Shares of U.S. communications technology company Zoom Video Communications Inc. (NASDAQ:ZM) slid more than 11.8% during Monday's after-hours session despite posting stellar quarterly results.
Results beat both the earnings and revenue front, totaling $1,071.4 billion in fourth-quarter revenue, a 21% year-over-year increase backed by strength in its global customer base. In addition, the company reported full fiscal year revenue of $4.1 billion, up 55% year-over-year.
However, the company's guidance for Q1FY23 and FY23 fell short of analyst expectations. Perhaps the most worrisome, was full-year fiscal 2023 revenue guidance for between $4.53 billion and $4.55 billion, which would be up just 10% to 11% from fiscal 2022's final number.
For the current first quarter, Zoom expects adjusted EPS in the range of 86c to 88c, well below the consensus estimates of $1.07 per share. Zoom expects adjusted EPS between $3.45 to $3.51 per share for the full-fiscal 2023, also below the estimated $4.40 per share.
"In fiscal year 2022, we delivered strong results with total revenue of more than $4 billion growing 55% year over year, along with increased profitability and operating cash flow growth as our global customer base continued to grow and find new use cases for our broadening communications platform." - Founder and CEO, Eric S. Yaun of Zoom.
The company that was the most visible of the pandemic-induced need for services to allow people and corporates connect may have to reinvent itself following its fourth-quarter results that prove the growth surge is over.
Zoom has struggled to maintain its growth as more employees return to work in their offices and, without substantial future growth, investors are reevaluating how they perceive Zoom's future.
Consequently, Zoom's stock price has declined by 75% from an October 2020 high to yesterday's New York close of $132.60, underscoring investors' skepticism.
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