Zoom Communications, Inc. · NASDAQ:ZM
Zoom Communications — Q1 2023 Earnings Presentation
23 slides from Zoom Communications's earnings presentation, May 23, 2022
Slide 1: Zoom Video Communications Q1 FY23 Earnings
Zoom Video Communications Q1 FY23 Earnings May 23, 2022 1
Slide 2: Use of non-GAAP financial measures
Use of non-GAAP financial measures In addition to the financials presented in accordance with U.S. generally accepted accounting principles ("GAAP"), this presentation includes the following non-GAAP metrics: non-GAAP gross profit, non-GAAP gross margin, non-GAAP R&D expense, non-GAAP S&M expense, non-
Slide 3: Safe Harbor statement
Safe Harbor statement This presentation and the accompanying oral presentation contain express and implied “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding Zoom's financial outlook for the second quarter and full fi
Slide 4: Zoom acquires Solvvy to bolster contact center offering
Zoom acquires Solvvy to bolster contact center offering ● Accelerates our expansion in Conversational AI, a $18.4B projected market by 20261 ● Broadens Zoom Contact Center offering with Solvvy's automated, integrated and easy-to-deploy service center ● Aligns culturally with our focus on delivering
Slide 5: Launch of Zoom Whiteboard & Zoom IQ for Sales
Launch of Zoom Whiteboard & Zoom IQ for Sales 5
Slide 6: Strong Wins show enduring case for Zoom Phone and early potential of Zoom Contact Center
Strong Wins show enduring case for Zoom Phone and early potential of Zoom Contact Center 6
Slide 7: Zoom creates value for customers in numerous ways
Zoom creates value for customers in numerous ways A study1 commissioned by Zoom and conducted by Forrester Consulting, found that the composite model organization using Zoom could lead to: Up to 52 70% 75% minutes Added productivity per Improvement in sales Reduction in internal IT employee per week
Slide 8: Continued top-line expansion
Continued top-line expansion (in millions) 12% Q1 Highlights ● Strong growth in revenue from Enterprise ● Enterprise renewal rates improved YoY ● Hit 3M Zoom Phone Seats during first quarter ● Offset by macro/geopolitical headwinds, Online volatility, FX impact 8
Slide 9: Strong growth in Enterprise, with incremental spend
Strong growth in Enterprise, with incremental spend Enterprise Revenue Enterprise Customers1 (in millions) 31% 24% TTM Net Dollar Expansion Rate for Enterprise Customers2 123% in Q1 FY23 1 The number of customers is rounded down to the nearest hundred. Enterprise Customers refers to customers who ha
Slide 10: Growing base of customers contributing >$100k in trailing 12-months revenue
Growing base of customers contributing >$100k in trailing 12-months revenue 46% 10
Slide 11: Continued growth in Americas & APAC, headwinds in EMEA
Continued growth in Americas & APAC, headwinds in EMEA Revenue1 Yr/Yr Growth Revenue Share by (in millions) Region2 APAC 20% EMEA flat Americas 15% 1,2 Subtotals revenue have been rounded. 11
Slide 12: Q1 FY23 expenses and margins
Q1 FY23 expenses and margins GAAP Non-GAAP1 Results Yr/Yr Results Yr/Yr Revenue $1,074 million 12% $1,074 million 12% Gross Margin 75.6% +333 bps 78.6% +474 bps R&D Expense 13.4% +662 bps 7.9% +358 bps S&M Expense 33.8% +809 bps 24.9% +491 bps G&A Expense 11.0% (514 bps) 8.6% +96 bps Operating Margi
Slide 13: Strong renewals and migration to longer term plans
Strong renewals and migration to longer term plans Total RPO1 Current2 & Non-Current (in millions) Yr/Yr Growth RPO Yr/Yr Growth Total Total 44% 44% 37% Unbilled Non-Current 69% 93% 28% 63% 72% Deferred Revenue Current 22% 25% 1 Remaining performance Obligations (RPO) consists of both billed conside
Slide 14: Strong collections and cash position in Q1
Strong collections and cash position in Q1 Cash Position1 (in billions) Operating Cash $526M Flow & Margin 49.0% Adj. Free Cash $501M Flow & Margin2 46.7% 1 Cash, cash equivalents and marketable securities, excluding restricted cash at the end of the period. 2 See appendix for a reconciliation of no
Slide 15: Q2 and Fiscal Year 2023 outlook
Q2 and Fiscal Year 2023 outlook Q2 FY23 FY23 Revenue $1,115 - $1,120 million $4,530 - $4,550 million Non-GAAP Operating $360 - $365 million $1,480 - $1,500 million Income Outlook1 Weighted Average Share 308 million 309 million Count Non-GAAP EPS $0.90 - $0.92 $3.70 - $3.77 1 A reconciliation of non-
Slide 16: Setting goals & recognizing progress with our first ESG Report
Setting goals & recognizing progress with our first ESG Report Read to find out how Zoom is: People Community ● Developing leaders at Zoom ● Funding and providing in-kind support to global ● Leading the Future of Work nonprofits and charities (read more in our Social ● Building and empowering a diverse
Slide 17: Q&A
Q A © 2021 Zoom Video Communications, Inc. 17
Slide 18: Thank You
Thank You © 2021 Zoom Video Communications, Inc. 18
Slide 19: Appendix
Appendix 19
Slide 20: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands) Q1 FY22 Q1 FY23 Gross Profit Total Revenue $956,237 $1,073,800 GAAP Gross Profit $691,243 $811,979 (+) Stock-based compensation expense and related payroll taxes $14,644 $31,598 (+) Acquisition-related expense $692 $791 Non-GAAP Gross Profit $706,579 $84
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands except EPS) Q1 FY22 Q1 FY23 Operating Profit Total Revenue $956,237 $1,073,800 GAAP Operating Profit $226,312 $187,065 (+) Stock-based compensation expense and related payroll taxes $104,375 $212,862 (+) Litigation settlements, net $66,916 $(4,226) (+) A
Slide 22: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands) Q1 FY22 Q1 FY23 Free Cash Flow Cash Flow from Operations $533,302 $526,151 (-) Purchases of PPE $(79,074) $(25,038) Adj. Free Cash Flow (non-GAAP) $454,228 $501,113 Operating Cash Flow Margin 55.8% 49.0% Adj. Free Cash Flow (non-GAAP) Margin 47.5% 46.
Slide 23: Historic Metrics
Historic Metrics ($ in millions) Q2 FY21 Q3 FY21 Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 Q1 FY23 Revenue $663.5 $777.2 $882.5 $956.2 $1,021.5 $1,050.8 $1,071.4 $1,073.8 Y/Y growth 355% 367% 369% 191% 54% 35% 21% 12% GAAP Operating Income $188.1 $192.2 $256.1 $226.3 $294.6 $290.9 $251.8 $187.1 Stock-