Zscaler, Inc. (NASDAQ:ZS) shares are trading lower Wednesday. The company reported fourth-quarter results after the market close on Tuesday.
What To Know: Zscaler reported fourth-quarter adjusted earnings per share of 89 cents, beating the consensus estimate of 80 cents. The cybersecurity company reported revenue of $719.22 million, beating the consensus estimate of $706.90 million.
Zscaler ended the quarter with annual recurring revenue above $3 billion for the first time. The company reported cash from operations of $250.6 million, up from $203.6 million in the prior year, and free cash flow of $171.9 million.
Zscaler said closed its acquisition of Red Canary to strengthen AI-driven threat detection and automation during the quarter. The company also rolled out new products, including AI Guard and Zscaler Cellular, aimed at expanding its Zero Trust security portfolio and addressing emerging risks tied to AI and connected devices.
Zscaler guided for first-quarter adjusted earnings per share of 85 cents to 86 cents, versus the consensus estimate of 84 cents. The company anticipates sales of $772 million to $774 million, versus the consensus estimate of $750.51 million.
Zscaler expects full-year 2026 adjusted earnings per share from $3.64 to $3.68, versus the consensus estimate of $3.18. In addition, the company sees sales of $3.26 billion to $3.28 billion, versus the consensus estimate of $2.65 billion.
Analyst Changes: Following the company’s fourth-quarter earnings report, multiple analysts issued price target adjustments.
- JPMorgan analyst Brian Essex maintained an Overweight rating on Zscaler and raised the price target from $348 to $351.
- Barclays analyst Saket Kalia maintained an Overweight rating on Zscaler and raised the price target from $300 to $320.
- RBC Capital analyst Matthew Hedberg maintained an Outperform rating on Zscaler and raised the price target from $315 to $335.
- BMO Capital analyst Keith Bachman maintained an Outperform rating on Zscaler and raised the price target from $295 to $315.
- Scotiabank analyst Patrick Colville maintained a Sector Outperform and loweeds the price target from $360 to $334.
- UBS analyst Roger Boyd maintained a Buy rating on Zscaler and lowered the price target from $365 to $350.
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ZS Price Action: At the time of publication, Zscaler shares were trading down 2.26% at $268.40, according to data from Benzinga Pro.
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