Zoom Video Communications cut its annual profit and sales projection as demand for the video conferencing platform fell after the pandemic’s height, sending its shares down more than 7% in extended trade.
Analysts are concerned about the company’s future as it competes for video conferencing market share with Microsoft Teams, Cisco WebEx, and Google Meet, and Zoom faces a hard job in retaining major clients that contribute more than $100,000 in revenue to sustain high growth levels.
The business anticipates sales of $4. 39 billion to $4. 40 billion, up from its earlier prediction of $4. 53 billion to $4. 40 billion.
55 billion, and it is headquartered in San Francisco. Zoom now estimates adjusted annual profits per share of $3. 66 to $3. 69, up from $3. 70 to $3. 77 previously projected.
Zoom, established by former Cisco CEO Eric Yuan, had the slowest sales growth ever, rising 8% to $1 billion in the second quarter, exceeding expectations for the first time since going public. In the second part of the quarter, the dollar gained but online business performance and sales fell.
Even though quarterly operating costs increased 51 percent to $704 million as the business invested in items to sustain demand, the company’s adjusted profits per share of $1. 05 surpassed market forecasts.
Zoom reduces its yearly profit and revenue predictions as demand falls.
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