In-line inspection becomes more valuable as AI accelerates attacks and data sprawl. The upside depends on converting telemetry into higher-priced platform bundles while maintaining reliability.

As AI drives attack speed beyond human response, enterprises shift to always-on, in-line security control planes; Zscaler can compound its traffic + telemetry into higher-value platform bundles (data security, AI security, security operations, compliance evidence) and sustain high-teens growth even as valuation normalizes.

Direct beneficiary of AI offense>defense: Zscaler sits on the in-line “switchboard,” monetizing trust, uptime, and telemetry loops at internet scale.

Zscaler remains a high-priority control point because traffic inspection, identity-aware access, and data governance get harder (and more necessary) as AI usage and phishing/social engineering scale. The company has a credible platform expansion path: attach more modules to existing large enterprises, add security-operations value post-Red Canary, and monetize AI security and compliance evidence as boards demand measurable controls. Returns are more likely to come from durable growth plus operational leverage than from multiple expansion.

The biggest risks are (1) competitive bundling by broader platforms that can sell “good enough” secure access/data controls, (2) execution complexity from turning acquisitions (Red Canary, SPLX) into repeatable, quota-bearing bundles, and (3) valuation sensitivity—ZS can execute well yet deliver muted returns if the market de-rates premium security software. Reliability matters structurally: an in-line architecture is punished for outages and latency.

$323.73