Core Insights - Zscaler is experiencing significant growth in its ITOps and SecOps operations, driven by the introduction of ZDX Copilot and agentic operations across various security modules [1][3][10] ITOps Summary - The launch of ZDX Copilot has resulted in a 70% year-over-year increase in bookings for the ZDX Advanced Plus package, reaching $75 million since its introduction [2][10] SecOps Summary - Zscaler's SecOps business has seen a remarkable 120% year-over-year growth in annual contract value due to the integration of agentic operations [3][10] New Growth Categories Summary - The New Growth Categories (NGC), which include Zero Trust Everywhere, Data Security Everywhere, and Agentic Operations, have achieved approximately $1 billion in annual recurring revenues (ARR), contributing to Zscaler's total ARR of $2.9 billion in Q3 fiscal 2025 [3][10] Competitive Landscape Summary - Competitors like Palo Alto Networks and CrowdStrike are also expanding their capabilities in agentic operations, with Palo Alto Networks deploying Cortex XSIAM and CrowdStrike introducing Falcon Next-Gen SIEM and Charlotte AI [5][6] Market Dynamics Summary - The agentic operations market is still expanding, providing ample growth opportunities for multiple players, including Zscaler, which has established a strong position in this emerging market [7] Price Performance Summary - Zscaler's shares have increased by 66.8% year-to-date, outperforming the Zacks Security industry's growth of 20.6% [8] Valuation Summary - Zscaler currently trades at a forward price-to-sales ratio of 15.16X, which is higher than the industry average of 14.6X [11] Earnings Estimates Summary - The Zacks Consensus Estimate for Zscaler's fiscal 2025 earnings indicates a slight decline of 0.31%, while the estimate for fiscal 2026 suggests an 11.86% growth, with recent upward revisions in estimates for both years [12]

Core Insights - Zscaler operates in the rapidly growing SASE (Secure Access Service Edge) market, which is attracting new entrants and raising concerns about potential commoditization [1] - The company is focusing on expanding beyond its historical markets of ZIA (Zscaler Internet Access) and ZPA (Zscaler Private Access) to identify new growth opportunities [1] - There is an observed acceleration in orders and bookings, indicating positive growth trends for Zscaler [1] Company Strategy - Zscaler is addressing the challenge of new market entrants by exploring strategies to differentiate its offerings and mitigate commoditization risks [1] - The company is actively seeking to grow its business by venturing into new areas beyond its established services [1] Market Dynamics - The SASE market is characterized by fast growth, presenting both risks and opportunities for companies like Zscaler [1] - The competitive landscape is evolving, necessitating a proactive approach from Zscaler to maintain its market position [1]

Summary of Zscaler (ZS) 2025 Conference Call Company Overview - **Company**: Zscaler (ZS) - **Industry**: Cybersecurity, specifically focusing on Secure Access Service Edge (SASE) and Zero Trust security models Key Points and Arguments Market Dynamics - SASE is a rapidly growing space with increasing competition and new entrants [1] - Zscaler is experiencing accelerating order bookings and growth beyond its historical markets of ZIA (Zscaler Internet Access) and ZPA (Zscaler Private Access) [1][2] Growth Opportunities - Zscaler identifies three major areas of opportunity: 1. Data security, which is becoming increasingly complex, especially with AI integration [5] 2. Agentic operations, leveraging AI to enhance security and IT operations [5] 3. Expansion into new markets beyond traditional offerings [5][12] Zero Trust Security Model - The concept of Zero Trust is evolving, with a shift from user-centric to encompassing cloud workloads, IoT, and AI agents [7][9] - Zscaler's Zero Trust Exchange is positioned as a comprehensive solution for secure communication across various entities [9] Product Development and Innovation - Zscaler has expanded its offerings to include a B2B collaboration exchange and enhanced capabilities for securing AI applications [9] - The company emphasizes the importance of a single vendor for data protection to simplify complex data protection policies [11] Customer Engagement and Sales Strategy - The sales approach has shifted from transactional to account-focused, enhancing customer relationships and sales productivity [62] - Zscaler's solutions are designed to reduce costs significantly for customers, with examples of cost reductions of 50-70% for large enterprises [33] Competitive Landscape - Zscaler faces competition from traditional firewall companies that are attempting to pivot to SASE solutions, but the company believes these offerings do not meet the true Zero Trust criteria [38][39] - The company maintains a strong brand reputation among CIOs and CISOs, focusing on ROI and value delivered rather than just pricing [44] Financial Performance and Metrics - Zscaler reported over $350 million in Annual Recurring Revenue (ARR) from data security, indicating strong growth potential in this area [75] - The company is focused on upselling existing customers, with a reported 40% increase in new logo Annual Contract Value (ACV) year-over-year [56] Data Protection Strategy - Zscaler's approach to data security emphasizes securing data rather than the network itself, positioning itself as a leader in Data Loss Prevention (DLP) [69] - The company has developed a flexible pricing model (Z Flex) to allow customers to choose and adapt their data protection modules according to their needs [78] Future Outlook - Zscaler is optimistic about the future, with plans to expand its Zero Trust offerings to branches and workloads, indicating a phased approach to market penetration [37][50] - The company is committed to continuous innovation and customer satisfaction, aiming to delight customers and win more business [86] Additional Important Insights - The transition to Zero Trust is seen as essential for modern cybersecurity, moving away from traditional firewalls and SD WANs [26] - Zscaler's focus on simplifying security operations and reducing complexity is viewed as a critical factor for resilience in enterprises [34][35] - The company acknowledges the presence of late adopters in the market but believes that its solutions will eventually become mainstream as more enterprises recognize the need for Zero Trust [36]

