Zoom Video Communications, Inc. (NASDAQ: ZM), today announced
financial results for the third fiscal quarter ended
October 31, 2022.
“At Zoomtopia, we announced a number of innovations including
Zoom Mail and Zoom Calendar, along with new partnerships that are
expected to power and enhance the modern work experience,” said
Eric S. Yuan, Zoom founder, and CEO. “Our customers are
increasingly looking to Zoom to help them enable flexible work
environments and empower authentic connections and collaboration.
Proactively addressing these needs with Zoom's expanding platform
continues to be our focus in this dynamic environment. In Q3, we
drove revenue above guidance with continued momentum in Enterprise.
In addition, our non-GAAP operating income came in meaningfully
higher than our outlook, setting us up to finish the year with
full-year revenue growth, strong GAAP and non-GAAP profitability,
and free cash flow that we expect to be at the high end of our
range of $1 billion to $1.15 billion.”1
Third Quarter Fiscal Year
2023 Financial Highlights:
- Revenue: Total
revenue for the third quarter was $1,101.9 million, up 5% year over
year. After adjusting for foreign currency impact, revenue in
constant currency was $1,126.1 million, up 7% year over year in
constant currency. Enterprise revenue was $614.3 million, up 20%
year over year and Online revenue was $487.6 million, down 9% year
over year.
- Income from Operations and
Operating Margin: GAAP income from operations for the
third quarter was $66.5 million, compared to GAAP income from
operations of $290.9 million in the third quarter of fiscal year
2022. After adjusting for stock-based compensation expense and
related payroll taxes, and acquisition-related expenses, non-GAAP
income from operations for the third quarter was $380.9 million,
compared to non-GAAP income from operations of $411.3 million in
the third quarter of fiscal year 2022. For the third quarter, GAAP
operating margin was 6.0% and non-GAAP operating margin was
34.6%.
- Net Income and Diluted Net
Income Per Share: GAAP net income attributable to common
stockholders for the third quarter was $48.4 million, or $0.16 per
share, compared to GAAP net income attributable to common
stockholders of $340.3 million, or $1.11 per share in the third
quarter of fiscal year 2022.Non-GAAP net income for the third
quarter was $323.2 million, after adjusting for stock-based
compensation expense and related payroll taxes, losses (gains) on
strategic investments, net, acquisition-related expenses,
undistributed earnings attributable to participating securities,
and the tax effects on non-GAAP adjustments. Non-GAAP net income
per share was $1.07. In the third quarter of fiscal year 2022,
non-GAAP net income was $338.4 million, or $1.11 per
share.
- Cash and Marketable
Securities: Total cash, cash equivalents, and marketable
securities, excluding restricted cash, as of October 31, 2022
was $5.2 billion.
- Cash Flow: Net cash
provided by operating activities was $295.3 million for the third
quarter, compared to $394.6 million in the third quarter of
fiscal year 2022. Free cash flow, which is net cash provided by
operating activities less purchases of property and equipment, was
$272.6 million, compared to $374.8 million in the third
quarter of fiscal year 2022.
Customer Metrics: Drivers of total revenue
included acquiring new customers and expanding across existing
customers. At the end of the third quarter of fiscal year 2023,
Zoom had:
- Approximately 209,300 Enterprise
customers, up 14% from the same quarter last fiscal year.
- A trailing 12-month net dollar
expansion rate for Enterprise customers of 117%.
- 3,286 customers contributing more than
$100,000 in trailing 12 months revenue, up approximately 31% from
the same quarter last fiscal year.
- Online average monthly churn of 3.1%
for Q3, down 60 bps from the same quarter last fiscal year.
Financial Outlook: Zoom is providing the
following guidance for its fourth quarter fiscal year 2023 and its
full fiscal year 2023.
- Fourth Quarter Fiscal Year 2023: Total
revenue is expected to be between $1.095 billion and $1.105 billion
and revenue in constant currency is expected to be between $1.120
billion and $1.130 billion. Non-GAAP income from operations is
expected to be between $316.0 million and $326.0 million. Non-GAAP
diluted EPS is expected to be between $0.75 and $0.78 with
approximately 301 million weighted average shares outstanding.
