Companies /Technology

Zscaler Inc

NASDAQ: ZS Software - Infrastructure
$184.23
▼ $3.07 (−1.64%) today
Markets closed · 6:39pm ET

Q1 2026 Earnings

Reported Nov 25, 2025, 4:07pm ET · SEC source
$0.96
Beat +11.42%
EPS · est. $0.86
$788.1M
Beat +1.84%
Revenue · est. $773.9M
−10.8%
Trailing market
ZS vs S&P since report
10 quarters
Consecutive EPS beats

Market Reaction

% change · around the report
−5%0+5%+10%Nov 25Nov 26report 4:07pm ETearnings+0.8%−5.6%
−5%0+5%+10%Nov 25Nov 26earnings+0.8%−5.6%
ZS −5.6%S&P 500 +0.8%
−5%0+5%+10%Nov 25Nov 26report 4:07pm ETearnings+1.0%−5.6%
−5%0+5%+10%Nov 25Nov 26earnings+1.0%−5.6%
ZS −5.6%NASDAQ +1.0%
−12%−6%0+6%Nov 24Dec 3report 4:07pm ETearnings+1.3%−9.8%
−12%−6%0+6%Nov 24Dec 3earnings+1.3%−9.8%
ZS −9.8%S&P 500 +1.3%
−12%−6%0+6%Nov 24Dec 3report 4:07pm ETearnings+2.4%−9.8%
−12%−6%0+6%Nov 24Dec 3earnings+2.4%−9.8%
ZS −9.8%NASDAQ +2.4%
−13.03%
Day of report
−0.19%
Next session
−4.02%
One week
−9.74%
30 days

S&P 500 over the same 30 days: +1.08%.

Did ZS Beat Earnings? Q1 2026 Results

Zscaler delivered a strong fiscal first quarter of 2026, posting revenue of $788.11 million, up 25.5% year over year and ahead of the $773.86 million consensus estimate, while non-GAAP EPS of $0.96 cleared the $0.86 consensus by 11.42%, underscoring <a href="https://247wallst.com/investing/2025/11/25/zs-pre_earnings/">broad-based momentum across the business</a>. The results were driven in large part by sustained enterprise demand for Zscaler's Zero Trust and AI Security platform, with Annual Recurring Revenue climbing 26% year over year to $3.20 billion and deferred revenue growing 32% to $2.35 billion, signaling robust bookings. The quarter also featured two acquisitions, Red Canary and SPLXAI, for a combined $692.00 million, extending the company's managed detection and AI security capabilities. Free cash flow reached $413.30 million, representing a 52% margin. Despite the clean beat, shares came under pressure as investors found little to get excited about in guidance that largely met rather than exceeded expectations; for Q2, Zscaler guided revenue of $797 million to $799 million and full-year revenue of $3.28 billion to $3.30 billion, with non-GAAP EPS of $3.78 to $3.82.

Key Takeaways
  • Strong demand for Zero Trust and AI Security platform
  • 26% year-over-year ARR growth to $3.204 billion
  • 32% year-over-year deferred revenue growth indicating strong bookings
  • Free cash flow margin expansion to 52% from 46% year-over-year
  • Increasing customer reliance on platform for security, lower costs, and reduced IT complexity

“Our outstanding Q1 results demonstrate the strong demand we are experiencing for our Zero Trust and AI Security platform. With over $3.2B in Annual Recurring Revenue, growing over 25% year-over-year, and Rule-of-78 performance, I'm very pleased to share that an increasing number of customers are relying on our platform for better security, lower operational costs and reduced IT complexity.”

Zscaler CEO, on the earnings call

Forward Guidance & Outlook

For Q2 FY2026, Zscaler expects revenue of $797M–$799M, non-GAAP operating income of $172M–$174M, and non-GAAP EPS of approximately $0.89–$0.90 on ~170M diluted shares. For full-year FY2026, the company expects ARR of $3.698B–$3.718B, revenue of approximately $3.282B–$3.301B, non-GAAP operating income of $732M–$740M, and non-GAAP EPS of $3.78–$3.82 on ~170.5M diluted shares, all using a 21% non-GAAP tax rate.

ZS YoY Financials

Q1 2026 vs Q1 2025 · SEC filings Q1 2025 Q1 2026
$0$300.0M$600.0M$628.0M$788.1MRevenue$485.6M$603.4MGross Profit$-42,320,764$-36,362,000Operating Income$-11,209,226$-11,615,000Net Income
$0$300.0M$600.0MRevenueGross ProfitOperating IncomeNet Income

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