(Bloomberg/Brody Ford) — Zoom Communications Inc. shares jumped the most in three months after the software maker reported quarterly revenue gains that signaled more customers are using its expanded suite of business tools.
Fiscal third-quarter sales increased 4.4% to $1.23 billion, Zoom said Monday in a statement. Profit, excluding some items, was $1.52 a share. Analysts, on average, estimated earnings of $1.44 a share on revenue of $1.21 billion, according to data compiled by Bloomberg.
Zoom, the maker of a popular videoconferencing tool, is pushing a broader range of products, including corporate phone systems and contact center software. At its annual conference in September, the company unveiled the latest version of its artificial intelligence assistant, which includes the ability to design custom AI tools for $12 per month.
“Zoom executed well on its core initiatives, including driving AI adoption, stabilizing churn, accelerating enterprise momentum, and gaining traction with emerging products like Contact Center and Workvivo,” Arjun Bhatia, an analyst at William Blair, wrote Tuesday in a note.
The shares rose 9.9% to $86.34 at the close Tuesday in New York, the biggest single-day jump since Aug. 22. The stock had declined 3.7% this year through Monday’s close amid a broader market anxiety toward application software.
“This quarter we announced AI Companion 3.0, and we’re thrilled to see AI Companion adoption grow meaningfully,” Chief Executive Officer Eric Yuan said in the statement. “We’re also seeing strong momentum with Custom AI Companion and our AI‑first Customer Experience suite.”
Enterprise revenue increased 6.1% to $741.4 million in the quarter, ended Oct. 31. Analysts, on average estimated $731.6 million. The company said it had 4,363 customers in the period who contributed more than $100,000 each over the past year.
Average monthly churn among individuals and small businesses in the quarter was 2.7%, down from 2.9% in the prior quarter. As the world reopened from pandemic restrictions, many of these casual users have let their Zoom licenses lapse.
“Management highlighted broad and consistent demand across both segments in the quarter and raised its FY26 revenue growth guidance,” suggesting “continued momentum,” Siti Panigrahi, an analyst at Mizuho Securities, wrote in a note.
Zoom also increased its total share repurchase authorization by $1 billion.
In the current period, revenue will be about $1.23 billion, the San Jose, California-based company said. Profit, excluding some items, will be about $1.49 a share. Analysts, on average, projected sales of $1.23 billion and adjusted earnings of $1.45 a share.
The company’s enterprise business “continues to be a key point of strength,” wrote Rishi Jaluria, an analyst at RBC Capital Markets. Important areas of interest to investors are traction for the company’s new AI companion tool, stabilization of churn in casual users and expected long-term margins, he wrote.
(Updates with closing shares in the fifth paragraph.)
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