Zoom revealed quarterly profits that exceeded Wall Street analyst expectations, coinciding with investors warning of slowing revenue in the video communication company as the end of the pandemic approaches.
During the quarter ended October 31, Zoom earned $1.11 per share on an adjusted basis, beating analyst estimates of $1.09 per share, to register a 71% growth to $340.3 million. As for revenue, the online meeting company raised about $1.05 billion, beating expectations of $1.02 billion, with a growth rate of 35% y/y but down 54% q/q compared to the second quarter. Read more [Zoom Shares Fall 11% After Slowing Growth].
For the fourth fiscal quarter, Zoom expects adjusted earnings of $1.06-1.07 per share on revenue of $1.051-1.053 billion, equivalent to a growth of 19%, while analysts see the company earning $1.05 per share on revenue of $1.02 billion.
Millions of people adopted the company’s software for remote classroom attendance and meeting after the coronavirus pandemic made these types of gatherings difficult, if not impossible, driving revenue growth rates of more than 300% in the periods leading up to the January quarter, and now Zoom is posting its slowest growth since at least 2018, even before it went public in 2019.
It is reported that Zoom canceled its plans to acquire cloud call center software company Five9 for $14.7 billion during the last quarter, to read more [Five9 Cancels $15B Deal With Zoom Video Communications], and in its report, Zoom stated that it will launch its own software to operate the cloud call center in early 2022.
Regardless of market movements during extended trading, Zoom has recorded a 28% decline since the beginning of this year so far, while the broader S&P 500 is up 25% during the same period.