ZSZscaler, Inc.
Industry Cyber software Updated 25 Sep 2026 Price 23 Oct 2026
If management hits its targets, one share by the end of 2028
$255 → $278
Promises vs. what happened
15 claims · 8 lettersEvery target management put in a slide deck, and whether they hit it, missed it, or quietly dropped it.
| Promise | Made in | What happened | |
|---|---|---|---|
| FY25 revenue, profit and cash flow | Q1 '25 | beat all three | Held |
| Triple ZTE customers in 18 months | Q2 '25 | three quarters early; 950+ by Q4 '26 | Held |
| Q1 '26 revenue $772-774M | Q4 '25 | $788M | Held |
| FY26 revenue $3.27-3.28B | Q4 '25 | $3.4B, 25% growth | Held |
| FY26 ARR $3.68-3.70B | Q4 '25 | $3.8B | Held |
| AI-Security ARR to well over $400M | Q4 '25 | hit three quarters early | Held |
| Red Canary adds $95M ARR, $90M revenue | Q4 '25 | $144M of revenue; ARR line retired for FY27 | Held |
| Z-Flex grows meaningfully in FY26 | Q4 '25 | $1.7B of TCV booked | Held |
| 40% of H2 net new ARR in Q3 | Q2 '26 | $166M, up 24% | Held |
| Q4 '26 revenue $875-878M | Q3 '26 | $898M | Held |
| AI-Security ARR over $500M by end '26 | Q1 '26 | never reported again; bookings given instead | Dropped |
| FY27 growth 16-17% | Q3 '26 | guided $3.91-3.94B; open | Open |
| FY26 free cash flow margin 26.0-26.5% | Q4 '25 | cut to 23%, then 22.8-23.3% | Missed |
| FY26 capex mid-single-digit % of revenue | Q2 '26 | raised to high single digits | Missed |
| FY27 capex up to +200bps of revenue | Q3 '26 | now low teens, and the cash-flow margin with it | Missed |
What they’re pitching
the headline page, letter by letterThe headline from each quarterly results deck over two years, so you can see what they want you to focus on, and when it changes.
'25Q2
'25Q3
'25Q4
'25Q1
'26Q2
'26Q3
'26Q4
'26
GuidanceOff page one Q3 '26
ARRNew Q2 '25 · Page one since Q1 '26
Rule of 40First seen Q1 '25
AI storyOff page one Q4 '26
ZT customersOff page one Q2 '26
Z-FlexNew Q3 '25 · Page one since Q1 '26
Red CanaryNew Q3 '25 · Page one since Q4 '26
AI threatFirst seen Q3 '26
Data securityOff page one Q1 '26
on the headline page further in the letter not in the letter▲ onto page one▼ off page one● first mentionTap a mark for the quote.
Results against guidance
“Outstanding Q1’25 results for growth and profitability”
Deck Q1'25 Earnings Call Presentation · p. 5 (OCR) ·
Results against guidance
“Q2 exceeds guidance on all metrics”
Deck Q2'25 Earnings Call Presentation · p. 3 (OCR) ·
Results against guidance
“Q3’25 results exceeded guidance on all metrics”
Deck Q3'25 Earnings Call Presentation · p. 3 ·
Results against guidance
“Fiscal Year 2025 results exceeded guidance on all metrics”
Deck Q4'25 Earnings Call Presentation · p. 4 ·
Results against guidance
“Strong start to FY26”
Deck Q1'26 Earnings Call Presentation · p. 3 ·
Results against guidance
“Strong Q2 results with revenue and operating income above guidance1 1. See the Financial Appendix of this shareholder letter for definitions of non -GAAP financial measures and reconciliation.”
Deck Q2'26 Shareholder Letter · p. 3 ·
Results against guidance
“We delivered strong Q3 26 results, growing revenue 25% while investing with discipline. Year-to-date, with 26% revenue growth and a 29% free cash flow margin, we achieved Rule of 55 performance.”
Deck Q3'26 Shareholder Letter · p. 14 ·
Results against guidance
“We delivered strong Q4 results, with revenue and ARR both growing 25% year-over-year, net new ARR growing 24%, and non-GAAP operating margin reaching a record 24.3%.”
