Palo Alto expects cloud, 5G to boost network security business
Aaron Lee, Taipei; Joseph Tsai, DIGITIMES
Palo Alto Networks, a specialist in gateway security, expects the rapid development of cloud computing and 5G technologies to drive up demand for network security solutions, thus helping the industry continue enjoying surging growths in upcoming years, said James Yu, country manager of Palo Alto Taiwan.
Palo Alto has recently announced revenues of US$711 million for its fiscal second quarter of the year, growing 30% from the same period a year ago with non-GAAP net profits reaching US$147 million and EPS at US$1.51.
Palo Alto’s major competitors in the market include Cisco, Huawei and Check Point and the company has a worldwide share of around 17% in terms of revenues in the gateway security market and is the largest solution provider currently, according to industry observers. In Taiwan, Palo Alto has also advanced from the fourth largest supplier two years ago to second place currently and is eyeing to be the top in three years.
Currently, network security’s strong demand is being fueled by the cloud computing trend and the next wave of demand will be generated by 5G business opportunities including Internet of Things (IoT) and autonomous driving, Yu said.
Yu pointed out that growing 30% a year in revenues is basic for the network security market, while the government and IT manufacturing sectors are the two major growth drivers for the market. For the government sector, infrastructure such as gasoline, water and power facilities particularly need the protection of network security technologies.
The Taiwan Semiconductor Manufacturing Company (TSMC) production halt resulting from a computer virus infection in August 2018 showed the importance of gateway security measures and helped raise IT players’ awareness of the problem, Yu noted.
Currently, many of Taiwan’s wafer foundries, packaging and testing houses, memory production firms and IC designers have already adopted Palo Alto’s solutions for network security, Yu added.
In the second half of 2019, Yu expects the company’s sales from Taiwan’s financial industry to also have a good chance to grow sharply.
James Yu, Palo Alto Taiwan country manager
Photo: Aaron Lee, Digitimes, March 2019