Zoom sales up fourfold as pandemic keeps workers at home

The video conferencing company Zoom continued to ride the boom in working and learning from home as Covid-19 infection rates accelerated again in recent weeks, lifting its revenue more than fourfold in the latest quarter. 

The San Francisco-based company said on Monday that demand for video conferencing drove its revenue to $777m in the three months to the end of October, up from $167m a year ago and far above the $693m Wall Street had been expecting.

Zoom shares fell as much as 7 per cent in after-hours trading, however, having already retreated 16 per cent from the high point touched last month at the height of the excitement around its prospects. They are still up seven-fold on the year, valuing the company at about $136bn, or two-thirds as much as the communications giant AT&T.

The third-quarter revenue growth of 367 per cent represented an acceleration from the 270 per cent rate in the first quarter as the pandemic hit, and 355 per cent in the three months to the end of July.

It projected fourth-quarter revenue of between $806m and $811m, which even at the top end of the range would be a slower year-on-year growth rate of 331 per cent.

Zoom has continued to add to its base of large customers, who have come to rely on its service during the era where staff are working from home.

The company said it now had 433,700 customers with more than 10 employees — up 485 per cent from the 74,100 it reported a year ago and up 17 per cent from the end of July. Of those, 1,289 customers are paying more than $100,000 each in revenue, a 136 per cent increase from a year ago.

In the latest quarter, pro forma earnings per share — excluding stock compensation and some other costs — rose to 99 cents, up from 9 cents a year ago. Based on formal accounting rules, net income rose to $198.4m, from $2.2m a year before.

Wall Street had been expecting pro forma earnings per share of 76 cents for the quarter.

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