Deck Q4'26 Shareholder Letter · p. 15 ·
ARR as the headline number
“ARR growth +23% Y/Y J \ NU ACV Y/Y”
Deck Q2'25 Earnings Call Presentation · p. 4 (OCR) ·
ARR as the headline number
“ARR growth +23% Y/Y”
Deck Q3'25 Earnings Call Presentation · p. 4 ·
ARR as the headline number
“ARR as key business metric”
Deck Q4'25 Earnings Call Presentation · p. 20 ·
ARR as the headline number
“ARR growth of ~26% Y/Y”
Deck Q1'26 Earnings Call Presentation · p. 4 ·
ARR as the headline number
“ARR growth of 25% Y/Y”
Deck Q2'26 Shareholder Letter · p. 3 ·
ARR as the headline number
“ARR growth of 25% Y/Y”
Deck Q3'26 Shareholder Letter · p. 3 ·
ARR as the headline number
“ARR growth of 25% Y/Y”
Deck Q4'26 Shareholder Letter · p. 3 ·
Rule of 40
“Above Rule-of-70 in Q1’25 a”
Deck Q1'25 Earnings Call Presentation · p. 14 (OCR) ·
Rule of 40
“Revenue growth % FCF Margin % Rule of 40”
Deck Q2'25 Earnings Call Presentation · p. 5 ·
Rule of 40
“Operating at rule of 52% for Year-to-date FY25”
Deck Q3'25 Earnings Call Presentation · p. 5 ·
Rule of 40
“Operating at Rule-of-50 for FY25”
Deck Q4'25 Earnings Call Presentation · p. 6 ·
Rule of 40
“Operating at Rule-of-78 for Q1’26”
Deck Q1'26 Earnings Call Presentation · p. 5 ·
Rule of 40
“With 26% revenue growth and a 36% free cash flow margin, we achieved Rule of 62 performance in the first half of the year, placing us among the elite companies that consistently outperform the Rule of 40.”
Deck Q2'26 Shareholder Letter · p. 18 ·
Rule of 40
“We delivered strong Q3 26 results, growing revenue 25% while investing with discipline. Year-to-date, with 26% revenue growth and a 29% free cash flow margin, we achieved Rule of 55 performance.”
Deck Q3'26 Shareholder Letter · p. 14 ·
Rule of 40
“For full year fiscal 2026, revenue also grew 25%, and when combined with 23% free cash flow margin, our performance exceeded the Rule of 40, landing at approximately 49%.”
Deck Q4'26 Shareholder Letter · p. 15 ·
Security for the AI era
“Securing use of AI-apps”
Deck Q1'25 Earnings Call Presentation · p. 6 ·
Security for the AI era
“Security for AI”
Deck Q2'25 Earnings Call Presentation · p. 11 ·
Security for the AI era
“Accelerating our vision of AI-powered SoC”
Deck Q3'25 Earnings Call Presentation · p. 16 ·
Security for the AI era
“AI-Security solutions, including “Security of AI Apps” and “Agentic Operations”, surpassed $250M ARR and expected to grow to well over $400M in FY263”
Deck Q4'25 Earnings Call Presentation · p. 22 ·
Security for the AI era
“On track for $500M+ ARR by FY26”
Deck Q1'26 Earnings Call Presentation · p. 4 ·
Security for the AI era
“Zscaler is the security platform for the AI era”
Deck Q2'26 Shareholder Letter · p. 4 ·
Security for the AI era
“AI is changing the nature of cybersecurity in real time, and Zscaler is the cybersecurity platform for the AI era. This is evident in our results and the reason we are so confident in our long-term potential.”
Deck Q3'26 Shareholder Letter · p. 3 ·
Security for the AI era
“These results reflect increasing market adoption of our Zero Trust platform. AI is quickly becoming the largest tailwind we have ever seen, driving demand for our”
Deck Q4'26 Shareholder Letter · p. 4 ·
Zero Trust Everywhere enterprises
“¢* Ambitious goal to triple the number of “Zero Trust Everywhere” enterprise from 130+ in next 18 months”
Deck Q2'25 Earnings Call Presentation · p. 17 (OCR) ·
Zero Trust Everywhere enterprises
“Goal: 390+ “Zero Trust Everywhere”1 enterprises2 by FY26”
Deck Q3'25 Earnings Call Presentation · p. 12 ·
Zero Trust Everywhere enterprises
“Zero Trust Everywhere surpassed 350 enterprises, outpacing our expectations.”
