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Palo Alto Networks Inc. (NASDAQ:PANW)

Analysis of Profitability Ratios
Quarterly Data

Microsoft Excel

Profitability Ratios (Summary)

Return on Sales

Return on Investment

Palo Alto Networks Inc., profitability ratios (quarterly data)

Microsoft Excel
Jul 31, 2026 Apr 30, 2026 Jan 31, 2026 Oct 31, 2025 Jul 31, 2025 Apr 30, 2025 Jan 31, 2025 Oct 31, 2024 Jul 31, 2024 Apr 30, 2024 Jan 31, 2024 Oct 31, 2023 Jul 31, 2023 Apr 30, 2023 Jan 31, 2023 Oct 31, 2022 Jul 31, 2022 Apr 30, 2022 Jan 31, 2022 Oct 31, 2021
Return on Sales
Gross profit margin 70.36% 71.94% 73.50% 73.47% 73.41% 73.56% 73.86% 74.17% 74.35% 74.43% 74.05% 73.35% 72.29% 70.80% 69.77% 69.06% 68.76% 69.34% 69.63% 69.77%
Operating profit margin 6.05% 9.62% 14.37% 13.24% 13.48% 11.09% 10.99% 9.11% 8.52% 8.97% 7.98% 8.15% 5.62% 2.30% 0.37% -1.56% -3.43% -5.12% -6.74% -7.51%
Net profit margin 2.67% 7.95% 12.96% 11.69% 12.30% 13.95% 14.64% 32.99% 32.11% 31.41% 30.24% 8.52% 6.38% 3.32% 0.56% -2.46% -4.85% -7.54% -9.50% -11.20%
Return on Investment
Return on equity (ROE) 1.12% 3.05% 13.65% 12.89% 14.49% 17.12% 19.68% 46.25% 49.86% 54.78% 52.25% 28.28% 25.15% 17.47% 4.71% -28.23% -127.14% -115.40% -391.77% -98.34%
Return on assets (ROA) 0.63% 1.82% 5.13% 4.75% 4.81% 5.63% 5.99% 13.42% 12.89% 13.65% 12.45% 4.15% 3.03% 1.52% 0.26% -1.14% -2.18% -3.51% -4.44% -4.89%

Based on: 10-K (reporting date: 2026-07-31), 10-Q (reporting date: 2026-04-30), 10-Q (reporting date: 2026-01-31), 10-Q (reporting date: 2025-10-31), 10-K (reporting date: 2025-07-31), 10-Q (reporting date: 2025-04-30), 10-Q (reporting date: 2025-01-31), 10-Q (reporting date: 2024-10-31), 10-K (reporting date: 2024-07-31), 10-Q (reporting date: 2024-04-30), 10-Q (reporting date: 2024-01-31), 10-Q (reporting date: 2023-10-31), 10-K (reporting date: 2023-07-31), 10-Q (reporting date: 2023-04-30), 10-Q (reporting date: 2023-01-31), 10-Q (reporting date: 2022-10-31), 10-K (reporting date: 2022-07-31), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-31), 10-Q (reporting date: 2021-10-31).


The financial performance across the analyzed period demonstrates a significant transition from operational losses toward profitability, followed by a period of peak margins and a subsequent contraction in the final quarters.

Gross Profit Margin
The gross profit margin remained relatively stable, maintaining a baseline near 69% during 2021 and 2022. A gradual expansion occurred throughout 2023, peaking at 74.43% in April 2024. Following this peak, a slow decline is observed, with the margin retreating to 70.36% by July 2026.
Operating Profit Margin
A consistent upward trajectory is evident in the operating profit margin, which moved from a deficit of -7.51% in October 2021 to a positive position by January 2023. The margin expanded steadily to reach a peak of 14.37% in January 2026 before experiencing a sharp decline to 6.05% in the final quarter of the period.
Net Profit Margin
The net profit margin mirrored the operating trend but exhibited higher volatility. After turning positive in January 2023, the margin saw a substantial surge between October 2023 and January 2024, jumping from 8.52% to 30.24%. It reached a maximum of 32.99% in October 2024 before trending downward, ending the period at 2.67%.
Return on Equity (ROE)
ROE experienced extreme fluctuations, characterized by deep negative values in 2021 and 2022. A rapid recovery occurred in 2023, leading to a peak of 54.78% in April 2024. This was followed by a sustained decline, with ROE falling to 1.12% by July 2026, indicating a significant reduction in the return generated on shareholders' equity.
Return on Assets (ROA)
The return on assets followed a pattern consistent with the other profitability metrics. ROA transitioned from negative territory in 2021 to a peak of 13.65% in April 2024. A subsequent downward trend is observed, with the ratio settling at 0.63% by the end of the analysis period.

Overall, the data indicates a successful turnaround phase culminating in early 2024, followed by a period of margin compression and diminishing returns on both assets and equity toward the end of the timeline.

