Zoom Video’s Q3 Results In Spotlight Following Stock’s Stellar Run: Retail Upbeat
Morgan Stanley said it is “constructive” on the setup for the fiscal year 2026 but does not see the third quarter as a ‘re-rating catalyst.”
FollowZoom Video Communications, Inc. ($ZM), which shot to prominence as a COVID-19 play, is scheduled to report its fiscal year 2025 third-quarter results after the market closes on Monday. The stock has gained 19.43% for the year, underperforming the S&P 500 Index, which is up over 25%.
San Jose, California-based Zoom Video, a communication technology company known for its videoconferencing app, is widely expected to report non-GAAP earnings per share (EPS) of $1.31, higher than the year-ago’s $1.29, and revenue of $1.16 billion, up 2.40% year-over-year (YoY).
In late-August, the company guided to non-GAAP EPS of $1.29-$1.31 and revenue to $1.16 billion-$1.165 billion.
At the Zoomtopia 2024 held in early October, the company announced its new AI-first platform innovations. These include the Zoom AI Companion 2.0, a new add-on option to customize and personalize AI Companion, Zoom Tasks to help users take action across Zoom Workplace, and enhanced employee and customer experience innovations underpinned by cutting-edge AI.
During the quarter, the company named Michelle Chang as its CFO, replacing Kelly Steckelberg. It also announced the launch of Zoom Phone in India.
Earlier this month, Morgan Stanley upped the price target for Zoom Video shares from $68 to $86, the Fly reported. The firm has an Equal-weight rating on Zoom Video shares.
Analysts at the firm see a modest topline upside, driven by enterprise, and a more meaningful operating margin and EPS beat due to operating expenditure discipline and continued share repurchases.
The third quarter may not be a "re-rating catalyst" due to the intra-quarter improvement in sentiment, the firm said, adding that it is "constructive" on the setup for the fiscal year 2026.
Zoom Video’s guidance for the fiscal year 2025 currently stands at $5.29 per share in earnings and $4.63 billion-$4.64 billion in revenue.
ZM sentiment and message volume November 25, 2024, as of 12:02 am ET | Source: Stocktwits
On Stocktwits, sentiment toward Zoom Video stock stayed ‘bullish’ (66/100), accompanied by ‘high’ message volume.
The retail crowd sees the stock as undervalued.
Zoom Video shares climbed 5.76% on Friday and added another 1.53% in the after-hours session.
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