Can PANW's Secure Browser Adoption Support Long-Term SASE Growth?

Palo Alto Networks PANW is seeing strong growth in its Secured Access Service Edge (SASE) business, and secure browsers are becoming a bigger part of that story. In the first quarter of fiscal 2026, Palo Alto Networks' SASE business had a strong quarter. SASE ARR grew 34% year over year and crossed $1.3 billion. PANW now has around 6,800 SASE customers, including about one-third of the Fortune 500.

During the first quarter, PANW highlighted strong momentum in secure browsers. PANW crossed 7.5 million browsers sold during the first quarter, while secure browser bookings nearly quadrupled year over year. Management said secure browsers are gaining importance as more AI tools and “agentic browsers” enter the workplace, creating security gaps that traditional tools may not fully cover. This is where PANW's secure browser comes into play, which adds another layer of protection for users accessing websites and cloud applications. This can be useful for organizations that want stronger security for web access, cloud apps, and remote work.

SASE growth is also being supported by large enterprise wins. During the first quarter, a large U.S. cabinet agency signed a $33 million SASE deal covering 60,000 seats after replacing its existing provider. In this deal, PANW displaced a major SASE incumbent. The customer selected PANW because it wanted a single unified platform that could provide unified visibility across its firewall setup and remote endpoints.

With SASE already at scale and secure browser traction rising, PANW appears to be using secure browsers to strengthen its overall SASE growth story. The above-mentioned factors demonstrate how strong growth in SASE and rising momentum in secure browsers bode well for PANW's long-term growth. The Zacks Consensus Estimate for fiscal 2026 and 2027 indicates revenue growth of around 14.1% and 13.2%, respectively.

How Competitors Fare Against PANW

Zscaler ZS and Fortinet FTNT are key rivals to Palo Alto Networks in the SASE space.

Zscaler is also expanding into browser-based security. ZS offers cloud-native secure access through its ZIA and ZPA platforms. In the fourth quarter of fiscal 2025, Zscaler saw continued demand from customers replacing legacy VPNs with its zero-trust architecture.

Fortinet is growing fast, driven by the rising adoption of its FortiSASE platform. During the third quarter of 2025, Fortinet’s Unified SASE ARR grew 13% year over year. Fortinet stands out by delivering all core SASE capabilities within a single operating system. Fortinet also offers Sovereign SASE, a tailored solution for large enterprises and service providers that require full on-premises or in-country control of their data.

PANW’s Price Performance, Valuation & Estimates

Shares of Palo Alto Networks have lost 6.4% in the past six months compared with the Zacks Security industry’s decline of 10.5%.

PANW 6-month Price Return Performance

From a valuation standpoint, Palo Alto Networks trades at a forward price-to-sales ratio of 11.7X compared with the industry’s average of 12.32X.

PANW Forward 12-Month P/S Ratio

The Zacks Consensus Estimate for Palo Alto Networks’ fiscal 2026 and 2027 earnings implies year-over-year growth of 14.9% and 12.3%, respectively. Estimates for fiscal 2026 and fiscal 2027 have both been revised upward by a penny over the past 60 days.

Palo Alto Networks currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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