Zoom Forecasts Tepid Growth As Pandemic Rise Fades; stocks fall

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Aug 30 (Reuters) – Zoom Video Communications Inc said demand for its video conferencing service was slowing after last year’s boom caused by the pandemic, sending its shares down 8% in after-market trading. .

The company expects revenue in the current quarter of between $ 1.015 billion and $ 1.02 billion, compared to the average analyst estimate of $ 1.013 million, according to Refinitiv data.

The COVID-19 crisis made Zoom a household name in 2020 when people working and studying at home turned to its platform. But vaccines are encouraging schools to reopen and more businesses to get their employees back in the office.

Competition from platforms like Cisco Webex and Microsoft Teams has also dampened the company’s efforts to win bigger contracts from companies.

Zoom forecast adjusted earnings of $ 1.07 to $ 1.08 per share in the third quarter, compared to estimates of $ 1.09, according to Refinitiv data.

Its margins have been hit by increased spending on its data centers and cloud computing services from providers like Amazon.com Inc, while free users on the video conferencing provider’s platform have risen.

For fiscal 2022, the company forecast annual revenue in the range of $ 4.01 billion to $ 4.02 billion, roughly in line with expectations.

The firm posted second-quarter earnings of $ 1.04 per share under revenue of $ 1.02 billion, both above analysts’ expectations.

(Report by Eva Mathews in Bengaluru. Edited in Spanish by Rodrigo Charme)

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