Earnings Review: Zoom Reports EPS Of $1.29 Beating Expectations -

Earnings Review: Zoom Reports EPS Of $1.29 Beating Expectations

Nov 21, 2023Jeremy ParkinsonFinance0

Key Highlights

Revenue Exceeds Expectations: Zoom reported a total revenue of $1.137 billion, surpassing the expected $1.13 billion and marking a 3% year-over-year increase.

Earnings Per Share Outperformance: Non-GAAP diluted earnings per share reached $1.29, exceeding the expected EPS of $1.09 by 20 cents and showing a significant improvement from the previous year.

Robust Cash Flow: Operating cash flow grew by 67% yearly to $493 million, with a notable increase in free cash flow to $453 million.

Image courtesy of 123rf.com via The Tokenist Zoom Video Communications, Inc. (ZM) demonstrated a solid financial performance in the third quarter of FY24, with total revenue reaching $1.137 billion, a 3% increase from the previous year. This figure notably exceeded the expected revenue of $1.13 billion and the company’s guidance. The company’s consistent revenue growth, even in a challenging economic climate, underscores its strong market position and the continued relevance of its services. EPS and Operating Income HighlightsZoom’s financial health was further accentuated by its earnings per share and operating income. The non-GAAP diluted earnings per share for Q3 stood at $1.29, significantly surpassing the anticipated $1.09 EPS. This result reflects the company’s effective cost management and operational efficiency, which was 20 cents above the high end of Zoom’s guidance and 22 cents higher than the same quarter last year. Additionally, non-GAAP operating income grew by 17% to $447 million, leading to a non-GAAP operating margin of 39.3%, a substantial improvement from the previous year. Strong Cash Flow and LiquidityZoom’s financial stability is further evidenced by its robust cash flow metrics. Operating cash flow for the quarter showed a remarkable 67% year-over-year increase, reaching $493 million. Similarly, free cash flow grew by 66% to $453 million, attributed to stronger collections, targeted expense management, and higher interest income. The company concluded the quarter with a strong liquidity position, having approximately $6.5 billion in cash, cash equivalents, and marketable securities.Zoom Video Communications, Inc.’s financial results for the third quarter of FY24 reveal a company that exceeded revenue and EPS expectations and demonstrated significant growth in profitability and cash flow.More By This Author:After Gaining 229% in a Year, Nvidia’s Stock Price Hits Record High Day Before Earnings ReportEarnings Review: LOW Reports A 7.4% Decrease In Comparable SalesThree Solid Stocks That Still Have Plenty Of Growth Left