Palo Alto Networks announced plans to acquire Aporeto, which has made a name for itself doing machine identity-based microsegmentation. The deal will cost Palo Alto approximately $150 million in cash.

Aporeto identifies workloads and applies microsegmentation across all infrastructures. According to Palo Alto, these features will enable customers to secure their applications at scale.

The acquisition — Palo Alto's eighth in two years — is slated to close during the company's fiscal second quarter. Aporeto co-founders Dimitri Stiliadis and Satyam Sinha will join Palo Alto.

“We are incredibly excited to welcome the team to Palo Alto Networks,” said Palo Alto CEO Nikesh Arora during the company's Q1 earnings call Monday, according to a Seeking Alpha transcript.

However, the deal wasn't enough to keep Palo Alto's stock price from plunging more than 11% in the wake of weak guidance.

Financial Analyst Keith Bachman at BMO Capital Markets in a research note called the company's earnings “disappointing on many fronts."

While Palo Alto retained its "outperforming" status, Bachman noted the company's lackluster product revenue growth, which was negative 4% year over year. And on this note he expressed concerns that the company's guidance implied this may continue to be the case for several quarters.

“We contend that competitive dynamics have likely shifted and that [Palo Alto Networks] isn’t winning as many new deals as its competitors,” Bachman wrote, adding that Palo Alto's guidance shows the company's growth is decelerating.

Palo Alto CFO Kathy Bonanno said the company is projecting revenue to grow by 18% to 19% year over year, while billings are expected to grow between 16% and 17%.

However, it wasn't all bad news. The company did post strong Q1 results, which saw revenues up 18% to $771.9 million.

During the quarter, Palo Alto saw its software-as-a-service (SaaS) subscription revenues increase 38% to $318 million, while support revenues also saw double-digit growth up 21%. Together, SaaS and support revenues accounted for roughly 70% of the company's overall revenues during the quarter, according to Bonanno.

And in the year since Arora took over as CEO, subscription and support have become increasingly important revenue sources for the company.

“About a year ago, we were a great single product company focused on integration and automation,” he said. “One year later, I couldn't be happier with our achievements. We have made significant progress moving into a leading position in cloud security, making great strides in automation using AI [artificial intelligence] and ML [machine learning] across our product portfolio.”

Arora also lauded the company's entrance earlier this month into the nascent secure access service edge (SASE) market.

Gartner, which coined the category, says SASE stitches together elements of edge computing, security, and wide-area networking (WAN) into a single cloud-managed package.

“Prisma Acess is perfectly suited to be a leader in this emerging category,” Arora said. “We are incredibly excited to bring this announced product to our customers.”