Recent News
On September 10, 2025 Gartner placed Zoom in the Magic Quadrant for Contact Center as a Service, marking Zoom’s first inclusion in that report during the three years since launching Zoom Contact Center.
On September 17, 2025 Zoom unveiled AI Companion 3.0 at Zoomtopia, introducing agentic AI features across Workplace and Business Services.
On September 26, 2025 Gartner recognized Zoom in the 2025 Magic Quadrant for Unified Communications as a Service for the sixth consecutive year.
Technical Analysis
ADX at 16.14 indicates no strong trend, limiting conviction for a sustained breakout; nonetheless, directional indicators favor buyers because DI+ shows a dip-and-reversal (24.11) and DI- decreases (20.16 decreasing), which together generate bullish directional bias that supports short-term upside toward the nearer analyst consensus target.
MACD sits at 0.25 with a signal line at 0.04 and the MACD trend shows a dip-and-reversal; MACD crossing above its signal line constitutes a bullish momentum confirmation and supports continuation of the recent rally.
MRO reads 17.12 with a dip-and-reversal trend; the positive MRO implies price currently trades above the model target and carries mechanical pressure for future compression, which suggests upside may face mean-reversion risk even as momentum indicators stay constructive.
RSI at 52.7 and increasing signals controlled upward momentum rather than overbought conditions, aligning with the MACD bullishness while leaving room for further gains before hitting overbought extremes.
Price trades above short- and medium-term averages: close $84.28 exceeds the 12-day EMA $81.95, 20-day average $81.05, 50-day average $81.53, and 200-day average $78.51; the 12-day EMA shows a dip-and-reversal, reinforcing the momentum argument but suggesting any rally could meet resistance near the upper Bollinger bands (upper 1σ $83.03; upper 2σ $85.00).
Ichimoku surfaces sit below price (Tenkan $81.52; Kijun $82.72; Senkou A $80.27; Senkou B $77.87), providing support structure and confirming the short-term bullish posture; SuperTrend lower support at $79.78 offers a nearby technical floor for swing traders monitoring risk bands.
Volume of 2.81M exceeds the 10-day average 2.33M, indicating above-average participation during recent advances and lending confirmation to the bullish momentum narrative.
Fundamental Analysis
Revenue totaled $1,217,227,000 with revenue per share $4.0558. Revenue growth stood at 3.62%, while revenue growth year-over-year measured 94.05%; quarter-to-quarter revenue growth registered -554.65% (QoQ change reported negative). These top-line figures show substantial year-over-year expansion alongside volatile sequential dynamics.
Operating income (EBIT) reached $321,735,000 and EBITDA $353,898,000. Operating (EBIT) margin measured 26.43%, up 28.52% QoQ and up 51.84% YoY; that margin sits above the industry peer mean (20.39%) and slightly above the industry peer median (25.53%), indicating healthier operating profitability versus the typical peer.
Gross margin registered 77.56%, up 1.65% QoQ and 2.76% YoY, signaling strong product-level economics that support margin durability across the platform.
Net income $358,592,000 and EPS actual $1.53 beat the estimate $1.38 by $0.15, an EPS surprise of 10.87%, a notable beat that supports the recent re-rating in valuation metrics.
P/E stands at 49.06x with forward P/E 58.16x; price-to-book 2.56x shows meaningful divergence from the industry peer mean P/B 18.62x and peer median 24.32x, placing the company’s P/B below typical peer multiples. Price-to-sales at 18.79x and enterprise multiple 42.81x reflect premium expectations embedded in equity value.
Free cash flow reached $507,474,000 for a free cash flow yield of 2.22%, which exceeds the industry peer mean (0.35%) and slightly surpasses the peer high (2.06%), indicating above-average cash conversion relative to peers while free cash growth registered -126.52% YoY and -15.88% QoQ, highlighting recent variability in cash generation.
Return on equity 4.01% and return on assets 3.26% improved sharply QoQ and YoY (ROE QoQ +40.11%; ROE YoY +55.98%), showing improving capital efficiency from recent operating gains.
Balance-sheet strength appears robust: cash and short-term investments $7,778,648,000, current ratio 444.80% (4.448x), cash ratio 399.38% (3.994x), and total debt $54,258,000 produce low leverage metrics (debt-to-equity 0.606%), supporting strategic flexibility for product investment and share repurchases.
