Palo Alto Networks (NASDAQ: PANW) expects artificial intelligence (AI) to become a key growth driver for the company in the long run, which is not surprising as this technology is expected to play a central role in shoring up cyber defenses and help organizations protect their networks from bad actors. However, a closer look at the company's latest quarterly results indicates it has a lot of work to do before it can make the most of the AI-related cybersecurity opportunity.

Bloomberg Intelligence forecasts that generative AI-driven cybersecurity spending could jump to $3.1 billion in 2027 from just $9 million in 2022. By 2032, generative AI-based cybersecurity spending is predicted to touch nearly $14 billion. This explains why Palo Alto management discussed the company's AI-related potential in detail on the latest earnings conference call, suggesting that this technology could drive healthy growth in the company's revenue by 2030.

However, the fact that Palo Alto stock fell a whopping 22% following the release of its fiscal 2024 second-quarter results (for the three months ended Jan. 31, 2024) on Feb. 20 cannot be ignored. Let's see why that was the case and whether AI could indeed help Palo Alto regain investor confidence.

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Source Fool.com