Palo Alto Earnings Leak Designed to Crush Short Sellers

This is what you get for betting against Silicon Valley’s hottest tech company. The vultures came looking for you, found you, then picked you apart aftet you laid dead in the after-hours–due to an earnings leak.

Shorts thought they could cover before the market closed, to lock in gains and avoid non-systematic risk?

Think again, fucked faces.

Do not believe for a second this was an accident. Instead, you should know, it was done by design.

For its fiscal Q2 ended Jan. 31, Palo Alto’s earnings per share soared 110.5% to 40 cents, beating estimates by a penny. Sales jumped 54% to $334.7 million, above views of $318.3 million. Both measures, however, decelerated for the second consecutive quarter.

“People are not interested in adding one more agent onto the endpoint,” he said. “So simplified on the endpoint is a driver and it’s very analogous to when people say, ‘Hey, I don’t want firewall and plus, plus, plus (more products).”

Billings also surged 62% to $459 million during Q2 as customers began “buying all elements of our platform,” CFO Steffan Tomlinson said on the call.

Subscription revenue of $84.3 million grew 68% vs. the year-ago quarter.

“We’re seeing customers standardizing on our platform,” McLaughlin said. And with that, “they’re adopting a lot more subscription services than they have in the past.”

Current-quarter sales guidance for $335 million-$339 million topped analyst forecasts for $334.9 million, but Palo Alto’s EPS ex items outlook for 41-42 cents missed Wall Street expectations for 45 cents.

The company’s Q3 sales would be up 44% at the midpoint of guidance, and EPS ex items would rise 80% at the midpoint. But both metrics would also decelerate for the third consecutive quarter. On a seasonal basis, Q1 and Q3 tend to be weaker, Tomlinson said.

Just before the stock halted and earnings leaked, it was trading at $125. The stock has roared higher since, trading up to $147, or 17% higher from the price where the stock traded before the leak.