Zoom reported better-than-expected third quarter results as the company gained wallet share and grew the number of customers contributing more than $100,000 in trailing 12 month revenue.
The company reported third quarter net income of $612.9 million, or $2.01 a share, on revenue of $1.23 billion, up 4.4% from a year ago. Non-GAAP earnings per share in the quarter was $1.52.
Wall Street was expecting Zoom to report earnings of $1.44 a share on revenue of $1.21 billion.
Zoom continued to show more growth in its enterprise segment. Enterprise revenue was $741.4 million, up 6.1% from a year ago, and online revenue, which usually refers to small businesses and consumers, had revenue of $488.4 million, up 2%.
By the numbers:
- Zoom reported that it had 4,363 customers contributing more than $100,000 in trailing 12 months revenue.
- Online monthly churn in the third quarter was 2.7%, or flat from a year ago.
- Workvivo had 1,225 customers, up 70% from a year ago.
- Zoom Phone passed 10 million paid seats in the third quarter.
- Zoom ended the quarter with $7.9 billion in cash and equivalents.
In prepared remarks, CEO Eric Yuan said the company is seeing strong demand for its AI Companion. He said team chat monthly active users were up 20% from a year ago. Zoom’s AI Companion integrates with Google Workspace, Microsoft 365 and Teams, Slack, Salesforce and ServiceNow.
"AI isn’t just bolstering our core, it’s opening new revenue streams and deeper customer value through customization and automation. Two quarters in, Custom AI Companion is scaling with several Fortune 200 wins and broad interest," said Yuan.
He noted that customer experience is gaining due to AI. "Within Customer Experience, AI has become a clear differentiator, creating additional monetization opportunities. Nine of our top ten CX deals involved paid AI, such as Zoom Virtual Agent or AI Expert Assist, as enterprises use Zoom to deliver faster, more personalized service," Yuan said.
As for the outlook, Zoom projected revenue between $1.23 billion and $1235 billion with non-GAAP earnings between $1.48 a share and $1.49 a share.
For fiscal 2026, Zoom said revenue will be between $4.852 billion and $4.857 billion with non-GAAP earnings of $5.95 a share and $5.97 a share.
