By now, leader in modern video communication services Zoom Video Communications Inc. (ZM) is a household name across the world due to its massive usage due to its video and audio conferencing services many find convenient.
The company has given its estimates for the current second quarter which is on the higher side compared to what Wall Street has forecasted for the company in second quarter.
Zoom is expecting to generate revenue of between $985 million to $990 million in the current quarter. This is higher than the $931.8 million revenue estimate Wall Street is expecting for the company.
Institutions have been adopting hybrid working models for their employees in which they work partly remote and partly from the offices. Zoom is counting on this realignment as one which will increase the demand of its video conferencing services.
Senior analyst at Third Bridge, Joe McCormack, is skeptical how long Zoom can maintain its growth rate since massive vaccination is going on across the world in efforts to try and bring things back to normal or even closer to normal.
McCormack also points out Zoom’s rival like Google, Cisco and Microsoft have been stepping up in terms of video conferencing a situation which puts Zoom’s growth rate at risk.
“The extent to which Zoom can compete sustainably with the likes of Cisco and Microsoft remains to be seen over the next few quarters as we begin to enter true COVID comparable quarters,” said McCormack.
In the last quarter, Zoom posted quarterly revenue of $956.2 million or $1.32 per share. This outperformed the experts’ estimates of $906 million or 99 cents per share.