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Apr 30, 2025
Zscaler Q3 2025 Earnings Report
Zscaler reported strong year-over-year revenue growth in Q3 2025, but swung to a GAAP net loss amid continued strategic investments.
Key Takeaways
Zscaler grew revenue by 23% to $678 million in Q3 FY25 but posted a GAAP net loss of $4.1 million. Non-GAAP earnings were strong, and free cash flow remained solid, signaling continued momentum in Zero Trust adoption and AI-focused security innovation.
Revenue reached $678 million, up from $553.2 million last year.
GAAP net income turned to a loss of $4.1 million versus $19.1 million profit last year.
Non-GAAP EPS rose to $0.84 from $0.71 last year.
Zscaler announced the acquisition of Red Canary to bolster AI-powered security operations.
Forward Guidance
Zscaler expects continued top-line growth in Q4 FY25, with revenue guidance between $705M–$707M and non-GAAP EPS around $0.79–$0.80.
Positive Outlook
- Revenue projected at $705M to $707M for Q4 FY25
- Non-GAAP income from operations expected to grow to $152M–$154M
- Q4 non-GAAP EPS forecasted between $0.79 and $0.80
- FY25 revenue expected to exceed $2.659B
- Calculated billings for FY25 expected between $3.184B–$3.189B
Challenges Ahead
- GAAP profitability remains under pressure
- Free cash flow declined YoY despite revenue growth
- Operating margin impacted by ongoing investment
- Rising costs related to stock-based compensation
- Macroeconomic and geopolitical risks continue to weigh on outlook
Historical Earnings Impact
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Avg. Return Before/After Earnings
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