ZM
The beat was real — but so was the shrug
Zoom did the thing investors always ask for: it beat on both the top and bottom lines. Revenue came in at $1.28 billion and adjusted EPS landed at $1.55, both ahead of expectations. Not bad for a company that spent years trying to convince the market it’s more than the app everyone used during lockdown.
The problem? The crystal ball looked a little cloudy
The market didn’t clap because Zoom’s third-quarter outlook was just a touch below estimates. Revenue guidance of $1.275 billion to $1.28 billion landed under Wall Street’s $1.282 billion target, and adjusted EPS guidance of $1.46 to $1.48 also came in shy of the $1.50 consensus.
That’s the kind of thing that turns a solid earnings report into an after-hours frown. Zoom also raised full-year guidance, but apparently not enough to distract traders from the near-term wobble.
Still not a one-trick pony
There were some decent bright spots hiding in the print:
- Enterprise revenue rose 7.8% year over year to $787.5 million
- Customers spending more than $100,000 annually climbed to 4,625, up 8.2%
- Free cash flow hit $472.4 million
- Zoom’s AI-first customer experience tools are growing fast, with Zoom Virtual Agent customer count up 256% year over year
So yes, the business is still producing cash and finding new ways to sell more software. But in stock-market land, guidance is the dinner reservation and earnings are just the appetizer.
Big picture
Zoom is still a profitable, cash-rich company with real enterprise traction. But the stock reaction says the bar is now higher: investors don’t just want “good enough” growth, they want proof the AI and enterprise story can actually reaccelerate the business.