Valuation context: WMDST values the stock as under-valued based on the company’s strong margins, positive free cash flow yield relative to peers, and improving profitability; elevated absolute multiples reflect market expectations for continued AI-driven revenue and margin expansion, while free cash conversion and cash-rich balance sheet provide downside protection.
MOST-RECENT QUARTERLY REPORT
| REPORT PERIOD ENDING: | 2025-07-31 |
| REPORT DATE: | 2025-08-21 |
| NEXT REPORT DATE: | 2025-11-19 |
| CASH FLOW | Begin Period Cash Flow | $ 1.2 B |
| Operating Cash Flow | $ 515.9 M | |
| Capital Expenditures | $ -8.47 M | |
| Change In Working Capital | $ -60.50 M | |
| Dividends Paid | — | |
| Cash Flow Delta | $ -38.17 M | |
| End Period Cash Flow | $ 1.2 B | |
| INCOME STATEMENT | REVENUE | |
| Total Revenue | $ 1.2 B | |
| Forward Revenue | $ 336.8 M | |
| COSTS | ||
| Cost Of Revenue | $ 273.2 M | |
| Depreciation | $ 32.2 M | |
| Depreciation and Amortization | $ 32.2 M | |
| Research and Development | $ 206.4 M | |
| Total Operating Expenses | $ 895.5 M | |
| PROFITABILITY | ||
| Gross Profit | $ 944.1 M | |
| EBITDA | $ 353.9 M | |
| EBIT | $ 321.7 M | |
| Operating Income | $ 321.7 M | |
| Interest Income | — | |
| Interest Expense | — | |
| Net Interest Income | — | |
| Income Before Tax | $ 448.2 M | |
| Tax Provision | $ 89.6 M | |
| Tax Rate | 20.0 % | |
| Net Income | $ 358.6 M | |
| Net Income From Continuing Operations | $ 358.6 M | |
| EARNINGS | ||
| EPS Estimate | $ 1.38 | |
| EPS Actual | $ 1.53 | |
| EPS Difference | $ 0.15 | |
| EPS Surprise | 10.87 % | |
| Forward EPS | $ 1.32 | |
| BALANCE SHEET | ASSETS | |
| Total Assets | $ 11.0 B | |
| Intangible Assets | $ 359.9 M | |
| Net Tangible Assets | $ 8.6 B | |
| Total Current Assets | $ 8.7 B | |
| Cash and Short-Term Investments | $ 7.8 B | |
| Cash | $ 1.2 B | |
| Net Receivables | $ 516.8 M | |
| Inventory | — | |
| Long-Term Investments | $ 13.4 M | |
| LIABILITIES | ||
| Accounts Payable | $ 11.6 M | |
| Short-Term Debt | — | |
| Total Current Liabilities | $ 1.9 B | |
| Net Debt | — | |
| Total Debt | $ 54.3 M | |
| Total Liabilities | $ 2.1 B | |
| EQUITY | ||
| Total Equity | $ 9.0 B | |
| Retained Earnings | $ 4.4 B | |
| VALUATION & PER-SHARE METRICS | EQUITY & PER-SHARE METRICS | |
| Book Value Per-Share | $ 29.82 | |
| Shares Outstanding | 300.120 M | |
| Revenue Per-Share | $ 4.06 | |
| VALUATION | Market Capitalization | $ 22.9 B |
| Enterprise Value | $ 15.2 B | |
| Enterprise Multiple | 42.811 | |
| Enterprise Multiple QoQ | -25.226 % | |
| Enterprise Multiple YoY | -7.667 % | |
| Enterprise Multiple IPRWA | high: 913.757 median: 119.829 mean: 103.303 ZM: 42.811 low: -500.562 |
|
| EV/R | 12.447 | |
| CAPITAL STRUCTURE | ||
| Asset To Equity | 1.234 | |
| Asset To Liability | 5.274 | |
| Debt To Capital | 0.006 | |
| Debt To Assets | 0.005 | |
