Unexpected pandemic winner
The popularity of video communications chat service Zoom has grown exponentially during the pandemic, with the company's shares surging ahead after reporting a monster second quarter.
Following a strong earnings report released this week, Zoom's shares skyrocketed more than 30 per cent on Wall Street yesterday and continued to rise today.
The Californian company's stock went up as much as 39 per cent in pre-market trading on Tuesday. That came as the price guidance lifted by an average of $161 a share following quarterly results that had the company raising its annual revenue forecast.
Zoom was an early beneficiary of the coronavirus pandemic, which forced people online for everything from work meetings and school lessons to family reunions and wine nights.
Video chat platforms have become a vital part of day-to-day life since mid-March when the COVID-19 pandemic shut down offices across the country, and Zoom and rivals like Microsoft's Teams and Cisco's Webex have seen usage soar.
For the three months ending July 31, Zoom saw its revenue more than quadruple year-on-year to $US663.5 million ($A902 million), far outpacing the $US500.5 million ($A680 million) which analysts had forecast. Zoom also raised its revenue forecasts by more than 30 per cent.
Since the start of the pandemic, Zoom has worked to convert the mass of free users into paying customers, which is important because the company relies on both its own data centres and cloud providers such as Amazon and Oracle to provide its serving, meaning it must bear costs for free users.
Zoom's number of large customers - those generating more than $US100,000 ($A136,000) in revenue in the past year - more than doubled to 988 in the fiscal second quarter.
This article has been adapted from the New York Post with permission