Core Viewpoint - Zscaler's stock has surged by 51% in 2025, defying broader market pessimism, driven by strong financial performance and an optimistic outlook for future growth [1][3]. Financial Performance - Zscaler reported $678 million in revenue for the third quarter of fiscal 2025, marking a 23% increase year-over-year and exceeding management's guidance of $665 million to $667 million [9]. - The company raised its full-year revenue guidance for fiscal 2025 to $2.66 billion, up from a previous estimate of $2.647 billion [10]. - On a non-GAAP basis, Zscaler achieved a net income of $136.7 million, reflecting a year-over-year increase of 20.7% [11]. Market Position and Growth Potential - Zscaler's Zero Trust Exchange platform is rapidly expanding, with 210 customers adopting the "zero trust everywhere" approach, a 60% increase from the previous year [8]. - The company views its addressable market as worth $96 billion, indicating significant growth potential [14]. - Zscaler's remaining performance obligation (RPO) increased by 30% to $5 billion, suggesting an acceleration in future revenue growth [14]. Analyst Sentiment - The majority of analysts covering Zscaler stock have assigned it a buy rating, with none recommending a sell [12]. - The average price target for Zscaler stock is $285.98, indicating a potential upside of 3.7% over the next 12 to 18 months, with a high target of $323 suggesting a 17.1% increase [13].

Zscaler Investor Welcome & Agenda Ashwin Kesireddy, VP, IR & Strategic Finance Innovations Briefing - Zenith Live 2025 Safe Harbor Unless otherwise noted, all numbers presented will be on an adjusted, non-GAAP basis. Reconciliation of GAAP to non-GAAP financial measures is in the appendix of this presentation. This presentation has been prepared by Zscaler, Inc. ("Zscaler") for informational purposes only and not for any other purpose. Nothing contained in this presentation is, or should be construed as, a ...

Zscaler, Inc. (NASDAQ:ZS) Investor Innovations Briefing Call June 3, 2025 2:30 PM ET Company Participants a - Corporate Participant Adam Geller - Chief Product Officer Ashwin Kesireddy - Vice President of Investor Relations & Strategic Finance Brian Beyer - Co-Founder, CEO & Director Dhawal Sharma - Corporate Participant Jagtar Singh Chaudhry - Co-Founder, CEO & Chairman of the Board Mike Rich - Chief Revenue Officer & President of Global Sales Conference Call Participants Adam Tyler Tindle - Raymond James ...

Summary of Zscaler (ZS) Update / Briefing June 03, 2025 Company Overview - **Company**: Zscaler (ZS) - **Focus**: Cybersecurity solutions with a strong emphasis on Zero Trust architecture and AI integration Key Industry Insights - **Zero Trust Architecture**: Zscaler has evolved its Zero Trust strategy from ZIA (Zscaler Internet Access) to ZPA (Zscaler Private Access) and ZDX (Zscaler Digital Experience), now promoting "Zero Trust Everywhere" as a comprehensive security approach [5][8][34] - **Data Security Growth**: Data security is identified as one of the fastest-growing areas for Zscaler, with significant investments in AI to enhance detection and prevention capabilities [5][6][13] - **AI Integration**: The company is embedding AI across its operations, particularly in security operations, to improve efficiency and effectiveness in threat detection and response [6][20][39] Core Strategic Initiatives - **Acquisitions**: The acquisition of Red Canary is aimed at enhancing Zscaler's security operations capabilities, leveraging their expertise in threat detection and incident response [17][39] - **Agentic Operations**: Zscaler is developing "agentic task agents" that utilize AI to automate security operations, improving the speed and accuracy of threat investigations [16][39][42] - **Zero Trust in Branch and Cloud**: Zscaler is expanding its Zero Trust framework to include branch locations and cloud environments, integrating SD-WAN capabilities to eliminate the need for traditional firewalls [46][48] Financial and Operational Highlights - **Customer Engagement**: Zscaler has seen strong validation from analysts and customers regarding its Zero Trust branch and cloud solutions, with significant deployments in various sectors, including finance and healthcare [47][49] - **Market Positioning**: The company positions itself against traditional firewall solutions, advocating for a firewall-free approach in cloud environments, which is gaining traction among enterprises [66][81] Important Metrics and Data - **Data Processing**: Zscaler processes over 500 billion signals daily, providing a unique vantage point for threat detection and response [97] - **Customer Base**: The company has a large and satisfied customer base, which is crucial for its growth and market penetration [98] Additional Insights - **Identity Security**: Zscaler emphasizes the importance of identity in its Zero Trust framework, integrating with identity vendors to enhance security posture [100][104] - **Proactive Security Measures**: The company is focusing on proactive security measures, including continuous threat exposure management and vulnerability assessments [31][34] - **Customer Testimonials**: Customers like FICO have reported successful implementations of Zscaler's solutions, highlighting the effectiveness of their Zero Trust approach [55][57] Conclusion Zscaler is strategically positioned to lead in the cybersecurity space with its innovative Zero Trust solutions and AI-driven security operations. The company's focus on integrating acquisitions and enhancing its product offerings will likely drive future growth and market share expansion.

