Zscaler, Inc. Keynote at Bank of America Global Technology Conference 2025: Expanding Zero Trust and Data Security Solutions in a Competitive SASE Market

Key Takeaways

TL;DR: Zscaler is aggressively evolving from its core Zero Trust solutions (ZIA, ZPA, ZDX) into new growth areas—including branch, workload, data protection, and AI-driven security operations—leveraging strategic acquisitions and flexible pricing models. The co. is addressing competitive pressures by emphasizing a comprehensive, ROI-driven solution and a refined go-to-market strategy.

• Core Growth & Evolution of Zero Trust Portfolio
  • Strategy Shift: Initially focused on ZIA, ZPA, and ZDX for user access, Zscaler is now expanding into broader “Zero Trust everywhere” use cases, incl. branch, cloud workloads, IoT/OT, and emerging AI agents.
  • New Growth Areas: Emphasis on three major vectors: data protection, AI/agentic operations (which blend threat/exposure mgmt.), and secured access to AI apps, all of which cumulatively represent nearly $1B in ARR for the co.
  • Direct Insight: Jay Chaudhry noted, “Zero Trust used to be the case, now it's Zero Trust everywhere,” underscoring the push from traditional internet access to securing every network entry point.
• Agentic Operations & AI-Driven Security
  • Innovative Edge: The introduction of “agentic operations” leverages internal security research, AI tech, and strategic acquisitions (e.g., Avalor and Red Canary) to disrupt traditional security ops & IT ops.
  • Market Impact: This approach enables rapid go-to-market for advanced threat and exposure mgmt. modules, reducing time-to-value compared to competitors, and positioning Zscaler as “the best party to be able to provide secure access to AI agents.”
• Data Security & Flexible DLP Offering
  • Oppt'y Rationale: As data migrates from traditional data centers to SaaS, endpoints, and cloud storages (S3, Snowflake, and even AI models), the need for a seamless data protection solution becomes critical.
  • Product Innovation: Zscaler’s data protection modules, packaged into 8 selectable features with a “Z-Flex” pricing model, offer customers the flexibility to adopt 3–8 modules, addressing a range of DLP needs.
  • Quantitative Signal: The co. has announced that its data security ARR has already exceeded about $350M. Jay stressed that “Data is no longer sitting in your data center” and must be protected in every channel.
• Sales Strategy & Execution
  • Organizational Transformation: Zscaler has restructured its go-to-market org. for a matured $2B biz—shifting from a transactional to an account-focused sales model, led by a former ServiceNow Americas head.
  • Efficiency & Upsell Focus: The emphasis is now on new ACV, upselling, and driving larger bundle deals. Jay emphasized that “new logo ACV went up 40% YoY” and that customers typically move from an initial ZIA purchase to adopting the full platform across branch and cloud workload security.
  • Billing Dynamics: Discussed accelerating unscheduled billings (up to +28% growth), driven by renewals and upsell activity, which signals customer satisfaction and effective account expansion.
• Competitive Landscape & Pricing Considerations
  • Market Positioning: While new entrants try to mimic aspects of the SASE model using legacy firewall tech or diluted “virtual” security, Zscaler distinguishes itself by offering true Zero Trust functionality that customers value.
  • ROI Over Pricing: In response to pricing pressures from competitors like Microsoft Entra or Fortinet, mgmt. emphasizes ROI and total cost-of-ownership savings. One exec. highlighted, “If you’re spending $20M on firewalls, what if I can cut it down to $7M?”—a clear value proposition that minimizes the risk of commoditization.
• Vision for Future Adoption Across Customer Segments
  • Migration Narrative: Early customers adopted Zscaler for traditional Zero Trust for users; today, the vision extends to Zero Trust branch (supported by the Airgap acquisition) and Zero Trust for workloads.
  • Customer Adoption: With over 45% of Fortune 500 cos. on board and customers sharing success stories (like one client whose rapid deployment led a CISO to become CIO), Zscaler is building strong momentum for cross-sell oppt'ys.

Overall, the call painted a picture of a co. evolving its product portfolio, sales model, and market positioning in response to rapid tech change (cloud, AI, data mobility) and competitive pressures. For investors, Zscaler’s focus on comprehensive Zero Trust security, operational efficiencies, and strategic product innovation is expected to drive long-term growth and resilience.

Call Q&A

• Unknown Analyst: How have customer discussions evolved from connectivity and security problems to a more holistic Zero Trust problem?
  • Jagtar Chaudhry: Discussions have shifted from specific solutions like ZIA, ZPA, and ZDX to a broader focus on Zero Trust access for users, regardless of location. Customers now seek Zero Trust solutions for branches and workloads, moving away from traditional network models.
• Unknown Analyst: Do you need a position in endpoint solutions like EDR to complete your vision?
  • Jagtar Chaudhry: We have an agent on every endpoint, but we focus on keeping endpoints lightweight. Our agent replaces multiple others, but we don't focus on core EDR functionality.
• Unknown Analyst: Is your disruptive tech an inhibitor for traditional cos. resistant to change?
  • Jagtar Chaudhry: Our tech is driven by customer needs for cybersecurity, biz agility, and cost reduction. We engage with senior mgmt. to demonstrate cost savings and simplification, coexisting with existing systems during phased transitions.
• Unknown Analyst: How do you view the risk from newcomers to classic SASE?
  • Jagtar Chaudhry: Newcomers often use firewall tech and call it SASE, which isn't true Zero Trust. Our focus is on demonstrating the benefits of our tech, which is compelling and well-received by customers.
• Unknown Analyst: How do you address price differences with competitors like Microsoft Entra and Fortinet?
  • Jagtar Chaudhry: We focus on ROI and value delivered. Our solution is often seen as the best by CIOs and CISOs. We demonstrate cost savings and rarely lose deals on price when properly engaged.