Zscaler (NASDAQ: ZS) and Okta (NASDAQ: OKTA) have both faced significant stock declines over the past year, down over 20% and 30%, respectively. Despite this, Zscaler reported a robust 26% revenue growth in its latest quarterly earnings, reaching $815.8 million, while its annual recurring revenue climbed to $3.3 billion. In contrast, Okta’s revenue growth is slowing, with a projected 9% increase for fiscal 2027, raising concerns about its long-term investment viability.
The contrasting financial trajectories of these two cybersecurity leaders highlight important market implications. Zscaler’s upward revision of its full-year guidance and its adherence to the “Rule of 40” suggest a solid growth outlook, making it a compelling buy despite its premium valuation. Meanwhile, Okta’s decelerating growth and challenges posed by AI could hinder its recovery.
For market professionals, the key takeaway is that while both companies are industry leaders, Zscaler’s stronger growth metrics and strategic positioning against AI disruptions may offer a more attractive investment opportunity than Okta in the current climate.
Source: nasdaq.com