Zscaler will report 3Q22 on Thursday, May 26 at 3:30 PM-EDT. Following is a summary of what they reported last quarter. I hope you find this information useful. It is provided without commentary or analysis. Also, I made no attempt to capture comments from the Q&A during last quarter’s CC.
I’ll start by providing some links.
2Q22 Earnings report can be found here: chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://ir.zscaler.com/static-files/f50149d3-3a1e-4ad0-b87d-…
2Q22 Prepared remarks can be found here: chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://ir.zscaler.com/static-files/7f8561d8-d477-4419-9497-…
Zscaler investor relations can be found here: https://ir.zscaler.com/investor-relations#s-why-invest
CEO - Jay Chaudry. CFO - Remo Canessa
To begin, I am not going to try to summarize the CEO remarks (you are welcome to read them at the 2nd link above if you want). Mr. Chaudry speaks in a language that I can only describe as acro-neeZe. Frankly, I simply can’t understand a lot of his commentary. But, the general gist of what he had to say is that Zscaler booked a lot of very large contracts during the quarter. And the other thing he said that I think important is that some of those contracts came from working with system integrators. I think that’s important because I am sure that there are a lot of companies that don’t have the IT resources to devote to software evaluations. They rely on system integrators to guide them in these decisions and implementation activities.
Moving on the the CFO comments - Following summary is copied directly from the first link above:
Second Quarter Fiscal 2022 Financial Highlights
• Revenue: $255.6 million, an increase of 63% year-over-year. (This was a 5.6% beat over guide and a 10.9% QoQ increase)
• Income (loss) from operations: GAAP loss from operations was $83.9 million, or 33% of total revenue, compared to $53.9 million, or 34% of total revenue, in the second quarter of fiscal 2021. Non-GAAP income from operations was $22.3 million, or 9% of total revenue, compared to $14.8 million, or 9% of total revenue, in the second quarter of fiscal 2021.
• Net income (loss): GAAP net loss was $100.4 million, compared to $67.5 million in the second quarter of fiscal 2021. Non-GAAP net income was $19.2 million, compared to $14.0 million in the second quarter of fiscal 2021.
• Net income (loss) per share: GAAP net loss per share was $0.71, compared to $0.50 in the second quarter of fiscal 2021. Non-GAAP net income per share was $0.13, compared to $0.10 in the second quarter of fiscal 2021.
• Cash flow: Cash provided by operations was $48.3 million, or 19% of revenue, compared to $30.4 million, or 19% of revenue, in the second quarter of fiscal 2021. Free cash flow was $29.4 million, or 12% of revenue, compared to $18.0 million, or 11% of revenue, in the second quarter of fiscal 2021.
• Deferred revenue: $759.9 million as of January 31, 2022, an increase of 70% year-over-year.
• Cash, cash equivalents and short-term investments: $1,621.2 million as of January 31, 2022, an increase of $118.7 million from July 31, 2021.
Financial Outlook For the third quarter of fiscal 2022, we expect:
• Total revenue of $270 million to $272 million
• Non-GAAP income from operations of $19 million to $20 million
• Non-GAAP net income per share of approximately $0.10 to $0.11, assuming approximately 149 million to 150 million common shares outstanding For the full year fiscal 2022, we expect:
• Total revenue of $1.045 billion to $1.05 billion
• Calculated billings of $1.365 billion to $1.37 billion
• Non-GAAP income from operations of $95 million to $98 million
• Non-GAAP net income per share of $0.54 to $0.56, assuming approximately 149 million to 150 million common shares outstanding.
The CFO also listed some “business highlights” of the quarter which I did not find particularly important from an investor’s POV. Nevertheless, if you wish to read them, look to the first link above.