Zoom Communications (NASDAQ:ZM) Posts Earnings Results

Zoom Communications (NASDAQ:ZM) announced its quarterly earnings results on Thursday. The company reported $1.55 earnings per share for the quarter, beating analysts’ consensus estimates of $1.41 by $0.14, FiscalAI reports. The business had revenue of $1.24 billion during the quarter, compared to analysts’ expectations of $1.22 billion. Zoom Communications had a net margin of 39.03% and a return on equity of 11.88%. The business’s revenue for the quarter was up 5.5% on a year-over-year basis. During the same period last year, the business earned $1.43 earnings per share. Zoom Communications updated its FY 2027 guidance to 5.960-6.000 EPS and its Q2 2027 guidance to 1.450-1.470 EPS.

Here are the key takeaways from Zoom Communications’ conference call:

• Revenue beat and guidance raise: Q1 revenue rose 5.5% year over year to $1.24 billion, above the high end of guidance, and Zoom raised full-year FY2027 revenue and profitability outlooks while reaffirming strong free cash flow expectations.
• AI momentum is accelerating: Paid AI Companion MAUs grew 184% year over year, My Notes topped 1.5 million monthly active users, and management highlighted expanding adoption of AI Companion 3.0 and Custom AI Companion across enterprise customers.
• Enterprise and CX are driving growth: Enterprise revenue increased 7.2%, large customers and net dollar expansion improved, and Zoom Customer Experience continued to post high double-digit growth with paid AI in nine of the top 10 ZCX deals.
• Profitability and cash generation remain strong: Non-GAAP operating margin reached 41.1% and free cash flow was $500 million, while the board authorized an additional $1 billion share repurchase, signaling confidence in future cash returns.
• Management sees a larger “system of action” opportunity: Zoom emphasized that it is evolving from a communications platform into an AI-enabled workflow layer, but also acknowledged a need to boost customer awareness and go-to-market execution to fully monetize that shift.

Zoom Communications Stock Down 2.7%

Shares of Zoom Communications stock opened at $96.75 on Friday. Zoom Communications has a 52-week low of $69.15 and a 52-week high of $111.56. The company has a 50 day moving average of $88.14 and a 200 day moving average of $86.59. The company has a market capitalization of $28.51 billion, a P/E ratio of 15.60, a P/E/G ratio of 5.69 and a beta of 1.00.

Zoom Communications News Roundup

Here are the key news stories impacting Zoom Communications this week:

• Positive Sentiment: Zoom reported first-quarter EPS of $1.55, ahead of consensus, and revenue of about $1.24 billion, also topping estimates, suggesting demand held up better than expected. Zoom Communications (ZM) Q1 Earnings and Revenues Top Estimates
• Positive Sentiment: Zoom raised full-year and next-quarter guidance, signaling management confidence that AI features and enterprise demand can support further growth and profitability. Zoom raises annual forecasts, banks on AI features to drive demand
• Positive Sentiment: Enterprise revenue rose 7.2% year over year, and the enterprise net dollar expansion rate improved to 99%, indicating healthier customer retention and cross-sell momentum. Zoom Communications Inc (ZM) Q1 2027 Earnings Call Highlights: Strong Revenue Growth and AI …
• Neutral Sentiment: Several previews and earnings recap articles focused on the same results, reinforcing the market’s attention on the quarter rather than introducing new catalysts. Zoom (ZM) Q1 Earnings: Taking a Look at Key Metrics Versus Estimates
• Negative Sentiment: Management noted ongoing competitive pressure and a slight uptick in churn, which could limit how much upside investors assign to the growth story. Zoom Communications Inc (ZM) Q1 2027 Earnings Call Highlights: Strong Revenue Growth and AI …

Wall Street Analysts Forecast Growth

A number of research analysts recently weighed in on ZM shares. Wolfe Research upgraded shares of Zoom Communications from a “peer perform” rating to an “outperform” rating and set a $115.00 price objective for the company in a report on Thursday, February 5th. KeyCorp upgraded shares of Zoom Communications from an “underweight” rating to a “sector weight” rating in a report on Friday. Cantor Fitzgerald restated a “neutral” rating on shares of Zoom Communications in a report on Friday. Wall Street Zen cut shares of Zoom Communications from a “buy” rating to a “hold” rating in a report on Saturday, March 7th. Finally, Argus upgraded shares of Zoom Communications to a “hold” rating in a report on Monday, March 9th. Fourteen analysts have rated the stock with a Buy rating and twelve have given a Hold rating to the stock. According to data from MarketBeat.com, the stock presently has a consensus rating of “Moderate Buy” and an average target price of $104.20.

Insider Buying and Selling

In other news, CEO Eric S. Yuan sold 69,923 shares of the business’s stock in a transaction that occurred on Monday, April 13th. The shares were sold at an average price of $81.22, for a total transaction of $5,679,146.06. Following the completion of the sale, the chief executive officer owned 36,796 shares in the company, valued at approximately $2,988,571.12. The trade was a 65.52% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Michelle Chang sold 8,489 shares of the business’s stock in a transaction that occurred on Friday, April 10th. The stock was sold at an average price of $81.32, for a total transaction of $690,325.48. Following the sale, the chief financial officer owned 30,467 shares of the company’s stock, valued at $2,477,576.44. This represents a 21.79% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold 144,329 shares of company stock valued at $12,364,989 over the last ninety days. 11.51% of the stock is currently owned by corporate insiders.

Institutional Trading of Zoom Communications

Institutional investors have recently modified their holdings of the stock. Sivia Capital Partners LLC purchased a new stake in shares of Zoom Communications during the 2nd quarter worth approximately $217,000. Thrivent Financial for Lutherans purchased a new stake in shares of Zoom Communications during the 2nd quarter worth approximately $269,000. Principal Securities Inc. lifted its position in shares of Zoom Communications by 8.1% during the 4th quarter. Principal Securities Inc. now owns 3,053 shares of the company’s stock worth $263,000 after buying an additional 230 shares during the last quarter. Sepio Capital LP purchased a new stake in shares of Zoom Communications during the 4th quarter worth approximately $243,000. Finally, Wealthspire Advisors LLC lifted its position in shares of Zoom Communications by 175.6% during the 4th quarter. Wealthspire Advisors LLC now owns 2,651 shares of the company’s stock worth $229,000 after buying an additional 1,689 shares during the last quarter. Hedge funds and other institutional investors own 66.54% of the company’s stock.

Zoom Communications Company Profile

Zoom Video Communications, Inc (commonly referred to as Zoom) is a provider of cloud-based communications and collaboration solutions. The company’s platform supports video conferencing, voice calling, instant messaging, webinars and large-scale virtual events, and meeting room systems, marketed to businesses, educational institutions, government organizations and individual users. Zoom’s product lineup includes Zoom Meetings, Zoom Phone, Zoom Rooms, Zoom Video Webinars and Zoom Chat, and the company offers integrations and extensions through a developer marketplace and third-party apps.

Founded in 2011 by Eric S.