Palo Alto Networks Leadership Sued After Stock’s Biggest Selloff

Board members and executives at Palo Alto Networks Inc. are responsible for misleading statements about the cybersecurity company’s product-access strategy, its artificial intelligence products, and customer demand before the stock’s worst session ever, an investor alleges.

The company blamed its lowered guidance in February on a shift in the strategy and on some US government contracts that didn’t close, shareholder Nathan Silva says. He filed his derivative suit April 19 in the US District Court for the Northern District of California.

The guidance announcement was followed by a 28% stock price decline to $261.97 on Feb. 21. That was the ...