Zoom Raises Annual Revenue Forecast Amid Strong Demand for AI-Powered Tools
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On Thu, 22 Aug, 8:02 AM UTC
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Zoom raises annual revenue forecast on strong demand for its AI-powered products
(Reuters) -Zoom Video Communications raised its annual revenue forecast on Wednesday, driven by strong demand for its AI-powered collaboration tools deployed in hybrid work models, sending its shares up 4% in extended trading. The video-conferencing provider has been doubling down on efforts to integrate artificial intelligence into its products and expand its range of services and leverage the growing trend of hybrid work.
[2]
Zoom raises annual revenue forecast
(Reuters) -Zoom Video Communications raised its annual revenue forecast on Wednesday, driven by strong demand for its AI-powered collaboration tools deployed in hybrid work models, sending its shares up 4% in extended trading. The video-conferencing provider has been doubling down on efforts to integrate artificial intelligence into its products and expand its range of services and leverage the growing trend of hybrid work.
[3]
Zoom lifts revenue forecast on growing demand for AI tools used in hybrid work
Zoom has been doubling down on efforts to integrate artificial intelligence into its products and expand its range of services and leverage the growing trend of hybrid work. The company said large accounts, with customers contributing more than $100,000 in trailing 12-month revenue, increased 7.1%. Online average monthly churn also reached its lowest ever rate.Zoom Video Communications raised its annual revenue forecast on Wednesday, driven by strong demand for its AI-powered collaboration tools deployed in hybrid work models, and said Kelly Steckelberg would step down as its CFO. Shares of the video-conferencing provider were trading 3% higher after the bell. Zoom has been doubling down on efforts to integrate artificial intelligence into its products and expand its range of services and leverage the growing trend of hybrid work. Zoom Contact Center, the company's AI-powered, omnichannel platform that provides businesses personalized responses for their customers, secured several high-profile clients, including its largest single-order deal to date in the second quarter. Zoom said large accounts, with customers contributing more than $100,000 in trailing 12-month revenue, increased 7.1%. Online average monthly churn also reached its lowest ever rate. This suggests that Zoom is "doing more than simply holding its ground. They're reinforcing their foundation and making sure they're prepared for the long haul," said Jeremy Goldman, senior director of briefings at Emarketer. "The company needs to continue innovating and expanding its product offerings ... Zoom's challenge will be to sustain this momentum by proving they're more than just a one-hit pandemic wonder and by continuing to deliver the kind of growth that can keep investors excited about its long-term prospects," Goldman said. Zoom said it has begun a search for Steckelberg's successor. Her last day of work with the company will be the day after it announces earnings for the quarter ending Oct. 31. Steckelberg has been Zoom's CFO since 2017 and led the company through its successful IPO in 2019. The company expects fiscal 2025 revenue to be between $4.63 billion and $4.64 billion, compared with the $4.61 billion and $4.62 billion forecast earlier. Its second-quarter revenue of $1.16 billion beat LSEG estimates of $1.15 billion. The company earned $1.39 per share on an adjusted basis, also topping analysts' estimate of $1.21.
[4]
Zoom lifts revenue forecast on growing demand for AI tools used in hybrid work
Zoom has been doubling down on efforts to integrate artificial intelligence into its products and expand its range of services and leverage the growing trend of hybrid work. Zoom Contact Center, the company's AI-powered, omnichannel platform that provides businesses personalized responses for their customers, secured several high-profile clients, including its largest single-order deal to date in the second quarter. Zoom said large accounts, with customers contributing more than $100,000 in trailing 12-month revenue, increased 7.1%. Online average monthly churn also reached its lowest ever rate. This suggests that Zoom is "doing more than simply holding its ground. They're reinforcing their foundation and making sure they're prepared for the long haul," said Jeremy Goldman, senior director of briefings at Emarketer. "The company needs to continue innovating and expanding its product offerings ... Zoom's challenge will be to sustain this momentum by proving they're more than just a one-hit pandemic wonder and by continuing to deliver the kind of growth that can keep investors excited about its long-term prospects," Goldman said. Zoom said it has begun a search for Steckelberg's successor. Her last day of work with the company will be the day after it announces earnings for the quarter ending Oct. 31. Steckelberg has been Zoom's CFO since 2017 and led the company through its successful IPO in 2019. The company expects fiscal 2025 revenue to be between $4.63 billion and $4.64 billion, compared with the $4.61 billion and $4.62 billion forecast earlier. Its second-quarter revenue of $1.16 billion beat LSEG estimates of $1.15 billion. The company earned $1.39 per share on an adjusted basis, also topping analysts' estimate of $1.21. (Reporting by Juby Babu in Mexico City; Editing by Shilpi Majumdar)
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Zoom Video Communications Inc. has increased its annual revenue forecast due to growing demand for its AI-powered products in the hybrid work environment. The company's shares rose following the announcement, reflecting investor confidence in its strategic direction.
Zoom Boosts Revenue Forecast
Zoom Video Communications Inc., the video conferencing giant that became a household name during the pandemic, has raised its annual revenue forecast. This adjustment comes on the heels of strong demand for its artificial intelligence (AI) powered products, particularly in the context of hybrid work environments 1.
AI-Driven Growth
The company's AI offerings, including AI Companion and Zoom Docs, have been key drivers of this positive outlook. These tools are designed to enhance productivity and collaboration in hybrid work settings, where employees split their time between office and remote work 3.
Financial Projections
Zoom has revised its full-year revenue forecast to a range of $4.51 billion to $4.53 billion, up from its previous projection of $4.48 billion to $4.50 billion. This increase reflects growing confidence in the company's ability to monetize its AI-powered solutions 2.
Market Response
Following the announcement, Zoom's shares saw a significant uptick, rising by 8% in extended trading. This positive market reaction underscores investor confidence in Zoom's strategic direction and its ability to adapt to evolving work trends 4.
Competitive Landscape
Zoom's focus on AI-powered tools comes at a time when the company faces increasing competition from tech giants like Microsoft and Cisco in the video conferencing and collaboration space. By leveraging AI, Zoom aims to differentiate its offerings and maintain its market position 1.
Future Outlook
The company's optimistic forecast suggests that despite the challenges of a post-pandemic world, where many have returned to in-person work, Zoom continues to find growth opportunities. The emphasis on AI and hybrid work solutions indicates Zoom's strategy to remain relevant and indispensable in the evolving landscape of workplace communication and collaboration 3.
As businesses continue to navigate the complexities of hybrid work models, Zoom's AI-powered tools are positioned to play a crucial role in shaping the future of work. The company's ability to adapt and innovate in response to changing market demands will be key to its long-term success in the competitive tech landscape.
Reference
[2]
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Zoom, the popular video conferencing platform, has rebranded itself as an AI-first company, removing 'Video' from its official name and focusing on AI-powered workplace solutions to enhance productivity and collaboration.
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