Zoom bags first $1bn quarter but demand for the Covid-19 essential is fading
Zoom, which became a household name amid the pandemic, has recorded its first billion-dollar revenue in just one quarter – but demand for its Covid-19 essential service is quickly weening.
The company forecast revenue of between $1.015bn and $1.020bn for its third quarter, which inched past analysts’ average estimate of $1.013bn, according to Refinitiv data.
The revenue forecast was up around 31.2 per cent from a year prior, when the company had swelled in popularity and usership due to global lockdown restrictions on social activities, work and school.
The video-conferencing platform enjoyed a pandemic-induced boom, when millions signed up to the service to both speak with colleagues and loved ones.
However, as restrictions ease, its demand has begun tapering off faster than expected, which tipped its shares to dive some 11 per cent.
Just last month Zoom completed its largest ever acquisition, dishing out $14.7bn to buy a cloud-based call centre operator Five9, as competition in the video conferencing sector intensified.
The California-based company has said it plans to shift its attention to Zoom Phone – its two-year-old cloud-calling product – and Zoom Room, a conference-hosting product.