PANW Stock Holds Near Record Highs Despite Fresh China Security Review That Mirrors Micron Case

The review is being conducted under China's cybersecurity review framework for critical infrastructure.

• China launched a cybersecurity review into Palo Alto Networks' products sold in the country.
• The review follows the same regulatory process that led to restrictions on Micron products in 2023.
• While Palo Alto does not separately report China revenue, the Asia-Pacific region accounted for about 12% of its FY2025 revenue.

The Chinese government is launching a formal security review into products sold by Palo Alto Networks (PANW) in China, but the stock seemed unaffected in pre-market trade.

PANW stock traded flat in early morning hours, and retail sentiment on Stocktwits around the firm remained in ‘bearish’ territory over the past day. The shares clocked an intra-day record high of over $376 in the previous session. The stock has nearly doubled this year and gained over 111% in the last 12 months. 

The Chinese Office of Cybersecurity Review stated it was conducting the investigation “to ensure the safe and stable operation of critical information infrastructure, prevent cybersecurity risks, hidden dangers and safe national security.”

Micron Review Offers a Roadmap

The investigation is the second major case involving a foreign technology company under China's cybersecurity review framework. In 2023, Micron Technology (MU) failed a similar review, after which Chinese authorities barred operators of critical infrastructure from purchasing the company's memory products.

Since at least January 2026, Chinese authorities have reportedly directed domestic firms to stop using cybersecurity software from more than a dozen U.S. and Israeli vendors, which includes Palo Alto, Fortinet (FTNT), Broadcom (AVGO), CrowdStrike (CRWD) and Check Point (CHKP). It stated that there are data‑leak and espionage risks associated with the firms. 

Financial Impact Could Be Limited

While the review raises strategic questions, the direct financial impact may be relatively modest. Palo Alto Networks does not disclose revenue generated specifically from China. The company reported that the broader Asia-Pacific region accounted for approximately 11.9% of fiscal 2025 revenue, or about $1.1 billion out of total revenue of roughly $9.2 billion.

That figure also includes major markets such as Japan, Australia, India and Southeast Asia. Hence, China likely represents only a portion of the company's Asia-Pacific business.