Zscaler: zero trust cloud accelerated ARR in 4Q

Zscaler: zero trust cloud accelerated ARR in 4Q

Title: Zscaler Accelerates ARR Growth in Fourth Quarter 2025

Zscaler, Inc. (Nasdaq: ZS), a leading provider of cloud security solutions, reported its financial results for the fiscal fourth quarter and fiscal year ended July 31, 2025. The company experienced robust growth in its Annual Recurring Revenue (ARR), driven by strong demand for its Zero Trust and AI security solutions.

In the fourth quarter, Zscaler's revenue grew by 21% year-over-year to $719.2 million. This growth was supported by a 22% increase in ARR to $3,015 million, and a 32% increase in calculated billings to $1,202.3 million. The company's deferred revenue also grew by 30% year-over-year to $2,468.0 million.

Despite these positive financial indicators, Zscaler reported a GAAP net loss of $17.6 million for the quarter, compared to a GAAP net loss of $14.9 million in the same period last year. However, the company's non-GAAP net income for the quarter was $146.7 million, compared to $115.8 million in the same period last year.

Zscaler's cash flows also improved, with cash provided by operations growing by 35% to $250.6 million, and free cash flow increasing by 24% to $171.9 million. The company's cash, cash equivalents, and short-term investments totaled $3,572.4 million as of July 31, 2025, an increase of $1,162.8 million from July 31, 2024.

Zscaler's full-year fiscal 2025 revenue grew by 23% year-over-year to $2,673.1 million. The company's ARR for the year increased by 22% to $3,015 million, and its calculated billings grew by 32% to $1,202.3 million. The company's deferred revenue for the year grew by 30% to $2,468.0 million.

Zscaler's financial performance was driven by several strategic initiatives, including the acquisition of Red Canary, the launch of AI-powered security innovations, and the introduction of new Zero Trust solutions. These initiatives have positioned Zscaler as a leader in cloud security, empowering enterprises to defend against evolving threats while driving safe, transformative AI innovation.

Zscaler's financial outlook for the first quarter of fiscal 2026 is optimistic, with the company expecting revenue of $772 million to $774 million, non-GAAP income from operations of $166 million to $168 million, and non-GAAP net income per share of approximately $0.85 to $0.86. For the full year fiscal 2026, Zscaler expects ARR of $3,676 billion to $3,698 billion, revenue of approximately $3,265 billion to $3,284 billion, non-GAAP income from operations of $728 million to $736 million, and non-GAAP net income per share of $3.64 to $3.68.

Zscaler's strong financial performance and strategic initiatives position the company well for continued growth in the cloud security market. As the leader in cloud security, Zscaler empowers enterprises to modernize securely with unmatched Zero Trust capabilities.

References
[1] https://www.morningstar.com/news/globe-newswire/9521937/zscaler-reports-fourth-quarter-and-fiscal-2025-financial-results