Companies /Technology

Zscaler Inc

NASDAQ: ZS Software - Infrastructure
$182.08
▼ $5.22 (−2.79%) today
Markets open · 10:24am ET

Q3 2023 Earnings

Reported Jun 1, 2023, 4:07pm ET · SEC source
$0.48
Beat +14.29%
EPS · est. $0.42
$418.8M
Beat +0.76%
Revenue · est. $415.7M
−3.2%
Trailing market
ZS vs S&P since report
10 quarters
Consecutive EPS beats

Market Reaction

% change · around the report
0+4%+8%+12%Jun 1Jun 2report 4:07pm ETearnings+1.4%+8.3%
0+4%+8%+12%Jun 1Jun 2earnings+1.4%+8.3%
ZS +8.3%S&P 500 +1.4%
0+4%+8%+12%Jun 1Jun 2report 4:07pm ETearnings+0.6%+8.1%
0+4%+8%+12%Jun 1Jun 2earnings+0.6%+8.1%
ZS +8.1%NASDAQ +0.6%
0+6%+12%May 31Jun 9report 4:07pm ETearnings+1.8%+11.9%
0+6%+12%May 31Jun 9earnings+1.8%+11.9%
ZS +11.9%S&P 500 +1.8%
0+6%+12%May 31Jun 9report 4:07pm ETearnings+0.6%+11.9%
0+6%+12%May 31Jun 9earnings+0.6%+11.9%
ZS +11.9%NASDAQ +0.6%
+5.40%
Day of report
+3.97%
Next session
+5.93%
One week
−0.46%
30 days

S&P 500 over the same 30 days: +2.74%.

Did ZS Beat Earnings? Q3 2023 Results

Zscaler posted a strong fiscal third quarter, with non-GAAP earnings per share of $0.48 beating the $0.42 consensus estimate by 14.29%, while revenue of $418.80 million edged past the $415.66 million consensus and grew 46.0% year over year. The headline driver behind the profitability improvement was a significant expansion in non-GAAP operating margin, which widened to 15% from 9% in the year-ago quarter as revenue leverage outpaced growth in operating expenses, helping lift free cash flow to $73.89 million. Calculated billings rose 40% to $482.29 million and deferred revenue climbed 44% to $1.18 billion, offering visibility into future revenue momentum. The company also raised its full-year fiscal 2023 revenue outlook to approximately $1.59 billion and increased its non-GAAP EPS guidance to $1.63 to $1.64, while projecting fourth-quarter revenue of $429.00 million to $431.00 million and non-GAAP EPS of roughly $0.49, signaling that management expects the current growth trajectory to continue into the final quarter.

Key Takeaways
  • 46% year-over-year revenue growth driven by customer adoption of Zero Trust security platform across all sectors globally
  • 135% year-over-year non-GAAP operating profit growth
  • 40% year-over-year calculated billings growth to $482.3 million
  • 44% year-over-year deferred revenue growth to $1,175.4 million

“The business value delivered by our Zero Trust security platform is continuing to drive customer adoption across all sectors globally, leading to another quarter of strong growth. On a year-over-year basis, we delivered 46% revenue growth, 40% billings growth, and 135% operating profit growth, all exceeding our guidance from last quarter.”

Zscaler CEO, on the earnings call

Forward Guidance & Outlook

For Q4 fiscal 2023, Zscaler expects revenue of $429 million to $431 million, non-GAAP income from operations of $69 million to $70 million, and non-GAAP EPS of approximately $0.49 on ~157 million diluted shares. For full-year fiscal 2023, the company expects revenue of approximately $1.591 billion to $1.593 billion, calculated billings of $1.974 billion to $1.978 billion, non-GAAP income from operations of $224 million to $225 million, and non-GAAP EPS of $1.63 to $1.64 on ~156 million diluted shares.

ZS YoY Financials

Q3 2023 vs Q3 2022 · SEC filings Q3 2022 Q3 2023
$0$200.0M$400.0M$286.8M$418.8MRevenue$222.5M$323.0MGross Profit$-41,101,526$-55,746,000Operating Income$-29,785,885$-46,046,000Net Income
$0$200.0M$400.0MRevenueGross ProfitOperating IncomeNet Income

Figures from SEC filings and company reports. Not investment advice.