| Debt To Assets QoQ | -12.478 % | |
| Debt To Assets YoY | 84.586 % | |
| Debt To Assets IPRWA | high: 0.701 mean: 0.329 median: 0.28 low: 0.005 ZM: 0.005 |
|
| Debt To Equity | 0.006 | |
| Debt To Equity QoQ | -12.301 % | |
| Debt To Equity YoY | 84.756 % | |
| Debt To Equity IPRWA | high: 2.26 mean: 0.417 median: 0.216 ZM: 0.006 low: -0.716 |
|
| PRICE-BASED VALUATION | ||
| Price To Book (P/B) | 2.556 | |
| Price To Book QoQ | -3.528 % | |
| Price To Book YoY | 19.567 % | |
| Price To Book IPRWA | high: 29.644 median: 24.318 mean: 18.62 ZM: 2.556 low: -17.466 |
|
| Price To Earnings (P/E) | 49.061 | |
| Price To Earnings QoQ | -9.757 % | |
| Price To Earnings YoY | 15.256 % | |
| Price To Earnings IPRWA | high: 693.657 mean: 183.355 median: 153.023 ZM: 49.061 low: -214.856 |
|
| PE/G Ratio | 7.016 | |
| Price To Sales (P/S) | 18.793 | |
| Price To Sales QoQ | -6.399 % | |
| Price To Sales YoY | 19.883 % | |
| Price To Sales IPRWA | high: 95.267 mean: 43.613 median: 42.816 ZM: 18.793 low: 5.82 |
|
| FORWARD MULTIPLES | ||
| Forward P/E | 58.159 | |
| Forward PE/G | 8.317 | |
| Forward P/S | 67.915 | |
| EFFICIENCY | OPERATIONAL | |
| Operating Leverage | 9.167 | |
| ASSET & SALES | ||
| Asset Turnover Ratio | 0.111 | |
| Asset Turnover Ratio QoQ | 3.362 % | |
| Asset Turnover Ratio YoY | -0.966 % | |
| Asset Turnover Ratio IPRWA | high: 0.231 mean: 0.115 ZM: 0.111 median: 0.104 low: 0.048 |
|
| Receivables Turnover | 2.449 | |
| Receivables Turnover Ratio QoQ | 1.37 % | |
| Receivables Turnover Ratio YoY | 11.206 % | |
| Receivables Turnover Ratio IPRWA | high: 3.437 ZM: 2.449 mean: 1.87 median: 1.716 low: 0.56 |
|
| Inventory Turnover | — | |
| Inventory Turnover Ratio QoQ | — | |
| Inventory Turnover Ratio YoY | — | |
| Inventory Turnover Ratio IPRWA | — | |
| Days Sales Outstanding (DSO) | 37.259 | |
| CASH CYCLE | ||
| Cash Conversion Cycle Days (CCC) | — | |
| Cash Conversion Cycle Days QoQ | — | |
| Cash Conversion Cycle Days YoY | — | |
| Cash Conversion Cycle Days IPRWA | — | |
| CAPITAL DEPLOYMENT | ||
| Cash Conversion Ratio | 0.181 | |
| CapEx To Revenue | -0.007 | |
| CapEx To Depreciation | -0.263 | |
| CAPITAL, LIQUIDITY & COVERAGE | CAPITAL STRUCTURE | |
| Total Capital | $ 9.0 B | |
| Net Invested Capital | $ 9.0 B | |
| Invested Capital | $ 9.0 B | |
| Net Tangible Assets | $ 8.6 B | |
| Net Working Capital | $ 6.7 B | |
| LIQUIDITY | ||
| Cash Ratio | 3.994 | |
| Current Ratio | 4.448 | |
| Current Ratio QoQ | -2.623 % | |
| Current Ratio YoY | -2.441 % | |
| Current Ratio IPRWA | ZM: 4.448 high: 2.767 mean: 1.054 median: 0.942 low: 0.436 |
|
| Quick Ratio | — | |
| Quick Ratio QoQ | — | |
| Quick Ratio YoY | — | |
| Quick Ratio IPRWA | — | |
| COVERAGE & LEVERAGE | ||
| Debt To EBITDA | 0.153 | |
| Cost Of Debt | 46.296 % | |
| Interest Coverage Ratio | 9.607 | |
| Interest Coverage Ratio QoQ | 33.173 % | |
