Zoom's stock jumps 10% on strong results, guidance amid AI push

By Jon Swartz

Zoom Video Communications Inc.'s stock surged in extended trading Monday, after the videoconferencing company topped expectations across the board with its financial results and forecasts. The company also authorized a $1.5 billion buyback.

Zoom (ZM) reported fiscal fourth-quarter net income of $298.8 million, or 95 cents cents a share, on revenue of $1.15 billion, up from $1.12 billion a year ago. After adjusting for stock compensation and other effects, Zoom reported earnings of $1.42 a share.

Analysts surveyed by FactSet had on average expected adjusted net income of $1.15 a share on revenue of $1.13 billion.

Zoom forecast first-quarter adjusted earnings of $1.18 to $1.20 a share on revenue of about $1.125 billion, while analysts on average were projecting $1.13 a share on sales of $1.13 billion, according to FactSet.

"We're committed to democratizing AI accessibility, offering it to all our customers regardless of business size, included at no extra charge with a paid license," Zoom Chief Executive Eric Yuan said in a statement announcing the results.

Shares of Zoom advanced more than 10% in after-hours trading Monday immediately following the release of its results. Zoom's stock has tumbled 14% over the past 12 months, while the broader S&P 500 index SPX has increased 27%.

Despite escalating competition from the likes of Microsoft Corp. (MSFT), Cisco Systems Inc. (CSCO), and Alphabet Inc.'s (GOOGL)( GOOG) Google, Zoom has been able to hold its own with a steady stream of products and services for consumers.

-Jon Swartz

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02-26-24 1853ET

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