Zscaler(NASDAQ) ZS

Zscaler NASDAQ:ZS helps businesses protect their data and users from online threats. It makes a cloud-based shield that replaces old office security systems. This platform connects workers to applications safely from any location.

Tools for the AI Era

• Internet Access: Secure gateways for workers to reach external websites and software; accounts for part of the 98% of revenue from subscriptions.
• Private Access: Connection tools that link users directly to private internal apps without using a risky corporate network.
• Digital Experience: Monitoring software that tracks how well applications are working for employees across different locations.
• Security for AI: Visibility and control tools that help organizations manage how their teams use artificial intelligence models.
• Data Protection: Safety features that stop sensitive information from being leaked or shared without permission.

Recent Growth and Moves

• Expanded the customer base to approximately 11,000 organizations by July 31, 2026.
• Introduced Zero Trust SASE to combine security and networking into one cloud-managed console.
• Launched Security for AI to govern the use of autonomous agents and models.
• Acquired new technologies and integrated them to enhance the functionality of the cloud platform.
• Completed a private offering of $1.7 billion in convertible senior notes in July 2025.

Scale as a Strength

Zscaler operates a global network across more than 200 data centers to process over 750 billion transactions every day. This large scale allows the platform to identify and block new threats for all customers at once.

How the Money Looks

• Revenue was $3.4 billion in fiscal year 2026, up 25% year over year.
• Net loss was $63.2 million in fiscal year 2026, compared to a $41.5 million loss in fiscal year 2025.
• Annual recurring revenue reached $3.8 billion as of July 31, 2026, up from $3.0 billion the previous year.
• Free cash flow was $779.1 million in fiscal year 2026, representing a 23% margin.

Bottom Line

Zscaler has moved beyond basic web security to provide a comprehensive zero trust platform for users, workloads, and artificial intelligence. Its shift toward an integrated security service helps modern enterprises operate safely without traditional office perimeters.