- Full Fiscal Year 2023: Total revenue is
expected to be between $4.370 billion and $4.380 billion and
revenue in constant currency is expected to be between $4.442
billion and $4.452 billion. Full fiscal year non-GAAP income from
operations is expected to be between $1.490 billion and $1.500
billion. Full fiscal year non-GAAP diluted EPS is expected to be
between $3.91 and $3.94 with approximately 304 million weighted
average shares outstanding.
Additional information on Zoom's reported results, including a
reconciliation of the non-GAAP results to their most comparable
GAAP measures, is included in the financial tables below. A
reconciliation of non-GAAP guidance measures to corresponding GAAP
measures is not available on a forward-looking basis without
unreasonable effort due to the uncertainty of expenses that may be
incurred in the future, although it is important to note that these
factors could be material to Zoom's results computed in accordance
with GAAP.
A supplemental financial presentation and other information can
be accessed through Zoom’s investor relations website at
investors.zoom.us.
___________________________________1 The free
cash flow outlook range assumes that the Section 174 tax
legislation requiring capitalization of R&D expenses will be
repealed or deferred by Congress by the end of this fiscal
year.
Zoom Video Earnings Call
Zoom will host a Zoom Video Webinar for investors on
November 21, 2022 at 2:00 p.m. Pacific Time / 5:00 p.m.
Eastern Time to discuss the company’s financial results, business
highlights and financial outlook. Investors are invited to join the
Zoom Video Webinar by visiting: https://investors.zoom.us/
About Zoom
Zoom is for you. Zoom is a space where you can connect to
others, share ideas, make plans, and build toward a future limited
only by your imagination. Our frictionless communications platform
is the only one that started with video as its foundation, and we
have set the standard for innovation ever since. That is why we are
an intuitive, scalable, and secure choice for large enterprises,
small businesses, and individuals alike. Founded in 2011, Zoom is
publicly traded (NASDAQ:ZM) and headquartered in San Jose,
California. Visit zoom.com and follow @zoom.
Forward-Looking StatementsThis press release
contains express and implied “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements regarding Zoom's financial outlook for
the fourth quarter of fiscal year 2023 and full fiscal year 2023,
Zoom’s free cash flow outlook, assumptions related to Section 174
tax legislation requiring capitalization of R&D expenses being
repealed or deferred, Zoom’s market position, opportunities, and
growth strategy, product initiatives and go-to market motions and
the expected benefits resulting from the same, and market trends.
In some cases, you can identify forward-looking statements by terms
such as “anticipate,” “believe,” “estimate,” “expect,” “intend,”
“may,” “might,” “plan,” “project,” “will,” “would,” “should,”
“could,” “can,” “predict,” “potential,” “target,” “explore,”
“continue,” or the negative of these terms, and similar expressions
intended to identify forward-looking statements. By their nature,
these statements are subject to numerous uncertainties and risks,
including factors beyond our control, that could cause actual
results, performance or achievement to differ materially and
adversely from those anticipated or implied in the statements,
including: declines in new customers and hosts, renewals or
upgrades, difficulties in evaluating our prospects and future
results of operations given our limited operating history,
competition from other providers of communications platforms,
continued uncertainty regarding the extent and duration of the
impact of COVID-19 and the responses of government and private
industry thereto, including the potential effect on our user growth
rate as the impact of the COVID-19 pandemic tapers, particularly as
users return to work or school or are otherwise no longer subject
to limitations on in-person meetings, as well as the impact of
COVID-19 and other macroeconomic conditions, including inflation,
on the overall economic environment, any or all of which will have
an impact on demand for remote work solutions for businesses as
well as overall distributed, face-to-face interactions and
collaboration using Zoom, delays or outages in services from our
co-located data centers, failures in internet infrastructure or
interference with broadband access which could cause current or
potential users to believe that our systems are unreliable, market
volatility, and global security concerns and their potential impact
on regional and global economies and supply chains. Additional
risks and uncertainties that could cause actual outcomes and
results to differ materially from those contemplated by the
forward-looking statements are included under the caption “Risk
Factors” and elsewhere in our most recent filings with the
Securities and Exchange Commission (the “SEC”), including our
quarterly report on Form 10-Q for the fiscal quarter ended July 31,
2022. Forward-looking statements speak only as of the date the
statements are made and are based on information available to Zoom
at the time those statements are made and/or management's good
faith belief as of that time with respect to future
events. Zoom assumes no obligation to update forward-looking
statements to reflect events or circumstances after the date they
were made, except as required by law.
