Shares of video communications company Zoom were floating near all-time lows ahead of today’s earnings report. A lack of growth in a competitive market and investors favoring profit-focused companies has weighed on the stock. 😢
However, investors were pleasantly surprised today after it reported better-than-expected results.
Adjusted earnings per share of $1.34 on revenues of $1.14 billion topped the expected $1.05 and $1.12 billion. YoY revenue growth of 3.6% is up marginally from last quarter but still hanging out near its historical lows. 🔺
The company saw 1% YoY growth in enterprise customers (218,100). That resulted in Enterprise revenue growth of 10.2% YoY to $659.5 million. And the number of customers contributing more than $100,000 in trailing on-year revenue jumped 17.8%.
On the margin side, Zoom’s non-GAAP operating margin came in at 40.5%. Meanwhile, its second-quarter operating cash flow of $336 million rose 30.6% YoY as it focused on cutting costs. ✂️
Current quarter guidance was short of expectations, but executives raised their full-year forecast marginally. The slightly positive news for a change helped $ZM shares bounce about 10% after hours before settling back down to +3%.
As investors digest the new information, we’ll see how the stock trades in the days ahead. 👀