| Interest Coverage Ratio YoY | 58.984 % | |
| Interest Coverage Ratio IPRWA | high: 93.343 ZM: 9.607 mean: 9.149 median: 4.713 low: -28.274 |
|
| Operating Cash Flow Ratio | 0.179 | |
| TIMING / LIQUIDITY | ||
| Days Payables Outstanding (DPO) | 4.232 | |
| DIVIDENDS | ||
| Dividend Coverage Ratio | — | |
| Dividend Payout Ratio | — | |
| Dividend Rate | — | |
| Dividend Yield | — | |
| PERFORMANCE | GROWTH | |
| Asset Growth Rate | 0.842 % | |
| Revenue Growth | 3.619 % | |
| Revenue Growth QoQ | -554.648 % | |
| Revenue Growth YoY | 94.048 % | |
| Revenue Growth IPRWA | high: 11.139 % median: 4.141 % ZM: 3.619 % mean: 1.387 % low: -6.143 % |
|
| Earnings Growth | 6.993 % | |
| Earnings Growth QoQ | 393.159 % | |
| Earnings Growth YoY | 136.011 % | |
| Earnings Growth IPRWA | high: 114.286 % ZM: 6.993 % median: 4.941 % mean: 3.172 % low: -13.529 % |
|
| MARGINS | ||
| Gross Margin | 77.558 % | |
| Gross Margin QoQ | 1.649 % | |
| Gross Margin YoY | 2.757 % | |
| Gross Margin IPRWA | high: 90.981 % ZM: 77.558 % mean: 74.17 % median: 73.229 % low: 59.218 % |
|
| EBIT Margin | 26.432 % | |
| EBIT Margin QoQ | 28.523 % | |
| EBIT Margin YoY | 51.838 % | |
| EBIT Margin IPRWA | high: 37.642 % ZM: 26.432 % median: 25.525 % mean: 20.394 % low: -41.293 % |
|
| Return On Sales (ROS) | 26.432 % | |
| Return On Sales QoQ | 28.523 % | |
| Return On Sales YoY | 51.838 % | |
| Return On Sales IPRWA | high: 36.289 % ZM: 26.432 % median: 25.525 % mean: 19.565 % low: -44.13 % |
|
| CASH FLOW | ||
| Free Cash Flow (FCF) | $ 507.5 M | |
| Free Cash Flow Yield | 2.218 % | |
| Free Cash Flow Yield QoQ | 12.875 % | |
| Free Cash Flow Yield YoY | 10.734 % | |
| Free Cash Flow Yield IPRWA | ZM: 2.218 % high: 2.055 % mean: 0.348 % median: 0.246 % low: -1.333 % |
|
| Free Cash Growth | 9.523 % | |
| Free Cash Growth QoQ | -15.875 % | |
| Free Cash Growth YoY | -126.518 % | |
| Free Cash Growth IPRWA | high: 259.959 % ZM: 9.523 % mean: -33.613 % median: -87.615 % low: -108.458 % |
|
| Free Cash To Net Income | 1.415 | |
| Cash Flow Margin | 28.64 % | |
| Cash Flow To Earnings | 0.972 | |
| VALUE & RETURNS | ||
| Economic Value Added | $ 0.04 | |
| Return On Assets (ROA) | 3.261 % | |
| Return On Assets QoQ | 40.5 % | |
| Return On Assets YoY | 54.843 % | |
| Return On Assets IPRWA | high: 6.233 % ZM: 3.261 % median: 1.678 % mean: 1.527 % low: -3.645 % |
|
| Return On Capital Employed (ROCE) | 3.537 % | |
| Return On Equity (ROE) | 0.04 | |
| Return On Equity QoQ | 40.105 % | |
| Return On Equity YoY | 55.975 % | |
| Return On Equity IPRWA | high: 0.151 median: 0.115 mean: 0.064 ZM: 0.04 low: -0.192 |
|
| DuPont ROE | 4.017 % | |
| Return On Invested Capital (ROIC) | 2.876 % | |
| Return On Invested Capital QoQ | 31.504 % | |
| Return On Invested Capital YoY | -242.376 % | |
| Return On Invested Capital IPRWA | high: 10.16 % median: 3.218 % mean: 2.969 % ZM: 2.876 % low: -12.344 % |
|