Video communications platform Zoom (NASDAQ: ZM) will be announcing earnings results this Tuesday afternoon. Here’s what to look for.
Zoom beat analysts’ revenue expectations last quarter, reporting revenues of $1.24 billion, up 5.5% year on year. It was a satisfactory quarter for the company, with an impressive beat of analysts’ billings estimates but decelerating growth in large customers. It added 66 enterprise customers paying more than $100,000 annually to reach a total of 4,534.
Is Zoom a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Zoom’s revenue to grow 4.2% year on year, in line with the 4.7% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Zoom has a history of exceeding Wall Street’s expectations.
Looking at Zoom’s peers in the video conferencing segment, some have already reported their Q2 results, giving us a hint as to what we can expect. RingCentral delivered year-on-year revenue growth of 5.9%, beating analysts’ expectations by 1%, and 8x8 reported revenues up 4.9%, topping estimates by 4.3%. RingCentral traded up 25.1% following the results while 8x8 was also up 3.1%.
Read our full analysis of RingCentral’s results here and 8x8’s results here.
There has been positive sentiment among investors in the video conferencing segment, with share prices up 16.4% on average over the last month. Zoom is up 18.5% during the same time and is heading into earnings with an average analyst price target of $116.35 (compared to the current share price of $108.09).
WHILE YOU’RE HERE: The Next Palantir? One satellite company captures images of every point on Earth. Every single day. The Pentagon wants it. Hedge funds are using it to beat earnings. You’ve probably never heard of it.
This is what the early days of Palantir looked like before it became a giant. Same playbook. Different technology. If you missed Palantir, you need to see this. Claim The Stock Ticker for Free HERE.
