# Zscaler (ZS) Q4 FY2026 earnings

Results filed 2026-09-03 for the quarter ended 2026-07-31. Source page: https://earnings.opennash.com/companies/zs/2026-q4/
Press release and exhibits: https://www.sec.gov/Archives/edgar/data/1713683/000171368326000156/0001713683-26-000156-index.htm
> Summaries and transcripts are machine-generated and can contain errors.

## In brief

Zscaler grew Q4 FY26 revenue 25% year over year to $898.2 million and ARR 25% to $3,771 million, with non-GAAP income from operations of $218.4 million, a record 24% of revenue.

Zscaler reported fourth-quarter revenue of $898.2 million, up 25% from a year ago, and annual recurring revenue (ARR) of $3,771 million, also up 25%. The Red Canary acquisition contributed $141 million of ARR; without it, ARR grew 20%. Non-GAAP operating margin hit a record 24%. GAAP results were still a net loss of $3.4 million, and free cash flow fell to $60.8 million as capital spending rose.
For fiscal 2027, management expects revenue of $3.908 billion to $3.938 billion and ARR of $4.396 billion to $4.426 billion, growth of roughly 17%. First-quarter revenue is guided to about 19% growth. The tension is deceleration: growth slows as the Red Canary boost laps, while heavy capital spending weighs on free cash flow, guided to a margin of 23.0 to 23.5%.

## Key numbers

| Metric | Value | Change | Basis |
| --- | --- | --- | --- |
| Q4 revenue | $898.2 million | up 25% year over year | GAAP |
| Q4 non-GAAP income from operations | $218.4 million | compared to $158.9 million in the fourth quarter of fiscal 2025 | non-GAAP |
| Q4 non-GAAP operating margin | 24% | compared to 22% in the fourth quarter of fiscal 2025 | non-GAAP |
| Q4 GAAP net loss | $3.4 million | compared to $17.6 million in the fourth quarter of fiscal 2025 | GAAP |
| Q4 GAAP net loss per share, diluted | $0.02 | compared to $0.11 in the fourth quarter of fiscal 2025 | GAAP |
| Q4 non-GAAP net income per share | $1.19 | compared to $0.89 in the fourth quarter of fiscal 2025 | non-GAAP |
| Q4 non-GAAP gross margin | 80% | compared to 79% in the fourth quarter of fiscal 2025 | non-GAAP |
| Q4 cash provided by operations | $279.3 million | compared to $250.6 million in the fourth quarter of fiscal 2025 | GAAP |
| Q4 free cash flow | $60.8 million | compared to $171.9 million in the fourth quarter of fiscal 2025 | non-GAAP |
| Fiscal 2026 revenue | $3,353 million | up 25% year over year | GAAP |

## Segments and operating metrics

| Name | Value | Change |
| --- | --- | --- |
| ARR | $3,771 million | up 25% year over year |
| Net new ARR | $246 million | grew 24% |
| ARR excluding Red Canary | $3,630 million | up 20% |
| Deferred revenue | $2,926 million | up 19% year over year |

## Outlook

| Metric | Period | Outlook |
| --- | --- | --- |
| Revenue | first quarter of fiscal 2027 | $935 million to $939 million |
| Non-GAAP gross margin | first quarter of fiscal 2027 | approximately 80% |
| Non-GAAP income from operations | first quarter of fiscal 2027 | $215 million to $217 million |
| Non-GAAP net income per share | first quarter of fiscal 2027 | $1.15 to $1.16 |
| ARR | fiscal 2027 | $4.396 billion to $4.426 billion |
| Revenue | fiscal 2027 | $3.908 billion to $3.938 billion |
| Non-GAAP gross margin | fiscal 2027 | approximately 80% |
| Non-GAAP income from operations | fiscal 2027 | $924 million to $932 million |
| Non-GAAP net income per share | fiscal 2027 | $4.86 to $4.90 |
| Free cash flow margin | fiscal 2027 | approximately 23.0 to 23.5% |

## Key takeaways

1. **Revenue and ARR both grew 25%** Q4 revenue was $898.2 million and ARR reached $3,771 million, each up 25% year over year. Excluding Red Canary, ARR grew 20% to $3,630 million.
2. **Red Canary flatters growth rates** Red Canary contributed ARR of $141 million. Excluding it, net new ARR grew 17% versus 24% reported.
3. **Non-GAAP operating margin hit a record 24%** Non-GAAP income from operations was $218.4 million, versus $158.9 million, or 22% of revenue, a year earlier.
4. **Free cash flow fell on capital spending** Free cash flow was $60.8 million, or 7% of revenue, versus $171.9 million, or 24%. Capex and internal use software was $218.5 million versus $78.7 million.
5. **Fiscal 2027 guidance implies slower growth** Revenue guidance of $3.908 billion to $3.938 billion implies growth of 16.6% to 17.5%, down from 25%. First-quarter revenue growth is about 19%.

## Questions

**How did Zscaler perform in Q4 fiscal 2026?** Revenue grew 25% year over year to $898.2 million and ARR grew 25% to $3,771 million. Non-GAAP income from operations was $218.4 million, a record 24% of revenue, while the GAAP net loss was $3.4 million.
**What is Zscaler's fiscal 2027 guidance?** Zscaler expects revenue of $3.908 billion to $3.938 billion, ARR of $4.396 billion to $4.426 billion, and non-GAAP net income per share of $4.86 to $4.90. It also expects a free cash flow margin of approximately 23.0 to 23.5%.
**How much did the Red Canary acquisition contribute?** Red Canary contributed ARR of $141 million. Excluding it, ARR grew 20% to $3,630 million and net new ARR grew 17%.
**Why did free cash flow decline in Q4?** Free cash flow was $60.8 million, versus $171.9 million a year earlier. The release attributes this to capex and internal use software of $218.5 million, versus $78.7 million.
**What is the outlook for the first quarter of fiscal 2027?** Zscaler expects revenue of $935 million to $939 million, about 19% growth, and non-GAAP income from operations of $215 million to $217 million. Non-GAAP net income per share is expected at about $1.15 to $1.16.