7 months ago • 1 min
Zoom, the virtual meetings superstar, raised its expectations for annual revenue and profit, defying the ebbing tide of pandemic-driven growth and a sluggish global economy. Zoom's growth has cooled off as offices reopen and competition intensifies, but it remains confident in its future prospects.
The company now projects annual revenue between $4.47 billion and $4.49 billion, which is a modest 2% increase from last year and 1% higher than its previous forecast. Meanwhile, Zoom's adjusted profit per share for the year is expected to be between $4.25 and $4.31, some 3% higher than its previous forecast.
While revenue in Zoom's most recent quarter of $1.11 billion surpassed analysts' estimates, it recorded the slowest quarterly growth in its history of 3%. Online revenue dipped 8%, reflecting the shifting landscape as people transition from remote-first work back into offices. Zoom anticipates online revenue to hover around $480 million this quarter and remain relatively steady throughout the rest of its financial year.
The enterprise segment, catering to larger businesses, saw a 13% increase in quarterly sales, reaching $632 million. However, Zoom's total revenue growth guidance implies this segment's growth will slow down throughout the rest of the year.
Zoom's ability to adapt and cater to a diverse customer base has been key to its success. While it gained popularity among individuals and small- to medium-sized businesses during lockdowns, it now faces stiff competition from deep-pocketed rivals like Microsoft Teams, Cisco Webex, and Salesforce Slack.
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