2021 and 2026, with total liabilities, equity, and temporary equity growing from 10,242 million to 48,460 million. This growth is primarily driven by a surge in deferred revenue and a massive increase in stockholders' equity, reflecting both operational scaling and significant capital movements.

Liability Composition and Deferred Revenue: Total liabilities increased from 9,478 million in 2021 to 20,968 million by 2026. A primary driver of this increase is the consistent growth in deferred revenue. Combined current and long-term deferred revenue rose from 5,024 million in 2021 to 14,756 million in 2026. This upward trend suggests a substantial increase in advance payments for services, typical of an expanding subscription or long-term contract model.
Debt Obligations and Convertible Notes: The management of convertible senior notes shows a distinct shift over the period. Short-term convertible senior notes peaked in 2022 at 3,677 million before being steadily reduced to zero by 2025. Conversely, long-term convertible senior notes, which were absent from the balance sheet between 2022 and 2025, reappeared in 2026 at 1,774 million, indicating a restructuring of debt maturity profiles.
Equity Evolution and Profitability: Stockholders' equity experienced explosive growth, rising from 635 million in 2021 to 27,492 million in 2026. A critical inflection point is observed in retained earnings, which transitioned from an accumulated deficit of 1,667 million in 2021 and 2022 to a positive balance of 1,350 million by 2024, reaching 2,791 million by 2026. This transition indicates a shift from historical losses to sustained profitability.
Capitalization and Paid-in Capital: Common stock and additional paid-in capital showed a steady increase until 2025, followed by a disproportionate surge in 2026, jumping from 5,292 million to 24,772 million. This significant increase suggests a major capital infusion, a large-scale issuance of shares, or the conversion of debt instruments into equity during the final reported period.
Operational Liabilities: Accrued compensation and other accrued liabilities have trended upward, with accrued compensation specifically increasing from 431 million in 2021 to 1,048 million in 2026. This pattern aligns with an expanding workforce and organizational growth.

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