Investors got a glimpse of post-pandemic Zoom on Monday after the video calling software company reported better-than-expected earnings for the second quarter. However, the company struggled with tough year-to-year comparisons as offices reopened and live events returned.
Zoom stocks were down more than 15% on Tuesday morning.
The company’s executives stated the slower growth despite delivering its $ 1 billion first quarter.
“What we are seeing … is headwinds in our mass markets, so these are individual consumers and small businesses. And as you say, they are now moving around the world. People are on vacation again, they are … happy hours personally” Zoom CFO Kelly Steckelberg told CNBC’s “Squawk Box” on Tuesday morning.
“As we got through the back half of the second quarter, we started seeing additional churn there, and that shows in our forecasts for the rest of the year, and that’s what I think you’re going to do in response to that See share, “she added.
Zoom’s forecast for the current quarter was for strong growth in its direct and channel businesses, with weakness in its online business due to challenges from smaller customers and consumers.
Despite the stock slump, analysts remained confident that the company will grow as its corporate endeavors.
“Look, we still believe that Zoom is a very good franchise with tremendous growth in the future, but we anticipate the post-pandemic market will need to streamline another level of growth in its valuation expectations,” said Sterling Auty of JPMorgan.
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