Zscaler Q4 earnings: ‘sitting in front of large secular growth opportunity’

Shares of Zscaler Inc (NASDAQ: ZS) ticked up in extended trading after the cloud security company reported market-beating results for its fourth financial quarter.

Zscaler stock up on encouraging guidance

The stock is gaining in after-hours also because the management issued upbeat guidance for the future. Zscaler now forecasts its revenue to fall between $2.05 billion and $2.07 billion on $2.20 to $2.25 of per-share earnings.

Analysts, in comparison, were at $2.05 billion and $2.11 a share, respectively. The stock market news arrives about a month after BTIG analyst Gray Powell said Zscaler stock had upside to $185.

We are confident in Zscaler’s ability to maintain leadership position in the SSE market despite headlines on increasing competition. Data points on emerging products (ZDX) were encouraging.

The Nasdaq-listed firm expects up to $2.56 billion worth of billings in its fiscal 2024 – also ahead of Street estimates.

Notable figures in Zscaler Q4 earnings release

• Lost $30.7 million versus the year-ago $97.7 million
• Per-share loss also declined from 69 cents to 21 cents
• Adjusted EPS printed at 64 cents as per the press release
• Revenue jumped 43% year-on-year to $455 million
• Consensus was 49 cents a share on $429 million revenue

Zscaler saw a 38% annualised growth in bookings in its recently concluded quarter to $719.3 million – some $62 million above expectations. BTIG’s Powell also said in his recent research note:

We think Zscaler is sitting in front of large secular growth opportunity as network security architectures migrate towards cloud environments over the next five years.