Zscaler Reports Strong Q4 2025 Revenue and Profit Growth

Zscaler (ZS.US) announced strong financial results for its fiscal fourth quarter and fiscal year ended July 31, 2025. The company reported revenue of $719.2 million, marking a 21% year-over-year increase, and non-GAAP net income of $146.7 million, significantly up from $115.8 million in the prior year quarter. Non-GAAP diluted net income per share was $0.89, surpassing the analyst estimate of $0.80.

Key Business Drivers

Zscaler's Annual Recurring Revenue ("ARR") grew 22% year-over-year to $3,015 million, indicating strong customer retention and expansion. Calculated billings also saw significant growth, increasing 32% year-over-year to $1,202.3 million, reflecting robust demand for their cloud security solutions. The company achieved its highest-ever operating margin for a quarter, demonstrating improved operational efficiency.

Key business highlights for the quarter included the acquisition of Red Canary to enhance AI-driven threat intelligence and automation, and the launch of AI-powered security innovations like Zscaler AI Guard. The company also introduced Zscaler Cellular, the industry's first Zero Trust solution to secure IoT/OT connectivity, and extended Zero Trust Everywhere capabilities. These strategic initiatives and product enhancements underscore Zscaler's focus on addressing evolving cyber threats and expanding its market reach.

Management Outlook

For the first quarter of fiscal 2026, Zscaler anticipates revenue between $772 million and $774 million. Non-GAAP income from operations is projected to be between $166 million and $168 million, with non-GAAP net income per share expected to be approximately $0.85 to $0.86. This forward-looking guidance indicates continued growth and profitability for the company.

For the full fiscal year 2026, Zscaler expects Annual Recurring Revenue to be in the range of $3.676 billion to $3.698 billion, and total revenue between $3.265 billion and $3.284 billion. The company forecasts non-GAAP income from operations of $728 million to $736 million, and non-GAAP net income per share between $3.64 and $3.68. These projections highlight management's confidence in the sustained demand for Zscaler's security solutions and their ability to capture market share.