Core Insights - Zoom Communications reported better-than-expected earnings driven by advancements in AI and strong enterprise growth [1][2] Financial Performance - The company announced fiscal Q4 2025 results with an EPS of $1.41, surpassing analysts' expectations of $1.30 [2] - Revenue increased by 3.3% year-over-year to $1.184 billion, exceeding projections of $1.178 billion [2][3] - Operating cash flow rose by 20.9% to $424.6 million, while free cash flow increased by 25.1% to $416.2 million [3][6] - GAAP operating margin improved by 430 basis points year-over-year to 19% [6] Business Focus and Strategy - Zoom specializes in video conferencing and voice call solutions, with a significant focus on AI innovations like Zoom AI Companion [4][7] - The enterprise segment contributed approximately 59% of total revenue, with a 5.9% increase in enterprise revenue to $706.8 million [5][6] - The number of clients generating over $100,000 in revenue increased by 7.3% over the past four quarters [5] Future Outlook - For fiscal 2026, Zoom projects revenues between $4.785 billion and $4.795 billion, indicating moderate growth [8] - Management expects non-GAAP EPS to range from $5.34 to $5.37, emphasizing efficiency to maintain profitability [8] - The company is focused on customer retention, with a net dollar expansion rate for enterprise clients just below 100% [9] - Plans to leverage AI integration across services to enhance competitiveness against rivals like Microsoft Teams [9]

Revenue Performance - Fourth quarter total revenue was $1,184.1 million, up 3.3% year over year, with full fiscal year total revenue of $4,665.4 million, up 3.1% year over year[6] - Revenue for the three months ended January 31, 2025, was $1,184,138 thousand, representing an increase from $1,146,457 thousand in the same period of 2024, a growth of approximately 3.3%[33] - GAAP revenue for the three months ended January 31, 2025, was $1,184,138, representing a year-over-year growth of 3.3% compared to $1,146,000 in 2024[38] - Full fiscal year 2026 total revenue is expected to be between $4.785 billion and $4.795 billion, with non-GAAP income from operations expected between $1.850 billion and $1.860 billion[15] Profitability Metrics - Non-GAAP net income for the fourth quarter was $446.9 million, or $1.41 per share, compared to $444.0 million, or $1.42 per share in the same quarter last year[5] - Net income for the year ended January 31, 2025, was $1,010,238 thousand, compared to $637,462 thousand for the year ended January 31, 2024, reflecting a year-over-year increase of approximately 58.5%[33] - The diluted net income per share for the year ended January 31, 2025, was $3.21, up from $2.07 for the year ended January 31, 2024, representing a growth of approximately 55.1%[33] - Non-GAAP income from operations for the year ended January 31, 2025, was $1,837,895, reflecting a year-over-year growth of 3.5% from $1,774,888 in 2024[37] Cash Flow and Liquidity - Operating cash flow for the fourth quarter was $424.6 million, up 20.9% year over year, with full fiscal year operating cash flow of $1,945.3 million, up 21.7% year over year[8] - Free cash flow for the fiscal year was $1,808.7 million, up 22.9% year over year[10] - Free cash flow (non-GAAP) for the year ended January 31, 2025, was $1,808,748, up from $1,471,883 in 2024, indicating a growth of 22.9%[37] - Cash flows from operating activities for the year ended January 31, 2025, totaled $1,945,308, an increase from $1,598,836 in 2024[37] - The company’s cash, cash equivalents, and restricted cash at the end of the year was $1,361,417, down from $1,565,380 at the end of the previous year[35] Customer Metrics - The number of customers contributing more than $100,000 in trailing 12 months revenue increased by 7.3% year over year[6] - Approximately 192,600 Enterprise customers were reported at the end of the fourth quarter[14] - The trailing 12-month net dollar expansion rate for Enterprise customers was 98%[14] - The net dollar expansion rate for Enterprise customers is calculated based on the annual recurring revenue (ARR) from the previous period, indicating strong customer retention and growth potential[27] Operating Efficiency - GAAP operating margin for the fourth quarter was 19.0%, up 430 basis points year over year, and non-GAAP operating margin was 39.5%, up 80 basis points year over year[6] - The company reported a GAAP operating margin of 19.0% for the three months ended January 31, 2025, compared to 14.7% in the same period of 2024[37] - The company reported a non-GAAP operating margin of 39.5% for the three months ended January 31, 2025, compared to 38.7% in the same period of 2024[37] Asset and Liability Overview - The total current assets as of January 31, 2025, were $8,675,974 thousand, an increase from $7,926,219 thousand as of January 31, 2024, representing a growth of approximately 9.4%[31] - The total liabilities as of January 31, 2025, were $2,053,337 thousand, compared to $1,910,387 thousand as of January 31, 2024, reflecting an increase of approximately 7.5%[31] - The total stockholders' equity as of January 31, 2025, was $8,935,084 thousand, an increase from $8,019,406 thousand as of January 31, 2024, indicating a growth of approximately 11.4%[31] Research and Development - Research and development expenses for the three months ended January 31, 2025, were $217,121 thousand, compared to $205,282 thousand in the same period of 2024, showing an increase of about 5.4%[33]

