CyberArk Software's (CYBR) $25 billion acquisition by Palo Alto Networks (PANW) may have been influenced by slowing momentum in its recurring revenue metrics, particularly a year-over-year decline in organic net new annual recurring revenue, UBS said in a report emailed Thursday.

CyberArk confirmed the deal and separately pre-announced its Q2 earnings results. The company stated it will no longer host its scheduled Aug. 7 earnings call. The acquisition is expected to close in the second half of Palo Alto Networks' fiscal year 2026, the report said.

"We're a little surprised CyberArk is a seller here," UBS said, citing its strong long-term potential in agentic AI and machine identity security, but noting that slowing growth metrics, including a year-over-year decline in organic NNARR and product delays with Venafi and Secure AI Agents, may have added pressure.

The company reported "mixed" results, with NNARR of $59 million, slightly below buyside expectations, whiles subscription revenue rose 66% year-over-year, the report said.

UBS downgraded CyberArk shares to neutral from buy and set a new price target of $485 from $480.