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Zscaler 8-K Report, Financial Results (Mar 5, 2025)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed March 5, 2025
Period End
March 5, 2025
Security
ZS
In the record · 2018–202610-K910-Q258-K62

ZS filed 9 annual reports (10-K), 25 quarterly reports (10-Q) and 62 current reports (8-K) between 2018 and 2026.

  1. Leadership change8-K · Sep ’20Sep ’20
  2. Restructuring8-K · Mar ’23Mar ’23
  3. Leadership change8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed March 5, 2025. Cited figures are marked; the original filing is the authoritative source.

Zscaler, Inc. (ZS) reported financial results for its second fiscal quarter of 2025, ended January 31, 2025, in a press release furnished as Exhibit 99.1 to this Form 8-K dated March 5, 2025.

Revenue was $647.9 milliona, up 23% year-over-year, and calculated billings were $742.7 million, up 18%. Deferred revenue reached $1,878.5 million as of January 31, 2025, up 25% year-over-year. GAAP net loss narrowed to $7.7 million from $28.5 million a year earlier, and non-GAAP net income rose to $127.1 million from $99.4 million.

The GAAP net loss figure includes a $17.2 millionb tax benefit from the release of a valuation allowance on U.K. deferred tax assets. GAAP loss from operations was $40.1 million, or 6% of revenue, compared with $45.5 million, or 9% of revenue, a year earlier. Non-GAAP income from operations was $140.5 million, or 22% of revenue.

For the third fiscal quarter of 2025, the company guided to revenue of $665 million to $667 millionc and non-GAAP income from operations of $140 million to $142 million, with non-GAAP net income per share of approximately $0.75 to $0.76. For full fiscal 2025, it expects revenue of approximately $2.640 billion to $2.654 billion, calculated billings of $3.153 billion to $3.168 billion, and non-GAAP income from operations of $562 million to $572 million. Effective August 1, 2024, the company adopted a long-term projected non-GAAP tax rate of 23%, with prior periods recast to reflect the change.

Cash, cash equivalents and short-term investments totaled $2,880.2 milliond as of January 31, 2025, up $470.6 million from July 31, 2024. Free cash flow was $143.4 million, or 22% of revenue, for the quarter, compared with $100.8 million, or 19% of revenue, a year earlier. For the six months ended January 31, 2025, free cash flow was $435.3 million, or 34% of revenue.

02—Key points

Key Highlights

  1. Q2 FY2025 revenue of $647.9 million, up 23% year-over-year
  2. Calculated billings of $742.7 million, up 18% year-over-year; deferred revenue of $1,878.5 million, up 25% year-over-year
  3. GAAP net loss of $7.7 million versus $28.5 million a year earlier, including a $17.2 million tax benefit from a U.K. valuation allowance release
  4. Non-GAAP net income of $127.1 million ($0.78 per diluted share) versus $99.4 million ($0.63 per share) a year earlier
  5. Free cash flow of $143.4 million, or 22% of revenue, versus $100.8 million, or 19% of revenue
  6. Q3 FY2025 guidance: revenue of $665 million to $667 million and non-GAAP income from operations of $140 million to $142 million
  7. Full-year FY2025 guidance: revenue of approximately $2.640 billion to $2.654 billion and non-GAAP income from operations of $562 million to $572 million

03—Questions

Frequently Asked Questions

  1. How did Zscaler perform in the second quarter of fiscal 2025?

    Revenue grew 23% year-over-year to $647.9 million, and GAAP loss from operations narrowed to $40.1 million from $45.5 million. Non-GAAP income from operations rose to $140.5 million, or 22% of revenue, from $103.2 million, or 20% of revenue.

  2. Why did the GAAP net loss improve so much, and what is the non-GAAP tax rate change?

    The GAAP net loss of $7.7 million included a $17.2 million tax benefit from releasing a valuation allowance on U.K. deferred tax assets. Starting August 1, 2024, the company uses a long-term projected non-GAAP tax rate of 23% when computing non-GAAP net income, and prior periods were recast to reflect this.

  3. What does Zscaler expect for the third quarter and full fiscal year 2025?

    For Q3, the company expects revenue of $665 million to $667 million and non-GAAP income from operations of $140 million to $142 million. For full fiscal 2025, it expects revenue of approximately $2.640 billion to $2.654 billion, calculated billings of $3.153 billion to $3.168 billion, and non-GAAP income from operations of $562 million to $572 million.

  4. How strong is Zscaler's cash position?

    Cash, cash equivalents and short-term investments were $2,880.2 million as of January 31, 2025, an increase of $470.6 million from July 31, 2024. Free cash flow for the quarter was $143.4 million, and for the six months ended January 31, 2025 it was $435.3 million.

04—Continue

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