Zoom Video Communications, a leading provider of video-conferencing solutions, said its revenue for the fourth quarter was $1,146.5 million, up 2.6 percent year over year.
Zoom Video’s enterprise revenue grew 5 percent and represented 58 percent of total revenue, up from 57 percent a year ago. Zoom achieved improvement in Online Average Monthly Churn, which decreased to 3 percent from 3.4 percent in Q4 of FY23. The number of enterprise customers grew 3 percent year over year to approximately 220,400, Zoom Video said.
There was 10 percent growth in the up-market as Zoom Video ended the fourth quarter with 3,810 customers contributing more than $100,000 in trailing 12 months revenue. These customers represented 30 percent of revenue, up from 28 percent in Q4 of FY23, Zoom Video said.
Zoom Video’s revenue for the fiscal year was $4,527.2 million, up 3.1 percent year over year.
At the end of the fourth quarter of fiscal year 2024, Zoom had: 220,400 Enterprise customers (3.5 percent), a trailing 12-month net dollar expansion rate for Enterprise customers of 101 percent; 3,810 customers contributing more than $100,000 in trailing 12 months revenue; online monthly churn of 3.0 percent for the fourth quarter.
The company’s success in the fourth quarter reflects its initiatives to integrate artificial intelligence (AI) into its products and diversify its portfolio, aligning with the increasing trend towards hybrid working arrangements.
“Zoom AI Companion, our generative AI assistant, empowers customers and employees with enhanced productivity, team effectiveness and skills. Since its launch five months ago, we expanded AI Companion to six Zoom products, all included at no additional cost to licensed users,” Zoom CEO Eric Yuan said in its earnings report.
Zoom CEO Eric Yuan also outlined plans to further leverage the Zoom AI companion, emphasizing a focus on customization and monetization. The AI companion has already been enabled for over 510,000 accounts in the past five months, as highlighted by CFO Kelly Steckelberg.
Zoom is targeting revenue of approximately $4.60 billion for fiscal-year 2025, and $1.13 billion in the first-quarter.
CUSTOMER WINS
Zoom Video said its Contact Center suite is a unified, AI-first solution that offers value to companies of all sizes seeking to strengthen customer relationships and deliver better outcomes. The base product includes AI Companion and the tiered pricing allows customers to add specialized CX capabilities such as AI Expert Assist, workforce management, quality management, virtual agent, and omnichannel support.
Zoom Video said its Contact Center suite is beginning to win in head-to-head competition with legacy incumbents. Beyond that, it is competing on its own merits with customers completely new to Zoom – broadening the funnel for the entire Zoom platform.
As Zoom becomes a full workplace solution, customers migrate from other chat products onto Zoom Team Chat. Over the past year, Zoom Team Chat usage has increased 130 percent across paid accounts. Its migration tool, designed to simplify the transition, has seen a 4x increase in downloads in the last 6 months.
Customers across industries are moving to Zoom Team Chat including a global supply chain leader, who has migrated over 1,200 users, a major law firm who 2 has migrated 1,500 users, and a financial payments leader, who has moved over 2,000 users.
ACHIEVEMENTS
In Q4, Zoom Video noticed traction in emerging products, including a nearly 3x increase in Zoom Contact Center licenses. Zoom Video added a significant number of new customers and expanded average deal size. Zoom Phone customers with 10,000 or more seats grew 27 percent to 95. Zoom AI Companion has grown tremendously in five months with over 510,000 accounts enabled and 7.2 million meeting summaries created as of the close of FY24.
Rajani Baburajan
