Zoom sales growth slows as online business falters in post-pandemic era

Zoom’s third-quarter results suggest business sales can be strong enough to offset slowing online or consumer revenue growth as businesses return workers to offices due to pandemic It shows that whether or not is a big question.

Zoom’s third-quarter 2022 revenue, announced Monday, increased 5% year-over-year to $1.1 billion, while total revenue increased 8% in the previous quarter.

Corporate earnings for the third quarter were $614.3 million, up 20% year-over-year. However, online revenue declined 9% year-on-year to total $487.6 million. Net operating income decreased 23% to $66.5 million due to lower online sales and higher expenses.

Zoom has lowered its full-year revenue forecast to a maximum of $4.38 billion. Earlier projections put him at $4.4 billion. Zoom shares fell 7.7% in Tuesday morning trading.

On a post-results conference call, Zoom CFO Kelly Steckelberg said Zoom Phone has seen strong growth, coupled with contributions from Zoom Rooms and other products, with enterprise customers making up an increasing share of total revenue. He said he expects it to go higher. with time.

in the transcript Posted in Seeking AlphaSteckelberg said Zoom has “approximately 209,300 enterprise customers, up 14% from the year-ago quarter.”

In the first year of the COVID-19 pandemic, Zoom revenue increased A 300% increase as workers around the world were forced to abandon their offices and communicate with colleagues via video calls. Hybrid and remote work are still a reality for most workers, but the return to in-person work has pushed Zoom’s stock price below its value since it peaked in October 2020. Losing more than 85% of him.

As a result, the company has attempted to: go away “This year, we are launching more than 1,500 features and enhancements on the Zoom platform, advancing the way people connect with each other,” founder and CEO Eric Yuan told analysts on the third-quarter conference call. ”, he said. , their organization, and their customers. ”

However, he cautioned that despite the company’s praise for its innovations, “besides FX, it still faces the backdrop of a ‘challenging macroeconomic environment’.” [foreign exchange] Increased pressure on new business and transaction scrutiny. ”

The stronger dollar this year has hurt financial results by reducing product sales in euros and other currencies for US-based technology companies.

In recent months, other tech companies have tried to cut operating costs because of poor performance. dismissal large number of employees. Zoom has not announced job cuts, but in the same call with analysts, Steckelberg said the company’s thinking for fiscal 2024 would be to cut jobs. .

“We increased our spending and hired more people this year, [Zoom is] very thoughtful about ensuring that [those resources] I’m focused on what’s right,” she said.