Zoom shares surge as video app beats quarterly revenue estimates
Zoom shares jumped more almost 10 per cent this evening after the video conferencing platform said it expects quarterly revenue to smash analysts’ estimates.
The company forecast revenue for the latest quarter to come in between $900m (£646.3m) and $905m, compared with estimates of $829.2m, according to IBES Refinitiv data.
The announcement pushed shares in the Nasdaq-listed firm up 9.7 per cent to $409.7.
Zoom shares more than quadrupled in 2020, as the platform became a household name amid stay at home orders during the pandemic. The app has remained popular throughout on-and-off lockdown measures, with Zoom being used for family gatherings, remote conference calls and Cabinet meetings over the last year.
The company announced reported earnings of $1.22 a share — up from 15 cents a share the same period last year. The figure marks a significant leap from estimates of 79 cents per share on an adjusted basis.
“The fourth quarter marked a strong finish to an unprecedented year for Zoom,” said Zoom chief executive Eric Yuan.
The conferencing service stands to benefit from the adoption of hybrid work models by many businesses that will see workers continue to partially work from home long after lockdown restrictions are lifted.
Zoom expects growth to continue, though at a slower pace than in 2020. The company guided for 2021 revenue of $3.76bn to $3.78bn.
Rebecca Bezzina, managing director at digital agency R/GA London said: “Zoom’s growth has been remarkable to watch. In under a year, the video conference platform has united a socially distanced world and become the defining app of the coronavirus era.”
“However, with the vaccine programme in full swing and end of the pandemic in sight, Zoom’s growth over the past year could be hard to sustain,” she added. “While the platform has been the ultimate victor of circumstance, it can turn its recent success into long term growth by staying true to what it set out to do initially — connect people.”