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Gross Profit Margin

Palo Alto Networks Inc., gross profit margin calculation (quarterly data)

Microsoft Excel
Jul 31, 2026 Apr 30, 2026 Jan 31, 2026 Oct 31, 2025 Jul 31, 2025 Apr 30, 2025 Jan 31, 2025 Oct 31, 2024 Jul 31, 2024 Apr 30, 2024 Jan 31, 2024 Oct 31, 2023 Jul 31, 2023 Apr 30, 2023 Jan 31, 2023 Oct 31, 2022 Jul 31, 2022 Apr 30, 2022 Jan 31, 2022 Oct 31, 2021
Selected Financial Data (US$ in millions)
Gross profit 2,304 2,028 1,909 1,836 1,857 1,670 1,658 1,585 1,616 1,471 1,476 1,405 1,447 1,246 1,189 1,102 1,058 946 912 867
Revenue 3,410 3,002 2,594 2,474 2,536 2,289 2,257 2,139 2,190 1,985 1,975 1,878 1,953 1,721 1,655 1,563 1,550 1,387 1,317 1,247
Profitability Ratio
Gross profit margin1 70.36% 71.94% 73.50% 73.47% 73.41% 73.56% 73.86% 74.17% 74.35% 74.43% 74.05% 73.35% 72.29% 70.80% 69.77% 69.06% 68.76% 69.34% 69.63% 69.77%
Benchmarks
Gross Profit Margin, Competitors2
Accenture PLC 32.05% 32.01% 32.03% 31.97% 31.91% 32.07% 32.18% 32.45% 32.61% 32.58% 32.58% 32.50% 32.34% 32.25% 32.12% 32.02% 31.99% 32.26% 32.30% 32.35%
Adobe Inc. — 89.25% 89.40% 89.40% 89.27% 89.14% 89.25% 89.15% 89.04% 88.66% 88.24% 88.08% 87.87% 87.89% 87.77% 87.66% 87.70% 87.76% 87.87% 88.04%
AppLovin Corp. — — 88.46% 88.37% 87.86% 84.56% 82.02% 78.70% 75.22% 73.89% 71.80% 69.90% 67.74% 61.91% 58.66% 57.47% 55.41% 60.39% 62.19% 62.81%
Cadence Design Systems Inc. — — 85.87% 86.08% 86.36% 85.54% 85.57% 85.86% 86.05% 87.79% 88.51% 89.31% 89.36% 89.18% 89.41% 89.18% 89.57% 89.87% 89.74% 89.83%
Datadog Inc. — — 79.51% 79.89% 79.96% 79.94% 79.92% 80.14% 80.79% 81.22% 81.55% 81.39% 80.74% 79.99% 79.33% 79.25% 79.30% 79.30% 79.00% 78.04%
International Business Machines Corp. — 57.97% 58.10% 58.36% 58.19% 57.81% 57.57% 57.04% 56.65% 56.53% 56.09% 55.64% 55.45% 55.04% 54.64% 54.24% 54.00% 53.78% 54.01% 54.48%
Intuit Inc. 80.17% 79.96% 80.05% 79.89% 79.57% 79.45% 78.97% 78.73% 78.72% 78.53% 78.08% 78.12% 78.13% 78.46% 79.00% 79.99% 81.09% 82.36% 82.11% 82.13%
Microsoft Corp. 67.94% 68.31% 68.59% 68.76% 68.82% 69.07% 69.41% 69.35% 69.76% 69.89% 69.75% 69.44% 68.92% 68.45% 68.16% 68.26% 68.40% 68.73% 68.83% 68.86%
Oracle Corp. 65.82% 67.08% 68.54% 69.66% 70.51% 71.12% 71.27% 71.31% 71.41% 71.53% 71.88% 72.26% 72.85% 74.50% 76.10% 77.78% 79.08% 79.44% 79.96% 80.22%
Palantir Technologies Inc. — — 84.80% 84.07% 82.37% 80.81% 80.03% 80.01% 80.25% 81.10% 81.39% 81.16% 80.62% 79.92% 79.15% 78.75% 78.56% 78.59% 78.73% 78.16%
Salesforce Inc. 77.68% 77.73% 77.65% 77.34% 77.19% 76.94% 76.35% 76.00% 75.50% 74.99% 74.52% 73.78% 73.34% 72.69% 72.61% 73.10% 73.48% 74.02% 74.34% 74.32%
ServiceNow Inc. — — 74.77% 76.56% 77.53% 78.05% 78.52% 78.92% 79.18% 79.24% 79.07% 78.87% 78.59% 78.52% 78.50% 78.45% 78.29% 77.85% 77.53% 77.26%
Synopsys Inc. — 72.38% 73.47% 75.14% 76.98% 79.12% 79.84% 79.64% 79.68% 80.25% 79.85% 79.69% 79.08% 78.79% 78.51% 78.91% 79.07% 79.48% 80.05% 79.78%
Workday Inc. 75.70% 75.64% 75.58% 75.66% 75.50% 75.60% 75.77% 75.64% 75.60% 74.73% 73.87% 73.25% 72.41% 72.22% 72.23% 72.25% 72.21% 72.39% 72.46% 72.61%

Based on: 10-K (reporting date: 2026-07-31), 10-Q (reporting date: 2026-04-30), 10-Q (reporting date: 2026-01-31), 10-Q (reporting date: 2025-10-31), 10-K (reporting date: 2025-07-31), 10-Q (reporting date: 2025-04-30), 10-Q (reporting date: 2025-01-31), 10-Q (reporting date: 2024-10-31), 10-K (reporting date: 2024-07-31), 10-Q (reporting date: 2024-04-30), 10-Q (reporting date: 2024-01-31), 10-Q (reporting date: 2023-10-31), 10-K (reporting date: 2023-07-31), 10-Q (reporting date: 2023-04-30), 10-Q (reporting date: 2023-01-31), 10-Q (reporting date: 2022-10-31), 10-K (reporting date: 2022-07-31), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-31), 10-Q (reporting date: 2021-10-31).

