Zscaler-led selloff hits cybersecurity stocks as Bath & Body Works, Micron gain premarket

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Zscaler selloff hits cybersecurity

Highlights

Zscaler falls premarket after forecasting current-quarter revenue of $875 million to $878 million, below the $879 million consensus, dragging down Palo Alto Networks (−4%) and CrowdStrike (−3%).
Bath & Body Works jumps 15% after issuing stronger-than-expected current-quarter guidance in its first-quarter earnings report, while Semtech and Micron Technology gain 7% each on earnings beats and milestone achievements.
Box edges lower after forecasting full-year adjusted earnings of $1.56 per share versus $1.63 expected, while analyst upgrades drive MGM Resorts (+3%) and Sandisk (+3%) higher.

Guidance and earnings drive early trading moves

Zscaler is leading the premarket decliners after the cloud security company says current-quarter revenue is expected at $875 million to $878 million, below the $879 million analysts were looking for, as reported by CNBC. The company still posts fiscal third-quarter adjusted earnings of $1.08 per share, ahead of the $1.01 consensus, while revenue of $850 million also tops expectations of $835 million, according to LSEG.

The weak outlook is weighing on peers, with Palo Alto Networks down 4% and CrowdStrike off more than 3% in sympathy. Box also edges lower after forecasting full-year adjusted earnings of $1.56 per share, below the $1.63 expected by analysts polled by LSEG, even though its first-quarter adjusted earnings and revenue come in ahead of estimates.

In retail, Bath & Body Works jumps 15% after issuing better-than-expected current-quarter guidance in its first-quarter earnings report. Dick's Sporting Goods falls 2.5% after reaffirming full-year earnings guidance of $13.50 to $14.50 per share, a range that leaves the midpoint close to analyst expectations, while its first-quarter earnings miss slightly and revenue beats by a small margin.

Semtech rises 7% after reporting first-quarter adjusted earnings and revenue above estimates, with current-quarter earnings, adjusted operating margin and EBITDA guidance also exceeding analyst expectations. Modine Manufacturing adds 2.5% after posting fiscal fourth-quarter adjusted earnings of $1.71 per share on revenue of $954.5 million, both above FactSet estimates, extending momentum after the company disclosed a $4 billion data center cooling deal a day earlier.

Upgrades, market milestones and sector implications

Micron Technology gains 7% in premarket trading, continuing a rally after the chipmaker crosses $1 trillion in market capitalization on Tuesday and becomes one of the market's largest semiconductor names. Sandisk adds 3% after Barclays upgrades the stock to outperform, arguing that a supply and demand imbalance is likely to persist through 2027 and support pricing power.

MGM Resorts rises 3% after JPMorgan upgrades the stock to overweight from neutral. The bank says U.S. leisure travelers remain resilient despite macroeconomic headwinds, improving the outlook for growth on the Las Vegas Strip.

Insulet drops about 5% after announcing a voluntary medical device correction covering specific lots of several pods. The company says the action follows a manufacturing issue that could lead to insulin under-delivery to patients.

The session's early moves point to a market that is rewarding companies with stronger guidance and punishing even modest outlook misses. They also show how company-specific updates are spilling over into related sectors, particularly in cybersecurity, while analyst upgrades continue to support selected names in gaming and storage.

Our earlier article on Micron Technology’s surge past a $1 trillion market capitalization explained how the milestone increased the stock’s profile and attracted stronger institutional attention. We also flagged that, despite clear bullish momentum, overbought signals could set up a near-term consolidation, with the $850–$920 zone as the key area to watch for a breakout or pullback.

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