– Why has zoom share price dropped – why has zoom share price dropped:
Zoom Video Communications Inc. The COVID pandemic turbocharged the demand for videoconferencing tools and collaboration applications in , allowing Zoom to swoop in and transform itself from a relatively niche provider of business software to a household name.
Those growth rates eventually slid as the company faced tougher year-ago comparisons, dropping into the double digits in the July quarter. For the period ended Oct. Analysts said this trend is likely to continue, putting pressure on Zoom to find new revenue streams and growth opportunities.
The company “zoomed to scale last year, but post-pandemic growth is a different story,” Deutsche Bank’s Matthew Niknam said in a research note, maintaining a “hold” rating on the company. Looking across estimates, analysts expect Zoom’s year-over-year revenue growth rates to decelerate to Other analysts note, however, that while not matching its meteoric rise during the pandemic, Zoom is not losing any ground and, in fact, continues to grow.
Zoom has been both a beneficiary and a victim of hype ever since it first exploded onto the scene at the dawn of the pandemic in , said Raul Castanon, a senior research analyst covering workforce collaboration and communication platforms at Research. After Zoom reported earnings after market close Nov. Castanon thinks that the momentum Zoom experienced during the pandemic lit a fire under its larger, deeper-pocketed competitors — including Microsoft Corp.
The market is now crowded with very well-established alternatives, and Zoom is feeling the impact. Zoom reported about , customers with more than 10 employees at the end of the quarter ended Oct. By comparison, the October quarter saw Moving beyond videoconferencing. Although Zoom’s claim to fame was its videoconferencing platform, the company is looking to expand its presence into other businesses as it seeks to reaccelerate growth.
One increasingly lucrative business segment that Zoom is eyeing is contact center software, which uses artificial intelligence to help companies interact with customers. Zoom now plans to launch its own solution in the space — Zoom Video Engagement Center — in early A spokesperson for the company declined to comment on the new service. Keith Snyder, an analyst at independent investment research firm CFRA, said this is an extremely attractive market for Zoom, as it synergizes well with the company’s existing range of products, but entry may not be a cakewalk.
Another area that Zoom is now exploring is advertising. Earlier in November, the company announced that it would roll out a pilot program to show ads to users on its free tier of service. Snyder noted that the free service made Zoom the poster child of the pandemic but “absolutely crushed” the company’s margins, as it had to invest very heavily in third-party infrastructure to host the service.
Joe McCormack, an analyst at research firm Third Bridge, said the free-to-use tier is predominantly used by consumers and small businesses who cannot afford the product’s monthly premium fee. Academia Commercial Banking Corporations. All Events Webinars Webinar Replays. Leveraged Commentary and Data Research Online. In This List Zoom share price decline steepens as revenue growth shrinks. Blog smartphone shipments rose 5. Blog Insight Weekly: Ukraine war impact on mining; US bank growth slowdown; cloud computing headwinds.
Post-pandemic slump The company “zoomed to scale last year, but post-pandemic growth is a different story,” Deutsche Bank’s Matthew Niknam said in a research note, maintaining a “hold” rating on the company. Beyond the hype Other analysts note, however, that while not matching its meteoric rise during the pandemic, Zoom is not losing any ground and, in fact, continues to grow.
Competition for users Castanon thinks that the momentum Zoom experienced during the pandemic lit a fire under its larger, deeper-pocketed competitors — including Microsoft Corp. Moving beyond videoconferencing Although Zoom’s claim to fame was its videoconferencing platform, the company is looking to expand its presence into other businesses as it seeks to reaccelerate growth.
Born free Another area that Zoom is now exploring is advertising.
Why has zoom share price dropped – why has zoom share price dropped:. Why Zoom Shares Are Falling
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Why has zoom share price dropped – why has zoom share price dropped:.Zoom’s Business Is Slowing Down, But Its Stock Price Is Still Exorbitant
The Street is unclear on how to value Zoom as its growth slows with people returning to offices and schools, despite the lingering pandemic. So the only course of action right now it seems — sell Zoom’s stock ZM and wait for more stable waters. Radke called the earnings report disappointing. The steep sell-off pushed shares of Zoom into the red for the past year, down about 2. Added Steckelberg on the growth slowdown, “When we look out through what we have seen is a slowdown in the online segment of the business, which again, even though the pandemic seems to be far from over, we are happy that people are feeling more comfortable out traveling.
And that’s really where we’re seeing the slowdown. And if you back all the way up to when we gave guidance at the beginning of the year, we had expected that towards the end of the year, but it’s just happened a little bit more quickly than we expected. And we, of course, feel good that people are out moving around the world. But It’s certainly creating some headwinds, as we’ve said, in the online segment of our business. Analysts are taking a mostly guarded view on Zoom in the near-term, even though many acknowledge the company will benefit from the long-term shift to hybrid work.
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From buying groceries to gasoline to automobiles, inflation has hammered Americans’ purchasing power. In fact, the most well-known metric of inflation has soared to a four-decade high. Meanwhile, the Federal Reserve enters a blackout period before its next policy-setting meeting later this month. If oil keeps rising, it would be great news for energy stocks—and oil exploration stocks in particular. Markets closed. Dow 30 32, Nasdaq 12, Russell 1, Crude Oil Gold 1, Silver Vix CMC Crypto FTSE 7, Nikkei 27, Read full article.
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