Zoom Communications, Inc. · NASDAQ:ZM
Zoom Communications — Q3 2024 Earnings Presentation
21 slides from Zoom Communications's earnings presentation, Nov 20, 2023
Slide 1: Zoom Video Communications Q3 FY24 Earnings
Zoom Video Communications Q3 FY24 Earnings November 20, 2023 © 2023 Zoom Video Communications, Inc.
Slide 2: Use of non-GAAP financial measures
Use of In addition to the financials presented in accordance with U.S. generally accepted accounting principles ("GAAP"), this presentation includes the following non-GAAP metrics: Revenue in Constant Currency, non-GAAP gross profit, non-GAAP gross margin, non-GAAP R&D expense, non-GAAP S&M non-GAAP
Slide 3: Safe Harbor Statement
Safe Harbor 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 fourth quarter and full fiscal yea
Slide 4: Thanks for attending Zoomtopia!
Thanks for attending Zoomtopia! 40+ customer presentations 45 new product and feature update announcements: ● AI Companion Updates ● AI Expert Assist ● Contact Center Quality Management ● Workspace Reservation wayfinding ● Zoom Clips ● Zoom Docs
Slide 5: Customer wins highlight the appeal of our customer and employee experience solutions
Customer wins highlight the appeal of our customer and employee experience solutions © 2023 Zoom Video Communications, Inc.
Slide 6: Q3 Milestones
Q3 Milestones Reached Reached # of Zoom One ~7 million ~700 customers w/ paid Zoom Contact Center Zoom Phone up Phone Seats customers ~330% YoY © 2023 Zoom Video Communications, Inc. 6
Slide 7: Continued top-line growth with positive trends in Enterprise and Online
Continued top-line growth with positive trends in Enterprise and Online Total Revenue1 Enterprise Revenue Online Average (in millions) (in millions) Monthly Churn2 FX impact 8% 4% 3% 3.1% 3.0% For endnote descriptions, see final slide © 2023 Zoom Video Communications, Inc. 7
Slide 8: Growth in new and existing Enterprise customers
Growth in new and existing Enterprise customers # of Enterprise Customers1 # of Customers Contributing >$100k in TTM Revenue 5% 14% 105% TTM Net Dollar Expansion Rate for Enterprise Customers2 in Q3 FY24 For endnote descriptions, see final slide © 2023 Zoom Video Communications, Inc. 8
Slide 9: Growth in Americas, macro headwinds in ROW
Growth in Americas, macro headwinds in ROW Revenue1 YoY Growth (in millions) APAC -2% EMEA -2% Americas 5% For endnote descriptions, see final slide © 2023 Zoom Video Communications, Inc. 9
Slide 10: Q3 FY24 expenses and margins
Q3 FY24 expenses and margins GAAP Non-GAAP1 Yr/Yr Yr/Yr Results Results Revenue $1,137 million 3% $1,137 million 3% Gross Profit 76.2% +72 bps 79.7% +22 bps As a % of Revenue R&D Expense 17.3% (47 bps) 9.3% (49 bps) S&M Expense 32.9% (588 bps) 25.0% (231 bps) G&A Expense 11.1% (169 bps) 6.1% (175 bp
Slide 11: Growing future revenue under contract
Growing future revenue under contract Total RPO1 YoY Growth Current2 & Non-Current RPO YoY Growth (in millions) (in millions) Total RPO Total RPO 10% 10% 42% Unbilled 41% Non-Current RPO 19% 13% 58% 59% Deferred Revenue Current RPO -3% 8% For endnote descriptions, see final slide © 2023 Zoom Video Co
Slide 12: Strong cash flow and position in Q3
Strong cash flow and position in Q3 Operating Cash Flow Free Cash Flow1 (in Millions) (in Millions) Cash Balance2 67% 66% $6.5 billion For endnote descriptions, see final slide © 2023 Zoom Video Communications, Inc. 12
Slide 13: Q4 and Fiscal Year 2024 outlook
Q4 and Fiscal Year 2024 outlook Outlook1 Q4 FY24 FY24 Revenue $1,125 - $1,130 million $4,506 - $4,511 million Total Revenue $1,129 - $1,134 million $4,542 - $4,547 million (Constant Currency) Non-GAAP Operating $409 - $414 million $1,740 - $1,745 million Income Weighted Average Share 312 million 308
Slide 14: © 2023 Zoom Video Communications, Inc.
© 2023 Zoom Video Communications, Inc. 14
Slide 15: Thank you
Thank you © 2023 Zoom Video Communications, Inc. 15
Slide 16: Appendix
Appendix © 2023 Zoom Video Communications, Inc. 16
Slide 17: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands) Q3 FY23 Q3 FY24 Q1-Q3 FY23 Q1-Q3 FY24 Gross Profit Total Revenue $1,101,899 $1,136,727 $3,275,157 $3,380,767 GAAP Gross Profit $831,234 $865,739 $2,469,060 $2,579,273 (+) Stock-based compensation expense and related payroll taxes $41,848 $38,672 $112,
Slide 18: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands except EPS) Q3 FY23 Q3 FY24 Q1-Q3 FY23 Q1-Q3 FY24 Operating Profit Total Revenue $1,101,899 $1,136,727 $3,275,157 $3,380,767 GAAP Operating Profit $66,508 $169,389 $375,316 $356,749 (+) Stock-based compensation expense and related payroll taxes $305,25
Slide 19: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands) Q3 FY23 Q3 FY24 Q1-Q3 FY23 Q1-Q3 FY24 Free Cash Flow Cash Flow from Operations $295,314 $493,153 $1,078,674 $1,247,611 (-) Purchases of PPE $(22,698) $(39,987) $(75,568) $(108,413) Free Cash Flow $272,616 $453,166 $1,003,106 $1,139,198 Operating Cash
Slide 20: Historic Metrics
Historic Metrics ($ in millions) Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Revenue $1,071.4 $1,073.8 $1,099.5 $1,101.9 $1,117.8 $1,105.4 $1,138.7 $1,136.7 Y/Y growth 21% 12% 8% 5% 4% 3% 4% 3% GAAP Operating Income $251.8 $187.1 $121.7 $66.5 ($129.9) $9.7 $177.6 $169.4 Stock-bas
Slide 21: Endnotes
Endnotes Continued top-line growth with positive trends in Enterprise and Online Growth in Americas, macro headwinds in ROW 1. Not drawn to scale. Currency Impact is a non-GAAP metric. See appendix for a reconciliation of 1. Subtotals revenue and revenue percent have been rounded. non-GAAP to GAAP f