1 Q4 2026 Calculation
Gross profit margin = 100 × (Gross profitQ4 2026 + Gross profitQ3 2026 + Gross profitQ2 2026 + Gross profitQ1 2026) ÷ (RevenueQ4 2026 + RevenueQ3 2026 + RevenueQ2 2026 + RevenueQ1 2026)
= 100 × (2,304 + 2,028 + 1,909 + 1,836) ÷ (3,410 + 3,002 + 2,594 + 2,474) = 70.36%

2 Click competitor name to see calculations.


The financial data indicates a consistent upward trajectory in both top-line revenue and gross profit over the analyzed period. Revenue grew from 1,247 million USD in October 2021 to 3,410 million USD by July 2026, while gross profit increased from 867 million USD to 2,304 million USD over the same timeframe.

Gross Profit Margin Trends
The gross profit margin exhibited three distinct phases. An initial period of slight contraction occurred between October 2021 and July 2022, where the margin dipped from 69.77% to a low of 68.76%. This was followed by a sustained expansion phase starting in October 2022, with margins steadily climbing to a peak of 74.43% in April 2024.
Margin Stabilization and Late-Term Contraction
Following the peak in early 2024, the gross profit margin entered a period of relative stabilization, maintaining levels between 73% and 74% through January 2026. However, a notable downward trend is observed in the final two quarters of the sequence, with the margin decreasing to 71.94% in April 2026 and further to 70.36% by July 2026.
Correlation Between Volume and Efficiency
While absolute gross profit continued to reach record highs through 2026, the decline in the margin percentage during the final periods suggests that the cost of goods sold grew at a faster rate than revenue toward the end of the observed period. This divergence indicates a reduction in production efficiency or a shift in product mix despite the overall growth in scale.

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Operating Profit Margin

Palo Alto Networks Inc., operating profit margin calculation (quarterly data)

Microsoft Excel
Jul 31, 2026 Apr 30, 2026 Jan 31, 2026 Oct 31, 2025 Jul 31, 2025 Apr 30, 2025 Jan 31, 2025 Oct 31, 2024 Jul 31, 2024 Apr 30, 2024 Jan 31, 2024 Oct 31, 2023 Jul 31, 2023 Apr 30, 2023 Jan 31, 2023 Oct 31, 2022 Jul 31, 2022 Apr 30, 2022 Jan 31, 2022 Oct 31, 2021
Selected Financial Data (US$ in millions)
Operating income (loss) 172 (183) 397 309 497 219 240 287 238 177 54 215 254 79 40 15 15 (48) (74) (83)
Revenue 3,410 3,002 2,594 2,474 2,536 2,289 2,257 2,139 2,190 1,985 1,975 1,878 1,953 1,721 1,655 1,563 1,550 1,387 1,317 1,247
Profitability Ratio
Operating profit margin1 6.05% 9.62% 14.37% 13.24% 13.48% 11.09% 10.99% 9.11% 8.52% 8.97% 7.98% 8.15% 5.62% 2.30% 0.37% -1.56% -3.43% -5.12% -6.74% -7.51%
Benchmarks
Operating Profit Margin, Competitors2
Accenture PLC 15.38% 14.49% 14.42% 14.35% 14.68% 15.38% 15.14% 15.04% 14.79% 14.20% 13.76% 13.60% 13.74% 14.42% 14.90% 15.27% 15.21% 15.20% 15.12% 15.19%
Adobe Inc. — 35.70% 36.07% 36.65% 36.63% 36.25% 36.37% 36.29% 31.35% 31.16% 30.51% 29.95% 34.26% 33.95% 33.64% 33.91% 34.64% 35.45% 36.25% 36.72%
AppLovin Corp. — — 77.44% 77.09% 75.75% 67.07% 58.94% 49.35% 39.78% 35.78% 29.99% 25.56% 19.74% 11.75% 7.61% 4.86% -1.70% 1.14% 0.99% 0.38%
Cadence Design Systems Inc. — — 30.33% 28.25% 28.17% 28.50% 27.71% 30.00% 29.10% 28.26% 28.19% 28.91% 30.59% 28.71% 28.78% 29.26% 30.15% 30.81% 30.20% 28.35%
Datadog Inc. — — 0.41% -0.67% -1.29% -1.38% -0.61% 1.05% 2.02% 2.86% 2.01% 0.60% -1.57% -4.77% -6.48% -5.80% -3.50% -1.02% 0.79% 0.34%
International Business Machines Corp. — 17.29% 17.29% 17.75% 17.50% 17.08% 16.08% 15.34% 14.95% 15.09% 15.46% 15.13% 15.17% 14.58% 13.88% 13.49% 13.50% 12.92% 12.77% 12.30%
Intuit Inc. 27.43% 27.47% 27.08% 26.69% 26.14% 24.38% 22.24% 21.66% 22.29% 24.02% 23.00% 22.86% 21.86% 21.67% 19.48% 18.41% 20.20% 23.68% 22.49% 24.10%
Microsoft Corp. 46.78% 46.80% 46.67% 46.27% 45.62% 45.23% 44.96% 44.49% 44.64% 44.70% 44.17% 43.01% 41.77% 40.85% 40.58% 41.69% 42.06% 42.56% 42.52% 42.14%
Oracle Corp. 30.59% 30.56% 30.28% 30.44% 30.80% 30.93% 30.30% 29.82% 28.99% 28.20% 27.73% 27.01% 26.21% 28.06% 30.42% 22.92% 25.74% 26.22% 26.62% 37.78%
Palantir Technologies Inc. — — 42.80% 38.13% 31.59% 21.81% 16.55% 13.02% 10.83% 13.80% 11.78% 8.43% 5.39% 1.71% -3.22% -5.93% -8.46% -11.05% -13.30% -20.43%
Salesforce Inc. 20.06% 20.54% 20.22% 19.27% 19.01% 18.84% 18.14% 17.65% 14.38% 11.03% 8.18% 4.42% 3.29% 1.64% 0.26% 0.77% 2.07% 3.67% 4.69% 4.25%
ServiceNow Inc. — — 11.40% 13.44% 13.74% 13.85% 13.28% 12.93% 12.42% 12.04% 10.78% 10.02% 8.49% 7.64% 6.32% 5.41% 4.90% 3.40% 3.30% 3.95%
Synopsys Inc. — 8.52% 7.03% 10.82% 12.97% 17.16% 20.88% 20.67% 22.13% 24.22% 23.31% 22.80% 21.72% 19.11% 18.81% 20.70% 22.87% 22.93% 23.18% 20.72%
Workday Inc. 7.55% 6.73% 5.88% 4.48% 4.91% 5.13% 4.34% 3.53% 2.52% 0.22% -1.47% -2.62% -3.57% -3.94% -3.24% -2.80% -2.27% -1.81% -2.71% -3.18%

