The following is a summary of the Zoom Video Communications, Inc. (ZM) Q1 2025 Earnings Call Transcript:
Financial Performance:
Zoom reported Q1 total revenue of $1.141 billion, up 3% YoY, exceeding its previous guidance by $16 million.
Non-GAAP income from operations was $457 million, growing 8% YoY, representing a 40% non-GAAP operating margin.
Non-GAAP diluted net income per share was $1.35 in Q1, an increase from last year.
Deferred revenue was $1.35 billion, slightly lower than the same period last year.
RPO increased 5% YoY, totaling around $3.67 billion.
Operating cash flow grew 41% YoY to $588 million, and free cash flow grew 44% YoY to $570 million.
For Q2, the company expects revenue to be between $1.145-$1.15 billion (approx. 1% YoY growth) and EPS to be between $1.20-$1.21.
The company raised its full-year FY25 outlook to a range of $4.61 billion-$4.62 billion (approx. 2% YoY growth). The company expects full-year non-GAAP operating income to be between $1.74-$1.75 billion and non-GAAP EPS to be between $4.99-$5.02.
Business Progress:
The company launched Zoom Workplace, an AI-powered platform aimed to streamline communications and improve productivity.
Major businesses are employing Zoom Rooms and Workspace Reservation to optimize time in office.
Zoom has integrated Workvivo into its platform for increased employee engagement.
The company announced significant traction with Zoom Contact Center and Zoom Phone, with material expansion in its customer base.
Q2 plans include a one-time investment for upgrading its data center backbone, and an increased investment in its AI platform is on the horizon.
The company has launched new pricing tiers, resulting in doubled ASPs for Zoom's products quarter over quarter.
The introduction of AI Companion into Zoom's product suite has added value to the platform and played a significant role in its preferential partnership deal with Meta.
Zoom's hybrid architecture with Avaya is set to provide a bridge for large scale enterprise customers who are not yet ready to move entirely to the cloud.
Revenue Accelerator has attracted new customers. Products such as Zoom Events platform and other emerging products are showing promising growth potentials.
The company is maturing and refining its financial and accounting policies, focusing on those that benefit both the business and its customers.
More details: Zoom Video Communications IR
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