Zoom growth explodes in coronavirus work world

Zoom’s paid usage skyrockets as remote work takes over

Zoom’s paid usage skyrockets as remote work takes over

In prepared remarks for the investor presentation, Yuan said, "Nearly 10 years ago, we created Zoom to build a better, simpler, and more efficient video communications platform".

But the once-weak privacy controls also helped make Zoom extremely easy to use, one of the reasons it became such a popular way to hold online classes, business meetings and virtual cocktail hours after most of the United States began ordering people to stay at home in effort to reduce the spread of the novel coronavirus that causes Covid-19.

Zoom Video posted a jump in earnings for the first quarter of 2020 driven by higher revenue.

Of course, the number of users tells only a small part of the story - more important is the revenue generated, and Zoom today announced that their revenue grew 169 percent from previous year to $328.2 million.

"The COVID-19 crisis has driven higher demand for distributed, face-to-face interactions and collaboration using Zoom".

Analysts, as averaged by Yahoo Finance, expected Zoom to report $202.48 million in revenue, and a per-share profit of $0.09.

"The increase in customers with 10 or fewer employees also shifted our billing mix, as these customers generally pay monthly, rather than annually like most enterprise customers", said Zoom CFO Kelly Steckelberg.

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"Use cases have grown rapidly as people integrated Zoom into their work, learning, and personal lives".

Zoom shares traded 2% lower during after-hours Tuesday.

For its full fiscal year 2021, Zoom said it expects revenue to top $1.77 billion, well ahead of Wall Street's forecast of $935.2 million. "But for now congrats to Zoom for being a critical if not essential tool during the Covid-19 pandemic".

Zoom's shares have more than tripled this year.

Yuan told analysts that Zoom owed a lot of thanks to partners such as Amazon Web Services Inc., which was able to provision the majority of the new service it needed when its data centers suddenly found themselves overwhelmed by traffic surges.

A host of security issues emerged in early March, including controversies over the level of encryption it provides and the practice of "Zoombombing" - where trolls interrupt meetings to share profanity or pornography - prompting scrutiny from United States authorities and temporary bans from schools in New York City and Singapore.

Security issues prompted some schools to stop using Zoom for online classes that have become widespread since February, although the company's efforts to introduce more security protection has brought some back to the service. The company's gross margin in the first quarter was 69.4%, down from 84.2% last quarter, as it ramped up cloud-related expenses to keep up with the usage surge.

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