Based on: 10-K (reporting date: 2026-07-31), 10-Q (reporting date: 2026-04-30), 10-Q (reporting date: 2026-01-31), 10-Q (reporting date: 2025-10-31), 10-K (reporting date: 2025-07-31), 10-Q (reporting date: 2025-04-30), 10-Q (reporting date: 2025-01-31), 10-Q (reporting date: 2024-10-31), 10-K (reporting date: 2024-07-31), 10-Q (reporting date: 2024-04-30), 10-Q (reporting date: 2024-01-31), 10-Q (reporting date: 2023-10-31), 10-K (reporting date: 2023-07-31), 10-Q (reporting date: 2023-04-30), 10-Q (reporting date: 2023-01-31), 10-Q (reporting date: 2022-10-31), 10-K (reporting date: 2022-07-31), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-31), 10-Q (reporting date: 2021-10-31).

1 Q4 2026 Calculation
Operating profit margin = 100 × (Operating income (loss)Q4 2026 + Operating income (loss)Q3 2026 + Operating income (loss)Q2 2026 + Operating income (loss)Q1 2026) ÷ (RevenueQ4 2026 + RevenueQ3 2026 + RevenueQ2 2026 + RevenueQ1 2026)
= 100 × (172 + -183 + 397 + 309) ÷ (3,410 + 3,002 + 2,594 + 2,474) = 6.05%

2 Click competitor name to see calculations.


The operating profit margin exhibits a distinct three-phase trajectory characterized by an initial recovery from negative territory, a period of sustained expansion, and a recent sharp contraction. Over the analyzed period, revenue grew consistently from 1,247 million US dollars to 3,410 million US dollars, providing the scale necessary for the shifts in operating efficiency.

Transition to Profitability
Between October 31, 2021, and October 31, 2022, the operating profit margin remained negative but showed a steady upward trend, improving from -7.51% to -1.56%. This period of narrowing losses culminated in a shift to positive territory in January 2023, where the margin reached 0.37%, marking the transition from operational losses to operational profitability.
Sustained Margin Expansion
From January 2023 through January 2026, a consistent trend of margin expansion is observed. The operating profit margin grew from 0.37% to a peak of 14.37%. This growth was supported by a significant increase in operating income, which rose from 40 million US dollars in January 2023 to 397 million US dollars by October 2025, reflecting improved operational leverage as revenue scaled.
Recent Volatility and Contraction
A significant reversal in profitability occurred in the final quarters of the series. In April 2026, the operating profit margin dropped sharply to 9.62%, coinciding with an operating loss of 183 million US dollars. Although operating income returned to a positive 172 million US dollars by July 31, 2026, the operating profit margin continued to decline to 6.05%, indicating a substantial compression of operational efficiency despite the continued growth in top-line revenue.

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Net Profit Margin

Palo Alto Networks Inc., net profit margin calculation (quarterly data)

