April 14, 2024

Balkan Travellers

Comprehensive up-to-date news coverage, aggregated from sources all over the world

ZS Stock: Zscaler Earnings Top Views But Billing Size Overcomes Disappointment

ZS Stock: Zscaler Earnings Top Views But Billing Size Overcomes Disappointment

Zscaler (ZS) reported the financial second-quarter earnings and revenue that topped Wall Street targets. But Billings’ growth was only hurt by analyst estimates, and ZS stock fell on the news Friday.




X



The cybersecurity company released its earnings report after the market closed on Thursday. Zscaler announced a restructuring and staff reduction with the aim of streamlining operations.

For the quarter ended January 31, Zscaler’s earnings were 37 cents per share on an adjusted basis, up 184% from the prior year. The San Jose, California-based company said revenue rose 52% to $387.6 million.

Analysts had expected Zscaler earnings of 29 cents per share on sales of $364.7 million. Billings also rose 34% to $493.8 million, compared to estimates of $491.5 million.

“On paper, Zscaler had a good quarter, but billings growth of 34% fell short of investor expectations as delayed and slower deals again impacted growth in the quarter,” UBS analyst Roger Boyd said in a note to clients.

ZS Stock: Rising Competition in Palo Alto?

ZS stock is down 12.7% to close at 117 in early stock market trading today.

For the full 2023 fiscal year, Zscaler projected bills of $1.94 billion in the middle of its forecast, slightly above estimates of $1.93 billion.

“Although clients continue to apply high levels of scrutiny to deals, which lengthens sales cycles, ZS Notes deals are not going away,” TD Coin analyst Shaul Eyal said in a note.

Some analysts point to increased competition Zscaler faces from Palo Alto Networks (Banu).

Zscaler provides cloud-based cybersecurity services across 150 data centers around the world.

See also  Intel is investing at least $19 billion to build a new chip factory in Germany

Heading to Zscaler’s earnings report, ZS stock has a relative strength rating of 18 out of the best possible 99, according to IBD stock check.

Follow Reinhardt Krause on Twitter @employee For updates on 5G wireless networks, artificial intelligence, cybersecurity, and cloud computing.

You may also like:

IBD Digital: Unlock IBD blue-chip stock listings, tools and analytics today

Learn how to time the market with IBD’s ETF market strategy

How to use the 10-week moving average to buy and sell

Get free newsletters from IBD: Market Prep | Technical report | how to invest