Due to fierce competition from Microsoft Teams and Cisco WebEx, Zoom Video Communications Inc. on Monday lowered its 2017 profit and sales predictions as demand for the video-conferencing platform cools off from pandemic highs.After reporting its worst quarterly revenue growth on record at 8% as people shifted away from virtual interactions, shares of the industry darling dropped 7% in extended trading.
The company’s internet business was likely to decline by 7% to 8% in fiscal 2023, according to finance head Kelly Steckelberg.When the outbreak began in early 2020, Zoom, established by a former Cisco executive, was a little-known company. As a result of spending more to tempt clients who have been reducing their spending owing to high inflation, Zoom’s costs have gone up.
In order to maintain its growth, Zoom now has the challenging task of obtaining well-paying customers.In the three months leading up to July, operating expenses increased by 51% to $704 million.The company now anticipates annual revenue of between $4.39 billion and $4.40 billion, down from its earlier forecast of $4.53 billion to $4.55 billion.It now forecasts $3.66 to $3.69 in annual adjusted profit per share instead of $3.70 to $3.77.
