Zscaler Raises Fiscal 2026 ARR Guidance to 24% on Strong Q2 Growth
Event summary
- Zscaler reported Q2 fiscal 2026 revenue growth of 26% YoY to $815.8 million.
- ARR grew 25% YoY to $3,359 million, with net new ARR of $155.5 million.
- Non-GAAP operating margin reached 22%, with free cash flow up 18% YoY to $169.1 million.
- Company raised fiscal 2026 ARR guidance to 24% from previous 23%.
- Acquired SquareX to advance Zero Trust browser security for AI era.
The big picture
Zscaler's strong Q2 performance and raised guidance reflect robust demand for its cloud security solutions, particularly as enterprises prioritize AI security. The company's strategic acquisitions and partnerships position it to capitalize on the growing need for zero trust architectures in the AI era. With a 22% non-GAAP operating margin and 18% YoY free cash flow growth, Zscaler demonstrates disciplined execution in a competitive market.
What we're watching
- AI Security Demand
- How Zscaler's AI security solutions will capture market share as enterprises accelerate AI adoption.
- Integration Challenges
- Whether recent acquisitions will be successfully integrated to drive long-term growth.
- Competitive Positioning
- The pace at which Zscaler can maintain its leadership in zero trust security amid increasing competition.
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