Zoom $ZM 3Q22 Earnings ๐ช๐ป
- Rev $1.05b +35% โ๏ธ
- GP $778m +50% โ๏ธ margin 74% +750bps โ
- NG EBIT $411m +41% margin 39% +1728bps โ
- NG Net Income $338m +14% margin 39% โญ๏ธ +173bps โ
- OCF $395m -4% โ๏ธ margin 38% โญ๏ธ -1539bps โ๏ธ
- FCF $375m -3% โ๏ธ margin 36% โญ๏ธ -1428bps โ๏ธ
- Rev $1.05b +35% โ๏ธ
- GP $778m +50% โ๏ธ margin 74% +750bps โ
- NG EBIT $411m +41% margin 39% +1728bps โ
- NG Net Income $338m +14% margin 39% โญ๏ธ +173bps โ
- OCF $395m -4% โ๏ธ margin 38% โญ๏ธ -1539bps โ๏ธ
- FCF $375m -3% โ๏ธ margin 36% โญ๏ธ -1428bps โ๏ธ
โก๏ธ $ZM Strong Business Metrics ๐ช๐ป
- 26% incremental rev from existing cust
- Cust > TTM $100k 2,507 +94% ๐
- Cust >10 staff 512K +18% โ๏ธ
- TTM NDER (>10) >130% 14th cons Q โญ๏ธ
- 4Q22 Rev Guide Flat QoQ $1.05b โก๏ธ
- 4Q33 NDRR to be modestly below 130% mark โก๏ธ
- 26% incremental rev from existing cust
- Cust > TTM $100k 2,507 +94% ๐
- Cust >10 staff 512K +18% โ๏ธ
- TTM NDER (>10) >130% 14th cons Q โญ๏ธ
- 4Q22 Rev Guide Flat QoQ $1.05b โก๏ธ
- 4Q33 NDRR to be modestly below 130% mark โก๏ธ
1 | Q4 - Lowest Seasonality
โโฆfor deferred revenue there's two things to remember, which is the seasonality trend of our renewals is that Q1 is the largest quarter for renewals order for renewals and Q4 is the lowest.โ
โโฆfor deferred revenue there's two things to remember, which is the seasonality trend of our renewals is that Q1 is the largest quarter for renewals order for renewals and Q4 is the lowest.โ
2 | Advertising - More to Explore
โZoom still offers good value, obviously, we got to do think about how to monetize it differently. Again, this is something new for us, and we would like to explore more in the next few quarters.โ
โZoom still offers good value, obviously, we got to do think about how to monetize it differently. Again, this is something new for us, and we would like to explore more in the next few quarters.โ
3 | ROW growing faster than Americas
- Rev Americas $700m +30%
- Rev ROW $350m +47%
- Rev Americas $700m +30%
- Rev ROW $350m +47%
4 | Very Strong RPO Growth (even faster than revenue)
- RPO $2.5b +51% โ๏ธโ๏ธ
- Current RPO $1.6b +38% โ๏ธ
- Non-Current RPO $822m +82% ๐
If one is focused on just โslowerโ near-term growth, they are missing the โlonger-termโ aspect.
- RPO $2.5b +51% โ๏ธโ๏ธ
- Current RPO $1.6b +38% โ๏ธ
- Non-Current RPO $822m +82% ๐
If one is focused on just โslowerโ near-term growth, they are missing the โlonger-termโ aspect.
4 | Very Strong RPO Growth (contโd)
โWe expect to recognize ~67% of the total RPO as revenue over the next 12 months as compared to 72% in 3Q21 , reflecting a shift back towards longer-term plans.โ
โWe expect to recognize ~67% of the total RPO as revenue over the next 12 months as compared to 72% in 3Q21 , reflecting a shift back towards longer-term plans.โ
5 | Very Strong Cash Flows and Cash Position
6 | Zoomโs $ZM stock price is down from all-time-highs.
7 | Arguably Zoomโs $ZM stock price has lagged the actual business fundamentals (growing revenues, profits and cash flows) in the near-term significantly.
Would be worth watching long-term, when this gap closes back up.
Would be worth watching long-term, when this gap closes back up.
โก๏ธ Final Takeaway on Zoom $ZM:
Strong combination of growth and very strong profitability, supported by product expansion (Phone, Apps, Events) to further strengthen the platform. Drawdown from ATH does not bother me, still holding it. Valuations are extremely undemanding.
Strong combination of growth and very strong profitability, supported by product expansion (Phone, Apps, Events) to further strengthen the platform. Drawdown from ATH does not bother me, still holding it. Valuations are extremely undemanding.
โข โข โข
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