In the rapidly evolving cybersecurity landscape, Zscaler is making significant strides by integrating artificial intelligence across its product portfolio. The company’s latest earnings call revealed an aggressive AI strategy that’s already delivering impressive results. Let’s dive into the key AI takeaways from Zscaler’s recent performance.
ZDX Copilot Transforms User Experience Management
One of Zscaler’s most impressive AI innovations is ZDX Copilot, which leverages Google’s Gemini models to revolutionize digital experience monitoring. The results speak for themselves: bookings for ZDX Advance Plus, which includes ZDX Copilot, grew by over 45% year-over-year.
What makes ZDX Copilot particularly valuable is its use of agentic AI technology to automate root cause analysis for end-user performance issues. By expanding IT workflow integrations, ZDX Copilot significantly reduces resolution times and improves operational efficiency. This represents a critical advancement for IT teams struggling with the growing complexity of digital environments.
AI Analytics Driving Revenue Growth
Zscaler’s recently introduced AI Analytics Solutions – including Risk 360, Unified Vulnerability Management, and Business Insights – are generating substantial returns. The annual contract value (ACV) from AI analytics has nearly doubled year-over-year, demonstrating strong market demand for intelligence-driven security solutions.
These analytics capabilities provide organizations with deeper visibility and more actionable insights, enabling more effective security decision-making in increasingly complex threat landscapes.
Enhancing Data Protection with AI
As organizations adopt generative AI tools, data protection has become increasingly critical. Zscaler is addressing this need through advanced AI-powered data classification and protection capabilities:
- Automated data classification: AI models identify and categorize sensitive information across various locations
- Image classification: Visual data is analyzed to detect potential security risks
- LLM proxy functionality: Real-time analysis of prompt queries and responses to detect and prevent malicious activities, including prompt injections
These capabilities are particularly relevant as organizations struggle to maintain visibility and control over data being shared with public AI applications. Zscaler reported that its data protection pillar experienced over 40% year-over-year growth in net new ACV, highlighting the market demand for these solutions.
Zero Trust Everywhere Strategy
Zscaler is elevating its zero trust approach to a comprehensive “Zero Trust Everywhere” standard that encompasses:
- Zero Trust users
- Zero Trust cloud
- Zero Trust branch
The company reported that over 130 enterprises have already adopted this comprehensive approach, with an ambitious goal to triple that number within the next 18 months. Notably, 57% of customers who purchased Zero Trust branch were new logo customers, indicating that this approach is expanding Zscaler’s market reach.
Strategic Leadership Investment
To accelerate its AI initiatives, Zscaler recently appointed Phil Tee as Executive Vice President of AI Innovations. This strategic hire underscores the company’s commitment to maintaining leadership in AI-powered security solutions.
The Competitive Advantage: Zero Trust + AI
Perhaps the most compelling aspect of Zscaler’s strategy is the combination of its Zero Trust Exchange – which secures customers and generates valuable security logs – with AI-powered analytics. This synergy creates a virtuous cycle: better security produces more data, which enables more effective AI, which in turn enhances security.
Go-to-Market Success
Zscaler’s investments in its go-to-market strategy are yielding positive results, with increased sales productivity and double-digit growth in both new and upsell business. Global System Integrators (GSIs) are playing a crucial role in closing deals, highlighting the importance of the partner ecosystem in driving AI adoption.
What’s Ahead
Zscaler’s latest earnings report demonstrates how AI has moved from a theoretical opportunity to a concrete business driver in cybersecurity. By embedding AI capabilities throughout its portfolio and aligning them with its zero trust architecture, Zscaler is creating differentiated value that’s resonating with customers and driving impressive financial results.
As organizations continue to face increasingly sophisticated threats and growing operational complexity, Zscaler’s AI-powered approach offers a compelling vision for the future of security. The company’s success in monetizing these innovations suggests that the market is ready to invest in intelligent security solutions that deliver measurable improvements in both protection and efficiency.