On September 3, 2024, Zscaler Inc (ZS, Financial) released its 8-K filing reporting financial results for its fiscal fourth quarter and full year ended July 31, 2024. Zscaler, a leading software-as-a-service (SaaS) firm specializing in cloud-native cybersecurity solutions, demonstrated significant growth and resilience in a competitive market.
Company Overview
Zscaler Inc (ZS, Financial) provides cloud-native cybersecurity solutions primarily to enterprise customers. The company's offerings include Zscaler Internet Access, which secures access to external applications, and Zscaler Private Access, which secures access to internal applications. Headquartered in San Jose, California, Zscaler went public in 2018.
Performance and Challenges
Zscaler Inc (ZS, Financial) reported a 30% year-over-year increase in revenue for Q4 2024, reaching $592.9 million, surpassing the analyst estimate of $567.93 million. The company's calculated billings grew by 27% year-over-year to $910.8 million, and deferred revenue increased by 32% to $1,895.0 million. Despite these achievements, Zscaler faced a GAAP net loss of $14.9 million, though this was an improvement from the $30.7 million loss in the same quarter last year.
These results highlight Zscaler's ability to capitalize on the growing demand for cloud security solutions. However, the company must continue to navigate challenges such as maintaining high growth rates and managing operational expenses to achieve profitability.
Financial Achievements
Zscaler's financial achievements are noteworthy in the software industry, where scalability and innovation are critical. The company's non-GAAP net income for Q4 2024 was $140.6 million, up from $100.9 million in Q4 2023. This improvement underscores Zscaler's effective cost management and operational efficiency.
Additionally, Zscaler's cash provided by operations was $203.6 million, representing 34% of revenue, compared to $135.9 million, or 30% of revenue, in Q4 2023. Free cash flow also increased to $136.3 million, or 23% of revenue, from $101.3 million, or 22% of revenue, in the same period last year.
Key Financial Metrics
| Metric | Q4 2024 | Q4 2023 |
|---|---|---|
| Revenue | $592.9 million | $455.0 million |
| GAAP Net Loss | $14.9 million | $30.7 million |
| Non-GAAP Net Income | $140.6 million | $100.9 million |
| Cash Provided by Operations | $203.6 million | $135.9 million |
| Free Cash Flow | $136.3 million | $101.3 million |
| Deferred Revenue | $1,895.0 million | $1,435.0 million |
Analysis and Outlook
Zscaler's strong financial performance in Q4 2024 and the full fiscal year reflects its robust market position and the increasing adoption of its Zero Trust Exchange platform. The company's ability to surpass half a trillion daily transactions further cements its leadership in the cloud security market.
Looking ahead, Zscaler expects revenue for the first quarter of fiscal 2025 to be between $604 million and $606 million, with non-GAAP net income per share estimated at $0.62 to $0.63. For the full fiscal year 2025, the company projects revenue of approximately $2.60 billion to $2.62 billion and non-GAAP net income per share of $2.81 to $2.87.
In conclusion, Zscaler Inc (ZS, Financial) has demonstrated strong financial performance and growth potential, making it an attractive consideration for value investors. For more detailed insights and analysis, visit GuruFocus.com.
Explore the complete 8-K earnings release (here) from Zscaler Inc for further details.
