Zoom Surpasses Earnings Expectations Amid Coronavirus-Driven Remote Work Surge
Zoom reports impressive fourth-quarter earnings and strong forward guidance as demand for remote work tools skyrocket during the coronavirus outbreak. Despite beating analyst estimates, the company's stock initially drops in after-hours trading.
Zoom video conferencing reports strong fourth-quarter earnings that easily beat analyst expectations, generating 15 cents per share on $188.3 million in revenue. The company experiences significant growth as the coronavirus outbreak forces businesses worldwide to adopt remote work policies. Even a temporary outage affecting Microsoft Teams drives additional users to Zoom's platform during this critical period.
The demand for Zoom's services shows clearly in its expanding customer base, with large corporate clients paying over $100,000 increasing by 86% year over year. Revenue grows 78% annually, and the company's marketplace of third-party integrations now exceeds 200 products. CEO Eric Yuan notes that February brings record usage as companies actively instruct employees to meet remotely to prevent the spread of the virus.
Looking ahead, Zoom provides optimistic guidance that exceeds Wall Street forecasts for both the upcoming quarter and the full fiscal year. The company projects first-quarter revenue between $199 million and $201 million and full-year revenue approaching $915 million. Despite these positive metrics and a stock surge of over 70% earlier in the year, shares drop as much as 10% in extended trading before partially recovering.