Zscaler Reports Fourth Quarter and Fiscal 2018 Financial Results
GlobeNewswire
•September 5, 2018
• Fourth quarter revenue grows 54% year-over-year to $56.2 million; fiscal 2018 revenue grows 51% year-over-year to $190.2 million
• Fourth quarter calculated billings grows 72% year-over-year to $95.4 million; fiscal 2018 calculated billings grows 65% year-over-year to $257.6 million
• Cash, cash equivalents and short-term investments of $298.5 million and no debt
SAN JOSE, Calif., Sept. 05, 2018 (GLOBE NEWSWIRE) -- Zscaler, Inc. ( ZS), the leader in cloud security, today announced financial results for its fiscal fourth quarter and fiscal year ended July 31, 2018.
"I am very proud of our team for achieving record financial results - strong revenue and billings growth and positive free cash flow. We believe they further validate our product offerings, and we are executing well.” said Jay Chaudhry, Chairman and CEO of Zscaler. “Enterprises are leveraging our born-in-the cloud architecture, purpose-built for local internet breakouts, resulting in significant sales of our high-end Transformation bundle. In addition, with the rapid uptake of our complementary ZPATM service, enterprises are relying on us to enforce business and security policy for their users to access applications and services on the internet, SaaS, public cloud or internal data center.”">"I am very proud of our team for achieving record financial results - strong revenue and billings growth and positive free cash flow. We believe they further validate our product offerings, and we are executing well.” said Jay Chaudhry, Chairman and CEO of Zscaler. “Enterprises are leveraging our born-in-the cloud architecture, purpose-built for local internet breakouts, resulting in significant sales of our high-end Transformation bundle. In addition, with the rapid uptake of our complementary ZPATM service, enterprises are relying on us to enforce business and security policy for their users to access applications and services on the internet, SaaS, public cloud or internal data center.”
Fourth Quarter Fiscal 2018 Financial Highlights
• Total revenue was $56.2 million, an increase of 54% year-over-year.
• GAAP loss from operations was $7.9 million, or 14% of total revenue, compared to $13.1 million in the fourth quarter of fiscal 2017, or 36% of total revenue. Non-GAAP loss from operations was $2.4 million, or 4% of total revenue, compared to $7.2 million in the fourth quarter of fiscal 2017, or 20% of total revenue.
• GAAP net loss was $7.0 million, compared to $13.3 million in the fourth quarter of fiscal 2017. Non-GAAP net loss was $1.4 million, compared to $7.4 million in the fourth quarter of fiscal 2017.
• GAAP net loss per share was $0.06, compared to $0.52 in the fourth quarter of fiscal 2017. Pro forma non-GAAP net loss per share was $0.01, compared to $0.07 in the fourth quarter of fiscal 2017.
• Net cash flows provided by operations was $14.7 million, compared to net cash flows used in operations of $3.7 million in the fourth quarter of fiscal 2017. Free cash flow was $11.9 million, or 21% of total revenue, compared to negative free cash flow of $5.4 million, or 15% of total revenue, in the fourth quarter of fiscal 2017.
• Deferred revenue grew 70% year-over-year to $164.0 million.
• Cash, cash equivalents and short-term investments were $298.5 million as of July 31, 2018.
Full Year Fiscal 2018 Financial Highlights
• Total revenue was $190.2 million, an increase of 51% year-over-year.
• GAAP loss from operations was $34.6 million, or 18% of total revenue, compared to $35.1 million in fiscal 2017, or 28% of total revenue. Non-GAAP loss from operations was $15.4 million, or 8% of total revenue, compared to $19.3 million in fiscal 2017, or 15% of total revenue.
• GAAP net loss was $33.6 million, compared to $35.5 million in fiscal 2017. Non-GAAP net loss was $14.4 million, compared to $19.7 million in fiscal 2017.
• GAAP net loss per share was $0.63, compared to $1.54 in fiscal 2017. Pro forma non-GAAP net loss per share was $0.13, compared to $0.19 in fiscal 2017.
• Net cash flows provided by operations was $17.3 million, compared to net cash flows used in operations of $6.0 million in fiscal 2017. Free cash flow was $2.1 million, or 1% of total revenue, compared to negative $14.2 million, or 11% of total revenue in fiscal 2017.
• Raised $205.3 million in net proceeds from our initial public offering in March 2018.
Recent Business Highlights
• In August 2018, we acquired artificial intelligence and machine learning technology and the development team of security startup TrustPath, Inc. to extend our ability to derive intelligence from transactions processed by our cloud to identify anomalous traffic, build user behavioral profiles, compute enterprise risk posture, and detect sophisticated targeted attacks as they emerge.
• Hosted our first user conference Zenith Live in June 2018.
• Achieved a major milestone of FedRAMP authorization for Zscaler Private Access-Government (ZPA-Government), which enables us to expand into the Federal market.
Reconciliations between GAAP and non-GAAP financial measures are provided in the tables of this press release.
Financial Outlook
For the first quarter of fiscal 2019, we expect:
• Total revenue of $58.0 to $59.0 million
• Non-GAAP loss from operations of $6.0 to $7.0 million
• Pro forma non-GAAP net loss per share of $0.05 to $0.06, assuming approximately 121 million common shares outstanding
For the full fiscal 2019, we expect:
• Total revenue of $250.0 to $260.0 million
• Non-GAAP loss from operations of $16.0 to $18.0 million
• Pro forma non-GAAP net loss per share of $0.12 to $0.13, assuming approximately 124 million common shares outstanding
These statements are forward-looking and actual results may differ materially. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.
Guidance for non-GAAP financial measures excludes stock-based compensation and significant litigation-related expenses. We have not reconciled our expectations as to non-GAAP loss from operations and pro forma non-GAAP net loss per share to their most directly comparable GAAP measure because certain items are out of our control or cannot be reasonably predicted. Accordingly, a reconciliation for non-GAAP loss from operations and pro forma non-GAAP net loss per share is not available without unreasonable effort.
Conference Call Information
Zscaler will host a conference call for analysts and investors to discuss its fourth quarter and fiscal 2018 earnings results and outlook for its first quarter of fiscal 2019 and full year fiscal 2019 today at 2:00 p.m., Pacific time (5:00 p.m. Eastern time).
| Date: | Wednesday, September 5 | | Time: | 2:00 p.m. PT (5:00 p.m. ET) | | Webcast: | https://ir.zscaler.com/ | | Dial-in number: | 323-994-2093 or 888-254-3590 |
A live webcast of the conference call will be accessible from the Zscaler website at ir.zscaler.com. Listeners may log on to the call under the "Events & Presentations" section and select "Q4 2018 Zscaler Earnings Conference Call" to participate. A telephone replay of the conference call will be available at approximately 5:00 p.m. PT, September 5 through September 9, 2018 by dialing (888) 203-1112 or (719) 457-0820 and entering the passcode 9011685.
Forward-Looking Statements
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