Zoom Video Quarterly Net Falls 50%, Revises Outlook Higher

Scott Peters
23 May, 2022
New York City

Zoom Video Communications said sales in the first quarter 2023 ending in April rose 12% to $1.07 billion. 

Net income in the quarter fell nearly half to $113.6 million or 37 cents per share from $227.4 million or 74 cents per share.   

Net cash provided by operating activities in the first quarter fell to $526.2 million from $533.3 million a year ago. 

Free cash flow in the quarter increased to $501 million from $454 million a year ago. 

Deferred revenues in the quarter rose 2% to $1.3 billion and revenue performance obligation surged 44% to $3 billion. 

As more customers sign for longer term contracts, the company said it plans to take 63% of RPO as revenues over the next 12 months compared to 71% in the first quarter of last year. 

Revenue from Enterprise customers grew 31% from a year ago and represented 52% of total revenue, up from 45% in Q1 of FY22. 

The number of Enterprise customers grew 24% year over year to approximately 198,900. 

At the end of the first quarter, Zoom had 198,000 enterprise customers and 2,916 contributed more than $100,000 in the trailing 12-month revenues, an increase of 46% from a year ago.  

Revenues in the Americas increased 15% and in the Asia Pacific region rose 20% in the quarter from a year ago. 

The company has repurchased $132 million representing 1.2 million shares of the $1 billion share buyback program announced in the last quarter. 

Guidance and Outlook 

In the second quarter of fiscal 2023, the company is anticipating revenues between $1.15 billion and $1.2 billion and non-GAAP from operations between $360.0 million and $365.0 million.

Non-GAAP diluted EPS is expected to be between $0.90 and $0.92 based on 308 million non-GAAP weighted average shares outstanding.

For the full fiscal 2023 the company is anticipating between $4.530 billion and $4.550 billion and non-GAAP income from operations between $1.480 billion and $1.500 billion. 

Full fiscal year non-GAAP diluted EPS is expected to be between $3.70 and $3.77 based on 309 million non-GAAP weighted average shares outstanding.

Company and Stock 

Zoom stock closed down 0.5% to $89.33 in regular trading hours and in the after-market hours gained $11.82 or 13% to $101.30. 

Zoom stock has declined 51.5% in the year so far.