Non-GAAP Financial Measures
Zoom has provided in this press release financial information
that has not been prepared in accordance with generally accepted
accounting principles in the United States (“GAAP”). Zoom uses
these non-GAAP financial measures internally in analyzing its
financial results and believes that use of these non-GAAP financial
measures is useful to investors as an additional tool to evaluate
ongoing operating results and trends and in comparing Zoom’s
financial results with other companies in its industry, many of
which present similar non-GAAP financial measures.
Non-GAAP financial measures are not meant to be considered in
isolation or as a substitute for comparable GAAP financial measures
and should be read only in conjunction with Zoom’s condensed
consolidated financial statements prepared in accordance with GAAP.
A reconciliation of Zoom’s historical non-GAAP financial measures
to the most directly comparable GAAP measures has been provided in
the financial statement tables included in this press release, and
investors are encouraged to review the reconciliation.
Non-GAAP Income From Operations and Non-GAAP Operating Margin.
Zoom defines non-GAAP income from operations as income from
operations excluding stock-based compensation expense and related
payroll taxes, acquisition-related expenses, and litigation
settlements, net. Zoom excludes stock-based compensation expense
because it is non-cash in nature and excluding this expense
provides meaningful supplemental information regarding Zoom’s
operational performance and allows investors the ability to make
more meaningful comparisons between Zoom’s operating results and
those of other companies. Zoom excludes the amount of employer
payroll taxes related to employee stock plans, which is a cash
expense, in order for investors to see the full effect that
excluding stock-based compensation expense had on Zoom's operating
results. In particular, this expense is dependent on the price of
our common stock and other factors that are beyond our control and
do not correlate to the operation of the business. Zoom views
acquisition-related expenses when applicable, such as amortization
of acquired intangible assets, transaction costs, and
acquisition-related retention payments that are directly related to
business combinations as events that are not necessarily reflective
of operational performance during a period. Zoom excludes
significant litigation settlements, net of amounts covered by
insurance, that we deem not to be in the ordinary course of our
business. In particular, Zoom believes the consideration of
measures that exclude such expenses can assist in the comparison of
operational performance in different periods which may or may not
include such expenses and assist in the comparison with the results
of other companies in the industry.
Non-GAAP Net Income and Non-GAAP Net Income Per Share, Basic and
Diluted. Zoom defines non-GAAP net income and non-GAAP net income
per share, basic and diluted, as GAAP net income attributable to
common stockholders and GAAP net income per share attributable to
common stockholders, basic and diluted, respectively, adjusted to
exclude stock-based compensation expense and related payroll taxes,
acquisition-related expenses, gains/losses on strategic
investments, net, litigation settlements, net, and undistributed
earnings attributable to participating securities, including the
tax effects of all non-GAAP adjustments. Zoom excludes gains on
strategic investments, net because given the size and volatility in
the ongoing adjustments to the valuation of our strategic
investments, we believe that excluding these gains or losses
facilitates a more meaningful evaluation of our operational
performance. Zoom excludes undistributed earnings attributable to
participating securities because they are considered by management
to be outside of Zoom’s core operating results, and excluding them
provides investors and management with greater visibility to the
underlying performance of Zoom’s business operations, facilitates
comparison of its results with other periods and may also
facilitate comparison with the results of other companies in the
industry.
Free Cash Flow. Zoom defines free cash flow as GAAP net cash
provided by operating activities less purchases of property and
equipment. Zoom considers free cash flow to be a liquidity measure
that provide useful information to management and investors
regarding net cash provided by operating activities and cash used
for investments in property and equipment required to maintain and
grow the business.
