Zscaler reported a solid top-line acceleration in QQ4 2024, with revenue of $592.9 million, up 30.3% year over year and 7.2% quarter over quarter, underscoring continued demand for cloud-native security solutions in large enterprise environments. Gross profit was $462.7 million, representing a gross margin of approximately 78.0%, consistent with the year-ago period, signaling a scalable product mix as the company migrates customers to higher-value, subscription-based offerings. However, management faces near-term profitability headwinds: operating income declined to a negative $26.9 million, and net income was negative $14.9 million, resulting in an EPS of -$0.0995 (diluted -$0.0982). The expense base remains elevated, with R&D at $139.2 million and SG&A (selling, general & administrative) at $350.5 million, contributing to a negative operating margin of -4.55% for the quarter. Free cash flow was strong at $136.3 million, and the company exited the period with a robust balance sheet and liquidity, including cash and short-term investments totaling about $2.41 billion and a net cash position of roughly $185 million. The firm continues to generate significant operating cash flow ($203.6 million) despite the negative GAAP profitability, illustrating meaningful underlying cash generation from subscription revenues. Look-forward considerations include the need for operating leverage to materialize as sales scale continues and for expense discipline to improve margins, against a backdrop of secular growth in cloud security adoption and Zscaler’s expanding platform offerings.