Palo Alto Networks said it will acquire CyberArk in a deal valued at $25 billion, or $45 a share, in a move that'll integrate identity security into its platform.
In a shareholder letter, Palo Alto Networks CEO Nikesh Arora said the deal is part of a plan to double the company's revenue. "After spending many years observing and studying the Identity Security landscape, the time is now to re-shape the $29 billion Identity Security category and lead from the front," said Arora, noting that security and identity technologies will converge.
Also: Palo Alto Networks acquires Protect AI, aims to secure AI ecosystems
Arora said:
"We are witnessing another inflection point driven by the emergence of AI agents, creating new AI security categories and reshaping the way Identity Security is delivered, with a significant proportion of attacks driven by credential theft, we feel Identity Security needs to change."
Key points of the deal include:
- Palo Alto Networks enters an identity security market with CyberArk, which has 10,000 customers and $1.32 billion in annual revenue.
- The deal is a bet that identity and security will converge due to AI agents and the need to secure humans, machines and agents.
- CyberArk's technology will be integrated into Palo Alto Networks' Strata and Cortex platforms.
- Palo Alto Networks with CyberArk is a bet that the combined companies can take share in the legacy identity access market.
The deal is expected to close in the second half of Palo Alto Networks' fiscal 2026. Palo Alto Networks said the deal will be accretive to free cash flow in fiscal 2028 following the first full year of the close.
