By Juby Babu (Reuters) -Palo Alto Networks said on Wednesday it will buy cloud management and monitoring company Chronosphere for $3.35 billion, as the cybersecurity firm looks to strengthen its AI offerings. The Santa Clara, California-based company plans to integrate Chronosphere with Cortex AgentiX platform, allowing use of its AI agents on the cloud management […]
Science
Palo Alto Networks to buy Chronosphere for $3.35 billion, raises annual forecasts
Audio By Carbonatix
By Juby Babu
(Reuters) -Palo Alto Networks said on Wednesday it will buy cloud management and monitoring company Chronosphere for $3.35 billion, as the cybersecurity firm looks to strengthen its AI offerings.
The Santa Clara, California-based company plans to integrate Chronosphere with Cortex AgentiX platform, allowing use of its AI agents on the cloud management firm’s data to detect performance issues and autonomously investigate their root cause.
Palo Alto will pay the deal amount in cash and new equity to substitute old awards.
Shares of Palo Alto were down more than 3% after the bell.
Chronosphere’s price tag and announcing the acquisition before closing the CyberArk deal are likely weighing on the shares, DA Davidson analyst Rudy Kessinger said.
Palo Alto will pay nearly 21 times Chronosphere’s annual recurring revenue, which was more than $160 million as of the end of September 2025.
The company announced the acquisition of identity security firm CyberArk Software for about $25 billion in July. While CyberArk’s shareholders approved the acquisition last week, both the deals are expected to close in the second half of fiscal 2026.
Separately, Palo Alto raised its annual revenue and profit forecasts on expectations of a surge in demand for its cybersecurity solutions to tackle rising online threats.
For fiscal 2026, Palo Alto now sees revenue in the range of $10.50 billion to $10.54 billion, compared with its earlier outlook of $10.48 billion to $10.53 billion.
It expects annual adjusted profit per share of $3.80 to $3.90, higher than the $3.75 to $3.85 it had forecast earlier.
Cybersecurity spending has remained resilient, underpinned by threats from nation-state actors and increasingly sophisticated ransomware attacks, benefiting companies such as Palo Alto.
For the first quarter ended October 31, revenue grew 15.6% to $2.47 billion, largely in line with the average of analysts’ estimates, according to data compiled by LSEG.
(Reporting by Juby Babu in Mexico City; Editing by Alan Barona and Leroy Leo)