Operating cash flow remains positive at $198.0 million in 2026Q3, though this is heavily supported by $205.2 million in stock-based compensation rather than core net income.
Zscaler, Inc. (ZS) cash flow statement — 11-year operating, investing & financing cash flows
| Metric | TTM | Jul'25 | Jul'24 | Jul'23 | Jul'22 | Jul'21 | Jul'20 | Jul'19 | Jul'18 | Jul'17 | Jul'16 | Jul'15 |
|---|
| Cash from Operations | 1.13B | 972.45M | 779.85M | 462.34M | 321.91M | 202.04M | 79.32M | 58.03M | 17.31M | -6.02M | -11.92M | -3.28M |
| Operating CF Margin % | - | 36.38% | 35.97% | 28.59% | 29.51% | 30.02% | 18.39% | 19.16% | 9.1% | -4.79% | -14.83% | -6.11% |
| Operating CF Growth % | 54.28% | 24.7% | 68.67% | 43.62% | 59.33% | 154.72% | 36.69% | 235.28% | 387.54% | 49.49% | -263.4% | - |
| Net Income | -63.18M | -41.48M | -57.71M | -202.34M | -390.28M | -262.03M | -115.12M | -28.66M | -33.65M | -35.46M | -27.44M | -12.83M |
| Depreciation & Amortization | 192.01M | 121.18M | 80.93M | 66.82M | 49.47M | 36.46M | 21.12M | 11.31M | 7.99M | 6.84M | 4.87M | 2.85M |
| Stock-Based Compensation | 821.92M | 661.35M | 527.68M | 444.83M | 409.56M | 258.54M | 121.39M | 46.42M | 11.22M | 9.92M | 3.62M | 1.56M |
| Deferred Taxes | -20.39M | -14.35M | -5.63M | 352K | -562K | -2.41M | -1.17M | -1.39M | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | 146.23M | 219.03M | 168.51M | 124.1M | 156.27M | 125.91M | 44.48M | 16.75M | 13.31M | 8.38M | 5.46M | 3.92M |
| Working Capital Changes | 53.05M | 26.72M | 66.07M | 28.57M | 97.45M | 45.57M | 8.61M | 13.59M | 18.43M | 4.3M | 1.58M | 1.22M |
| Change in Receivables | -139.99M | -256.01M | -152.96M | -183.86M | -143.34M | -111.61M | -54.22M | -31.73M | -22.56M | -14.56M | -6.19M | -4.72M |
| Change in Inventory | 0 | 0 | 0 | -45.3M | 0 | -18.91M | -18.89M | -7.98M | -2.99M | 2.66M | 1.97M | -1.06M |
| Change in Payables | -10.63M | 17.53M | 4.16M | -8.42M | 14.36M | 7.45M | 862K | 495K | -779K | 2.25M | 563K | -389K |
| Cash from Investing | -2.65B | -427.02M | -683.18M | -259.34M | 374.06M | -109.67M | -1.04B | -162.07M | -178.1M | -8.34M | -6.65M | -595K |
| Capital Expenditures | -234.9M | -245.76M | -144.59M | -128.72M | -90.58M | -58.3M | -51.81M | -30.16M | -15.17M | -8.17M | -6.25M | -6.71M |
| CapEx % of Revenue | 7.01% | 9.19% | 6.67% | 7.96% | 8.3% | 8.66% | 12.01% | 9.96% | 7.98% | 6.5% | 7.78% | 12.48% |
| Acquisitions | -918.07M | -834K | -374.7M | -15.64M | -25.29M | -40.53M | -41.6M | -11.43M | 0 | 0 | 0 | 1.53M |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -41.47M | 0 | -50.31M | 0 | 0 | 0 | 0 | 0 | 433K | 0 | 0 | -1.53M |
| Cash from Financing | 62.41M | 420.51M | 64.21M | 45.99M | 41.34M | 41.67M | 1.02B | 46.38M | 208.4M | 9.5M | 27.56M | 85.61M |
| Debt Issued (Net) | 0 | 354.16M | 0 | 0 | 0 | 0 | 1.13B | 0 | 0 | 0 | 833K | 0 |
| Equity Issued (Net) | 63.4M | 67.14M | 64.25M | 46.21M | 41.59M | 43.92M | 36.94M | -22K | 201.53M | 7.67M | 24.96M | 84.73M |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -22K | -3.81M | 0 | 0 | 0 |
| Other Financing | -991K | -792K | -39K | -217K | -255K | -2.25M | -145.25M | 46.41M | 6.86M | 1.82M | 1.77M | 889K |
| Net Change in Cash | -1.46B | 965.94M | 160.87M | 249M | 737.31M | 134.05M | 63.37M | -57.66M | 47.6M | -4.86M | 9M | 81.74M |
| Free Cash Flow | 914.41M | 726.69M | 584.95M | 333.62M | 231.33M | 143.74M | 27.51M | 27.86M | 2.14M | -14.19M | -18.16M | -9.98M |
| FCF Margin % | 27.28% | 27.19% | 26.98% | 20.63% | 21.2% | 21.36% | 6.38% | 9.2% | 1.12% | -11.29% | -22.61% | -18.59% |
| FCF Growth % | 25.83% | 24.23% | 75.33% | 44.22% | 60.93% | 422.55% | -1.28% | 1203.93% | 115.06% | 21.86% | -81.92% | - |
