Zscaler to Acquire Smokescreen to Enhance Zscaler Zero Trust Exchange with Advanced Active Defense Capabilities

Rhea-AI Summary

Zscaler (NASDAQ: ZS) has announced its acquisition of Smokescreen Technologies, a leader in active defense and deception technology. This move aims to amplify Zscaler's Zero Trust Exchange capabilities, enhancing detection of advanced cyber threats and ransomware. The transaction, pending standard closing conditions, is expected to finalize in fiscal Q4 2021. The integration of Smokescreen's technology aligns with proactive security measures, allowing Zscaler's clients to better thwart sophisticated attacks and improve overall threat intelligence.

Positive

• Acquisition of Smokescreen enhances Zscaler's Zero Trust Exchange capabilities.
• Integration of active defense technology improves detection of sophisticated cyber threats and ransomware.
• Expected to provide rich threat intelligence, aiding in proactive threat hunting.

Negative

• Risks associated with successfully integrating Smokescreen technology into Zscaler's platform.
• Uncertainty surrounding retention of key Smokescreen employees post-acquisition.

Zscaler to be Industry’s First Security Vendor to Integrate Active Defense into a Zero Trust Architecture

SAN JOSE, Calif., May 25, 2021 (GLOBE NEWSWIRE) -- Zscaler, Inc. (NASDAQ: ZS), the leader in cloud security, today announced that it has entered into a definitive agreement to acquire Smokescreen Technologies, a leader in active defense and deception technology. Smokescreen's cutting edge capabilities will be integrated into the Zscaler Zero Trust Exchange™, further building upon Zscaler’s ability to precisely detect the most sophisticated, highly targeted attacks, ransomware, and lateral movement attempts. Additionally, Smokescreen will help provide rich threat intelligence and telemetry for the Zscaler team to proactively hunt for emerging adversary tactics and techniques. The transaction is subject to standard closing conditions and is expected to close during Zscaler’s fiscal fourth quarter ending July 31, 2021.

In contrast to traditional reactive security measures, active defense uses proactive tactics to thwart the most advanced attackers with high-confidence detections across the lifecycle of an attack. It allows businesses to rebalance the defensive equation in their favor; identifying intrusions before attackers compromise vital company data and resources. Smokescreen is fully aligned with MITRE Shield, a framework for organizations to apply active defense effectively in their security operations workflows.

“Today’s most sophisticated cyberthreats, like the recent Colonial Pipeline ransomware attack, require immediate, high-confidence detections to drive effective response,” said Jay Chaudhry, CEO, chairman and founder, Zscaler, Inc. “Zscaler is proud to be the industry’s first security vendor to extend a zero trust architecture with integrated active defense and deception capabilities. With the addition of Smokescreen to our Zero Trust Exchange, our customers will be able to change the economics of cyberattacks by making them far more costly, complex and difficult for the adversary both before and during their attempted intrusions. I am pleased to welcome the Smokescreen team to the Zscaler family, and I look forward to our continued innovations in cybersecurity.”

“Alert volume has never been higher. Security teams can’t separate the signal from the noise to take a proactive stance against the most stealthy attackers,” said Sahir Hidayatullah, CEO at Smokescreen. “As analysts lose time chasing ghosts, the role of active defense has never been more critical. By taking the fight to the attacker, leading them down false paths with decoys deployed across networks, endpoints, and applications, and gathering the highest-fidelity security telemetry, we can dramatically speed up threat hunting and containment. We are thrilled to join Zscaler and look forward to integrating our technology into the world’s leading zero trust platform.”

Forward-Looking Statements

This press release contains forward-looking statements that are based on our management's beliefs and assumptions and on information currently available to our management. These forward-looking statements include our intention to acquire Smokescreen Technologies, the timing of when the acquisition will be completed and the expected benefits of the acquisition to Zscaler’s product offerings and to our customers. These forward-looking statements are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. A significant number of factors could cause actual results to differ materially from statements made in this press release, including those factors related to our ability to successfully integrate Smokescreen technology into our cloud platform and our ability to retain key employees of Trustdome after the acquisition.

Additional risks and uncertainties are set forth our most recent Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (“SEC”) on March 4, 2021, which is available on our website at ir.zscaler.com and on the SEC's website at www.sec.gov. Any forward-looking statements in this release are based on the limited information currently available to Zscaler as of the date hereof, which is subject to change, and Zscaler will not necessarily update the information, even if new information becomes available in the future.

About Zscaler

Zscaler (NASDAQ: ZS) accelerates digital transformation so customers can be more agile, efficient, resilient, and secure. The Zscaler Zero Trust Exchange protects thousands of customers from cyberattacks and data loss by securely connecting users, devices, and applications in any location. Distributed across more than 150 data centers globally, the SASE-based Zero Trust Exchange is the world’s largest in-line cloud security platform.

Zscaler™ and the other trademarks listed at https://www.zscaler.com/legal/trademarks are either (i) registered trademarks or service marks or (ii) trademarks or service marks of Zscaler, Inc. in the United States and/or other countries. Any other trademarks are the properties of their respective owners.

Media Contact:
Pavel Radda
pradda@zscaler.com

Investor Relations Contact:
Bill Choi, CFA
ir@zscaler.com

FAQ

What did Zscaler announce on May 25, 2021 regarding Smokescreen Technologies?

Zscaler announced it has entered into a definitive agreement to acquire Smokescreen Technologies to enhance its security offerings.

How will the acquisition of Smokescreen impact Zscaler's services?

The acquisition will enhance Zscaler's Zero Trust Exchange with active defense capabilities, improving detection and response to cyber threats.

When is Zscaler expected to finalize the acquisition of Smokescreen?

The acquisition is expected to close during Zscaler's fiscal fourth quarter ending July 31, 2021.

What are the potential benefits of Zscaler acquiring Smokescreen?

Potential benefits include improved threat intelligence, enhanced detection capabilities, and a proactive stance against cyber threats.

What challenges might Zscaler face after acquiring Smokescreen?

Challenges may include the integration of Smokescreen's technology and retaining key employees post-acquisition.