Zoom shares down 90% from peak as pandemic boom fades

[OfTheCross]

I hope y'all sold high.

I hope this doesn't mean anything bad for WFH

Zoom shares down 90% from peak as pandemic boom fades

Shares of Zoom Video Communications Inc have tumbled about 90% from their pandemic peak in October 2020 as the former investor darling struggles to adjust to a post-COVID world.

www.reuters.com

Nov 22 (Reuters) - Shares of Zoom Video Communications Inc (ZM.O) have tumbled about 90% from their pandemic peak in October 2020 as the former investor darling struggles to adjust to a post-COVID world.

The stock was down nearly 10% on Tuesday after the company cut its annual sales forecast and posted its slowest quarterly growth, prompting at least six brokerages to cut their price targets.

The company, which became a household name during lockdowns due to the popularity of its video-conferencing tools, is trying to reinvent itself by focusing on businesses, with products such as cloud-calling service Zoom Phone and conference-hosting offering Zoom Rooms.

Analysts, however, say any turnaround in the business is still a few quarters away as growth in its mainstay online unit slows and competition from Microsoft Corp's (MSFT.O) Teams and Cisco's (CSCO.O) Webex and Salesforce's (CRM.N) Slack gets intense.

"Zoom has a fundamental flaw - it has needed to spend heavily to keep hold of market share. Spending to cling onto, rather than grow, market share is never a good place to be and was a sign of trouble ahead," Hargreaves Lansdown equity analyst Sophie Lund-Yates said.


The company's operating expenses surged 56% in the third quarter as it spent more on product development and marketing. Its adjusted operating margin shrank to 34.6% from 39.1% a year earlier.

Some brokerages believe acquisitions could help revive growth at Zoom, but Chief Executive Eric Yuan said on a post-earnings call that he continued to see heightened deal scrutiny for new business.

"The game is not over for them but without acquisitions this is a multi-year path to returning to higher growth," Needham & Co analyst Ryan Koontz said.

 

[KateFabersBoyfriend]

Rarely use Zoom at my job. Typically use Teams internally and zoom with external clients.

 

[Json]

This is what I said in the recession thread.

companies that ramped up during the pandemic ( zoom, meta, etc) are going to have the major layoffs but it won’t be the typical broad layoffs of a traditional recession

 

[voiture]

Teams are far superior and it comes with the Microsoft ecosystem. If you use microsoft devices they will force the teams on you

 

[dora_da_destroyer]

nobody uses Microsoft in tech tho..every company is on Gsuite…that said, that’s why I didn’t fukk with Zoom’s explosion during the pandemic, it’s single point tool used by smaller companies and tech, Microsoft still dominates traditional Corp America

 

[Loose]

I hope y'all sold high.

I hope this doesn't mean anything bad for WFH

Zoom shares down 90% from peak as pandemic boom fades

Shares of Zoom Video Communications Inc have tumbled about 90% from their pandemic peak in October 2020 as the former investor darling struggles to adjust to a post-COVID world.

www.reuters.com

Nov 22 (Reuters) - Shares of Zoom Video Communications Inc (ZM.O) have tumbled about 90% from their pandemic peak in October 2020 as the former investor darling struggles to adjust to a post-COVID world.

The stock was down nearly 10% on Tuesday after the company cut its annual sales forecast and posted its slowest quarterly growth, prompting at least six brokerages to cut their price targets.

The company, which became a household name during lockdowns due to the popularity of its video-conferencing tools, is trying to reinvent itself by focusing on businesses, with products such as cloud-calling service Zoom Phone and conference-hosting offering Zoom Rooms.

Analysts, however, say any turnaround in the business is still a few quarters away as growth in its mainstay online unit slows and competition from Microsoft Corp's (MSFT.O) Teams and Cisco's (CSCO.O) Webex and Salesforce's (CRM.N) Slack gets intense.

"Zoom has a fundamental flaw - it has needed to spend heavily to keep hold of market share. Spending to cling onto, rather than grow, market share is never a good place to be and was a sign of trouble ahead," Hargreaves Lansdown equity analyst Sophie Lund-Yates said.


The company's operating expenses surged 56% in the third quarter as it spent more on product development and marketing. Its adjusted operating margin shrank to 34.6% from 39.1% a year earlier.

Some brokerages believe acquisitions could help revive growth at Zoom, but Chief Executive Eric Yuan said on a post-earnings call that he continued to see heightened deal scrutiny for new business.
Pj
"The game is not over for them but without acquisitions this is a multi-year path to returning to higher growth," Needham & Co analyst Ryan Koontz said.

 

[Neo TheInsurrectionistONE]

We use webex and teams over here now. I haven't used zoom in months.

 

[OperationNumbNutts]

I'm not sure who uses Zoom any more outside of individuals. Most I see use Teams. Still that rally of Zoom's stock got a lot of folks paid during the pandemic.

 

[FAH1223]

we still use Zoom at my job but also Teams as well

 

[BigMoneyGrip]

Everyone back outside

 

[chineebai]

Not just zoom but a boatload of companies when interest rates were nil. Look at carvana.

 

[Listen]

nobody uses Microsoft in tech tho..every company is on Gsuite…that said, that’s why I didn’t fukk with Zoom’s explosion during the pandemic, it’s single point tool used by smaller companies and tech, Microsoft still dominates traditional Corp America

Where you hear that lol? Besides major competitors like Salesforce, or cloud native start ups, everybody using that Microsoft suite and Teams now.

Heck, like 6 of the 1st replies in this thread say they are using Teams lol.

 

[dora_da_destroyer]

Where you hear that lol? Besides major competitors like Salesforce, or cloud native start ups, everybody using that Microsoft suite and Teams now.

Heck, like 6 of the 1st replies in this thread say they are using Teams lol.

Where I hear it? Every company I’ve worked in and where my coworkers have come from are all on Gsuite - basically all the startups and new enterprise companies in Silicon Valley. I already said large corporations (which include stuff like oracle, ibm, etc) use Microsoft. But you’ll be hard pressed to find a tech company (in the bay) founded after 2008-2010 that’s on Microsoft still

 

[1thouwow]

During the pandemic I thought Zoom was owned by Microsoft

 

[winb83]

Zoom is buying back shares, produces over a billion a year in free cash flow and has at least a billion in cash on the balance sheet. It was overpriced but it's still a healthy company.