Zoom Video Shares Fall 2% After Q1 Results

Zoom Video Communications (NASDAQ:ZM) delivered a robust first-quarter performance, surpassing analyst expectations for both earnings per share (EPS) and revenue.

The video conferencing leader reported an adjusted EPS of $1.35, exceeding the Street estimate of $1.19. Revenue for the quarter was $1.14 billion, slightly higher than the anticipated $1.13 billion.

Despite these strong results, Zoom's stock declined by more than 2% pre-market today due to cautious guidance for the second quarter. For Q2, Zoom expects an adjusted EPS between $1.20 and $1.21, below the Street estimate of $1.23. The projected Q2 revenue range of $1.145 to $1.15 billion is at the lower end of the analyst estimate of $1.15 billion.

For the full fiscal year 2025, Zoom forecasts an adjusted EPS of $4.99 to $5.02, which is above the Street estimate of $4.91. The revenue guidance for 2025 is set between $4.61 billion and $4.62 billion, closely aligning with the consensus of $4.61 billion.

Zoom's first-quarter revenue increased by 3.2% year-over-year (YoY), with Enterprise revenue growing by 5.3% YoY to $665.7 million. The company's GAAP operating margin was 17.8%, while the adjusted operating margin was 40.0%. Zoom's operating cash flow increased by 40.6% YoY to $588.2 million, demonstrating strong financial health.