Revenue in Constant Currency. Zoom defines revenue in constant
currency as GAAP revenue adjusted for revenue reported in
currencies other than United States dollars as if they were
converted into United States dollars using the average exchange
rates from the comparative period rather than the actual exchange
rates in effect during the respective periods. Zoom provides
revenue in constant currency information as a framework for
assessing how our underlying businesses performed period to period,
excluding the effects of foreign currency fluctuations.
Customer Metrics
Zoom defines a customer as a separate and distinct buying
entity, which can be a single paid host or an organization of any
size (including a distinct unit of an organization) that has
multiple paid hosts. Zoom defines Enterprise customers as distinct
business units who have been engaged by either Zoom’s direct sales
team, channel partners or independent software vendor partners. All
other customers that subscribe to our services directly through our
website are referred to as Online customers.
Zoom calculates net dollar expansion rate as of a period end by
starting with the annual recurring revenue (“ARR”) from Enterprise
customers as of 12 months prior (“Prior Period ARR”). Zoom defines
ARR as the annualized revenue run rate of subscription agreements
from all customers at a point in time. Zoom calculates ARR by
taking the monthly recurring revenue (“MRR”) and multiplying it by
12. MRR is defined as the recurring revenue run-rate of
subscription agreements from all Enterprise customers for the last
month of the period, including revenue from monthly subscribers who
have not provided any indication that they intend to cancel their
subscriptions. Zoom then calculates the ARR from these Enterprise
customers as of the current period end (“Current Period ARR”),
which includes any upsells, contraction, and attrition. Zoom
divides the Current Period ARR by the Prior Period ARR to arrive at
the net dollar expansion rate. For the trailing 12 months
calculation, Zoom takes an average of the net dollar expansion rate
over the trailing 12 months.
Zoom calculates online average monthly churn by starting with
the Online customer MRR as of the beginning of the applicable
quarter (“Entry MRR”). Entry MRR is defined as the recurring
revenue run-rate of subscription agreements from all Online
customers, including revenue from monthly subscribers that have not
provided any indication that they intend to cancel their
subscriptions. Zoom then determines the MRR related to customers
who canceled or downgraded their subscription during the applicable
quarter (“Applicable Quarter MRR Churn”). Zoom divides the
Applicable Quarter MRR Churn by the applicable quarter Entry MRR to
arrive at the MRR Churn rate for Online Customers for the
applicable quarter. Zoom then divides that amount by three to
calculate the online average monthly churn.
Public Relations
Colleen RodriguezHead of Global Public Relations and Executive
Communicationspress@zoom.us
Investor Relations
Tom McCallumHead of Investor Relationsinvestors@zoom.us
Zoom Video Communications,
