SAN JOSE, Calif. (Globe Newswire) – For the first time in company history, Zoom Video Communications, Inc. passed the $1 billion plateau in quarterly earnings.
The company announced financial results for the second fiscal quarter, which ended July 31.
“We achieved our first billion-dollar revenue quarter while delivering strong profitability and cash flow,” said Zoom founder and CEO, Eric S. Yuan. “(The quarter) also marked several milestones on our expansion beyond the UC platform. We launched Zoom Apps, bringing over 50 apps directly into the Zoom experience, and Zoom Events, an all-in-one digital events service. Today we are a global brand counting over half a million customers with more than 10 employees, which we believe positions us extremely well to support organizations and individuals as they look to reimagine work, communications, and collaboration.”
The Wall Street Journal reported Tuesday that, while Zoom hit $1 billion in a quarter for the first time, its adjusted earnings guidance came in “lower than expected.”
Shares of Zoom fell nearly 12% in after-hours trading after closing up some 2% in during regular hours Monday, The Joural reported.
Zoom’s highlights included:
- Revenue: Total revenue for the second quarter was $1,021.5 million, up 54% year over year.
- Income from Operations and Operating Margin: GAAP income from operations for the second quarter was $294.6 million, up from $188.1 million in the second quarter of fiscal year 2021. After adjusting for stock-based compensation expense and related payroll taxes, acquisition-related expenses, and expenses related to charitable donation of common stock, non-GAAP income from operations for the second quarter was $424.7 million, up from $277.0 million in the second quarter of fiscal year 2021. For the second quarter, GAAP operating margin was 28.8% and non-GAAP operating margin was 41.6%.
- Net Income and Diluted Net Income Per Share: GAAP net income attributable to common stockholders for the second quarter was $316.9 million, or $1.04 per share, up from $185.7 million, or $0.63 per share in the second quarter of fiscal year 2021.
Non-GAAP net income for the quarter was $415.1 million, after adjusting for stock-based compensation expense and related payroll taxes, acquisition-related expenses, gains on strategic investments, undistributed earnings attributable to participating securities, and expenses related to charitable donation of common stock. Non-GAAP net income per share was $1.36. In the second quarter of fiscal year 2021, non-GAAP net income was $274.8 million, or $0.92 per share. - Cash and Marketable Securities: Total cash, cash equivalents, and marketable securities, excluding restricted cash, as of July 31, 2021 was $5.1 billion.
- Cash Flow: Net cash provided by operating activities was $468.0 million for the second quarter, compared to $401.3 million in the second quarter of fiscal year 2021. Free cash flow, which is net cash provided by operating activities less purchases of property and equipment, was $455.0 million, compared to $373.4 million in the second quarter of fiscal year 2021.
Drivers of total revenue included acquiring new customers and expanding across existing customers. At the end of the second quarter of fiscal year 2022, Zoom had:
- 2,278 customers contributing more than $100,000 in trailing 12 months revenue, up approximately 131% from the same quarter last fiscal year.
- Approximately 504,900 customers with more than 10 employees, up approximately 36% from the same quarter last fiscal year.
- A trailing 12-month net dollar expansion rate in customers with more than 10 employees above 130% for the 13th consecutive quarter.
Zoom is providing the following guidance for its third quarter fiscal year 2022 and its full fiscal year 2022.
- Third Quarter Fiscal Year 2022: Total revenue is expected to be between $1.015 billion and $1.020 billion and non-GAAP income from operations is expected to be between $340.0 million and $345.0 million. Non-GAAP diluted EPS is expected to be between $1.07 and $1.08 with approximately 309 million non-GAAP weighted average shares outstanding.
- Full Fiscal Year 2022: Total revenue is expected to be between $4.005 billion and $4.015 billion. Non-GAAP income from operations is expected to be between $1.500 billion and $1.510 billion. Non-GAAP diluted EPS is expected to be between $4.75 and $4.79 with approximately 308 million non-GAAP weighted average shares outstanding.