Core Insights - Zoom Communications, Inc. reported financial results for the fourth quarter and fiscal year ended January 31, 2025, highlighting a transformation into an AI-first company driven by the Zoom AI Companion [1][2]. Financial Performance - Fourth quarter total revenue reached $1,184.1 million, reflecting a year-over-year increase of 3.3%, while full fiscal year total revenue was $4,665.4 million, up 3.1% year over year [5][10]. - Non-GAAP net income for the fourth quarter was $446.9 million, or $1.41 per share, compared to $444.0 million, or $1.42 per share in the same quarter of the previous year [4][6]. - The company achieved a GAAP operating margin of 19.0% in Q4, an increase of 430 basis points year over year, and a non-GAAP operating margin of 39.5%, up 80 basis points year over year [5][10]. Cash Flow and Share Repurchase - Operating cash flow for the fourth quarter was $424.6 million, a 20.9% increase year over year, with full fiscal year operating cash flow of $1,945.3 million, up 21.7% year over year [5][10]. - The company repurchased approximately 4.3 million shares of common stock in the fourth quarter and about 15.9 million shares during the full fiscal year [5][10]. Customer Metrics - The number of customers contributing more than $100,000 in trailing 12 months revenue increased by 7.3% year over year, totaling 4,088 customers [11]. - Zoom had approximately 192,600 Enterprise customers with a trailing 12-month net dollar expansion rate of 98% [11]. Financial Outlook - For the first quarter of fiscal year 2026, Zoom expects total revenue between $1.162 billion and $1.167 billion, with non-GAAP diluted EPS anticipated between $1.29 and $1.31 [18]. - For the full fiscal year 2026, total revenue is projected to be between $4.785 billion and $4.795 billion, with non-GAAP diluted EPS expected between $5.34 and $5.37 [18].

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Financial Performance - Zoom Communications Inc. is set to release its fourth-quarter financial results on February 24, 2025, with expected earnings of $1.35 per share, a decrease from $1.42 per share in the same period last year [1] - The company projects quarterly revenue of $1.19 billion, an increase from $1.15 billion a year earlier [1] - In the third quarter, Zoom reported revenue of $1.18 billion, surpassing the consensus estimate of $1.16 billion, and adjusted earnings of $1.38 per share, exceeding analyst estimates of $1.31 per share [2] Analyst Ratings - Citigroup analyst Tyler Radke maintained a Neutral rating and reduced the price target from $86 to $85 [4] - Cantor Fitzgerald analyst Thomas Blakey initiated coverage with a Neutral rating and a price target of $87 [4] - Wells Fargo analyst Michael Turrin upgraded the stock from Underweight to Equal-Weight and raised the price target from $70 to $85 [4] - Morgan Stanley analyst Meta Marshall maintained an Equal-Weight rating and increased the price target from $86 to $96 [4] - Rosenblatt analyst Catharine Trebnick maintained a Buy rating and raised the price target from $78 to $95 [4]

Zoom Video (ZM) is scheduled to report fourth-quarter fiscal 2025 results on Feb. 24.Zoom expects fourth-quarter fiscal 2025 revenues between $1.175 billion and $1.18 billion. For the fiscal fourth quarter, the Zacks Consensus Estimate for revenues is pegged at $1.18 billion, suggesting a 2.77% rise from the year-ago quarter’s reported figure.Non-GAAP earnings per share are expected in the range of $1.29-$1.30. The Zacks Consensus Estimate for earnings is pinned at $1.31 per share, indicating a decline of 7 ...

Company Overview - Zoom Communications (ZM) closed at $85.17, with a slight decrease of -0.04% compared to the previous day, underperforming the S&P 500's gain of 0.24% [1] - Over the past month, ZM shares have increased by 8.48%, significantly outperforming the Computer and Technology sector's gain of 1.76% and the S&P 500's gain of 2.37% [1] Upcoming Earnings - The earnings report for Zoom Communications is scheduled for February 24, 2025, with an expected EPS of $1.31, reflecting a decrease of 7.75% from the same quarter last year [2] - Revenue is projected to be $1.18 billion, indicating a 2.77% increase compared to the equivalent quarter last year [2] Analyst Estimates - Changes in analyst estimates for Zoom Communications are crucial as they often reflect short-term business dynamics, with upward revisions indicating positive sentiment towards the company's operations and profitability [3] - The Zacks Rank system, which incorporates these estimate changes, currently rates Zoom Communications at 3 (Hold) [5] Valuation Metrics - Zoom Communications has a Forward P/E ratio of 16.11, which is below the industry average of 29.86, suggesting that the company is trading at a discount compared to its peers [6] - The current PEG ratio for ZM is 2.97, compared to the Internet - Software industry's average PEG ratio of 2.14 [7] Industry Context - The Internet - Software industry, part of the Computer and Technology sector, holds a Zacks Industry Rank of 82, placing it in the top 33% of over 250 industries [8] - Research indicates that industries in the top 50% of the Zacks Industry Rank outperform those in the bottom half by a factor of 2 to 1 [8]

Wall Street analysts expect Zoom Communications (ZM) to post quarterly earnings of $1.31 per share in its upcoming report, which indicates a year-over-year decline of 7.8%. Revenues are expected to be $1.18 billion, up 2.8% from the year-ago quarter.Over the last 30 days, there has been no revision in the consensus EPS estimate for the quarter. This signifies the covering analysts' collective reconsideration of their initial forecasts over the course of this timeframe.Before a company announces its earnings ...

Core Viewpoint - Zoom Communication (NASDAQ: ZM) stock is currently down 60% from its peak during the pandemic, but it may present a better investment opportunity as it matures [1]. Group 1 - The stock experienced significant volatility during the pandemic, leading to a bearish outlook at that time [1]. - The current price level suggests a potential entry point for investors looking at a mature company [1]. - The analyst has over 15 years of market experience and combines microeconomic analysis of company financials with macroeconomic perspectives [1].

In this video, Motley Fool Analysts evaluate Zoom's (ZM 0.12%) current standing in the market. With ratings reflecting its post-pandemic challenges, they discuss management, financials, and future growth potential. Tune in to see if Zoom can navigate its way back to prominence or if it's destined for mediocrity.*Stock prices used were the prices of Jan. 15, 2025. The video was published on Feb. 18, 2025. ...