Statement of Comprehensive Income
Comprehensive income is the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.
Palo Alto Networks Inc., consolidated statement of comprehensive income
US$ in millions
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 financial performance over the observed six-year period is characterized by a transition from initial net losses to a period of significant profitability, followed by a subsequent contraction in both net and comprehensive income.
- Net Income Performance
- A substantial recovery is observed from 2021 to 2024, as net income moved from a loss of US$ 499 million to a peak of US$ 2,578 million. This upward trajectory reversed after 2024, with net income decreasing to US$ 1,134 million in 2025 and further declining to US$ 307 million by 2026.
- Other Comprehensive Income (OCI) Volatility
- Other comprehensive income, net of tax, remained negative in 2021 and 2022 before entering a positive phase from 2023 to 2025, peaking at US$ 50 million. However, a sharp reversal occurred in 2026, resulting in a net loss of US$ 119 million. This decline was driven by several factors, including unrealized losses on investments of US$ 62 million, a US$ 46 million negative change in cash flow hedges, and a US$ 55 million net realized loss reclassified into earnings.
- Comprehensive Income Correlation
- Total comprehensive income mirrors the trend of net income, reaching its maximum value of US$ 2,619 million in 2024. While OCI provided a modest additive effect to net income between 2023 and 2025, the significant OCI loss in 2026 acted as a further drag on the overall result, contributing to a final comprehensive income of US$ 188 million for that period.
- Specific Instrument Impacts
- The 2026 period introduced a new negative impact from the change in fair value of convertible senior notes attributable to instrument-specific credit risk, amounting to US$ 11 million. This addition to the OCI losses indicates an increase in the complexity of the balance sheet impact during the final year of the analysis.
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