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BB vs. PANW: Which Cybersecurity Stock is the Smarter Pick Now?
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Key Takeaways
BlackBerry's cybersecurity business is supported by strong UEM growth and government demand.
BB cut $150M in costs, boosted EBITDA by $54M, and expects $75M more cash in fiscal 2026.
PANW's growth in XSIAM and SASE is strong, but competition and shorter contracts pose concerns.
BlackBerry Limited (BB - Free Report) and Palo Alto Networks (PANW - Free Report) both offer cybersecurity solutions. Although they may focus on different aspects, operating in the high-growth cybersecurity space makes them contenders in this high-growth industry driven by increasing digital threats.
With the rapid acceleration of cloud adoption, digital transformation, and the widespread use of smart and IoT devices, cyberattacks have grown increasingly sophisticated. This creates a more complex attack surface, necessitating advanced cybersecurity solutions for endpoints, networks and cloud environments.
A series of high-profile data breaches has amplified awareness and urgency around cybersecurity, prompting significant investments across industries. According to a report by Grand View Research, the global cybersecurity market is expected to witness a robust CAGR of 12.9% between 2025 and 2030. This strong industry momentum benefits key players such as Palo Alto Networks, BlackBerry, and others operating in this dynamic sector.
For investors looking for exposure in the cybersecurity space, which stock makes for a better investment pick at present? Let’s dive into the pros and cons of each company.
BlackBerry: Focus on Cybersecurity Business Rejig
BlackBerry's transformation over recent years has been nothing short of dramatic. Once a smartphone giant, the company has now pivoted its focus to cybersecurity and Internet of Things (IoT) solutions. Its Secure Communications division now consists of BlackBerry Unified endpoint management (“UEM”), BlackBerry SecuSUITE and BlackBerry AtHoc solutions. Healthy momentum in UEM is being driven by rising deal wins from government agencies, top banks and law firms.
The rising demand for UEM solutions is being driven by the snowballing complexity of managing a growing number of endpoints while maintaining data security and regulatory compliance. BlackBerry highlights that the major trends fueling this growth include the integration of AI and machine learning to improve device management and the transition to cloud-based UEM platforms for enhanced scalability and flexibility. BlackBerry has developed strong ties with U.S. and international government agencies. The company’s solutions power more than 255 million vehicles and secure 18 of the G20 governments. This provides a relatively stable revenue stream and brand credibility in high-trust environments, such as defense, critical infrastructure and public safety.
BB offloaded its underperforming Cylance business to Arctic Wolf and reviewed the cost structure of the Secure Communications division to better focus on a more targeted customer base and improve overall cost efficiency. It has successfully achieved its initial target of cutting back roughly $150 million from its run rate. BlackBerry's total adjusted EBITDA for fiscal 2025 was $39.3 million, including Cylance. This marks a $54 million improvement from last year after adjusting for the patent sale in early fiscal 2024.
Cash and investments grew $144 million, mainly due to a strong boost in operating cash flow, which reached $42 million, along with the receipt of the first $80 million payment from the Cylance deal. Management expects an additional $75 million of cash to be added in fiscal 2026, including the second Cylance payment of $40 million, positioning the company to reinvest or return capital opportunistically.
Apart from intense competition, BlackBerry is taking a cautious stance on the Secure Communications division due to ongoing turmoil in its core government markets. In the last earnings call, BB highlighted the potential impact of DOGE and other shifts within the U.S. administration, as well as political changes in Canada, Germany and other regions, is likely to create a challenging and unstable environment. While significant effects are yet to be seen, the situation remains unpredictable. These developments could lead to short-term disruptions for the business. Although there may be long-term opportunities through consolidation, the current outlook is uncertain and carries risks.
The Case for PANW
While BlackBerry has a stronger presence in UEM, Palo Alto Networks’ main focus is on AI-driven threat detection, next-gen firewalls and cloud security. PANW’s strong product portfolio, strong customer base and increasing opportunities in areas such as Zero Trust and private 5G security position it well for long-term growth.
