Key Takeaways
- Zoom Video Communications shares popped Thursday after the provider of remote video services reported better-than-expected results and issued a rosy outlook as it held on to more customers.
- The company said it was able to sell more high-end packages by offering advanced artificial intelligence.
- Zoom also announced that Chief Financial Officer Kelly Steckelberg resigned.
Zoom Video Communications (ZM) shares popped Thursday after the provider of remote video services reported better-than-expected results and provided a rosy outlook as it held on to more customers.
The company posted fiscal 2025 second-quarter adjusted earnings per share (EPS) of $1.39, with revenue increasing 2.1% to $1.16 billion. Both exceeded estimates.
Enterprise revenue grew 3.5% to $682.8 million, while online revenue was flat at $479.7 million. However, the average monthly “churn rate” of online customers dropped 30 basis points (bps) to 2.9%, That was “its lowest ever rate,” Zoom Founder and Chief Executive Officer (CEO) Eric Yuan said.
More Big-Ticker Customers Thanks to Advanced AI
Zoom said that it had 3,933 customers contributing more than $100,000 in trailing 12 months revenue, a gain of about 7.1% year-over-year. Yuan said the company was able to sell high-end packages by offering advanced artificial intelligence (AI).
Zoom said it sees full-year adjusted EPS at $5.29 to $5.32 and revenue between $4.63 billion and $4.64 billion. Both are above analysts’ expectations.
Company Also Announced Departure of CFO
The company also announced the departure of Chief Financial Officer Kelly Steckelberg.
Steckelberg, who has been with Zoom for seven years, told analysts that she would be staying on through the current quarter earnings report. Yuan said that the company “is conducting a comprehensive search” for her replacement.
Zoom shares finished 13% higher at $68.04, their highest level since March. The stock is still a far cry from its October 2020 all-time highs above $500.
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