Zscaler (NASDAQ:ZS) stock slipped 2.1% in the market pre-open Monday after the company announced the departure of its Chief Operating Officer on Feb. 2.
Specifically, the cybersecurity firm’s COO Dali Rajic resigned from the company on Jan. 29, prompting a significant executive leadership shake-up. The resignation took effect on Feb. 2.
Zscaler is yet to officially announce a successor for Rajic. However, according to his LinkedIn, Jason Sutton, formerly the VP and COO of America Sales at NOW, will replace Rajic as Zscaler’s COO.
“All in, while it's tough to lose someone as respected and talented as Dali (we are excited to hear where he lands), we think ZS remains in good hands and would also not view the lack of reiterated guidance as a negative signal for the upcoming quarter,” Wolfe Research analysts said in a note.
Meanwhile, Morgan Stanley voiced a more cautious stance following Rajic’s resignation, who they believe was “instrumental” in establishing Zscaler's sales organization.
“Bottom line, we are incrementally cautious on sales disruption risk post the COO resignation last week,” analysts wrote.
“With tougher 2H billings comps and growing competition, we see limited upside to near-term topline forecasts, while investor expectations remain high, in our view. Remain EW,” they added.
Rajic joined the company in 2019 as President of Go-to-Market and Chief Revenue Officer, before being promoted to COO in 2022.