Zscaler (NASDAQ:ZS) Posts Earnings Results, Beats Estimates By $0.12 EPS

Zscaler (NASDAQ:ZS) announced its quarterly earnings data on Thursday. The company reported $1.01 EPS for the quarter, topping analysts’ consensus estimates of $0.89 by $0.12, FiscalAI reports. Zscaler had a negative return on equity of 0.12% and a negative net margin of 1.45%.The company had revenue of $815.75 million during the quarter, compared to the consensus estimate of $798.92 million.

Zscaler Price Performance

ZS traded up $11.66 on Thursday, hitting $167.36. 6,036,552 shares of the stock were exchanged, compared to its average volume of 2,475,668. The company has a debt-to-equity ratio of 0.86, a current ratio of 1.82 and a quick ratio of 1.82. The firm has a market capitalization of $26.69 billion, a price-to-earnings ratio of -643.67, a PEG ratio of 304.47 and a beta of 1.02. The business has a 50-day moving average of $201.91 and a two-hundred day moving average of $256.68. Zscaler has a 12 month low of $141.56 and a 12 month high of $336.99.

Analyst Ratings Changes

ZS has been the subject of a number of recent analyst reports. Mizuho decreased their price objective on Zscaler from $310.00 to $265.00 and set an “outperform” rating for the company in a research report on Tuesday, February 17th. Macquarie Infrastructure initiated coverage on shares of Zscaler in a report on Friday, October 31st. They issued an “outperform” rating and a $390.00 price target for the company. Weiss Ratings restated a “sell (d-)” rating on shares of Zscaler in a report on Wednesday, January 21st. Barclays set a $220.00 target price on shares of Zscaler in a research note on Thursday, February 19th. Finally, Stifel Nicolaus cut their price target on Zscaler from $330.00 to $320.00 and set a “buy” rating on the stock in a report on Wednesday, November 26th. One investment analyst has rated the stock with a Strong Buy rating, thirty-four have issued a Buy rating, seven have issued a Hold rating and one has given a Sell rating to the stock. According to MarketBeat.com, the company has an average rating of “Moderate Buy” and a consensus price target of $293.84.

Insider Transactions at Zscaler

In related news, Director James A. Beer sold 653 shares of the company’s stock in a transaction that occurred on Friday, January 2nd. The stock was sold at an average price of $226.72, for a total value of $148,048.16. Following the sale, the director directly owned 3,485 shares in the company, valued at $790,119.20. This represents a 15.78% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, CEO Jagtar Singh Chaudhry sold 2,843 shares of the stock in a transaction dated Tuesday, December 16th. The stock was sold at an average price of $230.82, for a total value of $656,221.26. Following the sale, the chief executive officer owned 347,857 shares of the company’s stock, valued at approximately $80,292,352.74. The trade was a 0.81% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last three months, insiders have sold 19,350 shares of company stock valued at $4,471,509. Corporate insiders own 17.20% of the company’s stock.

Institutional Investors Weigh In On Zscaler

A number of institutional investors and hedge funds have recently bought and sold shares of ZS. Kentucky Retirement Systems Insurance Trust Fund grew its position in Zscaler by 1.4% during the third quarter. Kentucky Retirement Systems Insurance Trust Fund now owns 2,569 shares of the company’s stock worth $770,000 after buying an additional 36 shares in the last quarter. Parallel Advisors LLC increased its position in shares of Zscaler by 10.9% during the 3rd quarter. Parallel Advisors LLC now owns 397 shares of the company’s stock valued at $119,000 after purchasing an additional 39 shares during the last quarter. Smartleaf Asset Management LLC lifted its holdings in shares of Zscaler by 7.5% in the 2nd quarter. Smartleaf Asset Management LLC now owns 648 shares of the company’s stock worth $204,000 after acquiring an additional 45 shares during the last quarter. Larson Financial Group LLC grew its stake in shares of Zscaler by 2.6% during the third quarter. Larson Financial Group LLC now owns 2,040 shares of the company’s stock valued at $611,000 after buying an additional 52 shares during the last quarter. Finally, Crossmark Global Holdings Inc. increased its stake in Zscaler by 6.1% in the 3rd quarter. Crossmark Global Holdings Inc. now owns 976 shares of the company’s stock worth $292,000 after purchasing an additional 56 shares during the period. 46.45% of the stock is owned by hedge funds and other institutional investors.

More Zscaler News

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Q2 results topped expectations and management raised ARR guidance to 24% — Revenue $815.8M vs. ~$799M est; adjusted EPS $1.01 vs. $0.89 est. Management raised FY26 ARR growth target to 24%, a clear positive signal for recurring revenue momentum. Press Release
• Positive Sentiment: ARR and cash-flow expansion: ARR +25% YoY to $3.359B; operating cash flow +14% to $204.1M; free cash flow +18% to $169.1M — these improve the quality of revenue and support valuation arguments for subscription growth. Quarter Summary
• Positive Sentiment: AI security momentum: company’s AI Security offering reportedly reached ~$400M ARR by Q1 2026, providing a fast‑growing monetization avenue beyond traditional seat‑based SaaS. This supports long‑term growth upside if adoption continues. SA Analysis
• Neutral Sentiment: GAAP profitability remains negative: the company reported a GAAP loss of $34.3M (‑$0.21/sh) and negative net margin/ROE metrics, meaning adjusted results rely on exclusion of stock comp and one‑offs — a mixed read for fundamental investors. Earnings Snapshot
• Neutral Sentiment: Pre‑earnings analyst upgrades and revisions anticipated a stronger quarter, which may have amplified the post‑earnings move; several analysts updated models ahead of the call. Benzinga Preview
• Negative Sentiment: Analyst skepticism remains: TD Cowen and BTIG published pessimistic forecasts, and some sell‑side commentary highlights valuation and competitive pressure as downside risks — these dissenting views can cap upside. TD Cowen Note BTIG Note
• Negative Sentiment: Competitive and valuation concerns highlighted in market coverage may keep volatility high; Investing.com notes competition and stretched multiples remain a test for the stock. Investing.com
• Negative Sentiment: Recent analyst downgrades earlier this week contributed to intraday weakness before the print, showing sensitivity to sell‑side views despite underlying ARR growth. Downgrade Coverage

About Zscaler

Zscaler is a cloud security company that delivers a cloud-native platform to protect users, applications and data as organizations move away from traditional, network-centric security architectures. The company focuses on a zero trust approach that assumes no implicit trust for users or devices, providing secure access to the internet, SaaS applications and private applications regardless of where users are located. Zscaler positions its services as an alternative to legacy appliances and site-centric VPNs, aiming to simplify security while enabling modern, distributed workforces.

Key offerings are built around the Zscaler Zero Trust Exchange, a multi-tenant cloud platform that enforces security and access policies in-line.