Zoom Video Communications Inc (NASDAQ:ZM) reported better -than-expected earnings overnight, however the announcement became something of a mixed bag as the remote meetings specialist’s forecasts for the rest of the year showed the predicted effects of a post-pandemic slowdown.
In its results for the first quarter, reported after the close on Tuesday, the company reported adjusted earnings per share (EPS) of US$1.32, better than the US$0.99 expected by analysts, while revenues in the period soared to US$956.2mln from US$328.2mln a year ago and above estimates of US$906mln.
The company highlighted new customer acquisition and expanded presence among existing clients during the quarter as key drivers of its higher earnings and revenues, reporting that customers with more than 10 employees had risen by 87% year-on-year to 497,000.
Looking ahead, Zoom said revenue for its second quarter is expected to be between US$985-US$990mln with EPS of between US$1.14-US$1.15.
Meanwhile, the company forecast full year revenues of between US$3.98-US$3.99bn, an increase from previous estimates, and EPS of between US$4.56-US$4.61.
However, while the full year estimates were higher than analyst predictions, the revenue figure implied a year-on-year growth rate of around 50.6% from the prior year’s number of US$2.65bn, a much slower rate of expansion compared to the 326% rate of growth during Zoom’s 2021 fiscal year.
“We kicked off the fiscal year with a very strong first quarter, posting 191% total year-over-year revenue growth combined with strong profitability and cash flow. Our steadfast commitment to empowering customers to work and learn from anywhere with our expansive, innovative, and frictionless video communications platform continued to drive our results. With this solid start, we are pleased to raise our total guidance range to US$3.975bn to US$3.99bn for the full fiscal year”, Zoom founder and chief executive Eric S. Yuan said in a statement.
“We have also opened our technology portfolio to developers through our powerful video SDK and to businesses to expand their reach through Zoom Events. Work is no longer a place, it’s a space where Zoom serves to empower your teams to connect and bring their best ideas to life. We are energized to help lead the evolution to hybrid work that allows greater flexibility, productivity, and happiness to both in-person and virtual connections”, he added.