Zscaler(ZS) Benzinga·2024-12-03 17:16Core Viewpoint - Zscaler Inc's shares fell despite reporting positive fiscal first-quarter results, with analysts expressing mixed sentiments regarding the company's future performance and leadership changes [1][12]. Financial Performance - Zscaler reported a 13% year-on-year increase in billings for the fiscal first quarter, although this represents a slowdown from the previous quarter's 27% growth [3][6][10]. - Non-GAAP earnings were reported at 77 cents per share, exceeding the consensus estimate of 63 cents, while revenues reached 606.1 million [5]. - The company raised its full-year revenue guidance, reflecting a projected growth of 21%, down from the 26% year-on-year growth reported for the fiscal first quarter [5][7]. Management Changes - CFO Remo Canessa's retirement has introduced uncertainty regarding Zscaler's commitment to its fiscal 2025 billings target, with analysts noting that this overshadowed the quarterly results [3][5][8]. - The transition in leadership may lead to a "wait-and-see" approach from investors until confidence in the new CFO is established [8]. Market Position and Outlook - Analysts believe Zscaler remains a leader in the SASE market, which is not yet saturated, and express optimism about the company's potential for recovery in the latter half of fiscal 2025 [4][6]. - The company has shown improved sales productivity and customer engagement, which could support future growth [6][10]. - There is potential for 19% billings growth in the first half of the year, with expectations of 25% growth in the second half, contingent on the renewal of contracts [11].