Updated February 27th, 2024 at 11:48 IST

Zoom reports strong quarterly results beating expectations, announces share buyback

The company reported an adjusted profit of $1.42 per share for the quarter ended Jan. 31, surpassing analysts' estimates of $1.15 per share.

Reported by: Business Desk
Representative | Image:Unsplash
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Zoom quarterly results: Zoom Video Communications reported strong quarterly results on Monday, surpassing analysts' expectations fueled by robust demand for its expanding product lineup amid the growing adoption of hybrid work models. The company's shares surged approximately 10 per cent in after-hours trading following the announcement.

In addition to its impressive financial performance, Zoom also announced its authorisation of a stock buyback program of up to $1.5 billion of its outstanding Class A common stock.

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Zoom's fourth-quarter results underlined the success of its efforts to integrate artificial intelligence (AI) into its products and diversify its portfolio, capitalising on the rising trend of hybrid working. The company reported an adjusted profit of $1.42 per share for the quarter ended Jan. 31, surpassing analysts' estimates of $1.15 per share. Revenue also exceeded expectations, standing at $1.15 billion compared to an estimate of $1.13 billion.

According to Ryan Koontz, a senior equity analyst at Needham and Co., Zoom's focus on integrating generative AI into its platform demonstrates a commitment to its long-term strategy, leveraging existing resources rather than investing in potentially riskier ventures.

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Zoom introduced its AI companion during the third quarter, offering paid users access to features such as meeting summaries, catch-ups, and AI-driven prompts for email and chat composition. CEO Eric Yuan underlined the company's plans to further develop and monetise Zoom AI customisation in the coming year.

CFO Kelly Steckelberg highlighted the widespread adoption of the Zoom AI companion, with over 510,000 accounts enabled in the past five months. Additionally, the company reported an operating cash flow margin of 30.6 per cent for the reported quarter.

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Looking ahead, Zoom provided a fiscal-year 2025 revenue forecast of approximately $4.60 billion, slightly below analysts' estimates. For the first quarter, the company anticipates revenue of $1.13 billion, aligning with analysts' expectations.

(With Reuters inputs)

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Published February 27th, 2024 at 11:48 IST