Zoom retail traders turned markedly upbeat as the company highlighted its “top-line growth, stellar profitability, and lower dilution.”
- Founder and CEO Eric Yuan said the company is building on its vision as an AI-first platform.
- The online monthly churn remained steady year over year (YoY) at 2.7%.
- The Zoom stream on Stocktwits saw a 2,800% increase in 24-hour message volume leading up to late Monday.
Video-conferencing app provider Zoom Communications, Inc.’s (ZM) stock climbed more than 3.5% in Monday’s extended trading following a beat-and-raise third-quarter. The company also announced a $1 billion increase to its stock repurchase authorization.
Zoom stock, which once traded at nearly $600 on its credentials as a COVID-19 play, has now notably pulled back from its all-time highs. The stock is down almost 4% year to date.
Zoom’s Q3 Snapshot
San Jose, California-based Zoom reported adjusted earnings per share (EPS) of $1.52 and revenue of $1.23 billion for the third quarter of fiscal year 2026, up from $1.38 and $1.18 billion reported for the year-ago quarter.
The results exceeded the Fiscal.ai-compiled consensus estimates of $1.40 and $1.217 billion, respectively.
Founder and CEO Eric Yuan said the company is building on its vision as an artificial intelligence (AI)-first platform. “Our disciplined approach is fueling top-line growth, stellar profitability, and lower dilution, helping us turn AI innovation into real, lasting value for customers and shareholders.”
Among user metrics, Zoom ended the quarter with 4,363 customers contributing more than $100,000 in trailing 12-month (TTM) revenue, up 9%. The net dollar expansion rate for enterprise customers was 98% on a TTM basis, and online monthly churn remained steady year over year (YoY) at 2.7%.
Zoom’s Outlook
The company expects fourth-quarter adjusted EPS of $1.48-$1.49 and revenue of $1.230 billion to $1.235 billion, versus the consensus estimates of $1.46 and $1.236 billion, respectively.
It raised its full-year adjusted EPS outlook to $5.95-$5.97 from $5.81-$5.84. The company also upped its revenue guidance to $4.852 billion to $4.857 billion $4.817 billion to $4.827 billion.
What Retail Feels About Zoom Stock
On Stocktwits, retail sentiment toward Zoom stock strengthened to ‘extremely bearish’ as of late Monday, from ‘bearish’ a day ago. Retail buzz increased to ‘extremely high’ levels. The 24-hour message volume change leading up to late Monday was over 2,800%.
A bullish user called on fellow retailers to be patient with Zoom stock and said it would rise another 7% from $81.50 in the near term.
Another user lauded the ‘beat-and-raise’ quarter and the $1 billion additional stock buyback. “Call center segment is really coming alive. Still looking for $90-$95 by EOY on a very reasonable P/E multiple,” they said.
According to Koyfin, the average analysts’ price target for Zoom stock is $93.04, implying nearly 20% upside from Monday’s closing level.
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