Cybersecurity Firm Picks New CEO -- WSJ
2018年6月2日 - 4:02PM
Dow Jones News
By Robert McMillan and Rolfe Winkler
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (June 2, 2018).
Palo Alto Networks Inc. on Friday named Nikesh Arora, a former
top SoftBank Group Corp. executive, as its next chairman and chief
executive, following years of rapid growth for the cybersecurity
company.
Mr. Arora will succeed Mark McLaughlin, who joined Palo Alto
Networks as CEO in 2011 and took the company public in 2012. He
oversaw brisk growth at a time when high-profile cyberattacks
pushed corporations to beef up their investments in security
software.
In an interview, Mr. McLaughlin said that after nearly a decade
of running publicly traded companies, he wants to spend more time
with his family. He said he discussed the transition with the board
for eight months. He will remain as vice chairman, a
"customer-facing" role in which he said he will help with customer
advocacy and the company's relationship with the federal
government.
With Mr. Arora, who also will replace Mr. McLaughlin as
chairman, Palo Alto Networks gains a CEO with a reputation as a
global deal maker.
Mr. Arora was a longtime executive at Alphabet Inc.'s Google,
where as chief business officer he oversaw sales, customer service,
marketing and tech support.
He pointed to his experience in helping Google build up
globally.
"No, I haven't worked in security," Mr. Arora said in an
interview. "The need here is to lead a team of 5,000 people, shore
up our global operations to continue to scale."
Mr. Arora said it was too soon to get into the specifics of his
strategy, but noted that he was attracted to helping companies
figure out how to stay secure as they transition to cloud
computing. "I think that is a huge opportunity," he said.
His tenure at Palo Alto Networks begins June 6, the company
said. Mr. Arora declined to comment on his compensation.
Mr. Arora said he plans to focus on continuing the company's
current trajectory. "The question is how do we take this from here
and 2x or 3x it and continue to scale," he said.
At SoftBank, where he served as president and operating chief,
Mr. Arora shepherded billions of dollars in investments. He had
once been considered a successor to the Japanese internet and
telecommunications company's CEO, Masayoshi Son, who had handpicked
the Silicon Valley deal maker to replace him. But Mr. Arora faced
criticism from some SoftBank shareholders over his investment
choices for the company, and he left abruptly in 2016 -- two years
after he was wooed away from Google.
Mr. Arora on Friday defended his investment record. "Of the
eight or nine investments I did, six are working really well, one
still remains to be seen and two didn't work. Now that's called
portfolio management."
Palo Alto Networks sells next-generation firewalls, security
products designed to keep malicious software out of corporate
networks. When it went public in 2012, annual revenue was $225.1
million. By fiscal 2017, that figure had jumped to $1.8 billion as
the company siphoned sales from established vendors such as Cisco
Systems Inc. and Check Point Software Technologies Ltd.
However, Palo Alto Networks has consistently run at a loss, in
part because of the cost of share-based compensation. Its loss
widened to $216.6 million in fiscal 2017 from $192.7 million a year
earlier.
The change at the top comes as Palo Alto Networks is looking to
acquisitions to maintain its breakneck revenue growth. In March,
the Santa Clara, Calif., company spent $300 million on
cloud-security company Evident.io. The following month, it bought
Israeli cybersecurity startup Secdo Ltd. Terms of that deal weren't
disclosed.
When Palo Alto Networks went public, the shares priced at $42.
The stock finished Friday up a half percent at $209.19. For the
year, it has surged 44%.
Mr. McLaughlin said the company's strategy is to invest in its
new security platform, for which it hopes other developers will
write software -- something akin to a Windows operating system but
for security software.
Write to Robert McMillan at Robert.Mcmillan@wsj.com and Rolfe
Winkler at rolfe.winkler@wsj.com
(END) Dow Jones Newswires
June 02, 2018 02:47 ET (06:47 GMT)
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