Zscaler Reaffirms Q1 and FY2027 Financial Guidance at Investor Day

Zscaler reaffirmed its financial outlook for the first quarter and full fiscal year 2027 at its Investor Day in New York, leaving the ranges it issued on September 3 unchanged. The cybersecurity company continues to expect first-quarter revenue of $935 million to $939 million, or about 19% year-over-year growth, and full-year revenue of $3.908 billion to $3.938 billion.

The company also maintained its fiscal 2027 annual recurring revenue outlook of $4.396 billion to $4.426 billion, representing expected growth of roughly 16.6% to 17.4%. Its full-year non-GAAP operating income forecast remains $924 million to $932 million, while non-GAAP earnings per share are still projected at $4.86 to $4.90.

By reiterating the same ranges, Zscaler made no formal change to its near-term financial expectations as management used the October 6 event to discuss strategy, product development, go-to-market priorities and longer-term growth. The company said in its Investor Day announcement that Chief Executive Officer Jay Chaudhry, Chief Financial Officer Kevin Rubin and other senior executives would focus on the company’s position in zero-trust security and the opportunities it sees around artificial intelligence.

The first-quarter and full-year ranges remain unchanged

For the first quarter of fiscal 2027, Zscaler still expects a non-GAAP gross margin of about 80%. Non-GAAP income from operations is projected at $215 million to $217 million, which the company said would represent growth of approximately 25% to 26% and an operating margin of 23%. Non-GAAP earnings per share remain guided to about $1.15 to $1.16, based on roughly 170 million fully diluted shares and a 21% non-GAAP tax rate.

The full-year outlook calls for the same roughly 80% non-GAAP gross margin and a free cash flow margin of approximately 23% to 23.5%. At the midpoint of the revenue range, Zscaler is guiding to about $3.923 billion of fiscal 2027 revenue. The midpoint of its ARR range is about $4.411 billion, while the midpoint of the non-GAAP operating income forecast is $928 million.

Those figures matter because the Investor Day did not bring an upward revision after the company’s strong finish to fiscal 2026. It also did not reduce the outlook. The practical message for investors is that management entered the event standing behind the financial framework it laid out just over a month earlier, even as the presentations emphasized longer-term product and AI opportunities.

Zscaler noted that its non-GAAP operating income and earnings-per-share forecasts exclude items such as stock-based compensation and related payroll taxes, amortization of acquired intangible assets and amortization of debt issuance costs. The company said it is not providing a reconciliation of those forward-looking non-GAAP measures to the most directly comparable GAAP figures because some excluded items cannot be reasonably predicted.

Fiscal 2026 provides the base for the new targets

The fiscal 2027 ranges follow a year in which Zscaler reported 25% revenue growth. Revenue for the year ended July 31, 2026 rose to $3.353 billion, while fourth-quarter revenue increased 25% to $898.2 million. ARR finished the year at $3.771 billion, also up 25%, including $141 million of ARR attributed to the Red Canary acquisition. Excluding Red Canary, Zscaler said ARR grew 20% to $3.630 billion.

Profitability improved on the company’s preferred adjusted measures as well. Full-year non-GAAP income from operations reached $767.1 million, equal to 23% of revenue, compared with $580.1 million and 22% of revenue in fiscal 2025. Free cash flow totaled $779.1 million, or 23% of revenue. On a GAAP basis, however, Zscaler recorded a $133.3 million operating loss and a $63.2 million net loss for fiscal 2026. The company’s fiscal 2026 Form 10-K provides the audited annual financial statements behind that reported base.

The full-year fiscal 2027 revenue guide therefore points to growth of 16.6% to 17.5%, slower than the 25% reported increase in fiscal 2026. The ARR guide likewise calls for growth in the high teens rather than another 25% year. That does not make the guidance weak on its own, particularly because reported fiscal 2026 growth included the contribution from Red Canary, but it sets a more moderate growth bar for the coming year.

The operating-income outlook implies a different pattern. Zscaler is forecasting about 21% growth in non-GAAP operating income for fiscal 2027, faster than the midpoint of its revenue-growth range. If achieved, that would extend the company’s recent progress in adjusted operating profitability while it continues investing in product development and sales capacity.

Investor Day keeps AI and the $10 billion ARR goal in focus

The financial reaffirmation was only one part of the Investor Day. Management used the event to reinforce its view that enterprise adoption of AI is creating additional security requirements, including protecting organizations from AI-assisted attacks, securing sensitive data and controlling how AI agents and models connect to applications. Chaudhry described the agentic AI era as a major opportunity for Zscaler and tied that opportunity to the company’s zero-trust architecture.

Zscaler has been expanding beyond its core secure-access products into areas it describes as Zero Trust SASE, data security, Agentic SecOps and security for AI. In its September results, management said those newer areas were contributing to broader platform adoption and helping expand the business beyond user-based products. Investor Day keeps that expansion central to the company’s case for maintaining durable growth as its revenue base becomes larger.

The company also reiterated its ambition to reach $10 billion in ARR. Zscaler did not attach a new deadline to that target in the October 6 announcement, so it should be treated as a longer-term objective rather than fiscal 2027 guidance. The current full-year ARR range tops out at $4.426 billion, meaning the $10 billion figure remains well beyond the company’s near-term outlook.

That distinction is important. The guidance Zscaler reaffirmed at Investor Day is specific and measurable for the current fiscal year, while the $10 billion ARR goal depends on continued customer expansion, product adoption and execution over a longer period. For now, the company has chosen to leave its Q1 and fiscal 2027 numbers intact and use Investor Day to explain how its AI and zero-trust strategy is intended to support the next phase of growth.