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Investor Alert

Earnings Results

Dec. 2, 2020, 4:31 p.m. EST

Zscaler stock rallies more than 10% on strong quarter and outlook

By Wallace Witkowski

Zscaler Inc. shares surged in the extended session Wednesday after the cybersecurity company reported results and forecast an outlook that surpassed Wall Street expectations.

Zscaler’s (NAS:ZS) stock rallied 11% after hours, following a 3.2% decline in the regular session to close at $146.79.

The company reported a fiscal first-quarter loss of $55 million, or 41 cents a share, compared with a loss of $17.1 million, or 13 cents a share, in the year-ago period. Adjusted net income, which excludes stock-based compensation and other items, was 14 cents a share, compared with a loss of 4 cents a share in the year-ago period.

Revenue rose to $142.6 million from $93.6 million in the year-ago quarter, while billings rose to $144.7 million from $88.3 million.

Analysts surveyed by FactSet had forecast earnings of 6 cents on revenue of $132.4 million and billings of $124.2 million.

“Our customers are accelerating their digital transformation, and this drove our strong first quarter results,” said Jay Chaudhry, Zscaler chairman and chief executive, in a statement.

Zscaler expects adjusted earnings of 7 cents to 8 cents a share on revenue of $146 million to $148 million for the fiscal second quarter, and 37 cents to 38 cents a share on revenue of $608 million to 612 million for the year. Analysts had forecast earnings of 7 cents on revenue of $140.2 million for the fiscal second quarter, and 31 cents a share on revenue of $588.1 million for the year.

As of Wednesday’s close, the stock is up 216% for the year, compared with a 14% rise in the S&P 500 index (S&P:SPX) , a 38% gain in the tech-heavy Nasdaq Composite Index (AMERICAN:COMP) , and a 22% advance in the ETFMG Prime Cyber Security ETF (PSE:HACK) .

Link to MarketWatch's Slice.