Zscaler Inc. (NASDAQ:ZS) is one of the best AI stocks with huge upside potential. On March 12, Zscaler announced a significant expansion of its global data sovereignty capabilities through its Zero Trust Exchange platform. The company is extending its dedicated control and logging planes to new regions, including an upcoming deployment in Canada, to help enterprises comply with local laws without sacrificing performance. This architecture uses fully isolated layers for management, traffic inspection, and record-keeping, ensuring that sensitive data remains within its required jurisdiction.

To further support digital sovereignty, Zscaler Inc. (NASDAQ:ZS) introduced in-region SSL inspection and malware analysis, allowing encrypted traffic to be analyzed locally to prevent data from leaving a specific territory. The platform also offers private, single-tenant service edges for organizations with specific hardware certification needs, alongside dedicated technical teams to assist with national regulatory interpretation. These enhancements aim to resolve the conflict between strict data protection mandates and the need for cross-border collaboration.

The expansion is backed by third-party validation and a โ€˜Collect Once, Certify Allโ€™ framework designed to accelerate compliance with regulations like GDPR, NIS2, and DoD IL5. Customers maintain total ownership of their encryption keys and can choose between regional or on-premises log storage. Because Zscaler owns and operates its own cloud infrastructure rather than relying on third-party providers, the platform is designed to ensure high availability and business continuity even during regional outages.

Zscaler Inc. (NASDAQ:ZS) operates as a cloud security company worldwide. The company offers cyberthreat protection products. It also provides data security products.

While we acknowledge the potential of ZS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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