Key Takeaways:
- Palo Alto Networks, the world’s largest cyber company, believes that Israel is the hub of innovation in cybersecurity.
- The company’s CEO, Nikesh Arora, has launched an aggressive acquisition-led growth strategy, resulting in the acquisition of several Israeli startups, including CyberArk.
- The acquisition of CyberArk is expected to double Palo Alto’s workforce in Israel and expand its R&D center in Tel Aviv.
- Arora reassures employees that layoffs are not expected after the merger with CyberArk, and the company plans to invest more in identity management.
- Palo Alto has become a preferred exit destination for many Israeli cybersecurity startups, with founders believing that the company is the right home for their products.
Introduction to Palo Alto Networks’ Commitment to Israel
Palo Alto Networks, the world’s largest cyber company by market value, has reaffirmed its commitment to Israel as a hub of innovation in cybersecurity. According to Nikesh Arora, CEO of Palo Alto Networks, the company believes that Israel is the source of the most significant amount of innovation in cybersecurity. Arora’s statement is backed by the company’s aggressive acquisition-led growth strategy, which has resulted in the acquisition of several Israeli startups, including CyberArk, a $25 billion deal expected to close between February and May 2026.
The Acquisition of CyberArk and its Impact on Palo Alto’s Workforce
The acquisition of CyberArk is the largest in Palo Alto’s history and marks a departure from its previous strategy of acquiring smaller startups. The deal is expected to double Palo Alto’s workforce in Israel, where the company currently employs about 1,600 people. Arora noted that even during the war, Palo Alto hired roughly 700 employees locally, demonstrating the company’s commitment to the region. The acquisition will also expand Palo Alto’s R&D center in Tel Aviv, which currently occupies 22 floors of the Alon Tower.
Reassurance on Layoffs and Investment in Identity Management
Arora reassured employees that layoffs are not expected after the merger with CyberArk. He stated that while some senior executives may make different choices, the company has no intention of making significant cuts. Instead, Palo Alto plans to invest more in identity management, an area where CyberArk specializes. Arora emphasized that the company has no products in identity management, making it an area of growth and investment.
Palo Alto as a Preferred Exit Destination for Israeli Startups
Palo Alto has become a preferred exit destination for many Israeli cybersecurity startups. Arora attributed this to the company’s philosophy of giving founders significant responsibility and real influence. He noted that founders often approach Palo Alto with acquisition offers, preferring to be part of the company due to its commitment to innovation and growth. Arora’s statement highlights the company’s reputation as a desirable acquirer in the cybersecurity industry.
Commitment to Israel Beyond the Founder’s Departure
Arora dismissed concerns that Palo Alto’s commitment to Israel might weaken following the departure of founder Nir Zuk from day-to-day leadership. He emphasized that the company’s commitment to Israel remains unchanged, with Zuk still being a major shareholder and available for guidance. Arora also highlighted the company’s continued investment in Israel, including the hiring of 750 people in recent years. He praised the Israeli team’s passion, resilience, and willingness to accept feedback and build the best products in the world.
Competition with Israeli Startup Wiz and the Role of AI in Cybersecurity
Arora addressed the competition with Israeli startup Wiz, which was sold to Google for $32 billion. He suggested that the rivalry may actually ease, as Palo Alto has crossed the 10% market share threshold, making it the first cybersecurity company to reach double-digit market share. Arora also emphasized that Israel’s military background remains an advantage in cybersecurity, even in the AI era. He noted that anyone who knows how to secure systems can learn how to secure AI, and that Palo Alto has changed its hiring approach to focus on real capabilities rather than formal education.
The Future of Cybersecurity and Palo Alto’s Role
In conclusion, Palo Alto Networks’ commitment to Israel and the cybersecurity industry is evident in its aggressive acquisition-led growth strategy and investment in local talent. The company’s reassurance on layoffs and investment in identity management demonstrates its dedication to growth and innovation. As the cybersecurity landscape continues to evolve, Palo Alto is well-positioned to remain a leader in the industry, with its commitment to Israel and its people at the forefront of its strategy.