Microsoft Excel
Jul 31, 2026 Apr 30, 2026 Jan 31, 2026 Oct 31, 2025 Jul 31, 2025 Apr 30, 2025 Jan 31, 2025 Oct 31, 2024 Jul 31, 2024 Apr 30, 2024 Jan 31, 2024 Oct 31, 2023 Jul 31, 2023 Apr 30, 2023 Jan 31, 2023 Oct 31, 2022 Jul 31, 2022 Apr 30, 2022 Jan 31, 2022 Oct 31, 2021
Selected Financial Data (US$ in millions)
Net income (loss) (282) (177) 432 334 254 262 267 351 358 279 1,747 194 228 108 84 20 3 (73) (94) (104)
Revenue 3,410 3,002 2,594 2,474 2,536 2,289 2,257 2,139 2,190 1,985 1,975 1,878 1,953 1,721 1,655 1,563 1,550 1,387 1,317 1,247
Profitability Ratio
Net profit margin1 2.67% 7.95% 12.96% 11.69% 12.30% 13.95% 14.64% 32.99% 32.11% 31.41% 30.24% 8.52% 6.38% 3.32% 0.56% -2.46% -4.85% -7.54% -9.50% -11.20%
Benchmarks
Net Profit Margin, Competitors2
Accenture PLC 11.28% 10.66% 10.61% 10.76% 11.02% 11.61% 11.43% 11.41% 11.19% 10.78% 10.89% 10.65% 10.72% 11.27% 10.99% 11.30% 11.17% 11.12% 11.27% 11.53%
Adobe Inc. — 28.05% 28.69% 29.48% 30.00% 30.01% 30.39% 30.63% 25.85% 25.59% 24.86% 24.08% 27.97% 27.12% 26.34% 26.32% 27.01% 28.00% 29.29% 29.90%
AppLovin Corp. — — 64.58% 64.29% 60.83% 54.48% 48.70% 39.92% 33.55% 26.87% 20.91% 16.48% 10.87% 3.46% 0.70% -2.82% -6.84% -2.82% -3.61% -2.46%
Cadence Design Systems Inc. — — 23.61% 21.18% 20.94% 20.35% 19.88% 22.19% 22.74% 23.87% 25.36% 25.68% 25.46% 24.42% 23.41% 23.23% 23.84% 22.86% 23.61% 23.59%
Datadog Inc. — — 4.48% 3.69% 3.14% 3.32% 4.13% 5.85% 6.85% 7.58% 6.81% 5.11% 2.28% -1.72% -4.38% -4.68% -2.99% -0.91% 0.48% 0.17%
International Business Machines Corp. — 15.99% 15.52% 15.61% 15.69% 12.09% 9.11% 8.71% 9.60% 10.22% 13.52% 13.18% 12.13% 11.32% 3.34% 3.03% 2.71% 2.08% 9.36% 9.46%
Intuit Inc. 21.29% 21.91% 21.57% 21.19% 20.55% 19.07% 17.69% 17.59% 18.19% 19.43% 18.35% 17.53% 16.59% 15.91% 14.22% 14.10% 16.23% 19.44% 19.03% 20.28%
Microsoft Corp. 40.31% 39.34% 39.04% 35.71% 36.15% 35.79% 35.43% 35.61% 35.96% 36.43% 36.27% 35.31% 34.15% 33.25% 33.05% 34.37% 36.69% 37.63% 38.50% 38.51%
Oracle Corp. 25.37% 25.30% 25.28% 21.08% 21.68% 21.80% 21.16% 20.40% 19.76% 20.27% 19.63% 18.40% 17.02% 17.46% 19.09% 13.15% 15.83% 18.08% 24.79% 34.16%
Palantir Technologies Inc. — — 49.00% 43.67% 36.31% 28.11% 22.18% 18.32% 16.13% 18.01% 16.32% 12.79% 9.43% 6.93% -2.35% -12.87% -19.61% -30.64% -30.90% -30.25%
Salesforce Inc. 17.96% 17.91% 16.87% 16.08% 16.35% 15.96% 15.44% 15.30% 11.87% 7.63% 4.77% 1.18% 0.66% 0.92% 1.83% 3.59% 5.45% 6.96% 9.99% 19.87%
ServiceNow Inc. — — 11.34% 12.59% 13.16% 13.67% 13.78% 13.41% 12.97% 12.77% 11.51% 20.34% 19.30% 18.72% 17.76% 5.25% 4.49% 2.90% 2.79% 3.56%
Synopsys Inc. — 11.43% 8.91% 13.76% 18.89% 31.04% 34.77% 34.75% 36.94% 24.60% 23.57% 23.49% 21.05% 18.71% 17.41% 18.22% 19.38% 20.86% 21.19% 20.18%
Workday Inc. 7.26% 6.95% 6.51% 5.60% 6.23% 19.87% 19.60% 19.67% 19.02% 0.96% -1.81% -4.09% -5.90% -5.29% -3.46% -0.49% 0.57% 0.63% -0.79% -3.81%

Based on: 10-K (reporting date: 2026-07-31), 10-Q (reporting date: 2026-04-30), 10-Q (reporting date: 2026-01-31), 10-Q (reporting date: 2025-10-31), 10-K (reporting date: 2025-07-31), 10-Q (reporting date: 2025-04-30), 10-Q (reporting date: 2025-01-31), 10-Q (reporting date: 2024-10-31), 10-K (reporting date: 2024-07-31), 10-Q (reporting date: 2024-04-30), 10-Q (reporting date: 2024-01-31), 10-Q (reporting date: 2023-10-31), 10-K (reporting date: 2023-07-31), 10-Q (reporting date: 2023-04-30), 10-Q (reporting date: 2023-01-31), 10-Q (reporting date: 2022-10-31), 10-K (reporting date: 2022-07-31), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-31), 10-Q (reporting date: 2021-10-31).

1 Q4 2026 Calculation
Net profit margin = 100 × (Net income (loss)Q4 2026 + Net income (loss)Q3 2026 + Net income (loss)Q2 2026 + Net income (loss)Q1 2026) ÷ (RevenueQ4 2026 + RevenueQ3 2026 + RevenueQ2 2026 + RevenueQ1 2026)
= 100 × (-282 + -177 + 432 + 334) ÷ (3,410 + 3,002 + 2,594 + 2,474) = 2.67%

2 Click competitor name to see calculations.


The financial trajectory of the net profit margin reveals a cyclical progression characterized by an initial recovery phase, a period of exceptional profitability, and a subsequent decline returning to negative territory.

