Zscaler FQ2 Revenue Climbs 26% to $816M with ARR at $3.4B
Zscaler reported FQ2 2026 revenue of $816M, a 26% YoY rise, with ARR at $3.4B up 25% and Americas driving 57% of sales. The company processed 1T AI transactions in 2025, launched AI Protect, shifted to metered usage (25% of new ACV) and generated $290M via Z-Flex.
1. FQ2 2026 Revenue and ARR
Zscaler delivered FQ2 2026 revenue of $816 million, up 26% year-over-year, driven by large-scale enterprise deals. Annual recurring revenue climbed 25% to $3.4 billion, reflecting strong contract renewals and expansions across key customers.
2. Regional and Customer Growth
The Americas region accounted for 57% of total revenue, solidifying its role as the primary growth engine. Customers contributing over $1 million in ARR increased by 18% year-over-year, underscoring deeper adoption among large enterprises.
3. AI Security Initiatives
In 2025 Zscaler processed nearly 1 trillion AI transactions, reinforcing its AI security leadership. The introduction of AI Protect targets management of shadow AI usage and prevention of data leaks and prompt-injection attacks.
4. Business Model Shifts and Acquisitions
Metered, non-seat-based usage now represents 25% of new annual contract value, while the Z-Flex program generated $290 million in contract value this quarter. Strategic expansions include acquiring SquareX for unmanaged device security and integrating Red Canary to bolster agentic security operations.