The bull case depends on converting an in-line security position into a programmable policy platform that expands attach and outcomes. The bear case is suite bundling and trust barriers to autonomous remediation compressing valuation faster than growth.

Zscaler can turn its in-line enterprise “policy choke point” into an AI-era control-plane: consolidate secure access + data protection, then layer autonomous remediation, agent identity/tool-use policy, and partner-delivered “policy apps,” sustaining ~20% growth while keeping a premium (but compressing) revenue multiple.

AI makes attacks faster than humans; value shifts to always-on verification, policy, and trusted distribution. Zscaler sits in the traffic path with telemetry and high switching costs, but lacks compute/energy leverage vs hyperscalers.

Zscaler is already shipping at scale with strong cash generation and is positioned at a durable enterprise control point (user/app traffic + policy). The non-linear upside is platformization: making “policy” programmable (partner marketplace), making response faster than humans (closed-loop remediation), and securing non-human actors (agent access governance). That expands willingness-to-pay per customer and raises attach rates without needing an entirely new buyer.

The key risk is competitive bundling (Microsoft/Palo Alto/Fortinet) shrinking differentiation while Zscaler expands into new categories (security operations, AI/agent controls). Second is “in-line trust”: outages/latency or a high-profile misfire in autonomous remediation could slow adoption and compress pricing.

$326.78