Zoom reports stronger Q1 results, raises 2027 outlook

Zoom Video Communications Inc. reported stronger-than-expected first-quarter results and raised its full-year outlook, sending its shares sharply higher in after-hours trading. The company's performance was driven by growth in its enterprise business and surging adoption of its artificial intelligence products.

For the quarter ended April 30, Zoom reported adjusted earnings per share of $1.55, exceeding analyst expectations of $1.42. Revenue reached $1.24 billion, a 5.5% increase from the same period last year and above the consensus estimate of $1.22 billion. Net income for the quarter was $425.7 million, up from $254.6 million a year earlier.

A key driver of the results was a 7.2% year-over-year increase in enterprise revenue, which totaled $755.7 million. The company ended the quarter with 4,534 customers contributing more than $100,000 in trailing 12-month revenue, an 8.2% increase. The trailing 12-month net dollar expansion rate for enterprise customers also improved slightly to 99%. The company's online revenue, its direct-to-consumer segment, grew 2.8% to $483.3 million.

Company leadership attributed the strength to the rapid adoption of its AI features. Paid users of the...