The days of virtual happy hours are long past now that most of the world has moved on from Covid-19 lockdowns. Zoom is still paying the price in its income statement and in the stock market. PIcture: BLOOMBERG
Zoom’s sales exploded during the pandemic as individuals and businesses flocked to video conferencing. Many consumers, though, stuck to the company’s free service, and many businesses that were willing to pay for the offering had, and still have, other options, such as Microsoft’s Teams. While Zoom is profitable, expectations for its sales growth may still be too high.
Since going public in 2019, the company has beaten revenue and profit estimates every single quarter, but its shares have fallen after six out of the last seven reports, as investors look to see how Zoom will fare in a slower-growth, post-pandemic environment. Enterprise is “not easy business to win, when you think about Microsoft’s ability to package Teams into an Office 365 sale,” Bloomberg Intelligence analyst John Butler said.