Zscaler’s AI Security Expansion Sets Stage for Quarterly Results

As Zscaler prepares to announce its first quarter 2026 financial results this Tuesday after market close, the cloud security firm's strategic push into artificial intelligence security positions it for potential growth. The company's recent acquisition and strong analyst sentiment create significant anticipation around this earnings release.

Financial analysts project Zscaler will report earnings per share of $0.85 with revenue reaching $773.86 million for the quarter. These projections represent substantial year-over-year growth, with EPS expected to increase by 10.39% and sales climbing 23.15%.

The company enters this earnings period with strong momentum, having exceeded its own forecasts in the fourth quarter of 2025. During that period, Zscaler generated $719.2 million in revenue and achieved a record operating margin of 22.1%.

Strategic Moves in AI Security

Zscaler strengthened its artificial intelligence capabilities through the early November acquisition of SPLX, recognized as an AI security pioneer. This strategic move enhances the company's zero-trust portfolio with several critical functions:

• Automated security testing specifically designed for AI systems
• Advanced governance frameworks for AI investments
• Comprehensive protection throughout the entire AI lifecycle

This expansion comes at an opportune moment as demand for AI security solutions experiences rapid market growth.

Should investors sell immediately? Or is it worth buying Zscaler?

Analyst Perspectives and Price Targets

Market experts display varying degrees of optimism, though the overall sentiment remains positive:

• Rosenblatt raised its price target from $330 to $365 while maintaining a Buy rating
• Barclays increased its target from $320 to $350
• TD Cowen reaffirmed its $330 target with a Buy recommendation
• Mizuho maintained a Neutral stance but lifted its target from $310 to $325

The consensus price target among analysts stands at approximately $330, suggesting potential upside from the current trading level around $295.

Technical Position and Market Performance

From a technical analysis perspective, Zscaler shares face resistance near the 50-day moving average of $305.60. The recent pullback contrasts with the stock's impressive year-to-date performance, which shows gains exceeding 64%.

The company's strategic partnership within Microsoft's Entra Agent ID Ecosystem further validates its market positioning and growth strategy.

Investors now await Tuesday's earnings release to determine whether the results will provide sufficient momentum to overcome current technical resistance and resume the upward trajectory that has characterized much of the year's trading activity.