Zscaler, Inc.

Strong FY26 close + momentum into FY27 (core results) - Q4 revenue: $898M, +25% YoY and +6% sequentially (above the high end of guidance). - Q4 ARR: +$246M net new ARR (+24% YoY); total ARR $3.8B (+25% YoY). - Profitability: Non-GAAP operating margin 24.3% (record); operating margin up 220 bps YoY. FY26 operating margin also improved (non-GAAP 22.9%). - FY26 free cash flow: $779M; free cash flow margin 23% (down from 27% YoY due to cash collection timing and higher CapEx timing, not demand weakness).

AI is the biggest demand tailwind—customer traction is already showing up - Management frames AI risk + agentic AI as structurally increasing urgency for Zero Trust (can’t “patch a patching race against AI”). - They cite assessments: 90% of organizations had AI applications/models/servers exposed to the internet; >1/3 had known exploitable vulnerabilities. - Security for AI bookings accelerated: +50% sequential increase in Q4 (on top of a strong Q3); management says no budget constraints observed. - Early but meaningful product adoption: “Security for AI” deals increasingly include data security—70% of security-for-AI deals in Q4 included data security.

Zero Trust platform expansion beyond users is a key opportunity (non-seat growth + large deal engine) - Growth is broadening from user-centric to branches, workloads, AI agents, and agentic infrastructure. - Non-seat-based metered usage solutions contributed about ~30% of new and upsell ACV, with ARR tied to these offerings >100% YoY. - Zero Trust Everywhere enterprises increased sharply: exited Q4 with >950 vs >700 in Q3 and ~350 end of FY25. - Large deal intensity: record number of $1M+ new ACV deals; $10M+ ARR customers nearly doubled YoY. - Z-Flex momentum: Q4 Z-Flex TCV >$770M (+60% QoQ); FY26 Z-Flex TCV >$1.7B; customers saw ~30% average ARR uplift.