Zscaler to acquire Red Canary as both companies look to soar

It’s always good to have early detection—and cloud security firm Zscaler has a new canary in the proverbial coal mine.

Zscaler’s acquisition of Red Canary, a managed detection and response leader, will combine data and SecOps to give the parent company a more aggressive and integrated approach to cybersecurity. The deal is for $675 million in cash and is expected to close this August.

On a Q3 earnings call just two days after the announcement, Zscaler founder and CEO Jay Chaudhry told investors that the acquisition builds on the company’s buying out of data fabric company Avalor. Red Canary got on their radar for its ability to interact and synthesize with the Zscaler data fabric the company built from its Avalor acquisition.

“They had developed a very sophisticated agentic AI technology for reasoning and workflow,” Chaudhry said. “And this is being used today, this is not the future—they’re using it to support a large number of customers. Now I can take their agentic technology, combine it with a Zscaler Data Fabric, and things are accelerated by many, many months for us.”

Good for both sides. In a statement accompanying the announcement, Red Canary CEO Brian Beyer said that Zscaler’s “global scale and reach provide the resources and granular data needed to fuel advanced AI, threat intelligence, and detection engineering.” That’s allowed for scaling up, Forrester VP and Principal Analyst Jeff Pollard told Cybersecurity Dive. And it makes for good policy on network endpoint and identity-based visibility.

“The network has ultimately been highly deprioritized from a detection and response perspective,” Pollard said.

Red Canary assured customers and partners that from their perspective, nothing would change in the immediate term. The company’s “vendor-neutral” stance is also unchanged, as is the mission and roadmap, Red Canary said in an FAQ sheet after the acquisition was announced.

In the earnings call, Chaudhry said that Zscaler is bullish on Red Canary’s ability to deliver on identity, data fabric, and agentic AI, allowing it to integrate itself into the existing Zscaler system.

“Red Canary brings a number of interesting things for us to move in that direction at a faster pace, so we can kind of accelerate our vision of becoming a leading player,” Chaudhry said.