Benzinga | May 24, 2021 10:09AM EDT

Zscaler's Earnings Outlook

Zscaler (NASDAQ:ZS) unveils its next round of earnings this Tuesday, May 25. Get prepared with Benzinga's ultimate preview for Zscaler's Q3 earnings.

What Are Earnings, Net Income, And Earnings Per Share?

Earnings and EPS are useful metrics of profitability. Total earnings also known as net income is equal to total revenue minus total expenses. Dividing net income by the total number of shares outstanding yields EPS.

Earnings And Revenue

Sell-side analysts expect Zscaler's EPS to be near $0.07 on sales of $163.71 million. In the same quarter last year, Zscaler reported earnings per share of $0.07 on sales of $110.52 million.

Why Analyst Estimates And Earnings Surprises Are Important

Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.

The analyst consensus estimate would represent no change in the company's earnings. Revenue would be have grown 48.12% from the same quarter last year. The company's reported EPS has stacked up against analyst estimates in the past like this: Quarter Q2 2021 Q1 2020 Q4 2020 Q3 2020EPS Estimate 0.08 0.06 0.03 0.02EPS Actual 0.10 0.14 0.05 0.07Revenue Estimate 147.35 M 132.31 M 118.55 M 106.30 MRevenue Actual 157.04 M 142.58 M 125.89 M 110.52 M

Stock Performance

For a full 12 months, the return has risen by 127.86%. Given that these returns are generally positive, long-term shareholders are probably relaxed going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.

Do not be surprised to see the stock move on comments made during its conference call. Zscaler is scheduled to hold the call at 16:30:00 ET and can be accessed here.