Zoom expects lukewarm growth as pandemic boom wears off and stocks fall

Aug.30 (Reuters) – Zoom Video Communications Inc (ZM.O) reported on Monday that demand for its video conferencing service was slowing after a boom sparked by the pandemic last year, causing its shares to fall 8% in exchanges after -sale.

The company expects revenue for the current quarter to be between $ 1.015 billion and $ 1.020 billion, compared to an average analyst estimate of $ 1.013 billion, according to data from Refinitiv.

The COVID-19 crisis made Zoom a household name in 2020 as people working and studying from home turned to its platform. But vaccinations are encouraging schools to reopen and more businesses to bring employees back to their offices.

Competition from legacy platforms such as Cisco’s (CSCO.O) and Microsoft’s (MSFT.O) Webex teams has also hampered the company’s efforts to win larger business deals.

Zoom said he expected adjusted earnings of $ 1.07 to $ 1.08 per share in the current quarter, compared to expectations of $ 1.09 per share.

Its margins have been affected due to increased spending on its data centers and cloud computing services by vendors such as Amazon.com Inc (AMZN.O) as free users multiply on the video conferencing provider platform.

It forecasts annual revenues of between $ 4.01 billion and $ 4.02 billion for fiscal 2022, which is roughly in line with expectations.

The company posted second-quarter earnings of $ 1.04 per share on revenue of $ 1.02 billion, both above analyst estimates.

Reporting by Eva Mathews in Bengaluru; Editing by Aditya Soni

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