Zoom Shares Tumble As Growth Expected to Slow After Pandemic

Nov 23, 2021 By MarketDepth

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Zoom Video Communications, Inc. (NASDAQ: ZM) stock crushed more than 15% after the  video-first communications platform company announced financial results for the third fiscal quarter ended October 31, 2021. Total revenue for the third quarter was $1,050.8 million, up 35% year over year.

Up from Last Year

Drivers of total revenue included acquiring new customers and expanding across existing customers. At the end of the third quarter of fiscal year 2022, Zoom had 2,507 customers contributing more than $100,000 in trailing 12 months revenue, up approximately 94% from the same quarter last fiscal year and approximately 512,100 customers with more than 10 employees, up approximately 18% from the same quarter last fiscal year.

“In Q3, we held our premier user event, Zoomtopia, on our Zoom Events service. During this immersive, multi-track conference, we showcased how Zoom is placing people at the center of our communications platform, connecting their disparate work streams into our technology, moving beyond enterprises’ ability to collaborate internally, and empowering them to communicate face-to-face with their customers through Zoom Events and our upcoming Video Engagement Center. We also showcased innovations such as hot desking, whiteboarding, and smart gallery, all designed to empower both co-located and remote hybrid workforces as some companies test return to office programs. Through innovation and dedication, we will continue to deliver happiness to our customers. Looking forward, we expect to close the year between $4.079 to $4.081 billion in total revenue, representing approximately 54% year-over-year growth, alongside strong profitability and operating cash flow growth. We are well on our way to becoming an indispensable platform for enterprises, individuals, and developers to connect, collaborate, and build in the flexible hybrid world of work. We believe our global brand, innovative technologies, and large customer base position us well for the future.”

Zoom founder and CEO, Eric S. Yuan

Zoom has also provided projections – for full Fiscal Year 2022: Total revenue is expected to be between $4.079 billion and $4.081 billion. Non-GAAP income from operations is expected to be between $1.598 billion and $1.600 billion. Non-GAAP diluted EPS is expected to be between $4.84 and $4.85 with approximately 306 million non-GAAP weighted average shares outstanding.