Palo Alto Networks’ XSIAM platform continues to be a core driver, with ARR growth of more than 200% year over year in the last reported quarter. The company now has 270 customers, each contributing over $1 million in average ARR. Within just 30 months of launch, XSIAM has generated nearly $1 billion on a trailing 12-month basis.PANW’s SASE platform registered 36% year-over-year ARR growth with particular strength in Prisma Access Browser. At the same time, the SASE customer base has reached 6,000 (up 22%), with 40% of new customers being net-new to Palo Alto Networks, a clear indicator of increasing market share. The newly launched Cortex Cloud, which integrates cloud posture with SOC operations, is witnessing strong interest with a nine-figure pipeline across hundreds of clients.
Amid rapid AI deployments, PANW’s Prisma AIRS (AI Runtime Security), launched in the third quarter of fiscal 2025, is expected to aid in gaining further market share. To further boost its AI efforts, it announced a $700 million acquisition of Protect AI, a leading AI security firm specializing in AI model scanning and red-teaming.
PANW secured over 90 net new platform deals in the third quarter of fiscal 2025 alone driven by its platformization strategy. However, these mega-deals support short-term growth; they introduce lumpiness into revenue and bookings and could pose risks if large deals are delayed, cancelled, or do not repeat.
PANW also highlighted that average contract duration declined slightly on a year-over-year and sequential basis in the fiscal third quarter. While the average contract duration remained around three years, any downtrend in contract length could raise concerns about customer retention, long-term revenue visibility, or pricing power.
Price Performance and Valuation for BB & PANW
Over the past month, BB and PANW have registered gains of 12.5% and 6.7%, respectively.
Image Source: Zacks Investment Research
In terms of the forward 12-month price/sales ratio, BB is trading at 4.69X, lower than PANW’s 12.86X.
Image Source: Zacks Investment Research
How Do Zacks Estimates Compare for BB & PANW?
Analysts have kept BB’s earnings estimates for the current fiscal year unchanged in the past 60 days. BB reports fiscal first quarter 2026 earnings tomorrow.
:
Image Source: Zacks Investment Research
Meanwhile, for PANW, there is a marginal upward estimate revision.
While Palo Alto Networks boasts rapid growth and innovation in AI-driven cloud security, BlackBerry presents an attractive investment opportunity with strong government ties, improving financials and a sharper cybersecurity focus post-restructuring. Its lower valuation and improving cost efficiency enhance its investment appeal. For investors seeking a smarter play in cybersecurity, BlackBerry looks like the better pick at present.
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BB vs. PANW: Which Cybersecurity Stock is the Smarter Pick Now?
Key Takeaways
BlackBerry Limited (BB - Free Report) and Palo Alto Networks (PANW - Free Report) both offer cybersecurity solutions. Although they may focus on different aspects, operating in the high-growth cybersecurity space makes them contenders in this high-growth industry driven by increasing digital threats.
With the rapid acceleration of cloud adoption, digital transformation, and the widespread use of smart and IoT devices, cyberattacks have grown increasingly sophisticated. This creates a more complex attack surface, necessitating advanced cybersecurity solutions for endpoints, networks and cloud environments.
A series of high-profile data breaches has amplified awareness and urgency around cybersecurity, prompting significant investments across industries. According to a report by Grand View Research, the global cybersecurity market is expected to witness a robust CAGR of 12.9% between 2025 and 2030. This strong industry momentum benefits key players such as Palo Alto Networks, BlackBerry, and others operating in this dynamic sector.
For investors looking for exposure in the cybersecurity space, which stock makes for a better investment pick at present? Let’s dive into the pros and cons of each company.
BlackBerry: Focus on Cybersecurity Business Rejig
BlackBerry's transformation over recent years has been nothing short of dramatic. Once a smartphone giant, the company has now pivoted its focus to cybersecurity and Internet of Things (IoT) solutions. Its Secure Communications division now consists of BlackBerry Unified endpoint management (“UEM”), BlackBerry SecuSUITE and BlackBerry AtHoc solutions. Healthy momentum in UEM is being driven by rising deal wins from government agencies, top banks and law firms.
The rising demand for UEM solutions is being driven by the snowballing complexity of managing a growing number of endpoints while maintaining data security and regulatory compliance. BlackBerry highlights that the major trends fueling this growth include the integration of AI and machine learning to improve device management and the transition to cloud-based UEM platforms for enhanced scalability and flexibility. BlackBerry has developed strong ties with U.S. and international government agencies. The company’s solutions power more than 255 million vehicles and secure 18 of the G20 governments. This provides a relatively stable revenue stream and brand credibility in high-trust environments, such as defense, critical infrastructure and public safety.
