Is it fair to say that they had easy beats across the boards since Q4 2019 was horrible?
I think you’re referring to Q2 FY2020 which was last year’s compare, so let’s test your hypothesis. I’ll use “calendar year” to normalize the distinctions between fiscal year timings.
Revenue growth (CAGR) from calendar year Q4 2018 to Q4 2020:
Cloudfare: 50.6% (from $55.5M to $125.9M), or +$70.4M
ZScaler: 45.4% (from $74.3M to $157.0M), or +$82.7M
Okta: 42.5% (from $115.5M to $234.7M), or $119.2M
Free cash flow (CAGR) from calendar year Q4 2018 to Q4 2020:
Cloudfare: ($13.5M)* to ($23.5M)
ZScaler: $12.0M to $18.0M
Okta: $4.8M to $32.5M
Even though a two-metric comparison is myopic, ZScaler doesn’t look out of place compared to Cloudfare and Okta erasing its bad quarter (or year). We can also use a QoQ comparison.
Revenue QoQ:
Cloudfare: 10.2% or $11.7M
ZScaler: 10.1% or +$14.4M
Okta: 8.0% or $17.3M
RPO QoQ:
Cloudfare: 12.0% or +$42.0M
ZScaler: 18.6% or +$161M
Okta: 13.9% or +220M
Here, ZScaler looks attractive with very encouraging signs of acceleration. So while some of the comparisons might have been soft, it’s also evident that ZScaler is learning from its mistakes and doing something right. That applies both in regards to its technology, with added focus on innovation (2x spend in R&D YoY) – and also a renewed sales tactics with Dali Rajic leading as Chief Revenue Officer. Several events recently have highlighted the importance of cybersecurity as a priority, and ZScaler’s top-down sales approach appear to be an “easy” solution for C-suite’s to outsource this headache.
*Assumed from their “six month ended 2018” figures reported in their S1
-RMTZP
Protect the identity of this board and maximize your learning by reading https://discussion.fool.com/for-board-newcomers-all-others-34765… before participating