Yahoo Finance Zoom Video (ZM) to Report Q1 Earnings: What's in the Cards?
Zoom Video Communications ZM is slated to release first-quarter fiscal 2024 results on May 22.
Zoom expects first-quarter fiscal 2024 revenues in the range of $1.08-$1.085 billion, which at the midpoint represent roughly 1% year-over-year growth or 3% in constant currency. The Zacks Consensus Estimate for the top line is currently pegged at $1.08 billion, indicating growth of 0.91% from the year-ago quarter.
Non-GAAP earnings are expected in the range of 96 cents to 98 cents per share. The consensus mark for earnings has remained steady at 99 cents per share over the past 30 days, indicating a decline of 3.88% year over year.
Zoom Video Communications, Inc. Price and EPS Surprise
Zoom Video Communications, Inc. price-eps-surprise | Zoom Video Communications, Inc. Quote
Factors to Note
Zoom’s first-quarter performance is likely to have gained from steady demand for varied products like Zoom Video Webinars, Zoom Rooms and Zoom Phones. An expanding portfolio of solutions is expected to have aided customer growth in the fiscal first quarter.
The expansion of Zoom IQ, a smart companion that empowers collaboration and unlocks potential, is expected to have been a key growth driver. This AI solution enhances customers’ experience by summarizing chat threads, organizing data, creating meeting agendas and drafting content for chats, emails and more.
The company’s freemium business model helps it win customers rapidly, who it can later convert into paying customers. In the fiscal fourth quarter, customers contributing more than $100,000 in revenues in the trailing 12 months grew 27% to 3,471. These customers accounted for 28% of revenues, up from 23% in the year-ago quarter. The momentum is expected to have continued in the to-be-reported quarter.
In the first quarter, Zoom announced first-of-its-kind partnership with Major League Basketball (MLB). Zoom Contact Center, the new official unified communications platform, will enhance MLB games and fan-viewership experience. This is expected to have positively impacted the top line of the to-be-reported quarter.
However, the company has been facing significant competition from the likes of Cisco, Microsoft and Google Meet. This might have led to a loss in small and medium-sized business customers, which is likely to have hurt top-line growth.
What Our Model Unveils
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Zoom has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are few companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming releases:
HP HPQ is set to report second-quarter fiscal 2023 results on May 30. The company has a Zacks Rank #2 and an Earnings ESP of +2.29% at present. HP’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 1.11%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for HPQ’s second-quarter earnings is pegged at 76 cents per share, suggesting a decline of 29.6% from the year-ago quarter’s earnings of $1.08. HP’s quarterly revenues are estimated to decrease 20.73% year over year to $13.07 billion.
Agilent A currently carries a Zacks Rank #3 and has an Earnings ESP of +0.40%. The company is scheduled to report second-quarter fiscal 2023 results on May 23. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 7%.
The Zacks Consensus Estimate for A’s second-quarter earnings is pegged at $1.27 per share, implying a year-over-year increase of 12.4%. It is estimated to report revenues of $1.67 billion, which suggests an increase of approximately 3.8% from the year-ago quarter.
NVIDIA NVDA carries a Zacks Rank #3 and has an Earnings ESP of +2.43% at present. The company is slated to report first-quarter fiscal 2024 results on May 24. Its earnings surpassed the Zacks Consensus Estimate twice in the trailing four quarters, while missing the same on two occasions, the average negative surprise being 3.2%.
The Zacks Consensus Estimate for NVDA’s first-quarter earnings is pegged at 92 cents per share, indicating a year-over-year decline of 32.4%. The consensus mark for revenues is pegged at $6.51 billion, suggesting a year-over-year drop of 21.5%.
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Zoom Video Communications, Inc. (ZM) : Free Stock Analysis Report
