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Zoom down after-hours despite topping earnings expectations

Zoom reported a beat on the top and bottom line in their quarterly earnings, posting $956M in revenue and an EPS of $1.32, versus $910M in expected revenue and an expected EPS of 99 cents. Yahoo Finance's Dan Howley breaks down the key metrics from Zoom's quarterly earnings report.

Video Transcript

ADAM SHAPIRO: Loreen and Alicia, hold on one second, because Dan Howley standing by. We do have earnings from Zoom Video. They are trading down after market. What's going on? Dan, I think you might be muted.

DAN HOWLEY: I should-- can you hear me now?

ADAM SHAPIRO: We got you.

DAN HOWLEY: OK. They had a beat on the top and bottom line. We have $956 million for revenue versus $910 million expected. And then on the earnings per share, we have $1.32 versus $0.99. Importantly, looking forward into the second quarter, they beat estimates there as well. They're looking for between $1.14 to $1.15 on earnings per share versus $0.94 was what was originally expected. Then for revenue, we're looking at $984 million to $999 million. The expectation was for $941 million. So they beat there.

But you can tell, obviously, the stock price off as much as 3% to 4% right now. I think going forward, the stock is really going to depend on the kind of customers that they're continuing to hold onto-- whether they can carry over those customers from companies that are 10 or more employees, as well as the ones that spend more than $100,000 for the trailing 12 months. Those are the ones that are really going to be important.

The consumers who were using it for the pandemic didn't put much into the revenue at the end of the day. It comes down to those businesses. We'll see going forward into the Q3 and Q4 if they hold on there and Zoom can count them as customers going forward. For now, though, looking like a beat for, obviously, Q1, and then for expectations for Q2.

ADAM SHAPIRO: All right. Dan Howley, thank you very much.

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