Eric Yuan, founder and CEO of Zoom Video Communications, speaks at the annual Concordia Summit in New York on September 25, 2024.
Lee Vogel | Concordia Summit | Getty Images
Zoom in Shares fell 4% in extended trading Monday after the video calling software maker reported strong third-quarter financial results and provided quarterly guidance that was slightly above expectations.
Here's how the company performed compared to the LSEG consensus:
Earnings per share: $1.38 adjusted vs. $1.31 expected Revenue: $1.18 billion vs. $1.16 billion expected
Zoom's revenue rose about 4% year over year in the quarter that ended Oct. 31, according to a statement. Zoom has grown its revenue by single digits for two and a half years, a sharp departure from 2020 and 2021, when the COVID-19 pandemic led to the company tripling in size.
Net income, which amounted to $207.1 million, or 66 cents per share, rose from $141.2 million, or 45 cents per share, in the same quarter a year earlier.
The company reported 192,400 enterprise customers in the quarter, an increase of 800 customers from the previous quarter.
In terms of guidance, Zoom called for $1.29 to $1.30 in adjusted earnings per share in the fiscal fourth quarter on $1.175 billion to $1.180 billion in revenue. Analysts surveyed by LSEG were expecting $1.29 per share and revenue of $1.17 billion.
Zoom boosted its outlook for fiscal 2025. It expects adjusted earnings per share to reach $5.41 to $5.43, with revenue ranging from $4.656 billion to $4.661 billion. The middle of the revenue range indicates growth of about 3%.
The LSEG consensus was $5.35 per share on revenue of $4.64 billion. In August, Zoom said it was looking for $5.29 to $5.32 per share and revenue of between $4.63 billion and $4.64 billion.
During this quarter, Zoom said in the first half of 2025 it will release a dedicated AI companion that can connect to corporate terms and services such as Service now and Work day. Zoom has also begun offering single-use webinar options, with space for up to 1 million participants.
As of Monday's close, Zoom stock was up about 24% this year, while the S&P 500 was up 25%.
The company also said that its company name will change from Zoom Video Communications to Zoom Communications Inc.
“This change reflects our evolution into an AI-first business platform for human communication and our vision for long-term growth,” Eric Yuan, founder and CEO of Zoom, said in a conference call with analysts.
