Zscaler Inc. has signed a definitive agreement to acquire Red Canary, a leading Managed Detection and Response (MDR) company, in a move to expand its AI-driven security operations capabilities.
The acquisition will bring together Zscaler’s Zero Trust Exchange platform and Red Canary’s threat detection expertise. The goal is to build a unified and agile Security Operations Center (SOC) that combines AI automation with expert human analysis.
Strategic Expansion into MDR
This deal marks Zscaler’s expansion beyond its core Zero Trust solutions and into the fast-growing MDR market. Red Canary has more than a decade of experience in security operations. Its platform helps customers detect and respond to threats up to 10 times faster, with 99.6% accuracy, using automated remediation workflows.
Based in Denver, Red Canary has been named a Leader in the Forrester Wave™ for MDR for three consecutive years and featured in the Gartner® Market Guide for MDR for seven years.
“The proposed acquisition of Red Canary is a natural expansion of our capabilities into managed detection and response and threat intelligence to accelerate our vision of AI-powered SOC of the future,” said Jay Chaudhry, CEO, Chairman, and Founder of Zscaler.
As of January 2025, Red Canary had annual recurring revenue (ARR) of over $140 million, reflecting strong demand in the enterprise cybersecurity market.
Powerful Data and AI Integration
Zscaler processes more than 500 billion transactions daily through its global cloud security platform, which serves nearly 45% of Fortune 500 companies. This massive data flow, combined with insights from Zscaler’s ThreatLabz research team and its 2024 acquisition of Israeli firm Avalor, will support advanced AI analytics for threat detection.
Red Canary’s expertise covers endpoints, identity, network, and cloud workloads. Its capabilities help address common challenges in security operations, such as missed alerts and incomplete threat analysis.
The combined platform will allow security teams to detect, triage, investigate, and respond to threats faster and more efficiently, using advanced AI features.
“Zscaler’s global scale and reach provide the resources and granular data needed to fuel advanced AI, threat intelligence, and detection engineering,” said Brian Beyer, CEO of Red Canary. “This gives us a broader view of adversary behavior and speeds up innovation.”
Strengthening the Unified Security Platform
This acquisition follows Zscaler’s $350 million acquisition of Avalor in 2024. Both deals support Zscaler’s strategy to build an integrated platform for security operations.
By combining Zero Trust architecture with built-in threat detection and response, Zscaler aims to offer a more complete solution compared to traditional, standalone tools.
The transaction is expected to close in August 2025, pending standard regulatory approvals and closing conditions. Financial terms of the deal were not disclosed.
Once completed, the acquisition will increase Zscaler’s addressable market and strengthen its appeal to enterprise customers looking for unified, AI-powered security platforms.
The combined company aims to deliver enhanced protection against cyber threats, improve data security, and modernize security operations to meet the needs of a constantly evolving threat landscape.
