Q3 26 EPS
$1.08
BEAT +7.11%
Est. $1.01
Q3 26 Revenue
$850.5M
BEAT +1.77%
Est. $835.7M
vs S&P Since Q3 26
-31.2%
TRAILING MARKET
ZS -31.7% vs S&P -0.5%
Market Reaction
Did ZS Beat Earnings? Q3 2026 Results
Zscaler delivered a strong fiscal third quarter, posting revenue of $850.48 million, up 25.4% year over year and ahead of the $835.66 million consensus, while non-GAAP EPS of $1.08 beat the $1.01 estimate by 7.11%, extending the company's streak of c… Read more Zscaler delivered a strong fiscal third quarter, posting revenue of $850.48 million, up 25.4% year over year and ahead of the $835.66 million consensus, while non-GAAP EPS of $1.08 beat the $1.01 estimate by 7.11%, extending the company's streak of consecutive quarterly EPS beats to nine. The cloud security firm's momentum was anchored by its annual recurring revenue climbing 25% to $3.52 billion, with $166 million in net new ARR added during the quarter, reflecting sustained enterprise demand for zero-trust security architecture. Non-GAAP operating margin reached 23%, up from 22% a year ago, underscoring improving profitability even as the company integrates recent acquisitions, including the Red Canary deal that contributed $127 million in ARR. Analysts had been watching AI disruption concerns closely ahead of the print, but deepening partnerships with Anthropic and OpenAI appeared to reinforce Zscaler's positioning in enterprise AI security. Looking ahead, the company raised full-year revenue guidance to approximately $3.33 billion and lifted non-GAAP EPS guidance to $4.10 to $4.11, though it trimmed its free cash flow margin outlook to 22.8% to 23.3%, citing higher capital expenditure plans.
Key Takeaways
- • 25% year-over-year revenue growth to $850.5 million
- • ARR grew 25% to $3,525 million; 21% organic growth excluding Red Canary
- • Non-GAAP operating margin reached all-time high of 23%
- • Free cash flow grew 14% year-over-year to $136.0 million
- • Deferred revenue grew 25% year-over-year to $2,477.2 million
ZS Forward Guidance & Outlook
For Q4 FY2026, Zscaler expects revenue of $875-$878 million (~22% growth), non-GAAP gross margin of ~80%, non-GAAP operating income of $206-$208 million (30-31% growth), and non-GAAP EPS of $1.08-$1.09 (21-22% growth) on ~168 million diluted shares. For full-year FY2026, the company raised guidance: ARR of $3.740-$3.749 billion (~24% growth, up from $3.730-$3.745 billion); revenue of ~$3.3295-$3.3325 billion (24.6-24.7% growth, up from $3.309-$3.322 billion); non-GAAP operating income of $755-$757 million (~30% growth, up from $742-$748 million); non-GAAP EPS of $4.10-$4.11 (25% growth, up from $3.99-$4.02). Free cash flow margin guidance was reduced to 22.8-23.3% from 26.5-27%, reflecting higher capex in the high single-digits as a percent of revenue.
ZS YoY Financials
Q3 2026 vs Q3 2025, source: SEC Filings
“Zscaler is ideally positioned as the cybersecurity platform for the AI era. Our differentiated Zero Trust SASE architecture, which hides applications from attackers and eliminates lateral movement, has never been more essential in securing against threats exposed by frontier models and compromised AI agents.”
— Jay Chaudhry, Q3 2026 Earnings Press Release
ZS Earnings Trends
ZS vs Market 30 Day Price Reactions
30-day stock return vs benchmark after each earnings
ZS EPS Trend
Earnings per share: estimate vs actual
ZS Revenue Trend
Quarterly revenue: estimate vs actual
ZS Quarterly Results
12 quarters of earnings data
| Quarter | EPS Est. | EPS Act. | Surprise | Revenue | Rev. Surprise |
|---|---|---|---|---|---|
| Q3 26 BEAT | $1.01 | $1.08 | +7.11% | $850.5M | +1.77% |
| Q2 26 BEAT | $0.90 | $1.01 | +12.56% | $815.8M | +2.11% |
| Q1 26 BEAT | $0.86 | $0.96 | +11.42% | $788.1M | +1.84% |
| Q4 25 BEAT FY | $0.80 | $0.89 | +11.03% | $719.2M | +1.71% |
| FY Full Year | $3.19 | $3.28 | +2.73% | $2.67B | +0.45% |
| Q3 25 BEAT | $0.76 | $0.84 | +10.77% | $678.0M | +1.64% |
| Q4 24 BEAT FY | $0.69 | $0.88 | +27.54% | $592.9M | +4.39% |
| FY Full Year | — | $3.19 | — | $2.17B | — |
| Q3 23 BEAT | $0.42 | $0.48 | +14.29% | $418.8M | +0.76% |
| Q2 23 | $0.29 | — | — | — | — |
| Q1 23 BEAT | $0.26 | $0.29 | +11.54% | $355.5M | +3.39% |
| Q4 22 | $0.00 | — | — | — | — |
| Q2 22 BEAT | $0.11 | $0.13 | +18.18% | $255.6M | +5.80% |
| Q3 21 BEAT | $0.07 | $0.15 | +114.29% | $176.4M | +7.75% |