Zoom Video Communications (ZM - Free Report) is set to release third-quarter fiscal 2020 results on Dec 5.
For the quarter, the company expects total revenues between $150 million and $156 million. Non-GAAP earnings are expected to be approximately 3 cents per share.
The Zacks Consensus Estimate for earnings stayed at 3 cents per share over the past 30 days. The consensus mark for revenues is pegged at $156.2 million.
Let’s see how things are shaping up for this announcement.
Factors to Watch
Zoom’s expanding customer base is expected to have aided the top line in the to-be-reported quarter. At the end of second-quarter fiscal 2020, the company had roughly 66,300 customers (having more than 10 employees), up 78% year over year.
Moreover, new customers accounted for 61% of the company’s year-over-year subscription revenue growth. The remaining 39% was owing to additional purchases from existing customers.
The U.S. Federal Risk and Authorization Management Program (FedRAMP) authorization received by Zoom in May is expected to have played a significant part in this regard. The authorization allows the U.S. Federal Government agencies and contractors to securely use Zoom for video meetings, API integrations and more.
Additionally, the company has a strong partner base that includes the likes of salesforce.com, Logitech (LOGI - Free Report) , Lenovo and Verizon. This is expected to have benefited the company in winning new customers.
However, increased sales & marketing expenses are expected to have hurt profitability in the to-be-reported quarter.
What Our Model Says
According to the Zacks model, a company with a positive Earnings ESP along with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates.
Zoom has a Zacks Rank #3 and an Earnings ESP of 0.00%, which makes surprise prediction difficult. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Stocks to Consider
Here are a couple of companies, which, per our model, have the right combination of elements to post an earnings beat this season:
Costco Wholesale (COST - Free Report) has an Earnings ESP of +1.01% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Adobe Systems (ADBE - Free Report) has an Earnings ESP of +0.12% and a Zacks Rank #3.
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This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
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Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
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Zoom Video Communications (ZM - Free Report) is set to release third-quarter fiscal 2020 results on Dec 5.
For the quarter, the company expects total revenues between $150 million and $156 million. Non-GAAP earnings are expected to be approximately 3 cents per share.
The Zacks Consensus Estimate for earnings stayed at 3 cents per share over the past 30 days. The consensus mark for revenues is pegged at $156.2 million.
Let’s see how things are shaping up for this announcement.
Factors to Watch
Zoom’s expanding customer base is expected to have aided the top line in the to-be-reported quarter. At the end of second-quarter fiscal 2020, the company had roughly 66,300 customers (having more than 10 employees), up 78% year over year.
Moreover, new customers accounted for 61% of the company’s year-over-year subscription revenue growth. The remaining 39% was owing to additional purchases from existing customers.
The U.S. Federal Risk and Authorization Management Program (FedRAMP) authorization received by Zoom in May is expected to have played a significant part in this regard. The authorization allows the U.S. Federal Government agencies and contractors to securely use Zoom for video meetings, API integrations and more.
Additionally, the company has a strong partner base that includes the likes of salesforce.com, Logitech (LOGI - Free Report) , Lenovo and Verizon. This is expected to have benefited the company in winning new customers.
However, increased sales & marketing expenses are expected to have hurt profitability in the to-be-reported quarter.
What Our Model Says
According to the Zacks model, a company with a positive Earnings ESP along with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates.
Zoom has a Zacks Rank #3 and an Earnings ESP of 0.00%, which makes surprise prediction difficult. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Stocks to Consider
Here are a couple of companies, which, per our model, have the right combination of elements to post an earnings beat this season:
Costco Wholesale (COST - Free Report) has an Earnings ESP of +1.01% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Adobe Systems (ADBE - Free Report) has an Earnings ESP of +0.12% and a Zacks Rank #3.
Free: Zacks’ Single Best Stock Set to Double
Today you are invited to download our latest Special Report that reveals 5 stocks with the most potential to gain +100% or more in 2020. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
Download Free Report Now >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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