BB offloaded its underperforming Cylance business to Arctic Wolf and reviewed the cost structure of the Secure Communications division to better focus on a more targeted customer base and improve overall cost efficiency. It has successfully achieved its initial target of cutting back roughly $150 million from its run rate. BlackBerry's total adjusted EBITDA for fiscal 2025 was $39.3 million, including Cylance. This marks a $54 million improvement from last year after adjusting for the patent sale in early fiscal 2024.
Cash and investments grew $144 million, mainly due to a strong boost in operating cash flow, which reached $42 million, along with the receipt of the first $80 million payment from the Cylance deal. Management expects an additional $75 million of cash to be added in fiscal 2026, including the second Cylance payment of $40 million, positioning the company to reinvest or return capital opportunistically.
Apart from intense competition, BlackBerry is taking a cautious stance on the Secure Communications division due to ongoing turmoil in its core government markets. In the last earnings call, BB highlighted the potential impact of DOGE and other shifts within the U.S. administration, as well as political changes in Canada, Germany and other regions, is likely to create a challenging and unstable environment. While significant effects are yet to be seen, the situation remains unpredictable. These developments could lead to short-term disruptions for the business. Although there may be long-term opportunities through consolidation, the current outlook is uncertain and carries risks.
The Case for PANW
While BlackBerry has a stronger presence in UEM, Palo Alto Networks’ main focus is on AI-driven threat detection, next-gen firewalls and cloud security. PANW’s strong product portfolio, strong customer base and increasing opportunities in areas such as Zero Trust and private 5G security position it well for long-term growth.
Palo Alto Networks’ XSIAM platform continues to be a core driver, with ARR growth of more than 200% year over year in the last reported quarter. The company now has 270 customers, each contributing over $1 million in average ARR. Within just 30 months of launch, XSIAM has generated nearly $1 billion on a trailing 12-month basis.PANW’s SASE platform registered 36% year-over-year ARR growth with particular strength in Prisma Access Browser. At the same time, the SASE customer base has reached 6,000 (up 22%), with 40% of new customers being net-new to Palo Alto Networks, a clear indicator of increasing market share. The newly launched Cortex Cloud, which integrates cloud posture with SOC operations, is witnessing strong interest with a nine-figure pipeline across hundreds of clients.
Amid rapid AI deployments, PANW’s Prisma AIRS (AI Runtime Security), launched in the third quarter of fiscal 2025, is expected to aid in gaining further market share. To further boost its AI efforts, it announced a $700 million acquisition of Protect AI, a leading AI security firm specializing in AI model scanning and red-teaming.
PANW secured over 90 net new platform deals in the third quarter of fiscal 2025 alone driven by its platformization strategy. However, these mega-deals support short-term growth; they introduce lumpiness into revenue and bookings and could pose risks if large deals are delayed, cancelled, or do not repeat.
PANW also highlighted that average contract duration declined slightly on a year-over-year and sequential basis in the fiscal third quarter. While the average contract duration remained around three years, any downtrend in contract length could raise concerns about customer retention, long-term revenue visibility, or pricing power.
Price Performance and Valuation for BB & PANW
Over the past month, BB and PANW have registered gains of 12.5% and 6.7%, respectively.
Image Source: Zacks Investment Research
In terms of the forward 12-month price/sales ratio, BB is trading at 4.69X, lower than PANW’s 12.86X.
Image Source: Zacks Investment Research
How Do Zacks Estimates Compare for BB & PANW?
Analysts have kept BB’s earnings estimates for the current fiscal year unchanged in the past 60 days. BB reports fiscal first quarter 2026 earnings tomorrow.
:
Image Source: Zacks Investment Research
Meanwhile, for PANW, there is a marginal upward estimate revision.
Image Source: Zacks Investment Research
BB or PANW: Which is a Better Pick?
BB and PANW carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
While Palo Alto Networks boasts rapid growth and innovation in AI-driven cloud security, BlackBerry presents an attractive investment opportunity with strong government ties, improving financials and a sharper cybersecurity focus post-restructuring. Its lower valuation and improving cost efficiency enhance its investment appeal. For investors seeking a smarter play in cybersecurity, BlackBerry looks like the better pick at present.