Taking advantage of the publication of its good quarterly results, Zscaler announced the acquisition of the start-up Edgewise Networks, specialized in network security, via segmentation and zero trust.
While financial analysts preferred to focus on Zscaler’s financial results, the cybersecurity firm announced the acquisition of Edgewise Networks. Founded in 2016, the start-up offers network security solutions based on micro-segmentation and zero trust. This concept provides trusted zones for applications, servers, processes with an identity verification to access them. The goal is to create a protected environment, thereby reducing the attack surface and the risk of compromising applications and data breaches.
With this acquisition, Zscaler wants to strengthen the security of applications in the cloud in public or private mode. Edgewise Networks has been using machine learning since 2017 to analyze the network, create a set of rules for trusted applications, and then generate specific security policies. Edgewise specifies that its solution can manage 13,000 connections with only 180 policies. Security specialists can also analyze these application-oriented policies on site or in the cloud in natural language.
Additional external growth and good financial results
The acquisition price was not released, but Edgewise Networks had raised $ 18 million in venture capital before the takeover. Investors include Pillar Ventures, .406 Ventures and Accomplice. This is the fourth external growth operation for Zscaler in 2 years: TrustPath in August 2018, Appsulate in July and more recently Cloudnetti on April 9.
Finally, financially, Zscaler is doing well with a 40% increase in revenues to $ 110.5 million in the third quarter (ended April 30). Adjusted earnings were $ 9 million or 7 cents per share. Analysts were pleasantly surprised as they expected earnings of 2 cents per share for revenue of $ 106.1 million. As a result, the stock jumped 17% on the stock market. For the fourth quarter, Zscaler expects sales of $ 117 million to $ 119 million and adjusted earnings of $ 2 million to $ 4 million, or 20 to 21 cents per share.