Zoom Video Communications has struggled to translate its AI advancements into substantial revenue growth, despite notable client acquisitions and strategic partnerships.
Zoom Video Founder and CEO Eric Yuan, in its earnings report, has revealed that revenue for FY 2026 will be between $4.785 billion and $4.795 billion, representing 2.7 percent growth. In FY 2025, total revenue grew by 3.1 percent to $4.665.4 billion. Enterprise revenue rose by 5.2 percent to $2.754 billion.
In Q4, total revenue increased by 3 percent to $1.184 billion, while enterprise revenue grew 5.9 percent $706.8 million, now comprising 60 percent of total revenue.
While Zoom has made significant investments in AI, these efforts have not yet resulted in a meaningful financial impact. The company’s Q4 non-GAAP gross margin was 78.8 percent, slightly down from the previous year, largely due to strategic AI investments. Despite AI enhancements in its platform, including Zoom AI Companion and the upcoming AI Companion 2.0, revenue growth remains sluggish.
Nevertheless, Zoom secured several high-profile deals in Q4, demonstrating its ability to attract major enterprises. Amazon adopted Zoom Workplace, reinforcing the long-standing partnership between the two companies.
Delta Air Lines, celebrating its centennial, chose Workvivo as its employee communications and engagement platform following the discontinuation of Meta Workplace.
Furthermore, Cloud Software Group became one of Zoom’s newest customer experience (CX) clients, selecting Zoom Contact Center and Zoom Virtual Agent to modernize its customer communications.
Zoom’s AI-driven strategy
Despite these client wins, Zoom’s AI-driven strategy has yet to significantly boost its overall financial performance. While the company remains optimistic about its AI-first approach, the challenge lies in converting technological advancements into sustained revenue growth. Zoom’s ability to further refine its AI offerings and monetize them effectively will be crucial in determining its long-term success in the competitive enterprise communications market.
Zoom Video Communications has prioritized AI as a core component of its evolution into an AI-first work platform, integrating AI capabilities across products like Zoom Phone, Team Chat, Events, Docs, and Contact Center. The company launched Zoom AI Companion, which saw a 68 percent quarter-over-quarter growth in active users, showcasing its increasing adoption.
AI Companion 2.0 introduces advanced agentic capabilities, such as memory, reasoning, and seamless integration with Microsoft and Google services. A Custom AI Companion add-on, set to launch in April, will allow businesses to automate workplace tasks with personalized AI agents.
Zoom is also enhancing AI capabilities for specific industries, including healthcare, with clinical note-taking features for medical professionals. The company’s AI-powered Contact Center achieved its largest ARR deal in history with a Fortune 100 U.S. tech company for over 15,000 agents. Zoom Virtual Agent is expanding its reasoning abilities to handle complex tasks while maintaining conversational context. The company’s federated AI approach leverages a mix of small and large language models for optimized efficiency and cost-effectiveness.
Additionally, Workvivo, Zoom’s employee engagement platform, saw rapid growth, with total customers increasing 89 percent year-over-year, driven by its AI-first strategy. Despite these advancements, AI investments have yet to significantly boost Zoom’s overall revenue, with growth remaining modest.
Baburajan Kizhakedath