Deck Q4'25 Earnings Call Presentation · p. 22 ·
Zero Trust Everywhere enterprises
“Zero Trust Everywhere enterprises 3-quarters ahead of schedule”
Deck Q1'26 Earnings Call Presentation · p. 4 ·
Zero Trust Everywhere enterprises
“The number of Zero Trust Everywhere enterprises1 has grown at a rapid pace and now sits at over 550, up from over 130 a year ago.”
Deck Q2'26 Shareholder Letter · p. 12 ·
Zero Trust Everywhere enterprises
“Trust Cloud. We exited Q3 with more than 700 Zero Trust Everywhere enterprises versus over 550 in Q2.”
Deck Q3'26 Shareholder Letter · p. 12 ·
Zero Trust Everywhere enterprises
“We exited Q4 with more than 950 Zero Trust Everywhere enterprises versus over 700 in Q3 and over 350 at the end of fiscal 2025.”
Deck Q4'26 Shareholder Letter · p. 13 ·
Z-Flex bookings
“Z-Flex: Customer benefits”
Deck Q3'25 Earnings Call Presentation · p. 8 ·
Z-Flex bookings
“Z-Flex traction is growing”
Deck Q4'25 Earnings Call Presentation · p. 16 ·
Z-Flex bookings
“+70% Q/Q in Flex bookings”
Deck Q1'26 Earnings Call Presentation · p. 4 ·
Z-Flex bookings
“+65% Q/Q in Z-Flex Bookings”
Deck Q2'26 Shareholder Letter · p. 3 ·
Z-Flex bookings
“RPO grew ~30% Y/Y +60% Q/Q in Z-Flex Bookings”
Deck Q3'26 Shareholder Letter · p. 3 ·
Z-Flex bookings
“RPO grew 27% Y/Y +60% Q/Q in Z-Flex Bookings”
Deck Q4'26 Shareholder Letter · p. 3 ·
Red Canary and organic net new ARR
“Scaling Zscaler’s Platform Vision with Red Canary”
Deck Q3'25 Earnings Call Presentation · p. 16 ·
Red Canary and organic net new ARR
“$95M ARR contribution from Red”
Deck Q4'25 Earnings Call Presentation · p. 21 ·
Red Canary and organic net new ARR
“ARR growth last year. Red Canary exited Q2 with $114 million of ARR.”
Deck Q2'26 Shareholder Letter · p. 19 ·
Red Canary and organic net new ARR
“ARR was $153 million, up 14% year-over-year, and total ARR was also up 21%. Red Canary exited Q3 with $127 million of ARR.”
Deck Q3'26 Shareholder Letter · p. 15 ·
Red Canary and organic net new ARR
“We delivered a strong finish to the fiscal year, with 25% ARR growth and a non-GAAP operating margin of 24%. We are seeing significant positive trends in net new ARR with growth excluding Red Canary accelerating to 17% in Q4.”
Deck Q4'26 Shareholder Letter · p. 3 ·
Frontier AI models as a threat
“Making it even more challenging, new powerful frontier AI models like Mythos are finding security vulnerabilities in software at machine speed, significantly diminishing the effort, skill, and time needed to breach enterprises.”
Deck Q3'26 Shareholder Letter · p. 5 ·
Frontier AI models as a threat
“The time between vulnerabilities being discovered and exploited, is also shrinking. You cannot win a patching race against AI. This is leaving organizations exposed, and likely leads to more breaches.”
Deck Q4'26 Shareholder Letter · p. 4 ·
Data Security Everywhere
“Most comprehensive Data Security Everywhere platform”
Deck Q3'25 Earnings Call Presentation · p. 14 ·
Data Security Everywhere
“Data Security Everywhere ARR”
Deck Q4'25 Earnings Call Presentation · p. 5 ·
Data Security Everywhere
“Data Security Everywhere achieved ARR of ~$450M, driven by consolidation on our unified platform4”
Deck Q1'26 Earnings Call Presentation · p. 23 ·
Data Security Everywhere
“Our third growth pillar is Data Security Everywhere which has eight modules, providing data discovery, data classification, posture management, and data loss prevention.”
