Soaring demand for the Zoom video conferencing service far exceeded even the most optimistic Wall Street forecasts in the latest three months, lifting quarterly revenue higher than the San Francisco-based company reported for the whole of 2019.
Zoom, whose name has become almost synonymous with working and learning from home during the pandemic, reported revenues of $663.5m for the period to the end of July, a 355 per cent increase from the year before, and an acceleration from the 270 per cent growth in the early months of the pandemic.
Most analysts had expected quarterly revenue of about $500m. Revenue for the entire last fiscal year, which ended in January, was $623m.
News of the surge in business, and higher financial guidance from the company for the rest of the year, lifted its shares nearly 10 per cent in after-market trading, on top of a 9 per cent increase in the regular trading session. At $356, the shares have more than tripled since the coronavirus crisis first hit stock prices.
Zoom’s ability to reach a massive new global audience has made it one of the biggest corporate winners from the crisis, though the demand has also proved challenging, leading to a temporary service failure last week just as schools around the US were asking students to log in for classes.
Profits also jumped well ahead of forecasts in the latest period, with pro forma earnings per share — excluding stock compensation benefits and some other costs — reaching 92 cents, up from 8 cents a year before and more than double the 45 cents analysts had expected.
Based on formal accounting principles, net income rose to $186m, from $6m the year before.
For the current fiscal year, Zoom said it expected revenue to reach $2.37bn-$2.39bn, about 30 per cent ahead of analysts’ estimates, with pro forma earnings per share of $2.40-$2.47, or 85 per cent ahead of expectations.