Zscaler (ZS) Stock Forecast & Price Target

Zscaler is well positioned for durable growth because its core Zero Trust SASE for Users business remains strong, reaching $2.8B of FY26 ARR and still growing double digits while preserving leadership in a market with more than $220B of addressable demand. The company also has substantial installed-base runway, with over $19B of addressable spend against $3.8B of FY26 ending ARR, more than 30% of ZIA users lacking ZPA, and only 9 of 30+ products adopted on average, supporting expansion without relying solely on new logos. Beyond the core, Data Security, Security for AI, and Zero Trust Branch are scaling quickly, with FY26 revenue growth of 25%, a 23% FCF margin, and management’s FY31 framework calling for over $8B of ARR, reflecting both execution stability and AI-driven upside.

Zscaler is exposed to intense competitive and execution risks that could pressure its growth and margins, especially if major public cloud providers more aggressively launch similar products or new entrants offer comparable functionality at lower prices. Its core thesis depends on customers shifting away from physical security appliances, but slower cloud adoption, prolonged sales cycles, and weaker IT spending could delay that transition and create greater quarterly volatility. The company also depends on third-party data center and cloud infrastructure partners it does not control, while staffing challenges and platform disruptions could further impair product development, service reliability, and overall business performance.