Zscaler Stock Falls 4.29% Amid 28.52% Volume Drop, Ranks 326th in U.S. Liquidity

Market Snapshot

Zscaler (ZS) experienced a 4.29% decline in its stock price on November 12, 2025, closing with a notable drop in investor activity. The company’s trading volume fell to $0.34 billion, a 28.52% decrease from the previous day, and ranked 326th in U.S. liquidity. This marked a sharp reversal from the 2.78% gain reported on November 10, which followed the announcement of its acquisition of AI security firm SPLX. While the recent acquisition and expanded AI security capabilities initially drove positive sentiment, the subsequent decline in volume and price suggests a potential consolidation phase or investor caution ahead of broader market adoption metrics or regulatory developments. The muted liquidity levels indicate reduced short-term engagement, despite the strategic significance of Zscaler’s integration of SPLX into its Zero Trust Exchange platform.

Key Drivers

Zscaler’s acquisition of SPLX represents a pivotal expansion in its AI security offerings, positioning the company at the forefront of a rapidly growing market. The integration of SPLX’s technology into Zscaler’s Zero Trust Exchange platform introduces advanced capabilities for securing AI systems across their entire lifecycle, from development to deployment. This move directly addresses escalating concerns among enterprises about vulnerabilities in AI infrastructure, particularly as large-scale models and autonomous agents become more prevalent. By embedding automated red teaming, AI asset discovery, and governance frameworks, Zscaler strengthens its ability to identify and mitigate risks in complex AI ecosystems, aligning with projected global AI security spending exceeding $250 billion by year-end. The acquisition also enhances Zscaler’s competitive edge in a fragmented market, enabling customers to apply unified security policies across AI assets and data pipelines.

The strategic alignment with AI security trends is further underscored by the broader industry’s projected growth in agentic AI infrastructure, expected to expand from $13.81 billion in 2025 to $140.80 billion by 2032. Zscaler’s expansion into AI Runtime Guardrails and Prompt Hardening capabilities allows enterprises to enforce consistent security protocols across agentic workflows and model interactions, addressing compliance challenges and mitigating risks such as model manipulation. This proactive approach to governance positions Zscaler to meet urgent demand for scalable solutions that automate risk assessment and ensure regulatory adherence in hybrid AI environments. The acquisition’s timing is particularly advantageous, as enterprises increasingly prioritize integrated platforms to protect sensitive data and accelerate AI adoption without compromising security.

Analyst optimism has also bolstered confidence in Zscaler’s strategic direction. Barclays and Wedbush Securities both raised price targets for Zscaler’s stock, with Barclays increasing its target to $350 and Wedbush to $350, maintaining “Overweight” and “Outperform” ratings, respectively. These upgrades reflect strong market belief in Zscaler’s ability to capitalize on the AI security boom, supported by its robust financial performance. The company’s fourth-quarter 2025 results highlighted annual recurring revenue exceeding $3 billion, a 22% year-over-year growth rate, and calculated billings expanding 32% to $1.2 billion. Such figures underscore Zscaler’s dominance in securing large-scale corporate operations, with its platform protecting approximately 40% of Global 2000 enterprises.

Despite the recent price decline, Zscaler’s stock remains near its 52-week peak of $336.99, achieved on November 3. This technical strength, combined with strategic acquisitions and favorable analyst sentiment, positions the company for continued market attention in the coming quarters. The upcoming first-quarter 2026 earnings release, scheduled for November 25, will provide critical insights into Zscaler’s ability to sustain its momentum amid evolving market dynamics. Financial experts project earnings per share of $0.85 and revenue of $773.35 million for the quarter ending October, further reinforcing expectations of strong execution.

Zscaler’s CEO, Jay Chaudhry, emphasized the strategic necessity of a unified AI security platform, stating that the acquisition aligns with the industry’s need to secure AI’s full potential. The integration of SPLX’s tools into Zscaler’s ecosystem not only enhances product offerings but also reinforces the company’s reputation as a trusted platform in an era of rapid technological transformation. As enterprises continue to prioritize security in AI investments, Zscaler’s ability to deliver scalable, cohesive solutions will likely determine its long-term success in this high-stakes sector.