Deck Q2'26 Shareholder Letter · p. 15 ·
Data Security Everywhere
“Data Security ARR crossed $500 million”
Deck Q3'26 Shareholder Letter · p. 9 ·
Data Security Everywhere
“Securing data and AI go hand-in-hand as evidenced by the fact that 70% of our Security for AI deals this quarter included our Data Security solution.”
Deck Q4'26 Shareholder Letter · p. 9 ·
What they keep talking about · 11
The themes that show up deck after deck, and the ones that disappear.
- Guidance
- The opening slide of all eight: results exceeded guidance. True every quarter on revenue, and not true on the cash-flow margin.
- ARR
- On the key-metrics slide from Q2 '25, redefined in Q4 '25 and guided from then on in place of calculated billings.
- Rule of 40
- A slide of its own in every deck, one CFO sentence in the letters: about 73, then 78, then 62, 55 and about 49 as the free cash flow margin fell.
- AI story
- In all eight, renamed three times — AI-Security, then AI Protect, then Security for AI. The ARR figure behind it is given twice, then stops.
- ZT customers
- A goal set at 130+ in Q2 '25 and reported every quarter since: 350, 550, 700, then 950+ by Q4 '26. The one target beaten early and kept.
- Z-Flex
- Introduced Q3 '25, on the headline slide from Q1 '26, and always as booked contract value rather than ARR: $65M to $770M+.
- Red Canary
- ARR given for Q2 to Q4 '26 only — $114M, $127M, then $144M of revenue — and the Q3 '26 letter says it will not be reported in FY27.
- AI threat
- New in Q3 '26 and the CEO's opening argument in both Q3 and Q4: frontier models find vulnerabilities at machine speed, so patching cannot keep up.
- Data security
- ARR given in Q4 '25 (~$425M), Q1 '26 (~$450M) and Q3 '26 ($500M+), then replaced in Q4 '26 by the share of AI deals that attach it (70%).
- New
- Q4 '26: the first FY27 guidance, and capex in the low teens as a percent of revenue — the highest the company has guided.
- Quiet
- Calculated billings, AI-Security ARR and Data Security ARR all stopped. Each was a headline number in the quarter before it went.
Every quarterly report we’ve saved · 8
The press releases and shareholder letters behind this page.
- Q4 FY2026 release · 8-K 3 Sep 2026
- Q3 FY2026 release · 8-K 26 May 2026
- Q2 FY2026 release · 8-K 26 Feb 2026
- Q1 FY2026 release · 8-K 25 Nov 2025
- Q4 FY2025 release · 8-K 2 Sep 2025
- Q3 FY2025 release · 8-K 29 May 2025
- Q2 FY2025 release · 8-K 5 Mar 2025
- Q1 FY2025 release · 8-K 2 Dec 2024
Archived as text; the links open the copies filed on EDGAR or the investor-relations site.
What analysts asked them
8 calls · Q1 25 – Q4 26The last eight earnings calls: what analysts kept asking about, which questions got dodged, and how much the CEO did the talking.
Share of questions by topic, call by call. A topic that suddenly dominates is usually the problem. The last row is how much of the answering the CEO did, rather than the CFO or others.