Inc.Condensed Consolidated Balance
Sheets(In thousands)
|
|
As of |
|
|
October 31,2022 |
|
January 31,2022 |
Assets |
|
(unaudited) |
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
1,096,174 |
|
|
$ |
1,062,820 |
|
Marketable securities |
|
|
4,068,818 |
|
|
|
4,356,446 |
|
Accounts receivable, net |
|
|
589,573 |
|
|
|
419,673 |
|
Deferred contract acquisition costs, current |
|
|
221,871 |
|
|
|
199,266 |
|
Prepaid expenses and other current assets |
|
|
165,661 |
|
|
|
145,602 |
|
Total current assets |
|
|
6,142,097 |
|
|
|
6,183,807 |
|
Deferred contract acquisition
costs, noncurrent |
|
|
173,305 |
|
|
|
164,714 |
|
Property and equipment,
net |
|
|
250,843 |
|
|
|
222,354 |
|
Operating lease right-of-use
assets |
|
|
90,981 |
|
|
|
95,965 |
|
Strategic investments |
|
|
354,549 |
|
|
|
367,814 |
|
Goodwill |
|
|
122,556 |
|
|
|
27,607 |
|
Deferred tax assets |
|
|
550,539 |
|
|
|
382,296 |
|
Other assets, noncurrent |
|
|
152,308 |
|
|
|
106,761 |
|
Total assets |
|
$ |
7,837,178 |
|
|
$ |
7,551,318 |
|
Liabilities and
stockholders’ equity |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
27,247 |
|
|
$ |
7,841 |
|
Accrued expenses and other current liabilities |
|
|
561,300 |
|
|
|
430,415 |
|
Deferred revenue, current |
|
|
1,307,763 |
|
|
|
1,141,435 |
|
Total current liabilities |
|
|
1,896,310 |
|
|
|
1,579,691 |
|
Deferred revenue,
noncurrent |
|
|
46,460 |
|
|
|
38,481 |
|
Operating lease liabilities,
noncurrent |
|
|
78,128 |
|
|
|
85,018 |
|
Other liabilities,
noncurrent |
|
|
60,468 |
|
|
|
68,110 |
|
Total liabilities |
|
|
2,081,366 |
|
|
|
1,771,300 |
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
Preferred stock |
|
|
— |
|
|
|
— |
|
Common stock |
|
|
292 |
|
|
|
299 |
|
Additional paid-in capital |
|
|
3,572,368 |
|
|
|
3,749,514 |
|
Accumulated other comprehensive loss |
|
|
(72,716 |
) |
|
|
(17,902 |
) |
Retained earnings |
|
|
2,255,868 |
|
|
|
2,048,107 |
|
Total stockholders’
equity |
|
|
5,755,812 |
|
|
|
5,780,018 |
|
Total liabilities and
stockholders’ equity |
|
$ |
7,837,178 |
|
|
$ |
7,551,318 |
|
Note: The amount of unbilled accounts receivable included within
accounts receivable, net on the condensed consolidated balance
sheets was $82.4 million and $59.7 million as of October 31,
2022 and January 31, 2022, respectively.
Zoom Video Communications,
Inc.Condensed Consolidated Statements of
Operations(Unaudited, in thousands, except share
and per share amounts)
|
Three Months Ended October 31, |
|
Nine Months Ended October 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenue |
$ |
1,101,899 |
|
|
$ |
1,050,756 |
|
|
$ |
3,275,157 |
|
|
$ |
3,028,488 |
|
Cost of revenue |
|
270,665 |
|
|
|
270,957 |
|
|
|
806,097 |
|
|
|
797,207 |
|
Gross profit |
|
831,234 |
|
|
|
779,799 |
|
|
|
2,469,060 |
|
|
|
2,231,281 |
|
Operating expenses: |
|
|
|
|
|
|
|
Research and development |
|
195,946 |
|
|
|
98,508 |
|
|
|
512,801 |
|
|
|
245,994 |
|
Sales and marketing |
|
427,747 |
|
|
|
293,698 |
|
|
|
1,191,004 |
|
|
|
810,544 |
|
General and administrative |
|
141,033 |
|
|
|
96,736 |
|
|
|
389,939 |
|
|
|
362,971 |
|
