Zoom Video Communications Inc. on Tuesday forecast better-than-expected revenue for the current quarter, after beating quarterly estimates, as the video-conferencing platform expects steady growth from remote work and online learning.
Zoom became a household name during the pandemic as businesses and schools switched to its video conferencing platform for virtual classes, office meetings and social catch-ups.
The platform reported it had about 2,000 customers contributing more than $100,000 in trailing 12 months revenue, up about 160 per cent from a year earlier.
Zoom forecast current-quarter revenue in the range of $985 million to $990 million, above estimates of $931.8 million, as businesses adopt hybrid work models that demand the usage of video-conferencing services.
Revenue in the first quarter ended April 30 rose to $956.2 million from $328.2 million a year earlier, beating analysts’ average estimate of $906 million, according to IBES Refinitiv data.
On an adjusted basis, the company earned $1.32 per share, compared with estimates of 99 cents per share.
Zoom’s shares fell as much as 5 per cent in after-market trading on higher costs, which jumped 155 per cent to $265 million in the quarter, but pared losses to trade up 1.7 per cent later in the session.
The surging number of free users on Zoom’s platform has ramped up costs for the company, which operates some of its own data centres.
Moreover, while Zoom’s platform was one of the first to capitalize on the global shift to virtual work and online classes, platforms such as Microsoft Teams, Cisco Webex and Google Meet soon caught up.
Privacy concerns around the platform also led users to migrate to rival platforms.
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