Zoom Video Communications Inc recently reported its Q12021 results. Revenues were up 169% Y-o-Y to $328.2 million. The number of customers, who have 10 or more employees, was up 354% Y-o-Y at 265,400. 769 of those customers contributed more than $100,000 to the company’s revenues.
GAAP income from operations for the first quarter was $23.4 million, significantly higher than the $1.6 million achieved in Q12020. Non-GAAP income from operations for Q12021 was $58.3 million. Revenues did translate into cash for Zoom Video. Cash flow from operations jumped to $259 million in Q12021 as compared to $22.2 million in Q12020.
The rise in work-from-home, study-from-home, and meet-from-home has led to an increase in the demand for Zoom’s free video conferencing technology as well as its paid services. The number of use cases has grown significantly as everyone from professionals to students have turned to Zoom for their work, education, and personal activities. Zoom has the potential to deliver services in the growing segment of telemedicine as well.
Eric Yuan, founder and CEO, Zoom, said, “We were humbled by the accelerated adoption of the Zoom platform around the globe in Q1. The COVID-19 crisis has driven higher demand for distributed, face-to-face interactions and collaboration using Zoom. Use cases have grown rapidly as people integrated Zoom into their work, learning, and personal lives.”
Zoom has provided optimistic guidance for 2Q20201. The company management estimates second-quarter revenues to be somewhere near the $500 million mark while non-GAAP income from operations could touch $130 – $135 million.
The company did face security and privacy issues lately. However, Zoom addressed these issues by adding features that control access of attendees to a virtual meet as well as adding a former National Security Advisor to its board. The company has announced that it will offer end-to-end encryption to its paid members.
Zoom stock has surged by more than 53% in the past one month, closing at $223.87 on June 3rd, 2020.