Total operating expenses |
|
764,726 |
|
|
|
488,942 |
|
|
|
2,093,744 |
|
|
|
1,419,509 |
|
Income from operations |
|
66,508 |
|
|
|
290,857 |
|
|
|
375,316 |
|
|
|
811,772 |
|
(Losses) gains on strategic
investments, net |
|
(6,898 |
) |
|
|
122,421 |
|
|
|
(78,014 |
) |
|
|
154,497 |
|
Other expense, net |
|
(4,861 |
) |
|
|
(2,995 |
) |
|
|
(8,482 |
) |
|
|
(3,171 |
) |
Income before provision for
income taxes |
|
54,749 |
|
|
|
410,283 |
|
|
|
288,820 |
|
|
|
963,098 |
|
Provision for income
taxes |
|
6,396 |
|
|
|
69,900 |
|
|
|
81,059 |
|
|
|
78,100 |
|
Net income |
|
48,353 |
|
|
|
340,383 |
|
|
|
207,761 |
|
|
|
884,998 |
|
Undistributed earnings
attributable to participating securities |
|
— |
|
|
|
(112 |
) |
|
|
(17 |
) |
|
|
(430 |
) |
Net income attributable to
common stockholders |
$ |
48,353 |
|
|
$ |
340,271 |
|
|
$ |
207,744 |
|
|
$ |
884,568 |
|
|
|
|
|
|
|
|
|
Net income per share
attributable to common stockholders: |
|
|
|
|
|
|
|
Basic |
$ |
0.16 |
|
|
$ |
1.14 |
|
|
$ |
0.70 |
|
|
$ |
2.99 |
|
Diluted |
$ |
0.16 |
|
|
$ |
1.11 |
|
|
$ |
0.68 |
|
|
$ |
2.89 |
|
Weighted-average shares used
in computing net income per share attributable to common
stockholders: |
|
|
|
|
|
|
|
Basic |
|
295,537,026 |
|
|
|
297,375,011 |
|
|
|
297,765,848 |
|
|
|
295,647,626 |
|
Diluted |
|
301,986,341 |
|
|
|
305,939,624 |
|
|
|
305,273,812 |
|
|
|
305,726,733 |
|
Zoom Video Communications,
Inc.Condensed Consolidated Statements of Cash
Flows(Unaudited, in thousands)
|
Three Months Ended October 31, |
|
Nine Months Ended October 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Cash flows from
operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
48,353 |
|
|
$ |
340,383 |
|
|
$ |
207,761 |
|
|
$ |
884,998 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
302,815 |
|
|
|
114,801 |
|
|
|
767,693 |
|
|
|
315,912 |
|
Amortization of deferred contract acquisition costs |
|
67,124 |
|
|
|
46,299 |
|
|
|
186,626 |
|
|
|
125,691 |
|
Losses (gains) on strategic investments, net |
|
6,898 |
|
|
|
(122,421 |
) |
|
|
78,014 |
|
|
|
(154,497 |
) |
Depreciation and amortization |
|
21,766 |
|
|
|
12,584 |
|
|
|
57,921 |
|
|
|
35,275 |
|
Provision for accounts receivable allowances |
|
12,853 |
|
|
|
8,890 |
|
|
|
39,580 |
|
|
|
23,482 |
|
Non-cash operating lease cost |
|
5,882 |
|
|
|
4,498 |
|
|
|
16,949 |
|
|
|
13,131 |
|
Amortization of discount/premium on marketable securities |
|
(665 |
) |
|
|
6,909 |
|
|
|
4,156 |
|
|
|
19,546 |
|
Other |
|
22,623 |
|
|
|
1,863 |
|
|
|
41,928 |
|
|
|
2,127 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
(112,122 |
) |
|
|
8,718 |
|
|
|
(238,020 |
) |
|
|
(108,541 |
) |
Prepaid expenses and other assets |
|
(27,102 |
) |
|
|
(14,628 |
) |
|
|
(163,721 |
) |
|
|
(71,998 |
) |
Deferred contract acquisition costs |
|
(60,817 |
) |
|
|
(62,708 |
) |
|
|
(217,822 |
) |
|
|
(165,305 |
) |
Accounts payable |
|
8,120 |
|
|
|
(31,898 |
) |
|
|
24,561 |
|
|
|
12,062 |
|
Accrued expenses and other liabilities |
|
52,129 |
|
|
|
78,105 |
|
|
|
116,391 |
|
|
|
171,914 |
|
Deferred revenue |
|
(46,225 |
) |
|
|
7,877 |
|
|
|
174,325 |
|
|
|
304,513 |
|
