Palo Alto Networks → CyberArk
Palo Alto Networks agreed to pay about $25bn in cash and shares for CyberArk, the Israeli leader in privileged-access security, to add identity as a core platform — a break from years of small purchases, and a bet that AI agents will be the next identities needing protection.
Palo Alto Networks' largest purchase, at $45.00 plus 2.2005 shares per CyberArk share, taking it into identity security.
- Value
- $25B
- Announced
- July 2025
- Completed
- February 2026
- Sector
- Technology
- Deal type
- acquisition
- Acquirer
- Palo Alto Networks (United States)
- Target
- CyberArk (Israel)
Why it mattered
CyberArk, founded in Israel in 1999 by Udi Mokady and Alon N. Cohen and listed on Nasdaq since 2014, built its business on securing privileged accounts — the administrator credentials through which attackers break into systems. Palo Alto, run since 2018 by Nikesh Arora, had grown from firewalls into a "platformization" strategy across network, cloud and security operations, usually buying start-ups for a few hundred million dollars; identity was the major category it lacked. Its pitch was that machine identities and autonomous AI agents are the new privileged users, and that CyberArk could be sold across Palo Alto's more than 70,000 customers.
The agreement of 30 July 2025 offered $45.00 in cash and 2.2005 Palo Alto shares for each CyberArk share, a 26% premium to CyberArk's unaffected ten-day average price and an equity value of about $25bn. Palo Alto expected the deal to add to revenue growth at once but to free cash flow per share only in fiscal 2028. CyberArk shareholders approved it on 13 November 2025, and it completed on 11 February 2026, two weeks after Palo Alto closed its roughly $3bn purchase of the observability company Chronosphere.
What it left behind
Because the exchange ratio was fixed and Palo Alto's shares had fallen, the consideration recorded at completion was $21.1bn, including 112 million new shares, with $14.8bn booked as goodwill. Within a week Palo Alto cut its full-year revenue and earnings forecasts, partly because it and CyberArk calculated annual recurring revenue differently, which trimmed CyberArk's expected contribution by 2–3%. When Palo Alto began trading on the Tel Aviv Stock Exchange on 23 February 2026, under CyberArk's old CYBR ticker, its market value at the previous close was about $121bn, the lowest since May 2024. The deal added roughly 4,000 employees, most from CyberArk, to a workforce of about 16,000; job cuts affecting more than 10% of CyberArk's staff followed, and the CyberArk platform has since been relaunched under Palo Alto's Idira brand.
Metric definitions are part of the price: when two subscription businesses count recurring revenue differently, the gap should surface in diligence, not in the first guidance after closing.