Zoom Q2 beats estimates, adjusts Q3 revenue and EPS above expectations
Zoom Video Communications released its second quarter estimates after hours on Monday, beating on both on top and bottom lines. The company also raised its outlook for its third quarter and its full year expectations for both revenue and earnings per share. Yahoo Finance’s Myles Udland breaks down the company’s earnings report on The Final Round.
Video Transcript
- Zoom, it has been a huge winner, a work-from-home winner over the last several months. They're out with their earnings results. Myles Udland has the details for us. Myles?
MYLES UDLAND: Yeah, Shawn. A stock here is up about 5% in after-hours trade. The stock was up 8% during the regular session. Maybe someone new something that we didn't know. The results here for Zoom very good, as you may have guessed. On an adjusted basis, the company earned $0.92 per share in the most recent quarter revenue. That was better than $0.45 expected by the Street.
Revenue coming in at $663.5 million. Expectations were for $500 million. The company also raised its outlook for the third quarter as well as the full year. In the current quarter, the company expects revenues come in $685 to $690 million. Estimates were something closer to $493 million. Adjusted profit in this current quarter should be $0.73 to $0.74 per share. The Street was looking for $0.35 per share. On a full-year basis, Zoom now expects revenues to be just shy of $2.4 billion, $2.37 to $2.39 billion. Previously, the company had been looking for $1.7 to $2 billion in full year revenue, so about 30% higher than the prior outlook there. And, then, profits full-year adjusted earnings per share, $2.40 to $2.47, better than the company's prior forecast for $1.21 to $1.29.
The numbers here are all very big and gaudy for Zoom. Looking at some of their customer metrics, customers with more than 10 employees up 458% from last year. Customers with more than 100 grand in revenues to the company over the last year up 112%. So, again, everyone is Zooming everything. The company has now become a verb. We are allowed to admit that Zoom is the primary video chat even though this show is happening on a Google product. Google will not be hurt by that. So, again, Zoom stock, that's up a couple hundred percent this year. It was up $40 today, counting the after-hours and regular-hours session, and kind of the number-one story, I think, of this pandemic.
WOMAN: Yeah, Myles. It's a huge story. I mean, this is a stock, like you said, was trading in the mid-60s when you go back to where we were at the beginning of the year, and right now, and after hours, up just around $340 a share. And I think a lot of analysts and a lot of investors here going into this report were questioning whether or not Zoom will be able to sustain the momentum that we saw from last quarter a couple of months ago when we really started to see the uptick in the beginning of the pandemic. But taking a look at these numbers, they're massive massive numbers for Zoom. So I know a lot of attention will be close on their earnings call that's expected to get underway a little later on this hour.