Recovery and Transition to Profitability
From October 2021 through October 2022, a consistent upward trend in profit margins is observed, as negative margins contracted from -11.20% to -2.46%. The company achieved a break-even point in January 2023, reporting a net profit margin of 0.56%. This positive momentum continued through October 2023, with margins expanding steadily to 8.52%.
Peak Profitability Period
A significant surge in profitability occurred between January 2024 and October 2024. During this interval, the net profit margin experienced a sharp increase, jumping to 30.24% in January 2024 and peaking at 32.99% by October 2024. This peak corresponds with a substantial spike in net income, specifically reaching 1,747 million US dollars in the first quarter of 2024.
Margin Compression and Return to Loss
Starting in January 2025, a marked correction is evident as the net profit margin dropped to 14.64%. While margins remained relatively stable between 11% and 13% through January 2026, a sharp downward trend emerged thereafter. By April 2026, the margin fell to 7.95%, and by July 2026, it decreased to 2.67%. This erosion culminated in a return to net losses in the final two quarters of the period, with net income falling to -177 million US dollars in April 2026 and -282 million US dollars in July 2026.
Revenue and Income Divergence
Despite a general upward trend in revenue, which grew from 1,247 million US dollars in October 2021 to 3,410 million US dollars by July 2026, the net profit margin did not maintain a linear correlation with growth. The divergence is most prominent in the final quarters, where record-high revenues coincided with a collapse in net income, indicating a significant increase in operating costs or non-operating expenses.

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Return on Equity (ROE)

Palo Alto Networks Inc., ROE calculation (quarterly data)

Microsoft Excel
Jul 31, 2026 Apr 30, 2026 Jan 31, 2026 Oct 31, 2025 Jul 31, 2025 Apr 30, 2025 Jan 31, 2025 Oct 31, 2024 Jul 31, 2024 Apr 30, 2024 Jan 31, 2024 Oct 31, 2023 Jul 31, 2023 Apr 30, 2023 Jan 31, 2023 Oct 31, 2022 Jul 31, 2022 Apr 30, 2022 Jan 31, 2022 Oct 31, 2021
Selected Financial Data (US$ in millions)
Net income (loss) (282) (177) 432 334 254 262 267 351 358 279 1,747 194 228 108 84 20 3 (73) (94) (104)
Stockholders’ equity 27,492 27,668 9,393 8,665 7,824 7,231 6,375 5,912 5,170 4,468 4,357 2,171 1,748 1,232 729 508 210 338 118 519
Profitability Ratio
ROE1 1.12% 3.05% 13.65% 12.89% 14.49% 17.12% 19.68% 46.25% 49.86% 54.78% 52.25% 28.28% 25.15% 17.47% 4.71% -28.23% -127.14% -115.40% -391.77% -98.34%
Benchmarks
ROE, Competitors2
Accenture PLC 26.51% 24.43% 24.51% 24.66% 24.61% 26.01% 26.27% 25.93% 25.68% 25.06% 25.92% 25.79% 26.75% 28.28% 29.20% 30.69% 31.11% 30.99% 31.09% 30.45%
Adobe Inc. — 61.92% 62.76% 63.05% 61.34% 59.11% 60.00% 51.55% 39.42% 36.85% 34.22% 31.05% 32.86% 32.46% 32.71% 33.35% 33.85% 33.49% 34.96% 35.04%
AppLovin Corp. — — 139.42% 167.67% 156.17% 192.05% 208.17% 333.67% 144.96% 122.87% 101.50% 78.59% 28.39% 9.58% 1.32% -4.32% -10.13% -4.35% -5.53% -3.44%
Cadence Design Systems Inc. — — 20.09% 17.85% 20.26% 20.41% 20.21% 22.64% 22.58% 22.77% 24.77% 29.35% 30.58% 30.75% 30.59% 29.09% 30.93% 28.99% 29.53% 26.96%
Datadog Inc. — — 4.07% 3.40% 2.89% 3.10% 3.90% 5.68% 6.77% 7.31% 6.77% 5.23% 2.40% -1.91% -5.04% -5.55% -3.56% -1.08% 0.54% 0.18%
International Business Machines Corp. — 31.43% 31.13% 32.61% 32.45% 28.34% 21.20% 20.36% 22.06% 26.17% 35.09% 35.17% 33.29% 30.00% 9.12% 8.48% 7.47% 6.29% 28.79% 28.98%
Intuit Inc. 24.04% 22.22% 22.78% 21.31% 19.63% 17.23% 16.92% 16.10% 16.07% 16.38% 16.38% 15.21% 13.81% 12.73% 12.28% 11.69% 12.57% 14.75% 13.93% 21.49%
Microsoft Corp. 30.23% 30.22% 30.51% 28.90% 29.65% 30.02% 30.64% 31.46% 32.83% 34.04% 34.64% 34.93% 35.09% 35.45% 36.83% 40.21% 43.68% 44.47% 44.49% 44.67%
Oracle Corp. 40.20% 42.11% 51.50% 51.51% 60.84% 72.68% 84.56% 101.48% 120.26% 189.26% 262.21% 395.57% 792.45% — — — — — — —
Palantir Technologies Inc. — — 30.86% 27.00% 22.00% 16.62% 12.87% 10.52% 9.24% 10.59% 9.99% 7.91% 6.04% 4.62% -1.63% -9.38% -14.57% -23.50% -22.95% -21.07%
Salesforce Inc. 12.61% 12.03% 10.86% 10.23% 10.13% 10.14% 9.77% 9.17% 6.93% 4.46% 2.72% 0.66% 0.36% 0.47% 0.89% 1.70% 2.48% 3.05% 4.24% 10.44%
ServiceNow Inc. — — 13.34% 14.98% 13.48% 15.32% 15.19% 15.17% 14.83% 14.38% 13.22% 23.78% 22.69% 22.08% 20.56% 7.14% 6.46% 4.44% 4.39% 5.58%
Synopsys Inc. — 3.46% 2.54% 3.61% 4.70% 7.23% 21.82% 22.68% 25.17% 19.44% 19.94% 21.10% 20.01% 17.36% 15.79% 16.72% 17.85% 18.42% 18.13% 16.87%
Workday Inc. 8.88% 7.23% 6.36% 5.46% 5.82% 18.79% 18.47% 18.23% 17.09% 1.01% -1.94% -4.45% -6.57% -5.81% -3.83% -0.55% 0.65% 0.73% -0.95% -5.01%