| Share of questions about… | Q1 25 | Q2 25 | Q3 25 | Q4 25 | Q1 26 | Q2 26 | Q3 26 | Q4 26 |
|---|---|---|---|---|---|---|---|---|
| Demand & customers | 35% | 43% | 42% | 31% | 28% | 69% | 36% | 62% |
| Growth & sales | 35% | 30% | 58% | 38% | 28% | 38% | 86% | 69% |
| Pricing & margins | · | · | 8% | · | 7% | · | 14% | · |
| Guidance & outlook | 19% | 13% | 25% | 44% | 24% | 62% | 57% | 38% |
| Capacity & supply | 4% | · | · | · | 3% | · | 7% | · |
| Capital & financing | · | · | · | · | 7% | 15% | 14% | 15% |
| Competition | 8% | 10% | 17% | · | 7% | 8% | 14% | 8% |
| Products & technology | 15% | 27% | 83% | 31% | 24% | 31% | 36% | 69% |
| Macro & regulation | · | 7% | 17% | 6% | · | · | · | · |
| Other | 50% | 43% | · | 25% | 41% | · | 7% | 8% |
| Questions | 26 | 30 | 12 | 16 | 29 | 13 | 14 | 13 |
| How much the CEO talked | 80% | 81% | 78% | 84% | 80% | 60% | 62% | 55% |
Who’s in charge, who’s selling
read from the filings · 1 Oct 2026Shareholder votes against the board and pay, plus which executives have been selling their own shares.
Tier 2 · live
Owners voted to declassify the board; the board has not said it will
The three classes mean a majority of the board cannot be replaced in any one year. At the 2026-01-12 meeting a shareholder proposal to declassify passed, 67.0M for against 63.2M. It is advisory, and nothing filed since says the board has acted. The next proxy, about November 2026, is where that becomes visible.
Tier 2 · stable
About 35% in the founder's family, with no second class of stock
Chaudhry holds 16.8%, almost all through trusts; Ajay Mangal holds 18.2% as trustee of four trusts the proxy says benefit Chaudhry's family. Against that, Vanguard has 7.1%. He has been chief executive and chairman since 2007. One class, one vote — the control is the size of the holding, not a structure.
Tier 2 · worsening
Four of the people who run or report the business changed in eighteen months
The chief financial officer left in June 2025 after eight years; the chief technology officer seat has been empty since mid-2025 with no successor named; Raj Judge resigned as strategy chief and director in April 2026, eleven months in, with no reason given; and Mike Rich hands over the revenue job today for "personal reasons" after two years and eleven months.
Tier 2 · stable
Pay in stock runs at about the whole of free cash flow
Share-based compensation was $822M in FY26, about 24.5% of revenue and 105.5% of free cash flow, with the share count up 3.3% a year over five years and 2.8% annualised in the latest half. The $1.7bn of converts sit outside that, struck at $439.52.
Tier 3 · worsening
Six measures were reported, then dropped
Calculated billings, AI-Security ARR, Data Security Everywhere ARR and emerging-products ARR growth among them; persistence across the eight documents is 0.625. Red Canary's ARR was given for three quarters and the Q3 '26 letter says it stops in FY27.
Where shareholders voted no
At each annual meeting shareholders vote on who sits on the board, what the executives are paid and whether the company may create more shares. These are the votes that drew the most "no"s at the last two meetings: the shares voted against (or withheld) each year, then what share of all votes cast that was. Under each one, what the vote was about and what a no means.
| 2025 | 2026 | Share 2026 | |
|---|---|---|---|
| Brown (Class II)A board seat. Shareholders vote to keep this person on the board, the group that hires, pays and can fire the CEO. A no, or a withheld vote, says they want this director out, often because of the committee they sit on or a decision they signed off. | — | 13.2M withheld | 10.1% |
| Darling (Class II)A board seat. | — | 35.7M withheld | 27.3% |
| Schneider (Class II)A board seat. | — | 23.8M withheld | 18.2% |
| Say on payExecutive pay. Shareholders say whether they accept what the top executives were paid. The vote is advisory: the board can ignore it, but a large no is a public rebuke and boards usually change the pay plan after one. | — | 8.8M against | 6.8% |
| Declassify the board — passedElect the whole board every year. Where only a third of the directors stand each year, it takes three years to replace the board. Annual elections make every seat answerable to shareholders every year, so shareholders gain power; a no keeps the board harder to remove. | — | 63.2M against | 48.5% |
Insiders who sold the most stock
Reported sales by executives and directors, biggest first.
| SEC insider data sets, Jul '25-Jun '26 | Sold | Note |
|---|---|---|
| All insiders | $26.0M | 45 sales by 8 people, and not one purchase |
| Of that, pre-planned | about half | 49.5% under pre-set 10b5-1 plans |
| The founder | not a material seller | his 16.8% is intact; the family trusts' last Form 4 was Jun '25 |