Zscaler reports higher Q2 operating expenses
(Reuters) -Cybersecurity firm Zscaler reported higher operating expenses in the second quarter, overshadowing a lift in its annual revenue forecast and dragging the company's shares down about 5% in extended trading.
The role of AI in cybersecurity is evolving as vendors like Zscaler are integrating these technologies into existing offerings and introducing new solutions.
Zscaler is facing competition from rival Palo Alto Networks, which plans to offer up to six months of free services to customers switching to its cybersecurity platform.
Its second-quarter total operating expenses rose 24% to $453.3 million from $365.2 million last year.
The company's research and development expenses rose 42% to $122.2 million from $85.8 million a year ago.
Still, with businesses spending more on cybersecurity networking solutions to combat sophisticated online threats, Zscaler eased past market estimates for second-quarter results, and forecast third-quarter revenue and profit above expectations.
Excluding items, Zscaler reported second-quarter profit per share of 76 cents, compared with LSEG estimates of 58 cents.
Zscaler expects annual revenue to be between $2.118 billion and $2.122 billion, compared with previous forecast of $2.09 billion to $2.10 billion.
It expects third-quarter adjusted profit per share between 64 cents to 65 cents, above the average LSEG estimate of 58 cents.
(Reporting by Harshita Mary Varghese and Juveria Tabassum; Editing by Alan Barona)
