Zoom shares make biggest single-day gain in a year after upgraded forecast

Video-conferencing company's stock rises 12.7 per cent in New York

Zoom rolled out new agentic AI capabilities in July, including a Custom AI Compantion add-on. Photo: Zoom

Zoom Communications' shares soared to their biggest single-day gain in a year after the video-conferencing company raised its annual revenue and profit forecast, amid hybrid work patterns and the adoption of AI in its products.

Shares of the California-based company jumped 12.7 per cent to $82.47 at the end of trading in New York on Friday after Zoom posted a better-than-expected forecast for its full fiscal year that ends in January 2026. This was the biggest single-day increase since August 22, 2024, when it gained 12.97 per cent.

Total revenue is expected to be between $4.825 billion and $4.835 billion for the fiscal year, the company said. This is up from its earlier projection of $4.8 billion to $4.81 billion.

Profit, excluding some items, will be $5.81 a share to $5.84 a share for the fiscal year ending in January. Full fiscal year free cash flow is expected to be between $1.740 billion and $1.780 billion.

“AI is transforming the way we work together, and Zoom is at the forefront, driving innovation that helps people get more done, reduce costs, and deliver better experiences for customers and employees alike,” Eric Yuan, Zoom’s founder and chief executive, said.

BX2025 Abu Dhabi: Artificial intelligence takes centre stage

02:00

Zoom became a household name during the Covid-19 pandemic when many companies grappling with shuttered offices and lockdowns turned to its platform to communicate with employees.

Last month, Zoom rolled out new agentic AI capabilities that it said would help users complete tasks across platforms and save time during the work day.

This included a Custom AI Companion add-on that can connect to 16 third-party apps to help orchestrate tasks without leaving Zoom. It also helps small business owners to leverage AI Companion across third-party video conferencing platforms such as Google Meet.

Zoom's revenue for the second quarter to July 31 reached $1.22 billion, up 4.7 per cent year-on-year, driven by acquiring new customers.

The company forecast third-quarter revenue ranging of $1.21 billion to $1.22 billion.

“We delivered an across-the-board strong Q2 marked by achieving our highest year-over-year revenue growth in 11 quarters,” Mr Yuan said.

“With our robust performance, we are happy to raise our full year outlook for revenue, non-GAAP [generally accepted accounting principles] operating income, as well as free cash flow.”