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Zoom raises annual revenue target on remote work boost

By September 1, 2020 No Comments

Zoom Video Communications Inc raised its annual revenue forecast by 30% after comfortably beating quarterly estimates on Monday, as it converts more of its huge free user base to paid subscriptions.

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Shares of the company, which have surged almost four-fold this year, rose 5% after the bell. They hit a record high in regular trading.

TickerSecurityLastChangeChange %
ZMZOOM VIDEO COMMUNICATIONS INC.325.10+25.83+8.63%

Video-conferencing platforms, once used mostly as a technological substitute for in-person meetings, became a vital part of day-to-day life this year for people stuck at home under coronavirus restrictions, be it for work, school or socializing.

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Zoom, however, has come under fire for its security and privacy shortfalls, prompting many companies and countries to curb the use of the platform.

The company said revenue rose 355% to $663.5 million, above analysts’ average estimate of $500.5 million.

Zoom said it now has 370,200 institutional customers with more than 10 employees, up about 458% from the same quarter last year.

The company, founded and headed by former Cisco manager Eric Yuan, raised its annual revenue target for fiscal year 2021 to the range of $2.37 billion and $2.39 billion, from $1.78 billion to $1.80 billion earlier.

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Net income attributable to common stockholders rose to $185.7 million, or 63 cents per share, from $5.5 million, or 2 cents per share, a year earlier.

Excluding items, the company earned 92 cents per share, beating the average analyst estimate of 45 cents, according to IBES data from Refinitiv.

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