Zscaler Stock Falls on Exec Change. Analysts See it as a 'Low-Disruption' Move.

Dow Jones
Sep 25

Shares of Zscaler fell Friday after the cybersecurity company made a change to its executive management.

The company said Thursday that Ross Tackett would be taking over the role of chief revenue officer from Mike Rich. Rich is leaving Zscaler for "personal reasons," according to the company.

Tackett, who has served as Zscaler's head of worldwide sales, will become the company's new chief revenue officer on Oct. 1. Rich will remain with Zscaler as a strategic advisor through Dec. 31. Rich held the position for nearly three years.

Zscaler stock fell 3% to $208 in premarket trading on Friday after ending Thursday up 0.1%. Shares were on pace to snap a four-day winning streak.

The stock has risen 14% in September as of the closing bell on Thursday.

Guggenheim analyst John DiFucci said in a research note that Rich joined Zscaler in November 2023 with the goal of transforming Zscaler's go-to-market strategy from a transactional selling model to a more account-focused model.

"We believe this transition took longer than Zscaler likely expected with noise at the sales level (attrition and the ramp period of new joiners)," DiFucci said.

Rosenblatt analyst Catharine Trebnick added in a research note that the executive change is a "low-disruption transition."

"Leadership changes in sales can create near-term noise. This one is well telegraphed, internally sourced, and cushioned by a transition period," Trebnick said.

 

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