During the pandemic, Zoom Video Communications Inc. became a household name and showed off the financial effects of its growth on Tuesday - record sales and earnings, and expectations of higher stock prices amid the boom.
Zoom posted a net profit of $27 million, or 9 cents per share, compared to a net profit of $200,000, or less than a penny per share, in the quarter of the year.
Zoom has posted earnings of 20 cents a share after accounting for stock-based compensation and other factors, up from 3 cents a share a year earlier. Its total sales of $122 million a year ago grew 169 per cent to $328.2 million.
Before the pandemic, investors never really paid attention to Zoom, but the company has emerged in the last few months as the go-to video conferencing platform for stay-home professionals and students. he company's virus-proof nature has so far helped shareholdings skyrocket 200 percent so far this year.
While shares continue to grow, some analysts doubt Zoom's ability to remain strong in the long run as billions-dollars tech titans like Facebook and Alphabet have announced plans to gain market share in the booming video conferencing field.
The San Jose, California-based American communications tech company reported it currently has 265,400 clients with over 10 employees, a year-over-year 354 per cent rise, with 769 customers paying over $100,000 for the service.
However, the company expects to see a bigger volume of consumer turnover in the second half of 2020, owing to consumers who avail of monthly subscriptions. It's possible those are the customers who will be able to return later this year to work in their offices.
Zoom soon became the de facto chat channel for people around the world thanks to its ease of use, and free 40-minute chat sessions. Use of the company's operating system rose 30-fold in April, as the ongoing global health crisis forced millions to learn, work and socialise remotely.
During its peak, the company tallied over 300 million participants on a daily basis in virtual gatherings, while paying consumers have more than tripled. The dramatic rise has the capacity to transform the group's trajectory. According to Zoom, it estimates sales as high as $1.8 billion this year - around double what the company projected in March.
The figures beat market observers' already rising estimates, providing another boost to a rallying stock that has more than tripled in valuation this year. Following a huge advance enroute Tuesday's much-anticipated disclosure, Zoom's shares were up almost 3 percent in after hours sessions to $213.60 - over five times the firm's initial public offering price of $36 just under 14 months ago.
