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Zoom shares rise on stronger-than-expected earnings
Shares in Zoom Video Communications Inc. rose in late trading after the video conferencing company reported stronger than expected fiscal first-quarter earnings.
For the quarter ended April 30, Zoom reported a profit before costs such as stock compensation of $315.8 million, or $1.03 per share, down from $402.1 million, or $1.32 per share, a year ago. Revenue rose 12%, to $1.074 billion. Analysts had expected 87 cents per share on revenue of $1.07 billion.
Zoom’s strong figures were driven by growth in customer metrics, with the company having about 198,900 enterprise customers as of the end of the quarter, up 24% year-over-year. The trailing-12-month net dollar expansion for enterprise customers was 123%, and 2,916 customers contributed more than $100,000 in the previous 12 months, up 46% year-over-year.
Highlights in the quarter included the launch of a range of new products: Zoom Contact Center, Zoom Whiteboard and Zoom IQ for Sales. Zoom Contact Center, made generally available in February, saw Zoom enter the cloud contact center market. The service combines unified communications and contact center services with the unique usability of Zoom’s platform to support use cases such as video and voice calls, with SMS and web chat capabilities also available in beta.
“In Q1, we delivered revenue of over $1 billion driven by ongoing success in enterprise, Zoom Rooms and Zoom Phone, which reached 3 million seats during the quarter,” Zoom founder and Chief Executive Officer Eric S. Yuan said in a statement. “We also maintained strong profitability and cash flow.”
Looking in the new quarter, Zoom predicted an adjusted profit of 90 to 92 cents a share on revenue of $1.115 billion to $1.120 billion. Analysts had expected an adjusted profit of 87 cents per share on revenue of $1.1 billion.
For the full fiscal year of 2023, Zoom expects an adjusted profit of $3.70 to $3.77 on revenue of $4.53 billion to $4.55 billion. Analysts had expected $3.53 a share on revenue of $4.55 billion.
Investors liked both the earnings beat and the company’s outlook. Popping as much as 14% after the results, Zoom shares settled up almost 5% after the bell.
Photo: Zoom
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