Zscaler (NASDAQ: ZS) tumbled Friday, on reporting a better-than-expected quarter, following conservative guidance. Zscaler said customers are taking longer to close new deals, and that it faces other headwinds as well.
Revenue for the quarter came in at $355.5 million, an increase of 54% year-over-year.
GAAP net loss was $68.2 million, compared to $90.8 million in the first quarter of fiscal 2022. Non-GAAP net income was $44.0 million, compared to $21.0 million in the first quarter of fiscal 2022.
Cash provided by operations was $128.5 million, or 36% of revenue, compared to $93.3 million, or 40% of revenue, in the first quarter of fiscal 2022. Free cash flow was $95.6 million, or 27% of revenue, compared to $83.4 million, or 36% of revenue, in the first quarter of fiscal 2022.
According to CEO Jay Chaudhry, "We delivered strong top line growth with improved operating profitability and increased free cash flow, once again performing at the Rule-of-80. We are seeing customers committing to our broader platform, driven by vendor consolidation and an elevated threat environment, Customers are engaging with us to embrace zero trust architecture, eliminate point products, simplify IT and standardize on the Zscaler platform, all of which delivers better security and lower cost.”
ZS shares lost $16.79, or 11.6%, to $127.71.
