Zscaler posts 25% revenue growth and targets $10 billion ARR by FY31 as valuation reaches 42x earnings
AI Market Summary
Zscaler reported 25% YoY revenue growth above guidance and is nearing GAAP profitability, reinforcing positive cybersecurity demand amid AI-driven security urgency. Management's FY31 $10B ARR target and 27%–30% non-GAAP operating margin goals support a durable mid-teens growth narrative. However, the note flags reduced conviction and highlights that valuation (about 42x earnings, 8.5x sales) is no longer cheap, tempering near-term upside sensitivity.
Impact level
● Low
Affected assets
NCSKZS2USD/USDT+0.86%
AI Insight · NCSKZS2USD/USDTAI Insight
● Neutral
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Zscaler reported 25% year-on-year revenue growth, beating guidance and nearing GAAP profitability. Management said it is targeting $10 billion in ARR by FY31, implying a mid-teens CAGR and 27%–30% non-GAAP operating margins. The stock trades at 42x earnings and 8.5x sales, leaving less room for valuation upside but still pointing to potential double-digit returns.
