Is Zscaler, Inc. (ZS) A Good Stock To Buy Now?

Zscaler, Inc. (ZS) is simply a starring cybersecurity level pioneering the Zero Trust Exchange, replacing bequest perimeter-based firewalls with a cloud-native architecture that secures users, applications, and subdivision environments. The institution continues to show beardown execution, reporting Q2 FY2026 gross of $816 million, up 26% year-over-year, portion yearly recurring gross (ARR) grew 25% to $3.4 billion.

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Despite tougher comparisons moderating integrated maturation to 7%, Zscaler maintained elite profitability with operating margins expanding to 22.2% and escaped currency travel margins exceeding 20%, sustaining a “Rule of 60+” profile. Growth is progressively driven by a displacement toward consumption-based pricing, with non-seat-based products contributing implicit 25% of caller ACV and increasing supra 100%, reflecting rising request tied to postulation and workload expansion.

Enterprise traction remains robust, with 728 customers generating implicit $1 cardinal successful ARR, supported by initiatives similar Z-Flex that widen declaration durations and heighten upsell visibility. The company’s Zero Trust architecture continues to differentiate it from firewall-based and bundled SASE competitors, portion its “Zero Trust Everywhere” strategy is driving deeper penetration and 2–3x ARR enlargement wrong ample customers.

Artificial quality is emerging arsenic a almighty tailwind, with the level processing astir 1 trillion AI-related transactions annually and caller offerings similar AI Protect enabling real-time inspection and argumentation enforcement. With a beardown pipeline, improving income productivity, and expanding monetization of AI-driven and consumption-based workloads, Zscaler is good positioned to prolong durable maturation and semipermanent currency travel expansion.

Previously, we covered a bullish thesis connected Rubrik, Inc. (RBRK) by ElectSamsepi0l successful December 2024, which highlighted its enactment successful backup and recovery, beardown ARR maturation post-IPO, and differentiated cyber resilience done cloud-integrated, air-gapped systems. RBRK’s banal terms has depreciated by astir 2.45% since our coverage. Sergey shares a akin presumption but emphasizes Zscaler’s Zero Trust architecture and AI-driven growth.