Zoom’s Q3 net profit surges as customer base grows

Zoom Video Communications said its third-quarter net profit surged nearly 90 times from the year-earlier period, as revenue soared on the back of an increase in customers as second and third waves of coronavirus infections forced countries to implement further lockdowns or movement restrictions.

Net profit surged to $198.4 million, from $2.2m in the same period a year ago, the Nasdaq-listed company said in a regulatory filing.

Revenue for the three months ending October 31 jumped 367 per cent to $777.2m – beating analysts' estimates of $694m, according to Refinitiv.

“We remain focused on the communication needs of our customers and communities as they navigate the current environment … and adapt to a new world of work from anywhere using Zoom,” Eric Yuan, the company’s founder and chief executive, said.

“We aspire to provide the most innovative, secure, reliable and high-quality communications platform to help people connect, collaborate, build and learn,” he added.

Zoom shares, which started the year at around $69, closed at $478.4 on Monday after falling 5 per cent in after hours trading.

The company increased its revenue outlook for the fourth quarter and the full financial year, with fourth quarter revenue to hover between $806m and $811m. For the full year, Zoom estimates revenue between $2.57 billion and $2.58bn – more than three times its financial earnings last year.

“We expect to strengthen our market position as we finish the fiscal year with an increased total revenue outlook of approximately $2.57bn to $2.58bn … approximately 314 per cent increase year-over-year,” Mr Yuan said.

The main drivers of revenue growth included acquiring new customers and expanding across existing customers, the company said.

By the end of the third quarter, it had nearly 433,700 customers with more than 10 employees, almost 485 per cent up from the same quarter last year.

The video communications platform has been adopted by businesses, schools, universities and individuals due to Covid-19-related movement restrictions and lockdowns. The company expects to increase its user base further in the remaining year.

“The top line result exceeded the high end of our guidance range of $690m [for Q3] due to strong sales and marketing execution in both our online and direct businesses, as well as lower-than-expected churn,” Kelly Steckelberg, chief financial officer at Zoom, said.

Revenue growth was primarily due to subscriptions provided to new customers, which accounted for approximately 81 per cent of the increase, while subscriptions provided to existing customers accounted for 19 per cent.

“This demand was broad-based across products, industry verticals, geographies and customer cohorts,” she added.

Revenue in the Asia-Pacific and Europe, Middle East and Africa grew 629 per cent, compared with more than 300 per cent growth in the Americas, Ms Steckelberg said.

Zoom increased its research and development spending in the third quarter to $25m, up 80 per cent year-on-year. R&D was almost 3 per cent of the total revenue earned during the quarter.

“We are committed to prioritise R&D hiring to drive further innovation, expansion and security into our platform,” the company said.

Where to donate in the UAE

The Emirates Charity Portal

You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.

The General Authority of Islamic Affairs & Endowments

The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.

Al Noor Special Needs Centre

You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.

Beit Al Khair Society

Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.

Dar Al Ber Society

Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.

Dubai Cares

Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.

Emirates Airline Foundation

Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.

Emirates Red Crescent

On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.

Gulf for Good

Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.

Noor Dubai Foundation

Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).

The rules on fostering in the UAE

A foster couple or family must:

be Muslim, Emirati and be residing in the UAE
not be younger than 25 years old
not have been convicted of offences or crimes involving moral turpitude
be free of infectious diseases or psychological and mental disorders
have the ability to support its members and the foster child financially
undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially

The specs: 2018 Alfa Romeo Stelvio

Price, base: Dh198,300
Engine: 2.0L in-line four-cylinder
Transmission: Eight-speed automatic
Power: 280hp @ 5,250rpm
Torque: 400Nm @ 2,250rpm
Fuel economy, combined: 7L / 100km