Zscaler Inc
Q3 2021 Earnings
Did ZS Beat Earnings? Q3 2021 Results
Zscaler delivered a standout third quarter of fiscal 2021, posting non-GAAP EPS of $0.15 against a consensus estimate of $0.07, a beat of 114.29%, while revenue climbed 59.6% year-over-year to $176.40 million, ahead of the $163.71 million Wall Street had expected. The primary engine behind the results was accelerating enterprise adoption of its Zero Trust Exchange platform, with calculated billings surging 71% year-over-year to $225.02 million and free cash flow expanding sharply to $55.78 million, representing a 32% margin compared to just 8% a year ago. Non-GAAP operating margin widened to 13% from 9% in the prior-year period, reflecting growing leverage in the subscription model. The company also announced plans to acquire deception technology specialist Smokescreen Technologies, adding active defense capabilities against ransomware to its security portfolio. Looking ahead, Zscaler raised its full-year fiscal 2021 revenue guidance to $660 million to $664 million, with fourth-quarter revenue expected in the range of $185 million to $187 million.
- Revenue growth accelerated to 60% year-over-year
- Calculated billings grew 71% year-over-year to $225.0 million
- Deferred revenue grew 65% year-over-year to $495.4 million
- Free cash flow margin expanded to 32% from 8% year-over-year
- Non-GAAP operating margin expanded to 13% from 9% year-over-year
- Work-from-anywhere economy driving zero trust adoption
“We delivered outstanding results for the third quarter, with revenue growth accelerating to 60% year over year and free cash flow reaching a new record. Our Zero Trust Exchange platform is helping customers realize their digital transformation goals and architect for the new normal of the work-from-anywhere economy.”
Zscaler CEO, on the earnings call
Forward Guidance & Outlook
For Q4 fiscal 2021, Zscaler expects revenue of $185 million to $187 million, non-GAAP income from operations of $13.5 million to $14.5 million, and non-GAAP EPS of approximately $0.08 to $0.09 on approximately 146 million diluted shares. For full-year fiscal 2021, guidance was raised to revenue of $660 million to $664 million, calculated billings of $878 million to $880 million, non-GAAP income from operations of $71 million to $72 million, and non-GAAP EPS of $0.47 on approximately 145 million diluted shares.
ZS YoY Financials
Figures from SEC filings and company reports. Not investment advice.