Company Overview Zscaler operates as the world’s largest security cloud provider, delivering cloud-native cybersecurity solutions through its Zero Trust Exchange platform. The company has been riding an exceptional growth wave, with the stock surging nearly 80% since April 2025 following consistently strong quarterly results. Zscaler now secures nearly 40% of the Global 2000 companies and over 45% of the Fortune 500, processing a staggering 500 billion daily transactions across its platform.

What makes Zscaler particularly compelling right now is the convergence of multiple growth drivers. The company reported Q4 fiscal 2025 revenue of $719.2 million, representing 21% year-over-year growth, while annual recurring revenue surged 22% to surpass $3 billion. For fiscal year 2026, management is guiding for revenue of $3.265 billion to $3.284 billion, reflecting 22-23% growth, as the company capitalizes on the massive shift toward Zero Trust architecture and AI-driven security. With the global cybersecurity market projected to reach $500 billion by 2030 and cloud security being the fastest-growing segment, Zscaler’s cloud-native platform positions it at the epicenter of a multi-year secular growth trend.

Key Technical and Fundamental Drivers

Explosive Stock Performance → 80% Surge Since April Zscaler shares have rocketed nearly 80% from April 2025 to current levels around $226, driven by consistent revenue beats and strong execution as enterprises accelerate their shift from traditional firewalls to cloud-native Zero Trust security architectures.

$3 Billion ARR Milestone → 22% Growth Rate The company’s annual recurring revenue crossed $3 billion in Q4 fiscal 2025, growing 22% year-over-year, with calculated billings surging 32% to $1.2 billion, demonstrating robust customer retention, expansion, and the company’s ability to upsell its expanding platform of 21 security modules.

Record Operating Margins → Over 22% in Q4 Zscaler achieved a record operating margin exceeding 22% in Q4 2025, showcasing improving profitability as the company scales its cloud infrastructure and benefits from operating leverage, with free cash flow margins guided at 26-26.5% for fiscal 2026.

AI Security Leadership → New Revenue Streams The company’s AI-powered security solutions, including AI Guard and GenAI security offerings, are driving strong demand, with the integration of recently acquired Red Canary’s managed detection and response technology expanding Zscaler’s threat detection capabilities in hybrid cloud environments.

Massive Addressable Market → $100 Billion+ Opportunity Management estimates a serviceable addressable market exceeding $100 billion across 335 million users, 150 million workloads, and 1.5 billion IoT/OT devices, with the global cloud security market projected to grow at a 12.9% CAGR through 2030, reaching $500.7 billion.

Market Takeaway Zscaler represents a pure-play bet on the future of enterprise security—a world where traditional perimeter-based defenses are being replaced by cloud-native Zero Trust architectures that secure users, devices, and applications regardless of location. The company’s 80% stock surge since April 2025 reflects growing investor recognition that Zscaler is winning the architectural battle, with enterprises increasingly consolidating their security spending onto platforms that reduce complexity and improve outcomes.

The fundamental momentum is undeniable: 22% ARR growth, 32% calculated billings growth, and expanding operating margins all point to a company hitting its stride. CEO Jay Chaudhry’s vision that “the internet would be the new corporate network” is playing out exactly as predicted, accelerated by remote work trends and cloud migration. With 24 analysts maintaining Buy or higher ratings and average price targets suggesting 27% upside from current levels, Wall Street is betting on continued execution.

The cybersecurity macro backdrop couldn’t be stronger. IBM reports the average data breach now costs $4.88 million, up from $4.45 million just two years ago, driving 23.5% of organizations to increase security investments following breaches. Meanwhile, AI is both creating new attack surfaces and enabling better defenses—exactly where Zscaler’s AI Guard and GenAI security offerings are gaining traction. While the stock trades at elevated valuations due to GAAP losses, improving non-GAAP profitability and 26%+ free cash flow margins demonstrate the path to sustainable profitability as the platform scales. For investors seeking exposure to the cybersecurity megatrend through a market leader with proven execution, Zscaler offers compelling risk-reward as enterprises continue their multi-year migration to cloud-first security architectures.