Operating lease liabilities, net |
|
(6,318 |
) |
|
|
(4,716 |
) |
|
|
(17,668 |
) |
|
|
(12,440 |
) |
Net cash provided by operating activities |
|
295,314 |
|
|
|
394,556 |
|
|
|
1,078,674 |
|
|
|
1,395,870 |
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of marketable securities |
|
(350,196 |
) |
|
|
(1,351,726 |
) |
|
|
(1,927,049 |
) |
|
|
(3,446,313 |
) |
Maturities of marketable securities |
|
831,199 |
|
|
|
255,639 |
|
|
|
2,137,875 |
|
|
|
1,047,545 |
|
Sales of marketable securities |
|
— |
|
|
|
162,013 |
|
|
|
— |
|
|
|
281,582 |
|
Purchases of property and equipment |
|
(22,698 |
) |
|
|
(19,767 |
) |
|
|
(75,568 |
) |
|
|
(111,816 |
) |
Purchases of strategic investments |
|
(3,500 |
) |
|
|
(39,449 |
) |
|
|
(65,050 |
) |
|
|
(126,349 |
) |
Proceeds from strategic investments |
|
300 |
|
|
|
— |
|
|
|
300 |
|
|
|
— |
|
Cash paid for acquisition, net of cash acquired |
|
— |
|
|
|
— |
|
|
|
(120,553 |
) |
|
|
(2,121 |
) |
Purchases of intangible assets |
|
(7,357 |
) |
|
|
(9,626 |
) |
|
|
(10,568 |
) |
|
|
(9,626 |
) |
Net cash provided by (used in) investing activities |
|
447,748 |
|
|
|
(1,002,916 |
) |
|
|
(60,613 |
) |
|
|
(2,367,098 |
) |
Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for repurchases of common stock |
|
(564,832 |
) |
|
|
— |
|
|
|
(990,778 |
) |
|
|
— |
|
Proceeds from issuance of common stock for employee stock purchase
plan |
|
— |
|
|
|
— |
|
|
|
34,605 |
|
|
|
37,846 |
|
Proceeds from employee equity transactions (remitted) to be
remitted to employees and tax authorities, net |
|
3,216 |
|
|
|
(47,242 |
) |
|
|
671 |
|
|
|
(28,342 |
) |
Proceeds from exercise of stock options |
|
1,750 |
|
|
|
3,023 |
|
|
|
6,815 |
|
|
|
11,044 |
|
Other |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
337 |
|
Net cash (used in) provided by financing activities |
|
(559,866 |
) |
|
|
(44,219 |
) |
|
|
(948,687 |
) |
|
|
20,885 |
|
Effect of exchange rate
changes on cash, cash equivalents, and restricted cash |
|
(20,528 |
) |
|
|
— |
|
|
|
(36,639 |
) |
|
|
— |
|
Net increase (decrease) in
cash, cash equivalents, and restricted cash |
|
162,668 |
|
|
|
(652,579 |
) |
|
|
32,735 |
|
|
|
(950,343 |
) |
Cash, cash equivalents, and
restricted cash – beginning of period |
|
943,420 |
|
|
|
1,995,352 |
|
|
|
1,073,353 |
|
|
|
2,293,116 |
|
Cash, cash equivalents, and
restricted cash – end of period |
$ |
1,106,088 |
|
|
$ |
1,342,773 |
|
|
$ |
1,106,088 |
|
|
$ |
1,342,773 |
|
Zoom Video Communications,
Inc.Reconciliation of GAAP to Non-GAAP
Measures(Unaudited, in thousands, except share and
per share amounts)
|
Three Months Ended October 31, |
|
Nine Months Ended October 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
GAAP income from
operations |
$ |
66,508 |
|
|
$ |
290,857 |
|
|
$ |
375,316 |
|
|
$ |
811,772 |
|
Add: |
|
|
|
|
|
|
|
Stock-based compensation expense and related payroll taxes |
|
305,258 |
|
|
|
118,708 |
|
|
|
780,712 |
|
|
|
339,825 |
|
Litigation settlements, net |
|
— |
|
|
|
— |
|
|
|
(4,226 |
) |
|
|
66,916 |
|
Acquisition-related expenses |
|
9,119 |
|
|
|
1,713 |
|
|
|
22,450 |
|
|
|
18,317 |
|
Non-GAAP income from
