Zscaler reports strong Q3 results, focuses on margin optimization and introduces new products

Zscaler reported strong results for Q3 of fiscal 2025, with revenues up 23% to $678 million. Non-GAAP gross margins slightly contracted to 80.3%. The company is focused on margin optimization after introducing new products and modules for growth. Zscaler’s Rule of 52 metric highlights its ability to balance growth with profitability.

Competitors like CrowdStrike and Okta are also evolving their platforms to meet enterprise security demands. CrowdStrike enhances its identity security platform with AI solutions, while Okta focuses on identity and access management with AI for real-time threat detection. Zscaler’s shares have surged 74.4% YTD, trading at a higher forward P/S ratio than the industry average.

Zscaler’s fiscal 2025 earnings estimate shows a slight decline, but fiscal 2026 estimates imply growth. The company carries a Zacks Rank #3 (Hold). Experts recommend 7 elite stocks for the next 30 days, with a history of outperforming the market. Users can access free stock analysis reports for companies like Okta, Zscaler, and CrowdStrike on Zacks Investment Research.

Read more at Nasdaq: Zscaler’s Product Expansions Drive Sales: Are Margins at Risk?