Zscaler (NASDAQ:ZS) Releases Quarterly Earnings Results, Misses Expectations By $0.95 EPS

Zscaler (NASDAQ:ZS) posted its quarterly earnings data on Thursday. The company reported $0.14 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.09 by ($0.95), Zacks reports. Zscaler had a negative return on equity of 0.37% and a negative net margin of 2.44%.

Zscaler Stock Up 2.9%

Shares of NASDAQ:ZS traded up $5.07 during mid-day trading on Thursday, reaching $177.80. 6,878,209 shares of the stock were exchanged, compared to its average volume of 3,332,915. The company has a quick ratio of 1.86, a current ratio of 1.86 and a debt-to-equity ratio of 0.72. The company has a market cap of $28.75 billion, a P/E ratio of -370.41, a P/E/G ratio of 104.98 and a beta of 0.95. Zscaler has a one year low of $114.63 and a one year high of $336.99. The stock’s 50 day simple moving average is $159.43 and its 200-day simple moving average is $150.39.

Key Stories Impacting Zscaler

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Quarterly earnings beat expectations. Zscaler exceeded Wall Street’s fiscal fourth-quarter estimates, providing the primary catalyst for the stock’s move higher. Zscaler stock soars on earnings beat, upbeat guidance
• Positive Sentiment: Growth remained strong. Zscaler reported 25% year-over-year growth in both fourth-quarter and fiscal-year revenue, while annual recurring revenue also increased 25% year over year. Sustained ARR growth supports the company’s recurring-revenue model and long-term expansion story. Zscaler Announces Strong Fourth Quarter and Fiscal 2026 Financial Results
• Positive Sentiment: Outlook and product momentum improved investor confidence. Management issued upbeat guidance, and CEO Jay Chaudhry said Zscaler’s agentic security tool is gaining momentum. The comments suggest potential for additional growth from newer artificial-intelligence-related security offerings. Zscaler stock soars on earnings beat, upbeat guidance
• Neutral Sentiment: Pre-earnings coverage focused on whether guidance would be the key metric, reflecting Zscaler’s history of being penalized when its forecasts appeared overly conservative. The stronger report and outlook appear to have addressed that concern for now. Bull v. Bear: ZS Faces Low Earnings Bar, Guidance Will be Biggest Metric
• Negative Sentiment: Some analysts had adopted a more cautious stance ahead of the earnings release, creating a risk of disappointment. That concern was a potential headwind, although the earnings beat and upbeat guidance have reduced its immediate impact. Analysts turn cautious ahead of Zscaler’s Q4 print

Insider Transactions at Zscaler

In other Zscaler news, CEO Jagtar Singh Chaudhry sold 2,878 shares of the business’s stock in a transaction that occurred on Tuesday, June 16th. The stock was sold at an average price of $126.43, for a total value of $363,865.54. Following the sale, the chief executive officer owned 343,038 shares in the company, valued at approximately $43,370,294.34. The trade was a 0.83% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Robert Schlossman sold 3,146 shares of the company’s stock in a transaction that occurred on Tuesday, June 16th. The stock was sold at an average price of $126.43, for a total value of $397,748.78. Following the transaction, the insider directly owned 69,366 shares of the company’s stock, valued at approximately $8,769,943.38. This trade represents a 4.34% decrease in their position. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last quarter, insiders have sold 16,772 shares of company stock worth $2,139,799. 17.20% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

Several large investors have recently added to or reduced their stakes in the business. Binnacle Investments Inc bought a new position in Zscaler in the third quarter valued at $25,000. AlphaCentric Advisors LLC acquired a new stake in Zscaler in the 4th quarter valued at $29,000. Mcguire Capital Advisors Inc. bought a new stake in Zscaler during the 4th quarter worth about $32,000. Strive Financial Group LLC bought a new stake in Zscaler during the 4th quarter worth about $39,000. Finally, Sumitomo Mitsui Financial Group Inc. boosted its stake in shares of Zscaler by 105.5% during the 4th quarter. Sumitomo Mitsui Financial Group Inc. now owns 215 shares of the company’s stock worth $49,000 after buying an additional 4,111 shares during the last quarter. Institutional investors and hedge funds own 46.45% of the company’s stock.

Wall Street Analysts Forecast Growth

Several brokerages recently weighed in on ZS. Rosenblatt Securities restated a “buy” rating and issued a $200.00 price objective on shares of Zscaler in a report on Wednesday, June 10th. Mizuho lifted their target price on Zscaler from $185.00 to $210.00 and gave the stock an “outperform” rating in a report on Wednesday, August 19th. Piper Sandler cut their price objective on Zscaler from $185.00 to $160.00 and set a “neutral” rating on the stock in a report on Wednesday, May 27th. Truist Financial set a $210.00 price objective on Zscaler in a research report on Wednesday, May 27th. Finally, Stephens reissued an “overweight” rating and set a $200.00 target price on shares of Zscaler in a research note on Friday, June 12th. Thirty-four investment analysts have rated the stock with a Buy rating, six have assigned a Hold rating and one has issued a Sell rating to the company’s stock. According to data from MarketBeat, Zscaler presently has a consensus rating of “Moderate Buy” and a consensus target price of $213.10.

Zscaler Company Profile

Zscaler is a cloud security company that delivers a cloud-native platform to protect users, applications and data as organizations move away from traditional, network-centric security architectures. The company focuses on a zero trust approach that assumes no implicit trust for users or devices, providing secure access to the internet, SaaS applications and private applications regardless of where users are located. Zscaler positions its services as an alternative to legacy appliances and site-centric VPNs, aiming to simplify security while enabling modern, distributed workforces.

Key offerings are built around the Zscaler Zero Trust Exchange, a multi-tenant cloud platform that enforces security and access policies in-line.