Zscaler reported fiscal first-quarter earnings and revenue that topped Wall Street targets for ZS stock amid strong federal government sales. The cybersecurity firm's guidance for Zscaler stock edged by views amid high expectations.
Reported after the market close on Monday, Zscaler earnings rose 131% to 67 cents a share from a year earlier on an adjusted basis. Revenue climbed 40% to $496.7 million, the San Jose, Calif.-based firm said.
ZS stock analysts expected earnings of 49 cents per share on sales of $473.4 million.
Also, billings rose 34% to $456.6 million, compared with estimates for $442.7 million. Despite the billings beat, Zscaler kept full fiscal year 2024 billings guidance at 25% growth to $2.540 billion.
ZS Stock: Management Changes
For the current quarter ending in January, Zscaler said it expects earnings per share in the range of 57 cents to 58 cents, ahead of estimates for 52 cents a share.
Zscaler said it expects revenue of $506 million at the midpoint of guidance. Analysts had predicted revenue of $496.7 million.
Also, Zscaler plans to ramp up sales and marketing.
The company has hired a new chief revenue officer, Mike Rich, formerly at ServiceNow. It also has hired a new chief marketing officer, Joyce Kim, from Twilio.
On the stock market today, ZS stock fell 4.6% to 183.10 in early trading.
Heading into the Zscaler earnings release, the cybersecurity stock had gained 73% in 2023. Also, Zscaler stock had a Relative Strength Rating of 96 out of a best-possible 99, according to IBD Stock Checkup.
Zscaler provides cloud-based cybersecurity services via 150 data centers worldwide. Zscaler's web security gateways inspect customers' data traffic for malware.
Further, the Zscaler Private Access, or ZPA cloud service, replaces virtual private networks, or VPNs, to support remote work.
Zscaler competes with Palo Alto Networks and Microsoft.
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