ZSCALER INC (NASDAQ:ZS) Stock Rises on Q4 Earnings Beat Despite Revenue Miss

ZSCALER INC (NASDAQ:ZS) has released its fiscal fourth quarter and full-year 2025 financial results, delivering a performance that has captured significant market attention. The cloud security leader reported both revenue and earnings per share figures that notably diverged from analyst expectations, contributing to observable price movements in after-hours trading.

Earnings and Revenue Performance Versus Estimates

For the quarter ended July 31, 2025, Zscaler reported revenue of $719.2 million. This represents a solid 21% year-over-year increase, underscoring the company's continued growth trajectory in the competitive cybersecurity market. However, this figure came in slightly below the analyst consensus estimate of approximately $728.1 million.

A more decisive beat was recorded on the bottom line. The company reported non-GAAP earnings per share (EPS) of $0.89, comfortably surpassing the Wall Street estimate of $0.82. This earnings outperformance suggests stronger-than-anticipated profitability, potentially driven by operational efficiencies, effective cost management, or a favorable sales mix during the quarter.

Market Reaction and Price Action

The market's initial reaction, as evidenced by after-hours trading, has been decidedly positive. The stock was up approximately 3.6% following the earnings announcement. This positive momentum indicates that investors are weighing the significant EPS beat more heavily than the slight revenue miss. The market appears to be rewarding the company's ability to translate its sales into profit effectively. This short-term price action suggests a collective investor sentiment that views the quarter's fundamentals as strong overall.

Summary of Key Press Release Highlights

The company's official announcement highlighted several critical achievements beyond the raw financial numbers:

• Strong Top-Line Growth: The 21% year-over-year revenue growth reaffirms the sustained demand for Zscaler's cloud-native security platform.
• Annual Recurring Revenue (ARR): The press release emphasized growth in ARR, a key metric for SaaS companies that indicates the predictable revenue generated from subscriptions. A healthy ARR points to strong customer retention and expansion.
• Market Leadership Position: Zscaler continues to position itself as "the leader in cloud security," a claim supported by its ongoing innovation and large customer base.

Forward-Looking Guidance and Analyst Expectations

While the press release summary did not explicitly detail the company's own internal guidance, external analyst estimates provide a benchmark for the future. Analysts are forecasting sales of approximately $773 million for the upcoming Q1 2026. For the full fiscal year 2026, the sales estimate stands at around $3.3 billion. The market will be closely monitoring whether Zscaler's official forward guidance, typically provided in the full earnings report, aligns with or exceeds these analyst projections. Guidance that meets or surpasses these figures could serve as a further catalyst for the stock.

The quarterly earnings cycle is a crucial pulse check for any company. For a deeper dive into Zscaler's historical performance, future estimates, and a more detailed breakdown of these results, you can review more earnings and estimates data here.

Disclaimer: This article is for informational purposes only and does not constitute financial advice, investment recommendation, or an offer to buy or sell any security. The performance data and estimates are based on publicly available information and are subject to change. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions.