Zoom raises revenue target with increasing need for video conferencing

Zoom Video Communications raised its annual revenue forecast by 30 percent after its revenue rose 355 percent to US$663.5 million, exceeding analysts' average estimate of US$500.5 million on Aug 31.

The company raised its annual revenue target for the fiscal year 2021 to US$2.37 billion to $2.39 billion, from the previous $1.78 billion to US$1.80 billion.

The increased revenue was partly due to converting more of its free user base to paying subscribers.

Zoom now has 370,200 institutional customers with over 10 employees, up about 458 percent from the same quarter last year.

Shares of the company rose 5 percent after the bell and hit a record high in regular trading.

The shares have increased almost four-fold this year.

Net income attributable to common stockholders rose to US$185.7 million, or 63 cents per share, from US$5.5 million, or 2 cents per share, a year earlier.

Excluding items, the company earned 92 cents per share, surpassing the average analyst estimate of 45 cents.

Video-conferencing platforms have become a vital part of day-to-day life with people stuck at home under coronavirus restrictions.

It is being used for work, school, and socializing.

However, there were security and privacy issues with Zoom, prompting many companies and countries to curb the use of the platform.