Zilla's Early Wins: Can it Accelerate CyberArk's Expansion?
CyberArk CYBR continues to scale its identity security platform. During the first quarter of fiscal 2025, the company reported Annual Recurring Revenues (ARR) of $1.215 billion and net new ARR of $46 million. A new contributor to this growth is Zilla Security, an identity governance company, which was acquired by CyberArk in February 2025 to broaden its identity security platform.
During the first quarter, CyberArk highlighted early traction from its acquisition of Zilla Security. Zilla contributed approximately $5 million in ARR, including securing a six-figure new logo win in financial services. The main highlight of the deal was that the customer displaced its legacy identity governance and administration (IGA) vendor to deploy Zilla. The company noted that the customer feedback on Zilla has been overwhelmingly positive, particularly around simplifying access reviews and automating provisioning across modern environments.
Zilla expands CyberArk's identity security platform with artificial intelligence (AI)-powered IGA capabilities. With enhanced capabilities, CyberArk is now able to deliver scalable automation that enables accelerated identity compliance and provisioning across digital environments.
Zilla's capabilities are made available as standalone offerings. The offerings include Zilla Comply for access reviews and Zilla Provisioning that automates onboarding, role transitions, and offboarding through an AI-driven approach. These offerings are now becoming a key part of CyberArk's broader identity security platform.
Although Zilla is still in its early days, CyberArk expects Zilla to contribute more meaningfully to the sales cycle in the second half of 2025 and into 2026.
How Competitors Fare Against CYBR
Palo Alto Networks PANW and Zscaler ZS are also evolving their platforms to meet enterprise security demands.
Palo Alto Networks is doubling down on its platformization strategy. In the third quarter of fiscal 2025, PANW closed more than 90 net new platform deals. Moreover, the number of customers platformized on Cortex was up nearly three times, reflecting strong momentum with Palo Alto Networks' Extended Security Intelligence and Automation Management or XSIAM security operation platform. Additionally, the number of customers with multiple platformizations grew nearly 70% year over year.
Zscaler continues to expand its Zero Trust Exchange platform. In the third quarter of fiscal 2025, Zscaler reported ARR of $2.9 billion, up 23% year over year. Zscaler's Zero Trust Everywhere, Data Security Everywhere, and Agentic Operations are becoming its main growth engine. Together, these innovative categories are approaching $1 billion in ARR and are growing faster than Zscaler's total ARR growth.
CYBR's Price Performance, Valuation and Estimates
Shares of CyberArk have gained 16.6% year to date compared with the Zacks Security industry's growth of 21.3%.
CYBR YTD Price Performance
From a valuation standpoint, CYBR trades at a forward price-to-sales ratio of 13.37, below the industry's 14.65.
CYBR Forward 12-Month P/S Ratio
The Zacks Consensus Estimate for CYBR's 2025 and 2026 earnings implies a year-over-year increase of 25.74% and 25.72%, respectively. The estimates for 2025 and 2026 have been revised downward over the past 7 days, respectively.
CyberArk currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
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