- Zoom had a chaotically extraordinary year in 2020, with usage and revenues skyrocketing.
- Quarterly results reported Tuesday show it is still expanding, but the pace of growth is staying level.
- Now that the world is reopening, Zoom faces new challenges to show that it can adapt to a post-pandemic world.
- See more stories on the Insider activity page.
The pandemic boom
in the world center and made the video chat app a household name.
As the company struggled to adapt to its new popularity, Zoom’s board began holding weekly meetings – sometimes daily – and on at least one occasion last year, CEO Eric Yuan personally held as and several 19 meetings in one day.
Santiago Subotovsky, member of the Zoom council said Insider that Zoom’s experience was as if a “12-year-old had to go straight to college” as an influx of new users caused his annual income to drop to 326% between January 2020 and January 2021.
Now, its first-quarter fiscal results released Tuesday show its wild growth streak is leveling off.
Zoom reported Q1 revenue of $ 956.2 million, showing annual growth of 191%, which surpassed the analyst’s estimated $ 910.2 million compiled by Bloomberg. Earnings per share came in at $ 1.32, easily exceeding Wall Street’s forecast of $ 0.98.
Zoom also set a year-over-year revenue cap of $ 3.757 billion and $ 3.99 billion, slightly more than analysts forecast of $ 3.82 billion. By comparison, the last fiscal year brought in $ 2.65 billion in revenue, so this represents continued growth even as pandemic restrictions loosen, something analysts have watched.
The stock initially fell up to 3% after hours before rebounding in time and jumping more than 2%. Zoom’s orientation for its second fiscal quarter missed just the highest analyst estimates.
The results show how a slow but steady return to the office for many workers brings new challenges and opportunities. Zoom should show that their video conferencing software can remain a fundamental part of the modern workplace even when people can meet face to face.
To do so, the company will have to rely on the strategies developed during its vortex growth period, which Subotovsky and seven other insiders and executives described to Insider earlier this year.