Zscaler Stock Jumps Premarket After Beat-And-Raise Q2: Retail Optimism Abounds

Zscaler, Inc. (ZS) stock climbed in Thursday’s premarket after the cybersecurity vendor announced forecast-beating quarterly results and issued upbeat forward guidance.

The San Jose, California-based company reported adjusted earnings per share (EPS) of $0.78 for the second quarter (Q2) of the fiscal year 2025. This compares to the year-ago’s EPS of $0.63 and the Finchat-compiled consensus of $0.69.

Revenue grew 23% year over year (YoY) to $647.9 million, exceeding the mean analysts’ estimate of $635.35 million.

The headline numbers also came in ahead of the guidance issued in early December that modeled EPS and revenue of $0.68 to $0.69 and $633 million to $635 million, respectively.

Zscaler Chairman and CEO Jay Chaudhry said, “Growing adoption of Zero Trust and [artificial intelligence] AI is driving strong demand for our platform, resulting in yet another strong quarter that exceeded our guidance on both top and bottom line.”

The company’s Zero Trust cloud-native platform implements a zero-trust security strategy, which operates on the principle that no user, device, or application is trusted by default.

Among user metrics, deferred revenue climbed 25% YoY to $1.88 billion, slightly slower than the 27% growth in the first quarter (Q1). Calculated billings increased 18% to $742.69 million versus the first quarter’s 13% growth. 

The company ended the quarter with a cash position of $2.88 billion.

Looking ahead, Zscaler guided third-quarter (Q3) adjusted EPS and revenue in the range of $0.75 to $0.76 and $665 million to $667 million, respectively, compared to the consensus estimate of $0.74 and $666.22 million.

The company raised its fiscal year 2025 adjusted EPS guidance to a range of $3.04 to $3.09, from $2.94 to $2.99 and revenue guidance to a range of $2.64 billion to $2.654 billion from $2.623 billion to $2.643 billion.

On Stocktwits, retail sentiment toward Zscaler stock improved to ‘extremely bullish’ (98/100) from the ‘neutral’ mood that prevailed a day ago. The message volume perked to ‘extremely high’ levels.

A bullish watcher shared a technical chart and said the next stop is at the $212 level. 

Calling the quarterly release a “great report,” another user said they expected a violent move to the upside.

Zscaler stock climbed 4.49% to $205.28 in premarket trading. It has gained about 9% year-to-date.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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