CALIFORNIA: Zoom Video Communications’ second-quarter net profit rose more than 70.6 percent year-on-year as the company achieved its first billion-dollar revenue quarter, underpinned by the increasing demand for video conferencing as companies adopted hybrid work models.
The California-based company’s net profit attributable to shareholders climbed to $316.9 million, almost $131.2 million more than the same period last year. Revenue during the three-month period to July 31 increased 54 percent on an annualised basis to $1.02 billion. It was nearly 6.8 percent up on a quarterly basis.
“We achieved our first billion-dollar revenue quarter while delivering strong profitability and cash flow,” Zoom founder and chief executive Eric Yuan said. The May-July period marked several milestones “on our expansion beyond the UC [unified communications] platform”, said Yuan.
The company raised its revenue outlook for the third quarter ending in October this year and the 2021-2022 financial year. Third-quarter revenue was forecast in the range of $1.01bn and $1.02bn while full-year revenue is expected to be between $4bn and $4.02 – about 55 per cent more than its financial earnings in the last financial year.
Zoom said its second quarter revenue growth was driven by “acquiring new customers and expanding across existing customers”. As of July 31, the company had nearly 504,900 paid customers with more than 10 employees, up by almost 36 per cent from the same period last fiscal year.
Zoom, which became an essential service for office meetings and family gatherings during the Covid-19 pandemic, invested $82.3 million in research and development in three months to July 31, almost 93 percent more than the prior year period. It was more than 8 percent of the total revenue earned during the quarter.
The company’s operating cash flow was $468 million for the second quarter, nearly 66.7 million more than the same period last year. Total cash and marketable securities stood at $5.1bn on July 31.