Zoom beats forecasts but a flat outlook exposes the limits of its AI pitch

Zoom Technologies Inc (NASDAQ:ZOOM) , the US video conferencing company, delivered a quarter that beat Wall Street on both revenue and earnings, and the shares still fell around 5% in after-hours trading. Revenue for the three months to July reached $1.28 billion, up 4.9% on a year earlier, while enterprise revenue rose 7.8% to $787.5 million. Adjusted earnings came in at $1.55 a share, ahead of the $1.48 analysts had modelled. The problem was the guidance gap. Underwhelming Zoom pointed to third-quarter revenue of roughly $1.278 billion at the midpoint, marginally below the $1.28 billion the market expected, and adjusted earnings of $1.46 to $1.48 against a $1.50 consensus. Full-year revenue guidance of $5.085 billion to $5.095 billion was left broadly in line with forecasts, with the earnings range nudged slightly higher to $6.08 to $6.12. At the midpoint, the annual revenue figure moved by about $5 million, or roughly 0.1%, on the outlook issued in May. For a company whose shares had climbed 18% this year on an artificial intelligence narrative, that is close to no upgrade at all. Will the pivot work? Zoom's argument is that it has stopped being a meetings tool and become a communications platform, selling phone systems, contact centre software and AI assistants into the same customer base. The company said licensed monthly active users of its AI features in the Workplace product grew 125% year on year. Customer numbers for Zoom Virtual Agent, an automated system that handles inbound customer queries, rose 256%. For UK businesses running hybrid operations, the practical shift is that call routing, transcription, note-taking and first-line customer suppo...