Zoom ups its full-year forecast

Zoomer or later, things had to change.🥁 Zoom has long served as a loose proxy for the state of the pandemic: At the height of the lockdowns, Zoom was everything, everywhere, all the time.

So when the company recently announced that employees would have to return to the office, it felt like the death knell for the pandemic era. All this made the video conferencing company’s latest earnings report one to watch, and it largely topped analysts’ expectations.

Zoom’s revenue grew 3.6% year over year, per the company’s quarterly report. Net income bounced to $182 million, or 59 cents per share, compared to $45.7 million, or 15 cents per share, in Q2 2022

The company also upped its full-year forecast, now expecting between $4.485 billion and $4.495 billion in revenue for the full 2024 fiscal year, and adjusted earnings per share of $4.63 to $4.67.

While the company’s next earnings report could show some signs of the impact of its new RTO policy, the latest call did offer a glimpse into how generative AI could impact the company.

Zoom recently amended its terms of service to state that it retained the right to use some customer data to train and refine its AI capabilities. When people were predictably creeped out, Zoom updated the terms of service to explicitly clarify that users’ video calls wouldn’t be used to train AI.

When asked in an earnings call with analysts how Zoom planned to monetize generative AI investments, Zoom founder and CEO Eric Yuan stressed that the company was taking a different approach than some competitors.

“[Competitors] give you some free service, then they give you generative AI, [and] oh, my God, they charge you a crazy price,” Yuan said. “I do not think that’s fair to customers, right? We are taking a different approach and more value to leverage gen AI to our existing customers, [and] focus on the feature improvements to leverage gen AI.”

He added that the company will discuss AI further during a fall event.