Core Insights - Zscaler has announced advanced AI security capabilities aimed at enhancing data security and preventing cyberattacks, addressing challenges faced by businesses adopting AI technologies [1][4] - The Zscaler platform processes over 500 trillion security signals daily, leveraging this data to power its AI engines for accurate threat detection and automated security [2][3] AI-Powered Innovations - Zscaler's new AI-focused solutions aim to simplify the deployment of advanced AI tools in large environments, enhancing precision and automating threat neutralization [3][4] - Key innovations include AI-powered data security classification, which identifies sensitive content across more than 200 categories, improving data security assessments [5] - Enhanced generative AI protections provide greater visibility and control over AI applications, allowing organizations to block non-compliant prompts and safeguard sensitive data [5] - AI-powered segmentation features a user-to-application segmentation engine that streamlines app management and improves security posture [5] Network Intelligence Enhancements - Zscaler Digital Experience (ZDX) now utilizes AI to benchmark and visualize internet performance, enabling proactive detection of ISP issues and optimizing connections to Zscaler data centers [5]

Core Insights - Zscaler has launched a new suite of solutions aimed at enabling customers to adopt Zero Trust Everywhere, enhancing security across branches and multi-cloud environments [1][2][3] - The updates to the Zscaler Zero Trust Exchange™ platform empower organizations to secure their networks against threats like ransomware by making branches and clouds invisible to malicious actors [2][3] Product Innovations - Unified Appliance for Zero Trust Branch: This solution secures communications between various locations and segments OT and IoT devices, eliminating the need for traditional firewalls and reducing complexity and costs [4] - Zero Trust Gateway for Cloud Workloads: A cloud-native service that secures communications from workloads to the internet and between workloads in under 10 minutes, enhancing security in hybrid and multi-cloud environments [4] - Zscaler Microsegmentation for Cloud Workloads: This service provides granular segmentation policies for cloud workloads, protecting critical assets against lateral threats [4] - Zero Trust Exchange for B2B: A platform that facilitates secure collaboration between partner organizations, replacing outdated technologies and enhancing data protection during mergers and acquisitions [4] Strategic Impact - The expanded Zero Trust Everywhere approach allows organizations to modernize their security infrastructure, mitigate risks, and protect data across various environments [5] - Zscaler's solutions are designed to simplify security network infrastructure, making it easier for businesses to scale securely in a rapidly changing threat landscape [3][4]

Core Viewpoint - Zscaler's share price is projected to reach $360 due to positive technical price action, favorable analyst sentiment, and strong business fundamentals, indicating a breakout from a long-term trading range [1][2][5]. Group 1: Business Fundamentals - The recent breakout in Zscaler's stock price is attributed to business fundamentals catching up to valuation concerns, leading to an improved outlook for sustainable 20% growth and increasing shareholder value [2][10]. - Zscaler reported a solid fiscal Q3 2025, with revenue exceeding analyst forecasts and growth remaining above 20%, supported by accelerated gains in billings and deferred revenue [10][11]. - The company has a robust balance sheet with over $3 billion in cash and equivalents, a 21% increase in net income, and an 18% free cash flow margin [11]. Group 2: Analyst Sentiment - Analyst activity shifted positively following Zscaler's fiscal Q3 results, with a 17% increase in the consensus price target and no decreases tracked among 36 analysts [5][6]. - The consensus price target reflects a 25% increase compared to the previous year, indicating strong analyst confidence in the company's performance [6][11]. - The stock currently has a Moderate Buy rating, with a high forecast of $320 and an average forecast of $277.32 [11][15]. Group 3: Market Dynamics - The market is experiencing a recovery rally, with projections suggesting potential new all-time highs in the range of $375 to $403 [4]. - Institutional investors own 41% of Zscaler's stock and have been buying on balance throughout the year, providing a solid support base for price action [13]. - Short interest was at 9% ahead of the release, setting the stage for a potential short-covering rally [14]. Group 4: Product Development - Zscaler's new product, Z-Flex, is designed to streamline security stack adjustments for businesses, enhancing flexibility and scalability while reducing costs [9][8].