Start here if you're new
what it is
Zoom sells subscription software for video meetings, phone calls, chat, and workplace collaboration.
how it gets paid
Last year Zoom Comms made $4.9B in revenue. Core Meetings & Workplace was the main engine at $3.90B, or 80% of sales.
why it's growing
Revenue grew 4.4% last year. The number that mattered was 4.4% annual revenue growth.
what just happened
Zoom's last report missed EPS by 8.28%, which matters more when revenue is only growing 4.4% a year.
At a glance
B+ balance sheet — decent shape, but not bulletproof
30/100 earnings predictability — expect surprises
14.2x trailing p/e — the market's not buying it — or you found a deal
14.0% return on capital — nothing to write home about
xvary composite: 54/100 — below average
What they do
Zoom sells subscription software for video meetings, phone calls, chat, and workplace collaboration.
Zoom wins because your coworkers already know how to use it, and that matters more than another feature list. It sells in 180 countries and still posts a 77.3% gross margin (gross margin → money left after running the service → room to keep building and still make money). Once your calendar, links, and habits live inside Zoom, leaving is annoying in a very human way.
How they make money
$4.9B
annual revenue · their business grew +4.4% last year
Core Meetings & Workplace
$3.90B
+4.4%
Zoom Phone
$0.55B
+6.5%
Contact Center
$0.15B
+6.5%
Events, Webinars & Other
$0.30B
+4.4%
The products that matter
core video meetings platform
Zoom Meetings & Chat
$4.9B company revenue base
this is still the center of gravity. the broader business generated $4.9B last year and grew 4.7%, which tells you the core platform remains useful but no longer behaves like hypergrowth software.
core platform
cloud phone system
Zoom Phone
inside $3.2B enterprise revenue
the numbers here are indirect, not broken out on this page. what you do know is that enterprise revenue reached $3.2B and grew 6.5%, so phone and adjacent upsells need to keep doing real work inside that segment.
enterprise upsell
ai meeting assistant
AI Companion
attached to a $4.9B base
this is the monetization wildcard. there is no separate revenue number here yet, which is the point: AI has to move from feature defense to paid revenue if Zoom wants growth above the current 4.7% pace.
show-me product
Key numbers
14.2x
trailing p/e
P/E → price versus yearly profit → you are paying a below-many-software-stocks multiple for a business with real margins.
36.0%
net margin
Net margin → profit kept from each sales dollar → Zoom keeps $0.36 after all costs, which is very rich for a company growing 4.4%.
23.1%
operating margin
Operating margin → profit after day-to-day costs → the core business still throws off cash before tax and accounting noise.
$6.55
fy2027 eps est
EPS → profit per share → against an $86.06 stock price, that points to roughly 13.1x on next year's estimate.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 30 / 100
- net profit margin 36.0% — keeps 36 cents of every dollar in revenue
- return on equity 14% — $0.14 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in ZM 3 years ago → it's now worth $11,540.
The index would have given you $13,880.
source: institutional data · total return
What just happened
missed estimates
Zoom's last report missed EPS by 8.28%, which matters more when revenue is only growing 4.4% a year.
The business is still profitable, but the latest stumble exposed the real story: expense control has been doing a lot of the work. The research service said profit gains in the third quarter largely came from falling costs, while revenue growth through the first three quarters was 4%.
$1.25B
revenue
$1.44
eps
77.3%
gross margin
the number that mattered
The number that mattered was 4.4% annual revenue growth, because a company with a 14.2x earnings multiple needs steadier demand, not just cleaner cost control.
-
zoom communications is poised for modest progress this year.
-
the 4% revenue growth in the first three quarters of 2025 is not exciting in itself, but it is an acceleration from the 3.1% pace set in all of fiscal 2024 (year ends january 31st), and was the best annual pace for the company in the past 12 quarters.
-
our posted earnings switched to an adjusted basis for 2025, and the $6.05 per share we project for the year represents a 9% increase from 2024's adjusted earnings.note, 2025's adjusted earnings exclude about $2.65 a share in stock-based compensation expenses, an item we feel should be included.
-
third quarter's vs. prior year profit surge largely came from declining expenses, as the cost of revenues dropped 4.3%, and total operating expenses fell 8.9%.
-
share net was also boosted by a lower stock count, as excess cash flow went to buy back shares.a continued emphasis on the faster-growing larger accounts has led us to increase our longer-term projections for the company. although we are still cautious of the fact that further margin improvements have their limits, zoom's larger accounts have been making up a growing portion of its revenues, and their recent impact on accelerating revenue growth appears likely to continue.
source: company earnings report, 2026
Get this snapshot in your inbox
This page, delivered free — plus weekly updates when the numbers change. plain english, no spam.
weekly updates
earnings alerts
plain english
no spam
What could go wrong
the #1 risk is microsoft teams turning video into a bundled feature instead of a paid category.
med
bundled competition
Microsoft Teams and Google Meet do not need to win on product love alone. They can win by making video feel free inside a larger office bundle. That is a real threat to Zoom's standalone pricing power.
If that pressure intensifies, a 36.9% net margin and 23.1% operating margin have further to fall than a weaker software company would.
med
guidance sensitivity
The stock dropped 12% after a weak profit forecast. That tells you the market is already skeptical and is using guidance as the referendum, not the reported quarter.
Low growth plus fragile sentiment can turn ordinary earnings calls into double-digit moves.
med
AI needs to become revenue, not just retention
AI Companion may help defend the core product, but the page gives you no standalone revenue proof yet. If AI stays a feature instead of an upsell engine, Zoom is still mostly a mature meetings business.
That leaves the company leaning on 6.5% enterprise growth and 0.8% online growth, which is not enough for a durable rerating on its own.
The combined risk picture is simple: if enterprise growth cools and bundles keep pricing pressure on the core, the stock stays a low-multiple software name no matter how pretty the margins look.
source: institutional data · regulatory filings · risk analysis
Pay attention to
calendar
Q1 FY2027 earnings
next earnings report is expected May 20, 2026. you care less about the beat and more about whether guidance calms the market after that 12% post-forecast drop.
metric
enterprise growth staying ahead of company growth
enterprise grew 6.5% versus 4.7% for the full business. if that spread narrows, the highest-quality part of the story is weakening.
trend
online / SMB stagnation
0.8% growth is the number to watch because mature self-serve software rarely reaccelerates by accident. if this segment stays flat, enterprise has to do all the lifting.
risk
buyback support versus real growth
the $3.7B buyback plan can support EPS, but it cannot create demand. if repurchases become the main story, you are owning financial engineering more than operating momentum.
Analyst rankings
short-term outlook
average
momentum score 3. in human-speak, analysts see a stock without a strong near-term edge.
risk profile
average
stability score 3. you are not buying a bunker stock, but you are not buying a rollercoaster either.
chart momentum
average
technical score 3. the chart is not screaming opportunity or danger. it is mostly waiting for fundamentals to settle the argument.
earnings predictability
30 / 100
earnings predictability is weak. translation: guidance and sentiment can move the stock more than you think.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 350 buyers vs. 200 sellers in 4q2025. total institutional holdings: 0.2B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$64
$128
$86
current price
$96
target midpoint · +12% from current · 3-5yr high: $140 (+65% · 13% ann'l return)
Want the deeper analysis?
The full deep dive: dcf model, scenario analysis, competitive moat breakdown, and quarterly tracking — everything on this page, taken further.
see plans from $5/moThe deep dive