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Zoom Q1 Earnings Surpass Expectations, Revenues Increase Y/Y
ZoomZoom(US:ZM) ZACKSยท2025-05-22 15:51

Core Insights - Zoom Communications reported first-quarter fiscal 2026 adjusted earnings of $1.43 per share, exceeding the Zacks Consensus Estimate by 10% and reflecting a year-over-year increase of 5.93% [1] - Revenues for the quarter reached $1.175 billion, surpassing the consensus mark by 0.89% and showing a year-over-year growth of 2.93% [1] Revenue Breakdown - Enterprise revenues, which constitute 60.01% of total revenues, increased by 5.86% year over year to $705 million [2] - The number of customers contributing over $100,000 in revenues over the trailing 12 months grew by 8% to 4,192, accounting for 32% of total revenues [2] Customer Metrics - The total number of Enterprise customers at the end of the fiscal first quarter was approximately 182,600 [3] - The percentage of total Online Monthly Recurring Revenue (MRR) from Online customers with a service term of at least 16 months was 74.2%, an increase of 40 basis points year over year [3] - The trailing 12-month net dollar expansion rate for Enterprise customers was reported at 98% [3] Operating Performance - Non-GAAP gross margin for the quarter was 79.18%, slightly down from 79.31% in the previous year [4] - Non-GAAP operating income rose by 2.35% year over year to $467.33 million, with an operating margin of 49.78%, compared to 40.01% in the year-ago quarter [5] Financial Position - As of April 30, 2025, total cash, cash equivalents, and marketable securities stood at $7.8 billion, unchanged from the previous quarter [6] - Net cash provided by operating activities was $489.3 million, down from $588.2 million in the year-ago quarter, while free cash flow decreased to $463.4 million from $569.7 million [6] Future Guidance - For the second quarter of fiscal 2026, Zoom expects revenues between $1.195 billion and $1.2 billion, with non-GAAP earnings per share projected in the range of $1.36 to $1.37 [7] - For the full fiscal year 2026, revenues are anticipated to be between $4.8 billion and $4.81 billion, with non-GAAP earnings per share expected to be in the band of $5.56 to $5.59 [7]