Based on: 10-K (reporting date: 2026-07-31), 10-Q (reporting date: 2026-04-30), 10-Q (reporting date: 2026-01-31), 10-Q (reporting date: 2025-10-31), 10-K (reporting date: 2025-07-31), 10-Q (reporting date: 2025-04-30), 10-Q (reporting date: 2025-01-31), 10-Q (reporting date: 2024-10-31), 10-K (reporting date: 2024-07-31), 10-Q (reporting date: 2024-04-30), 10-Q (reporting date: 2024-01-31), 10-Q (reporting date: 2023-10-31), 10-K (reporting date: 2023-07-31), 10-Q (reporting date: 2023-04-30), 10-Q (reporting date: 2023-01-31), 10-Q (reporting date: 2022-10-31), 10-K (reporting date: 2022-07-31), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-31), 10-Q (reporting date: 2021-10-31).

1 Q4 2026 Calculation
ROE = 100 × (Net income (loss)Q4 2026 + Net income (loss)Q3 2026 + Net income (loss)Q2 2026 + Net income (loss)Q1 2026) ÷ Stockholders’ equity
= 100 × (-282 + -177 + 432 + 334) ÷ 27,492 = 1.12%

2 Click competitor name to see calculations.


The analysis of Return on Equity (ROE) reveals a cyclical trajectory characterized by an initial recovery phase, a period of peak profitability, and a subsequent sharp decline. The transition from significant losses to high positive returns indicates a period of operational turnaround followed by an expansion of the equity base that eventually diluted the return ratio.

Net Income Performance
A transition from net losses to profitability occurred in July 2022. Earnings experienced a substantial surge, peaking at 1,747 million USD in January 2024. Following this peak, net income remained positive but showed a general stabilizing trend before returning to negative territory in April 2026, with losses reaching 282 million USD by July 2026.
Stockholders' Equity Growth
Equity remained volatile during 2021 and 2022 but entered a phase of consistent growth starting in January 2023, rising from 729 million USD to 9,393 million USD by January 2026. A disproportionate increase is observed in the final two quarters, with equity jumping to 27,668 million USD by April 2026, representing a significant expansion of the capital base.
Return on Equity (ROE) Trends
ROE exhibited extreme volatility in the early period, reaching a low of -391.77% in January 2022. The ratio turned positive in January 2023 (4.71%) and accelerated rapidly to a peak of 54.78% in April 2024. From July 2024 onward, a steady downward trend is observed, with ROE falling to 1.12% by July 2026. This decline is attributed to the simultaneous decrease in net income and the massive surge in stockholders' equity, which increased the denominator of the ratio while the numerator contracted.

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Return on Assets (ROA)

Palo Alto Networks Inc., ROA calculation (quarterly data)

