Palo Alto Networks Inc

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

All references made to share or per share amounts related to our common stock have been retroactively adjusted to reflect the effects of the Stock Split. Refer to Note 1. Description of Business and Summary of Significant Accounting Policies in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information on the Stock Split.

Unregistered Sales of Equity Securities

During the three months ended January 31, 2025, holders of the 2025 Notes converted $112.4 million in aggregate principal amount of the 2025 Notes, which we repaid in cash. We also issued 1.7 million shares of our unregistered common stock to the holders of the 2025 Notes for the conversion value in excess of the principal amount. These shares of our common stock were issued in reliance on the exemption from registration provided by Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities Act”).

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In February 2019, we announced that our board of directors authorized a $1.0 billion share repurchase program, which is funded from available working capital. In December 2020, August 2021, August 2022, November 2023, and August 2024, we announced additional $700.0 million, $676.1 million, $915.0 million, $316.7 million, and $500.0 million increases to this share repurchase program, respectively, bringing the total authorization to $4.1 billion, with $1.0 billion remaining as of January 31, 2025. The expiration date of this repurchase authorization was extended to December 31, 2025, and our repurchase program may be suspended or discontinued at any time. Repurchases under our program are to be made at management’s discretion on the open market, through privately negotiated transactions, transactions structured through investment banking institutions, block purchase techniques, 10b5-1 trading plans, or a combination of the foregoing. We did not repurchase shares of our common stock under our share repurchase program during the three months ended January 31, 2025.

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Between November 1, 2024 and November 30, 2024, we withheld shares of restricted stock upon employee net exercise of stock options to satisfy the associated exercise price and tax withholding requirements. An aggregate of 1.3 million shares with an average value of $191.68 per share were withheld by us to satisfy the exercise price and tax withholding requirements during this period.

Between November 1, 2024 and November 30, 2024, December 1, 2024 and December 31, 2024, and January 1, 2025 and January 31, 2025, shares of restricted stock were withheld by us from certain employees upon the vesting of equity awards to satisfy tax withholding requirements. The average value of shares withheld to satisfy tax withholding requirements during these periods were $181.20 per share, $189.36 per share, and $180.18 per share, respectively. The number of shares withheld to satisfy tax withholding requirements during these periods was not significant.