Zscaler reported stronger-than-expected financial results for its fiscal fourth quarter, with revenue climbing 25% compared to the prior year to approximately $719 million. The cloud security company narrowed its net loss to $3.4 million, or 2 cents per share, compared to a $17.6 million loss, or 11 cents per share, in the same quarter a year prior. Annual recurring revenue reached $3.77 billion, surpassing a $3.75 billion estimate from StreetAccount.
Chief Executive Jay Chaudhry attributed the quarterly performance to growing adoption of the company’s Zero Trust cloud security framework and its technology innovations. He expressed particular enthusiasm about the recently introduced Zero Trust offering designed for AI agents, which he characterized as an early-stage opportunity with potential to accelerate substantially in the coming years. Chaudhry noted that bookings related to AI security totaled $100 million over the past year and grew more than 50% sequentially during the quarter.
Despite beating earnings expectations, Zscaler’s stock experienced a decline on the announcement. The shares have fallen roughly 20% during the year, underperforming peers in the cybersecurity sector that have reached new highs. Chaudhry acknowledged investor skepticism but contended that the market has not fully appreciated the company’s competitive advantages, particularly as artificial intelligence agent adoption expands.
The company issued guidance that exceeded analyst expectations. For the upcoming fiscal first quarter, Zscaler projected revenue between $935 million and $939 million alongside adjusted earnings per share of $1.15 to $1.16, compared to estimates of $927 million in revenue and $1.08 in adjusted EPS. For the full fiscal year, the company expects revenue in the range of $3.91 billion to $3.94 billion and adjusted EPS between $4.86 and $4.90, both above consensus forecasts of $3.90 billion and $4.60 per share, respectively.
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