Zscaler reported fourth quarter revenue of $898.2 million, surpassing consensus estimates, though non-GAAP EPS of $1.19 fell slightly short of analyst expectations. Despite achieving a record non-GAAP operating margin of 24%, management provided a conservative outlook for fiscal year 2027, projecting revenue growth to moderate to approximately 17%. The company also announced a 3% reduction in its global workforce to reallocate resources toward AI and strategic growth initiatives.
Key Highlights
- Fourth quarter revenue grew 25% year-over-year to $898.2 million, beating the $892.0 million estimate.
- Annual Recurring Revenue (ARR) reached $3.77 billion, up 25% year-over-year, though organic growth excluding the Red Canary acquisition was lower at 20%.
- Management committed to a restructuring plan to reduce global headcount by 3%, incurring up to $33 million in charges to pivot capacity toward AI.
- Full-year fiscal 2027 revenue guidance of $3.908 billion to $3.938 billion indicates a significant deceleration from the 25% growth seen in fiscal 2026.