Microsoft Excel
Jul 31, 2026 Apr 30, 2026 Jan 31, 2026 Oct 31, 2025 Jul 31, 2025 Apr 30, 2025 Jan 31, 2025 Oct 31, 2024 Jul 31, 2024 Apr 30, 2024 Jan 31, 2024 Oct 31, 2023 Jul 31, 2023 Apr 30, 2023 Jan 31, 2023 Oct 31, 2022 Jul 31, 2022 Apr 30, 2022 Jan 31, 2022 Oct 31, 2021
Selected Financial Data (US$ in millions)
Net income (loss) (282) (177) 432 334 254 262 267 351 358 279 1,747 194 228 108 84 20 3 (73) (94) (104)
Total assets 48,460 46,266 24,979 23,536 23,576 22,003 20,952 20,375 19,991 17,931 18,292 14,809 14,501 14,171 13,163 12,544 12,254 11,100 10,401 10,426
Profitability Ratio
ROA1 0.63% 1.82% 5.13% 4.75% 4.81% 5.63% 5.99% 13.42% 12.89% 13.65% 12.45% 4.15% 3.03% 1.52% 0.26% -1.14% -2.18% -3.51% -4.44% -4.89%
Benchmarks
ROA, Competitors2
Accenture PLC 11.37% 11.32% 11.40% 11.76% 11.74% 12.55% 12.83% 12.64% 12.99% 12.84% 13.70% 13.35% 13.41% 14.29% 14.54% 14.97% 14.55% 14.38% 14.42% 14.19%
Adobe Inc. — 24.30% 24.15% 24.27% 24.17% 24.19% 24.44% 22.54% 18.39% 17.97% 16.93% 16.70% 18.23% 17.60% 17.44% 17.76% 17.51% 18.00% 18.57% 18.58%
AppLovin Corp. — — 53.33% 51.42% 45.92% 44.63% 40.77% 33.64% 26.92% 21.18% 15.69% 11.35% 6.66% 2.10% 0.37% -1.39% -3.30% -1.41% -1.78% -1.12%
Cadence Design Systems Inc. — — 11.41% 9.68% 10.92% 11.05% 10.64% 12.00% 11.76% 11.34% 14.61% 18.30% 18.36% 17.63% 17.26% 16.54% 16.53% 15.80% 17.77% 16.93%
Datadog Inc. — — 2.35% 1.95% 1.62% 1.76% 2.14% 2.76% 3.18% 4.15% 3.70% 2.78% 1.23% -0.97% -2.51% -2.67% -1.67% -0.50% 0.25% 0.08%
International Business Machines Corp. — 7.21% 7.05% 6.88% 6.97% 5.40% 3.93% 3.76% 4.39% 4.76% 6.30% 5.96% 5.55% 5.35% 1.53% 1.37% 1.29% 1.00% 4.38% 4.14%
Intuit Inc. 12.41% 11.66% 12.66% 12.41% 10.47% 9.48% 9.59% 8.79% 9.22% 9.73% 9.33% 9.07% 8.58% 7.74% 7.15% 6.93% 7.45% 8.77% 8.26% 14.07%
Microsoft Corp. 17.64% 18.04% 17.93% 16.49% 16.45% 17.18% 17.37% 17.31% 17.21% 17.80% 17.54% 17.29% 17.56% 18.16% 18.50% 19.40% 19.94% 21.03% 20.91% 20.24%
Oracle Corp. 6.53% 6.61% 7.52% 6.89% 7.39% 7.53% 7.83% 7.61% 7.42% 7.76% 7.55% 6.86% 6.33% 6.36% 6.85% 4.46% 6.15% 6.96% 9.60% 11.35%
Palantir Technologies Inc. — — 25.83% 22.37% 18.26% 13.50% 10.36% 8.47% 7.29% 8.26% 7.79% 6.21% 4.64% 3.51% -1.21% -6.94% -10.80% -16.90% -16.42% -15.01%
Salesforce Inc. 6.64% 7.59% 6.83% 6.29% 6.02% 6.49% 6.11% 5.69% 4.14% 2.85% 1.71% 0.41% 0.21% 0.30% 0.57% 1.08% 1.52% 1.99% 2.65% 6.85%
ServiceNow Inc. — — 5.27% 7.21% 6.71% 7.94% 7.53% 7.33% 6.99% 7.25% 6.29% 10.99% 9.96% 10.51% 9.54% 2.94% 2.44% 1.81% 1.66% 2.03%
Synopsys Inc. — 2.26% 1.65% 2.33% 2.76% 4.14% 9.11% 16.18% 17.31% 12.86% 12.96% 13.33% 11.90% 10.42% 9.40% 9.85% 10.45% 11.07% 10.95% 10.21%
Workday Inc. 3.83% 3.62% 3.25% 2.83% 2.93% 9.87% 9.49% 9.33% 8.39% 0.48% -0.89% -2.00% -2.72% -2.54% -1.48% -0.21% 0.28% 0.33% -0.40% -1.98%

Based on: 10-K (reporting date: 2026-07-31), 10-Q (reporting date: 2026-04-30), 10-Q (reporting date: 2026-01-31), 10-Q (reporting date: 2025-10-31), 10-K (reporting date: 2025-07-31), 10-Q (reporting date: 2025-04-30), 10-Q (reporting date: 2025-01-31), 10-Q (reporting date: 2024-10-31), 10-K (reporting date: 2024-07-31), 10-Q (reporting date: 2024-04-30), 10-Q (reporting date: 2024-01-31), 10-Q (reporting date: 2023-10-31), 10-K (reporting date: 2023-07-31), 10-Q (reporting date: 2023-04-30), 10-Q (reporting date: 2023-01-31), 10-Q (reporting date: 2022-10-31), 10-K (reporting date: 2022-07-31), 10-Q (reporting date: 2022-04-30), 10-Q (reporting date: 2022-01-31), 10-Q (reporting date: 2021-10-31).

1 Q4 2026 Calculation
ROA = 100 × (Net income (loss)Q4 2026 + Net income (loss)Q3 2026 + Net income (loss)Q2 2026 + Net income (loss)Q1 2026) ÷ Total assets
= 100 × (-282 + -177 + 432 + 334) ÷ 48,460 = 0.63%

2 Click competitor name to see calculations.


The Return on Assets (ROA) trajectory exhibits three distinct phases: a period of recovery from negative returns, a peak in capital efficiency, and a subsequent decline associated with a significant expansion of the asset base and a return to net losses.

Profitability Recovery and Transition
Between October 2021 and October 2022, a consistent upward trend in ROA is observed, moving from -4.89% toward break-even. This improvement coincides with a narrowing of net losses, which decreased from 104 million US dollars to a net profit of 20 million US dollars, despite a simultaneous increase in total assets from 10.4 billion to 12.5 billion US dollars.
Peak Operational Efficiency
A period of significant profitability expansion occurred between January 2023 and October 2024. ROA transitioned from a modest 0.26% to a peak of 13.65% in April 2024. This peak was driven by a substantial surge in net income, most notably a spike to 1.7 billion US dollars in January 2024, indicating a period of high asset utilization and strong bottom-line performance relative to the company's size.
Stabilization and Asset Expansion
From January 2025 through January 2026, ROA entered a stabilization phase, fluctuating between 4.75% and 5.99%. During this window, net income remained positive and relatively stable, while the asset base grew steadily from 20.9 billion to 24.9 billion US dollars, suggesting a moderate dilution of returns as the balance sheet expanded.
Recent Performance Decline
A sharp contraction in ROA is evident in the final two quarters ending July 2026, where the ratio fell to 0.63%. This decline is attributed to two simultaneous factors: a return to net losses, reaching 282 million US dollars by July 2026, and a rapid doubling of total assets from 24.9 billion to 48.4 billion US dollars. The substantial increase in assets without accompanying income growth has resulted in a significant reduction in overall asset efficiency.

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