Zoom lifts revenue forecast on growing demand for AI tools used in hybrid work

By Juby Babu

 

(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, 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.

 

(Reporting by Juby Babu in Mexico City; Editing by Shilpi Majumdar)