Zscaler (ZS) Q3 2026 Earnings
How Did ZS Stock React to Q3 2026 Earnings?
S&P 500 over the same 30 days: −1.26%.
Did ZS Beat Earnings? Q3 2026 Results
Yes. Zscaler reported Q3 2026 earnings of $1.08 a share on May 26, 2026, beating the $1.01 consensus estimate by 7.1%. Revenue was $850.5M against a $835.7M estimate.
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.
- 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
“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.”
Zscaler CEO, on the earnings call
What Was Zscaler's Outlook in Q3 2026?
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
| Metric | Q3 2026 | Q3 2025 | Year over year |
|---|---|---|---|
| Revenue | $850.5M | $678.0M | +25.4% |
| Gross Profit | $657.8M | $522.2M | +26.0% |
| Operating Income | −$29.6M | −$43.7M | −32.2% |
Figures from SEC filings and company reports. Not investment advice.