Zoom Communications Non-GAAP EPS of $1.53 beats by $0.15, revenue of $1.22B beats by $20M

• Zoom Communications reported strong second-quarter financial results, with a Non-GAAP EPS of $1.53, exceeding expectations by $0.15, and revenue of $1.22 billion, achieving 5.2% year-over-year growth.

• For the third quarter of fiscal year 2026, Zoom anticipates revenue between $1.210 billion and $1.215 billion, aligning with consensus estimates, and expects Non-GAAP diluted EPS between $1.42 and $1.44.

• The full fiscal year 2026 guidance includes total revenue expectations of $4.825 billion to $4.835 billion and Non-GAAP diluted EPS forecasted between $5.81 and $5.84, both surpassing consensus estimates.

• Following the financial report, Zoom's shares rose by 2.1% in after-hours trading, reflecting investor confidence in the company's performance and outlook.

Recommendation Rating: Strong Buy

Zoom Communications (NASDAQ: ZM) has released its financial performance for the second quarter, showcasing impressive results. The company reported a Non-GAAP Earnings Per Share (EPS) of $1.53, outperforming expectations by $0.15. The revenue for the quarter reached $1.22 billion, reflecting a year-over-year growth of 5.2%, and exceeded projections by $20 million.

Looking ahead, Zoom has outlined its guidance for the third quarter and the full fiscal year 2026.

Third Quarter Fiscal Year 2026 Guidance:

• Total revenue is anticipated to be between $1.210 billion and $1.215 billion, which aligns with the consensus estimate of $1.21 billion.

• Revenue in constant currency is projected to range from $1.207 billion to $1.212 billion.

• Non-GAAP income from operations is expected to fall between $465 million and $470 million.

• Non-GAAP diluted EPS is forecasted to be between $1.42 and $1.44, compared to a consensus of $1.39, assuming approximately 307 million weighted average shares outstanding.

Full Fiscal Year 2026 Guidance:

• Total revenue expectations are set between $4.825 billion and $4.835 billion, slightly above the consensus of $4.81 billion.

• Revenue in constant currency is projected at between $4.817 billion and $4.827 billion.

• Full-year Non-GAAP income from operations is anticipated to be between $1.905 billion and $1.915 billion.

• Non-GAAP diluted EPS is expected to be between $5.81 and $5.84, surpassing the consensus of $5.61, based on about 308 million weighted average shares outstanding.

• The free cash flow for the entire fiscal year is anticipated to be between $1.740 billion and $1.780 billion.

Following the announcement, Zoom’s shares showed a positive response, increasing by 2.1% in after-hours trading.