Zscaler, Inc. (ZS)
NASDAQInformation TechnologySoftware - InfrastructureSnapshot 2026-09-09
$166.10+2.57%
Close 2026-09-09 · 1-day change
NASDAQInformation TechnologySoftware - InfrastructureSnapshot 2026-09-09
Intact: The reason to own it still holds.
Zscaler aims for $3.33B revenue in fiscal 2026. Profit should rise toward $757M. EPS target is about $4.10 per share. Recent wins and AI opportunities support growth.
Revenue growth may slow due to challenges. Profit gains could stall. The recent guidance cut warns of risks ahead.
The price is about 12% above our fair value near $135. Analysts expect 21% revenue growth. Our fair value is 25% below the Street median.
Breaks if: EPS falls below $3.50 in FY26
Target non-GAAP net income per share of approximately $4.10 for fiscal 2026, reflecting earnings growth and operational leverage.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a speculative growth opportunity. The current thesis state is cautious, as the company has shown some momentum but has recently missed earnings expectations.
The market appears to be pricing in a justified valuation with a low expectations gap. ZS is valued at a premium compared to its peers, indicating that investors may have high hopes for its future performance.
Management is on track to meet its revenue and earnings targets, despite being loss-making overall. However, the recent earnings miss raises concerns about the company's ability to maintain this trajectory in the near term.
The long-term thesis hinges on the company's ability to avoid further earnings misses and the potential impact of external factors, such as Federal Reserve interest rate cuts and performance from leading tech companies.
The most important moves since the prior daily snapshot.
Company momentum rose by 19.0 points (from -24.2 to -5.2).
Yes, our read has strengthened. The latest earnings beat supports this view. Zscaler reported $898 million in revenue, growing 25% year-over-year. The company also achieved a record operating margin of 24.3%. Net new annual recurring revenue growth accelerated to 17% in Q4. This growth excludes the impact of the Red Canary acquisition. There are no new threats identified that weaken the read.
as of 2026-09-09
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Stated as a priority in 3 of last 3 quarters. Non-GAAP EPS increased from $3.28 in 2025 to $4.21 in 2026, consistent with guidance of $4.10 to $4.11. Management is delivering earnings growth aligned with stated expectations.
“Non-GAAP net income per share was $4.21, compared to $3.28 in fiscal 2025.”
“For the full year of fiscal 2026, the company expects: Non-GAAP net income per share of $4.10 to $4.11.”
“For the full year of fiscal 2026, we expect: Non-GAAP net income per share of $3.99 to $4.02.”
Breaks if: Operating income stays negative or below $500M in FY26
Drive non-GAAP income from operations to approximately $757 million for fiscal 2026, improving operating margin and profitability.
Stated as a priority in 3 of last 3 quarters. Non-GAAP income from operations increased from $580.1M in 2025 to $767.1M in 2026, exceeding the guidance range of $755M to $757M. Management is delivering improved operating profitability consistent with stated goals.
“Non-GAAP income from operations was $767.1 million, or 23% of revenue, compared to $580.1 million in fiscal 2025.”
“For the full year of fiscal 2026, the company expects: Non-GAAP income from operations of $755 million to $757 million.”
“For the full year of fiscal 2026, we expect: Non-GAAP income from operations of $742 million to $748 million.”
Breaks if: Revenue falls below $3.0B in FY26
Continue growing revenue to reach approximately $3.33 billion for fiscal year 2026, reflecting strong year-over-year growth.
Stated as a priority in 3 of last 3 quarters. Revenue grew from $2.67B in 2025-Q4 to $3.35B in 2026-Q4, a 25% increase, matching management's guidance range of approximately $3.33B for fiscal 2026. The trajectory is delivering consistent growth aligned with stated targets.
“Full Year Fiscal 2026 Results: Revenue grew 25% year over year to $3,353 million.”
“For the full year of fiscal 2026, the company expects: Revenue of approximately $3.3295 billion to $3.3325 billion.”
“For the full year of fiscal 2026, we expect: Revenue of approximately $3.282 billion to $3.301 billion.”
In the next 1 to 3 years, ZS will need to demonstrate consistent performance to regain investor confidence. Not investment advice.