Zoom Video Communications Inc. reported over $1 billion in revenue for the quarter ended in July, fueled by strong demand for its videoconferencing services that became ubiquitous during the pandemic for holding office meetings, school classes and all sorts of virtual gatherings.
The roughly 54% revenue increase, while slightly better than Wall Street expected, couldn’t match the massive growth Zoom saw in the prior-year period, when revenue surged more than fourfold as companies leaned more heavily into remote working.
Zoom shares fell more than 10% in after-hours trading, after closing up 2% on Monday.
But the growth—and Zoom’s expectation of more than $1 billion in revenue for the current quarter—underscores demand for office collaboration tools.
Research firm International Data Corp. projects collaboration applications to become a roughly $51 billion market by 2025, nearly double 2020 levels.