operations |
$ |
380,885 |
|
|
$ |
411,278 |
|
|
$ |
1,174,252 |
|
|
$ |
1,236,830 |
|
GAAP operating margin |
|
6.0 |
% |
|
|
27.7 |
% |
|
|
11.5 |
% |
|
|
26.8 |
% |
Non-GAAP operating margin |
|
34.6 |
% |
|
|
39.1 |
% |
|
|
35.9 |
% |
|
|
40.8 |
% |
|
|
|
|
|
|
|
|
GAAP net income attributable
to common stockholders |
$ |
48,353 |
|
|
$ |
340,271 |
|
|
$ |
207,744 |
|
|
$ |
884,568 |
|
Add: |
|
|
|
|
|
|
|
Stock-based compensation expense and related payroll taxes |
|
305,258 |
|
|
|
118,708 |
|
|
|
780,712 |
|
|
|
339,825 |
|
Litigation settlements, net |
|
— |
|
|
|
— |
|
|
|
(4,226 |
) |
|
|
66,916 |
|
Losses (gains) on strategic investments, net |
|
6,898 |
|
|
|
(122,421 |
) |
|
|
78,014 |
|
|
|
(154,497 |
) |
Acquisition-related expenses |
|
9,119 |
|
|
|
1,713 |
|
|
|
22,450 |
|
|
|
18,317 |
|
Undistributed earnings attributable to participating
securities |
|
— |
|
|
|
112 |
|
|
|
17 |
|
|
|
430 |
|
Tax effects on non-GAAP adjustments |
|
(46,442 |
) |
|
|
— |
|
|
|
(122,254 |
) |
|
|
— |
|
Non-GAAP net income |
$ |
323,186 |
|
|
$ |
338,383 |
|
|
$ |
962,457 |
|
|
$ |
1,155,559 |
|
|
|
|
|
|
|
|
|
Net income per share - basic
and diluted: |
|
|
|
|
|
|
|
GAAP net income per share - basic |
$ |
0.16 |
|
|
$ |
1.14 |
|
|
$ |
0.70 |
|
|
$ |
2.99 |
|
Non-GAAP net income per share - basic |
$ |
1.09 |
|
|
$ |
1.14 |
|
|
$ |
3.23 |
|
|
$ |
3.91 |
|
GAAP net income per share - diluted |
$ |
0.16 |
|
|
$ |
1.11 |
|
|
$ |
0.68 |
|
|
$ |
2.89 |
|
Non-GAAP net income per share - diluted |
$ |
1.07 |
|
|
$ |
1.11 |
|
|
$ |
3.15 |
|
|
$ |
3.78 |
|
|
|
|
|
|
|
|
|
GAAP and non-GAAP
weighted-average shares used to compute net income per share -
basic |
|
295,537,026 |
|
|
|
297,375,011 |
|
|
|
297,765,848 |
|
|
|
295,647,626 |
|
GAAP and non-GAAP
weighted-average shares used to compute net income per share -
diluted |
|
301,986,341 |
|
|
|
305,939,624 |
|
|
|
305,273,812 |
|
|
|
305,726,733 |
|
|
|
|
|
|
|
|
|
Net cash provided by operating
activities |
$ |
295,314 |
|
|
$ |
394,556 |
|
|
$ |
1,078,674 |
|
|
$ |
1,395,870 |
|
Less: Purchases of property and equipment |
|
(22,698 |
) |
|
|
(19,767 |
) |
|
|
(75,568 |
) |
|
|
(111,816 |
) |
Free cash flow (non-GAAP) |
$ |
272,616 |
|
|
$ |
374,789 |
|
|
$ |
1,003,106 |
|
|
$ |
1,284,054 |
|
Net cash provided by (used in)
investing activities |
$ |
447,748 |
|
|
$ |
(1,002,916 |
) |
|
$ |
(60,613 |
) |
|
$ |
(2,367,098 |
) |
Net cash (used in) provided by
financing activities |
$ |
(559,866 |
) |
|
$ |
(44,219 |
) |
|
$ |
(948,687 |
) |
|
$ |
20,885 |
|
Operating cash flow margin
(GAAP) |
|
26.8 |
% |
|
|
37.5 |
% |
|
|
32.9 |
% |
|
|
46.1 |
% |
|
|
|
|
|
|
|
|
|
Three Months Ended October 31, |
|
Nine Months Ended October 31, |
|
|
2022 |
|
|
|
2022 |
|
|
Revenue |
|
YoY Growth (%) |
|
Revenue |
|
YoY Growth (%) |
GAAP revenue |
$ |
1,101,899 |
|
|
|
5 |
% |
|
$ |
3,275,157 |
|
|
|
8 |
% |
Add: Constant currency impact |
|
24,194 |
|
|
|
2 |
% |
|
|
47,674 |
|
|
|
2 |
% |
Revenue in constant currency
(non-GAAP) |
|
1,126,093 |
|
|
|
7 |
% |
|
|
3,322,831 |
|
|
|
10 |
% |
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