DA Davidson analyst Andrew Nowinski raised his price target on Zscaler to $58 and kept his Buy rating after its "solid" Q1 results, with revenue and billings topping the midpoint of prior guidance by 5% and 7% respectively. The analyst notes that the stock traded down about 5% afterhours as Q2 billings forecast implies a "significant" deceleration in growth, but wonders whether the management set that guidance too conservatively as comps in Q3 and Q4 become easier. Nowinski expects Zscaler to outperform in the coming quarter given the company's limited competition and increasing sales capacity.

Zscaler announced innovations - ZDX Copilot, Hosted Monitoring, and Data Explorer - to its Zscaler Digital Experience service. The new ZDX Copilot, an AI assistant, instantly analyzes and harnesses knowledge from over 500 trillion data points daily across users, devices, networks, and applications, to provide IT operations, service desk, and security teams insights they need related to digital experience and performance. Teams can ask sequences of questions to effectively converse with Copilot, which uses Generative AI, to review high-level trends and progressively narrow results down to specific actionable insights.