| FCF per Share | 5.71 | 4.71 | 3.91 | 2.30 | 1.64 | 1.06 | 0.21 | 0.23 | 0.03 | -0.14 | -0.65 | -0.38 |
| FCF Conversion (FCF/Net Income) | -14.47x | -23.45x | -13.51x | -2.29x | -0.82x | -0.77x | -0.69x | -2.03x | -0.51x | 0.17x | 0.43x | 0.26x |
| Interest Paid | 0 | 0 | 1.44M | 1.44M | 1.44M | 1.46M | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | -23.72M | 0 | 23.12M | 14.94M | 5.61M | 4.14M | 2.52M | 1.77M | -870K | 385K | 319K | 173K |
Quick answers to the most common questions about buying ZS stock.
Zscaler, Inc. (ZS) generated $972.5M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Zscaler, Inc. (ZS) generated $726.7M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Zscaler, Inc. (ZS) spent $245.8M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
Key Metrics
Top Statement Risk
High Stock-Based Compensation Dilution
Metrics are mathematically derived from official filings.
Earnings Quality Masked by SBC
According to the provided cash flow data, Zscaler consistently reports negative net income while generating positive operating cash flow, with the 2026Q3 net loss of $13.9 million contrasting sharply against $198.0 million in operating cash flow, largely driven by substantial non-cash stock-based compensation adjustments.
The persistent gap between GAAP net losses and operating cash flow suggests that the company's operational viability is heavily reliant on equity-based incentives rather than core earnings. Investors should monitor whether this reliance on SBC creates a structural floor for cash flow that would evaporate if equity compensation were curtailed or if dilution reached unacceptable levels.
FCF Margins Reflect Operational Scale
As reported in financial statements, Zscaler's free cash flow trajectory has shown volatility, peaking at a 52.4% margin in 2026Q1 before moderating to 23.3% in 2026Q3, indicating that while the business is cash-generative, its FCF profile remains sensitive to timing differences in billings and working capital.
The fluctuation in FCF margins appears to be a function of the company's 'land and expand' model, where large upfront contract payments can temporarily inflate cash flow. Analysts should interpret these margins with caution, as they do not yet represent a steady-state cash generation capability independent of aggressive sales cycles.
Working Capital Volatility Impacts Liquidity
Based on the reported figures, Zscaler's working capital dynamics are highly erratic, swinging from a $162.8 million inflow in 2026Q1 to a $69.1 million outflow in 2026Q3, which suggests that the company's cash flow is significantly influenced by the timing of large enterprise renewals and collections.
This volatility implies that the company's cash position is susceptible to enterprise budget cycles and potential delays in customer payments. The reliance on these working capital swings to bolster operating cash flow warrants further investigation into the underlying health of the accounts receivable aging profile.
SBC Obscures True Cash Reality
Analysis of the cash flow statement reveals that stock-based compensation, which reached $205.2 million in 2026Q3, consistently exceeds the reported net loss, effectively acting as a primary driver of the company's ability to report positive operating cash flow despite ongoing GAAP unprofitability.
By treating SBC as a non-cash add-back, the company presents a cash flow picture that may overstate its self-funding capability. Investors should consider the economic cost of this dilution, as it represents a real claim on future earnings that is not fully captured by traditional cash flow metrics.