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Jan 31, 2024

Zscaler Q2 2024 Earnings Report

Reported strong Q2 results with billings, revenue, and operating profit above guidance, driven by high customer interest in the Zscaler Zero Trust Exchange platform.

Key Takeaways

Zscaler's Q2 fiscal year 2024 shows strong financial performance with revenue reaching $525.0 million, a 35% year-over-year increase, and calculated billings growing by 27% to $627.6 million. The company's GAAP net loss decreased significantly, and non-GAAP net income saw substantial growth, highlighting the increasing adoption of the Zscaler Zero Trust Exchange platform.

Revenue increased by 35% year-over-year, reaching $525.0 million.

Calculated billings grew by 27% year-over-year, totaling $627.6 million.

GAAP net loss improved to $28.5 million compared to $57.5 million in the previous year.

Non-GAAP net income increased to $121.1 million, up from $57.6 million year-over-year.

Total Revenue
$525M
Previous year: $388M
+35.4%
EPS
$0.76
Previous year: $0.37
+105.4%
Calculated Billings
$628M
Previous year: $494M
+27.1%
Gross Profit
$411M
Previous year: $300M
+36.8%
Cash and Equivalents
$1.44B
Previous year: $1.26B
+14.4%
Free Cash Flow
$101M
Previous year: $62.8M
+60.5%
Total Assets
$3.93B
Previous year: $3.04B
+29.4%

Zscaler

Zscaler

Forward Guidance

For the third quarter of fiscal 2024, Zscaler expects revenue between $534 million and $536 million, non-GAAP income from operations between $98 million and $100 million, and non-GAAP net income per share between $0.64 and $0.65. For the full year fiscal 2024, the company anticipates revenue of approximately $2.118 billion to $2.122 billion, calculated billings of $2.55 billion to $2.57 billion, non-GAAP income from operations of $395 million to $400 million, and non-GAAP net income per share of $2.73 to $2.77.

Positive Outlook

  • Revenue of $534 million to $536 million is expected for Q3 2024.
  • Non-GAAP income from operations of $98 million to $100 million is projected for Q3 2024.
  • Non-GAAP net income per share of approximately $0.64 to $0.65 is anticipated for Q3 2024.
  • Revenue of approximately $2.118 billion to $2.122 billion is expected for the full year fiscal 2024.
  • Calculated billings of $2.55 billion to $2.57 billion is projected for the full year fiscal 2024.

Challenges Ahead

  • Guidance excludes stock-based compensation expense and related employer payroll taxes.
  • Guidance excludes amortization of debt issuance costs.
  • Guidance excludes amortization expense of acquired intangible assets.
  • Certain items are out of the company's control or cannot be reasonably predicted.
  • A reconciliation for the guidance for non-GAAP income from operations and non-GAAP net income per share is not available without unreasonable effort.