10-Q · May 22, 2026
Zoom Video Communications reported a solid Q1 2026 with total revenue of $1.239 billion, reflecting a 5.5% increase year-over-year. Diluted EPS for the quarter was $1.55, exceeding consensus estimates due to improved…
Earnings analysis · 10-Q
ZM earnings analysis
Filed August 26, 2026 · Our reading of the company's report
The latest report
Zoom delivered Q2 FY27 revenue of $1.2772 billion and non-GAAP diluted EPS of $1.55, exceeding consensus estimates of $1.2691 billion and $1.38, respectively. Enterprise revenue grew 7.8% year over year to $787.5…
Read full summary
Zoom delivered Q2 FY27 revenue of $1.2772 billion and non-GAAP diluted EPS of $1.55, exceeding consensus estimates of $1.2691 billion and $1.38, respectively. Enterprise revenue grew 7.8% year over year to $787.5 million, but free cash flow declined to $472.4 million from $508.0 million. The outlook calls for FY27 revenue of $5.085 billion-$5.095 billion and non-GAAP EPS of $6.08-$6.12, although the filing does not provide the prior full-year outlook needed to assess a raise or reduction. Large private-investment exposure, the ongoing EDNY investigation, and AI, privacy, and regulatory risks temper the positive operating trends.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.55
- Segment
- Enterprise revenue: $787.5 million, up 7.8% year over year.
- Segment
- Online segment revenue: not disclosed in the provided filing text.
What stood out
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Revenue and EPS beat consensus
Revenue was $1.2772 billion, approximately 0.6% above the $1.2691 billion consensus estimate. Non-GAAP diluted EPS was $1.55 versus the $1.38 estimate, a 12.3% beat.
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Enterprise growth accelerated
Enterprise revenue increased 7.8% year over year to $787.5 million, indicating stronger momentum in the large-customer business.
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Liquidity remained substantial
The company maintained substantial liquidity, with $932.0 million of cash and cash equivalents and $6.3177 billion of marketable securities as of July 31, 2026.
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Share repurchases continued
The company repurchased 3,740,213 shares during the quarter at an average price of $94.07, leaving approximately $1.273 billion available under the repurchase authorization.
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Two governance developments improved
The NDCA investigation concluded in August 2026 without further action, while management stated that disclosure controls were effective at a reasonable assurance level as of July 31, 2026.
What to watch
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Free cash flow declined year over year
Free cash flow declined to $472.4 million from $508.0 million in the prior-year period, a decrease of approximately 7.0%, despite the reported EPS and revenue beats.
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Large private-investment exposure
Private equity and debt securities totaled $3.7859 billion as of July 31, 2026, including a $3.1345 billion investment in Anthropic. Changes in private-company valuations could therefore create material gains or losses in reported results.
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Regulatory and FX exposure persists
The EDNY investigation remains ongoing, and the filing states that a negative outcome could result in substantial fines, penalties, or other financial exposure. Separately, 20.5% of six-month revenue and 17.0% of expenses were denominated in currencies other than the U.S. dollar, creating continued foreign-exchange exposure.
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AI costs and monetization remain uncertain
The filing highlights AI-related cost and adoption risks: third-party AI service price increases may be significant, while certain AI features are currently offered at no additional cost. Failure to recover those costs could pressure profitability.
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AI regulation raises compliance risk
The company faces potential regulatory penalties tied to evolving AI and privacy rules, including EU AI Act fines of up to €35 million or 7% of worldwide annual turnover, whichever is higher.
Management's outlook
FY27 revenue guidance is $5.085 billion-$5.095 billion and non-GAAP diluted EPS guidance is $6.08-$6.12. Q3 FY27 guidance is revenue of $1.275 billion-$1.280 billion and non-GAAP diluted EPS of $1.46-$1.48. The filing materials do not provide the prior full-year outlook needed to determine whether guidance was raised or lowered.
Earlier filings 4
10-K · February 27, 2026
Zoom positions itself as an AI-first unified communications and collaboration platform (Zoom Workplace and Zoom Business Services) with AI Companion woven across Meetings, Chat, Phone, Contact Center and Workvivo.…
10-Q · August 23, 2024
Zoom reported quarterly revenue of $1,162,520,000 (up $23,844,000 or +2.1% year-over-year) and net income of $219,015,000, with diluted EPS of $0.70 for the three months ended July 31, 2024. Operating income rose to…
10-K · March 4, 2024
Zoom positions itself as a unified communications platform focused on hybrid work and AI-driven productivity, highlighting product breadth (Meetings, Phone, Team Chat, Docs, Whiteboard) and recent AI initiatives such as…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.